There is much to be concerned about what we have been told about...

There is much to be concerned about what we have been told about this companies activities over the past two years.  Most presumed activities have come to nothing IMO.

[ASX Announcement: May 17, 2017]

• AusCann and Tasmanian Alkaloids entered into an exclusive strategic partnership in May 2017 to jointly establish the cultivation, manufacturing, and distribution operations for medical cannabis in Australia and overseas. The partnership now holds all the required licences and also has Therapeutic Goods Administration (TGA) certified manufacturing facilities to cultivate and manufacture final dose form cannabis medicines. These facilities will be used to manufacture AusCann branded products for the Australian and international markets and potentially products for Canopy Growth.
• AusCann Managing Director Elaine Darby: “Our ongoing relationship with Canopy Growth offers major benefits for AusCann, and we are very pleased to be working with Canopy Growth as the Australian market expands. The combination of this arrangement and our strong partnership with Tasmanian Alkaloids, positions us to be the leading supplier of affordable, effective, and clinically-validated cannabinoid medicines to the Australian market and select international markets.”

It was stated by the CEO that the TGA certified manufacturing facility in Tasmania would be ready at end of the year(2018). Whats happened with that?

By the December 2017 Activities report, nothing was mentioned about any cultivation activities by the partnership alluded to in May 2017.  Then….

[ASX Announcement: December 7, 2017]

• AusCann’s strategic partner, Tasmanian Alkaloids has been granted a manufacturing licence by the Office of Drug Control to commence manufacturing operations at its Tasmania site.
• Through its strategic alliance with Tasmanian Alkaloids, AusCann has access to TGA certified Good Manufacturing Practice manufacturing facilities in Tasmania and will look to commence growing operations in early 2018.
• The ability for the Partnership to use existing infrastructure allows for the rapid development of manufacturing facilities which will allow for the earliest possible supply of final dose form cannabinoid medicines to Australian patients. AusCann will import its genetics for planting in Tasmania in early 2018.
• Elaine Darby, Managing Director, AusCann commented: “This final required licence from the ODC is a significant achievement for the Partnership and AusCann. It allows us to progress our cultivation and manufacturing operations in the Australian market and puts us firmly on track to become a fully integrated cannabinoid pharmaceutical company. Tasmanian Alkaloids are an excellent strategic partner and we have in place facilities and a joint project team with the necessary skills and expertise to produce final dose form cannabinoid medicines. The potential Australian medical cannabis market is significant with chronic pain control an initial target for us. There is also real potential for Australia to be an exporter of high quality cost effective cannabis medicines in the future.”

Then…
22 January 2018:

• As part of the wholesale agreement with API, AusCann will distribute imported cannabinoid medicines from its Canadian partner, Canopy Growth Corporation, ahead of establishing its own local supply of medications. AusCann is working closely with its strategic partner Tasmanian Alkaloids in establishing its cultivation and manufacturing operations in Tasmania, with the first crop expected to be planted this year.

Quarterly activities report ending 31 March 2018 is very telling as to where we are now!  Read it!

• AusCann and Tasmanian Alkaloids have commenced operations to produce final dose cannabinoid pharmaceuticals for the domestic and international markets

What has happened with those operations?

[ASX Announcement:Tuesday, 24 April 2018]:

• Leading medical cannabis company AusCann Group Holdings Limited (ASX:AC8) (‘AusCann’ or ‘the Company’ is pleased to announce that it has received an import permit under its existing import licence and will soon receive finished cannabis oils from its major shareholder, Canopy Growth Corporation (Canopy Growth).
  AusCann and Canopy Growth are pursuing opportunities in several key areas in Australia including the importation, distribution, and local production of medical cannabis products.
• Importation of Canopy Products
  AusCann will initially import the Canopy-supplied AusCann branded products for chronic and neuropathic pain control known as AC 5:5, AC 0:9.5, and AC 15:0, with each name representing the ratio of tetrahydrocannabinol (THC) to cannabidiol (CBD) in each product.

I suspect the product depicted in todays investor presentation, is one of these imported products.. This announcement coincides with Canopy Growth’s launch of Spectrum Cannabis Australia with support from the Victoria State Government.  Why no mention about sales of these products?

• Canopy and AusCann are working together on developing an arrangement where Canopy will also supply AusCann with Spectrum Cannabis branded products for AusCann to distribute into the Australian market alongside existing AusCann products. Spectrum Cannabis is Canopy Growth’s international medical brand, operating under a simple colour-coded system to classify its medical cannabis products.
• In June 2018, Mr Pigeau was appointed following an extensive global search and will oversee AusCann’s cultivation activities, accelerating AusCann’s Australian medical cannabis manufacturing operation.

And then….
In Quarterly activities report ending 30 June 2018:

• “Entered a research agreement with Jade Cannabis to develop and optimise AusCann’s
  cannabis cultivation system”.

Why do this if there was NO mention/progress of first crop or other cultivation activities in Tasmania?

• In November 2018, they appoint PCI Pharma as their manufacturer of the solid dose capsule.

We were led to believe in no uncertain terms that Tasmanian Alkaloids already had the TGA certified cultivation/manufacturing facility way back in May, 2017.   
Approval time to secure TGA Manufacturing licence is around 12 months AFTER facility build, quality system implemented and validated processes for facilities, utilities, equipment etc, are established “, so why would they walk away from that more than a year later giving investors to believe progress was being made in cultivation/manufacturing activities during that time.  There was no mention of them since the March 2018 quarter.

FYI, Spectrum Cannabis in Chile was taken over by Canopy in September, 2018.  Spectrum Cannabis Chile also has a pain management focused clinical trial underway. The trial which has been approved at both Phase I and Phase II was designed by Dr. Sergio Sánchez, a Chilean doctor, medical cannabis pioneer, and the founder of NGO Latinoamerica Reforma, one of the country’s leading cannabis advocacy groups.

Auscanns’ Dayacann operation in Chile had completed similar phase 1 trials and had started phase II trials about a year ago but we’ve had no follow up information on either since then.  Why?

In my opinion, Auscann has lost any first mover advantage it thought it had and it won’t be long before Canopy swoops in for a take-over as it did with Spectrum Chile.

I hope I'm wrong!