Cannabinoid firm Avicanna pays off debt with funds from $2M private placement

Toronto-based Avicanna said it paid off $1.4 million in debt from August 2023 after closing on a nearly $2 million non-brokered private placement of its 6.6 million shares.

Avicanna is a biopharmaceutical company focused on cannabinoid-based products.

In addition to paying off the debt, Avicanna said in a news release that it plans to use the proceeds from the offering for general working capital and administrative expenses and costs related to production and manufacturing as well as research and clinical development.

The unit shares and warrants, and any securities that are issuable upon conversion, are subject to a four-month hold period under Canada’s securities laws.

The offering also is subject to the approval of the Toronto Stock Exchange, where shares of Avicanna are traded as AVCN.

Last August, Avicanna acquired Medical Cannabis by Shopper’s Business from Canadian pharmacy chain Shoppers Drug Mart.

Avicanna paid 2.6 million Canadian dollars ($1.9 million) plus earnout payments based on net revenue for a two-year period.

The company reported 2023 revenue growth of 314%, increasing from $2 million in 2022 to $16.8 million last year.

The increase was largely driven by the Medical Cannabis Shoppers acquisition and the launch of MyMedi.ca.

Consolidated gross profits increased by 500% from $1.1 million in 2022 to $6.7 million in 2023.