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Congratulations on the recent qualifying transaction and initiation of trading. For those that are not well informed on the LiveWell story could you walk us through the company and fill the readers in on how LiveWell is focused on becoming one of the largest and lowest cost cannabis producers?
- LiveWell is a cannabis and hemp health and wellness company focused on prescription and consumer health products supported by data and discovery, science and technology. Our vision is to focus on innovating at an industry level, rather than copying those that have come before us. While we prepare to engage the current cannabis market, LiveWell has an eye to the “real” patient/consumer market based on unmet medical and health needs.
- Our low-cost advantage comes from the anticipated scale of our operations and locations. In Québec, we have some of the lowest power rates in the country and a plentiful labour pool. Our innovation and focus processes also play a role in our low operating expenses. Our partnership with Canopy has given us access to best practices and operational optimization that they have developed over a number of years and grow cycles. We are applying Canopy best practices towards building our greenhouses and processes. We also recently announced an LOI from the Government of Québec to make a major investment in our Québec facility.
What are some of the major growth drivers for LiveWell and what should investors be monitoring? Tell us a little about the existing facilities as well as the expansion plans. When can we expect these assets to be fully operational?
- LiveWell’s vision is quality outcomes and innovation with strategic partnerships that differentiate us. Our team has a breadth of experience: horticultural, pharma/biopharma, engineering, manufacturing, human resources and finance. Our team has taken to market blockbuster consumer pharma and healthcare products and plans to replicate with cannabis and hemp along with derivatives such as CBD. Growth drivers for LiveWell will be receiving licences, revenue deals, innovation and strategic partnerships, and product development and launches.
- The Ottawa grow facility is located 15 minutes east of the Parliament buildings in the Ottawa Capital region. Our ACMPR application is in late stage of Health Canada’s approval. We plan to retrofit 540,000 square feet of existing greenhouses with zoning approved for an additional 144,000 square feet. The first phase of approximately 110,000 square feet is in progress with 20,000 square feet (plus 41,000 square feet of support area) of that submitted for licensing. Once complete and licenced, we will proceed with the completion of the remaining 90,000 square feet of grow space of Phase 1. Optimized costs at scale production are under $1.00 and with a target of $0.90, assuming we retrofit the entire 540,000 square feet.
- The Québec Project, which includes a world-class Research and Innovation Centre, sits on over 450 acres and is located 1 hour NW of Gatineau along the Ottawa River, between Shawville and Campbell’s Bay. Several considerations for location include access to water, low power rates and opportunity for economic development partnership with the Pontiac region and the province of Québec.
The Québec project will include:
- A world-class Research and Innovation Centre: the facility is dedicated to research and development in support of continuous improvement and commercial operations. Our innovation cycle will be supported by data, discovery, science and technology. The centre will include turnkey grow, processing, formulation, manufacturing and commercialization centre.
- Planned build-out is 600,000 square feet of greenhouse expandable to 1,000,000 square feet. Build-out of the first 100,000 square feet is already underway. Optimized costs at scale production are $0.80 and with a target of $0.75.
- Our partner Canopy is supporting us through the application process at this location as well.
We are seeing an increasing number of licensed producers beefing up their R&D budgets. Can you tell us about LiveWell’s Research and Innovation Centre and explain how it will be utilized for growth initiatives?
- LiveWell’s Research and Innovation Centre is going to differ in terms of scale and partnerships. Initially, we are focused on cannabidiol (CBD) isolated from industrial hemp and cannabis as we see this as a fast-growing product segment within the industry. Of importance are the economies of scale that industrial hemp derived CBD offers. LiveWell has been actively planning and is well positioned for a future to take advantage of this feedstock for rapid commercialization. With an ever-expanding legal/regulatory global framework and self-directed care market, patients are seeking alternatives to current treatments for unmet medical and health needs. In terms of partnerships, we’ve formed a number of alliances with leading medical, academic and government organizations. Our goal is to have the LiveWell Québec facility as the world leader in cannabis and hemp innovation – positioning Québec as the leader in cannabis innovation, production, and distribution.
How is LiveWell preparing for the roll out of the adult use market across Canada? Also, what is the company’s strategy to differentiate itself in the marketplace?
- Our strategy to differentiate ourselves in the marketplace is driven by our partnerships, competitive advantages – proprietary high-value formulation + organic processing + product delivery technologies, our world-class research & innovation centre, as well as our personnel.
- To put it simple, LiveWell is the complete all-round package in terms of hitting all the key points when evaluating a company in this sector. We have proven that the goals we set are and have been achievable. Going forward, this reinforces our belief in one another and all parties involved along this process to maximize LiveWell’s potential.
Earlier this year, LiveWell signed a strategic agreement with Canopy Rivers and Canopy Growth. Can you elaborate on the strategic relationship and explain how this is a major differentiator for the company?
- Canopy Growth is the global leader and pioneer in the cannabis industry. Canopy Growth has tremendous industry presence, insight and experience based on their years of growth and operations. Our partnership gives us access to key personnel, operations, and administrative support with access to sales channels as well. Having Canopy Growth as a partner differentiates both our operations and our access to industry best practises. The Canopy Rivers partnership, whom we deem “value added” investors, offers us access to various options of capital and highly respected capital markets feedback.
On July 26, LiveWell made a major announcement after Québec expressed interest in contributing up to 25% of the overall financing for its world-class Innovation and Research Centre. Can you please expand on this announcement and what it means from a partnership standpoint for LiveWell in the province of Québec?
- This is a major announcement for us by a provincial Government, whereby there is an interest in financial support. This partnership will drive significant economic growth in Pontiac RCM. As evidenced by our partnership with Canopy, we feel that the way to win longer term is to partner with those who can help facilitate our growth. Québec has only 8 licenses, but approximately 23% of Canada’s population. So, it is largely an untapped market. Most projects really only started to make progress late last year, including ourselves, so effectively, we’re at the starting line with everyone else in Québec. However, we’re well down the path of having provincial support which will help open doors and accelerate our growth.
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