27 June 2019
The information contained within this announcement is deemed by the Company to constitute inside information stipulated under the Market Abuse Regulation (EU) No. 596/2014. Upon the publication of this announcement via the Regulatory Information Service, this inside information is now considered to be in the public domain.
Sativa Group PLC
(“Sativa” or “the Company” or “the Group”)
Phytovista subsidiary completes largest UK CBD industry blind product test for The Centre for Medicinal Cannabis.
PhytoVista Laboratories (“PhytoVista”), a UK market leader in CBD testing and a subsidiary of Sativa Group Plc (NEX: SATI), has completed an independent blind test of consumer cannabidiol (CBD) products for The Centre for Medicinal Cannabis (“CMC”) involving 30 major retail CBD oil brands.
PhytoVista’s technicians used its state of the art analytical equipment to report back to the CMC on the quality of the samples being asked to focus on the areas of health & safety, consumer rights, and criminal law. The results are contained within the CMC report ‘CBD in the UK: Towards a responsible, innovative and high-quality cannabidiol industry’ published today.
The test utilised PhytoVista’s standard analysis process, which produces a Certificate of Analysis capable of reporting by product on pesticides, heavy metals, residual solvents, cannabinoids, terpenes and mycotoxins, and Tetrahydrocannabinol (THC) content. Each £150 test has a turnaround time of five days or less.
For the CMC, PhytoVista was asked to test specifically for heavy metals, residual solvents and cannabinoids.
PhytoVista reported the results to the CMC and the detailed conclusions are contained within the CMC report (see below for contact details). The process however was most revealing in terms of quality and instances of poor practice. The biggest issues related to accuracy of labelling, the presence of controlled substances and some contaminants, and in one sample the complete absence of any CBD, a result validated by the CMC through a second independent laboratory test.
38% of the products tested had less than 50% of the advertised CBD content. One product had 0% CBD. 45% of the selected products had measurable levels of THC (mean content 0.04%) or CBN (mean content 0.01%) and are thus technically illegal within the UK.
One product had 3.8% ethanol (3.4% qualifies as an alcoholic beverage). Dichoromethane was detectable in seven products (3.8-13.1ppm) and cyclohexane was found in one product (27.9ppm). These percentages of solvents and heavy metals are still below the permitted daily dose levels in pharmaceutical products, although above food limit safety levels.
Conversely, George Botanicals, another Sativa subsidiary and a wholesaler and on-line retailer of CBD products, can guarantee that all of its products have been batch tested independently by PhytoVista. Sativa subsidiary Goodbody Wellness opens its first high street CBD wellness store in Bath on Saturday 29th June and offers the same guarantee.
Geremy Thomas, the Company’s founder and CEO, said: “Sativa identified early on that in established overseas markets for CBD, and in particular Canada, product testing and validation was an early stage bottleneck within the industry. PhytoVista is well established in the UK and has already conducted over 1500 independent tests.”
Paul Birch, Founder of CMC, said: “PhytoVista was chosen as a highly reputable, recognised UK-based laboratory. Its well established testing process was efficient, detailed and already contributes to making the UK’s CBD sector responsible and verifiable.”
Centre for Medicinal Cannabis (CMC)
CMC Press release & link to Executive Summary
For further information please contact:
Founder & Chief Executive Officer Sativa Investments PLC
+44 (0) 20 7971 1255
NEX Exchange Corporate Adviser
Stephen Keys / Max Gould Cenkos Securities plc
+44 (0) 20 7397 8900
Cenkos Securities +44 (0) 20 7397 8900
Financial PR and IR
+44 (0) 7771 663 886 SativaInvestments@abchurch-group.com
Chief Financial Officer
Sativa Investments PLC
+44 (0) 20 7971 1255
Notes to Editors
Sativa is a seed to Consumer medicinal cannabis and cannabidiol (CBD) wellness business, focused on the smart-sourcing of the raw material, advanced extraction, manufacture, testing, distribution, and research & development of medicinal cannabis and CBD products. The Company has a Home Office licence application in process which, when granted as the Directors believe it will be as the application is in its final stages, will enable the Company to engage in the highly regulated process of growing, strictly for medicinal research & development purposes only, Tetrahydrocannabinol (THC) rich cannabis flowers at its high- security Somerset headquarters.
The Company joined the UK’s NEX market in March 2018 as the UK’s first medicinal cannabis investment vehicle and since then has capitalised on its first-mover advantage, developing a substantial UK bridgehead into what the Company believes will be a significant market in the future. Two UK operating subsidiaries, PhytoVista Laboratories and George Botanicals, are already well established and fully trading with healthy gross margins in independent CBD testing and CBD wholesale & retail respectively.
Phytovista has conducted over 1000 independent tests and George Botanicals develops, manufactures and distributes low-THC CBD wellness products. Other important future revenue streams are at various stages of development from concept to actual launch, with the first Goodbody CBD wellness centre opening in Bath on 28th June.
Prior to the Listing, Sativa’s founder and CEO, Geremy Thomas, spent 12 months researching the global medical cannabis and CBD industries at his own personal expense. He based himself in Canada, the most advanced country in terms of medicinal cannabis acceptance and regulation, travelling to America, Australia, the Far East, and Europe to connect with industry leaders and participants. The Company on Listing was therefore already internationally connected, and this has given it a head start within the UK industry for smart-sourcing and the adoption of advanced value-add techniques and models.
In May 2019 the Company obtained permission from NEX Exchange to reclassify itself as a trading company, having delivered on its original investment strategy. Benefits of this include widening the appeal of the equity opportunity to additional types of investors including institutions and family offices, many of which are precluded from investing in fund-type vehicles.
Sativa has a highly experienced Medical Advisory Board, Chaired by Sir Alasdair Breckenridge, a former Chairman of the Medicines and Healthcare Products Regulatory Agency (MHRA). He is joined by Dr Matthew Brown, an award-winning pain consultant at The Royal Marsden Hospital, Dr. Peter Fedlshreiber, a barrister and physician specialising in medical law, and Dr. Stuart Ungar, co-founder of the Doctors Laboratory and who researched biochemical neuropsychopharmacology at the Royal Free Hospital.
The Company has a strong senior management team and Board team including Joseph Colliver FCA as Chief Financial Officer and a Board Director, and Jonathan Wearing, a seasoned City corporate financier, as Chairman. Dr Nick Horniman, Director of Regulatory Affairs, has over thirty years of experience in the veterinary industry and he co-ordinates the Group’s ongoing relationships with regulators such as the Home Office, Food Standards Agency (FSA) and the Veterinary Medicines Directorate (VMD). He is also investigating the significant opportunities for medicinal cannabis and CBD products in the pet and equine markets. Chris Jones, a retail management professional who was instrumental in building the Phones 4U chain, leads the team developing the Goodbody wellness centres, which will offer customers a variety of high-quality CBD products.
Sativa’s smart-sourcing strategy enables it to define the crucial factors of seed strain, growing techniques and environment, along with extraction methods, all of which are imperative to the quality of the end-product. Phytovista Laboratories confirms the cannabinoid profile and quality of each batch on delivery to ensure that it is regulatorily compliant, is free of unwanted chemical elements, and is of proven origin. The commercial off-take agreements that the Company is entering in to will contribute to quality assurance, forecasted forward quantities of supply, consistency, and pre-determined pricing, rather than spot pricing.
The Group’s activities include the Sativa Foundation, which awards research grants to academic institutions in order to further research & development into the efficacy of the full spectrum of cannabinoids. In April 2019 the Company entered into a three-year research agreement with King’s College London to research the impact of cannabinoids on inflammation and respiratory diseases.
Sativa has invested in two Canadian-based businesses, pharmaceutical company Veritas Pharma Inc. and a Rapid Dose Therapeutics Inc. Both of these provide Sativa with valuable know-how alongside their investment potential. The Company also has a 60% share of a joint venture with Germany’s Lexamed GmbH, providing a foothold into the German market.
For more information on Sativa Investments, please visit: www.sativainvestments.com
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