It is not about making people live longer but rather about prolonging health and vitality into old age, says Gabriel Theron, CEO and founder of the medicinal cannabis-focused business Cilo Cybin Holdings.
He is referring to the health and wellness solutions that the company ultimately hopes to market by combining “biohacking, biotech and pharmaceutical” information.
Earlier in September, Cilo Cybin Holdings became the first listing of a medical cannabis-focused special purpose acquisition company (SPAC) in Africa when it launched its initial public offering (IPO) on the JSE.
Theron says they hope to raise between R500m and R2bn through the IPO, which offers investors an opportunity to buy shares in the company from a starting amount of R1,000 for 1,000 shares.
The offer will close on November 4.
Theron says the initial uptake has been “encouraging”, but they expect most investors to come on board as the closing date nears. They have started speaking to institutional investors but are first focusing on “retail clients”, he said.
Theron, a former CEO of state-owned forestry company SAFCOL, started Cilo Cybin Pharmaceutical (CCP) in 2018, and since the beginning of 2022 the company has been marketing its own branded medical cannabis, vaping and supplementary health products. It is the first company in SA to obtain licences to grow, process, package, label and sell medical cannabis and its products. The company also offers third-party manufacturing and packaging services to the budding SA cannabis industry.
The existing product range includes non-psychoactive CBD cannabis products, which retail through various channels, and high THC (psychoactive) products specially for patients suffering from chronic pain or other negative reactions caused by cancer treatments.
The CCP manufacturing facility in Centurion, which has the capacity to produce about R150m worth of cannabis and vaping products a month, now extracts about 10kg of oil per month, but after the acquisition, expansion and upgrade of the facility this is to be increased to 150kg of oil per month.
The business has a collaboration agreement with the Vaal University of Technology for research & development in exchange for royalties.
By listing as a SPAC, all the money raised through the IPO may only be used for the acquisition or merger of assets, and these must be finalised within 24 months of the IPO.
But Theron says they hope to make their first acquisition, which will be to grow the existing cannabis business, much sooner. The first anticipated acquisition will be for a manufacturing facility owned by CCP through a share swap agreement (also at R1 per share).
Capital raised through the IPO will also be used to upgrade and expand the facility and to fund EU accreditation for the facility. Between 2023 and 2026 the business also plans to invest in an analytical laboratory for cannabis and psychedelic testing and in expanding its distribution and retail channels.
“The initial plan is to supersize the medical cannabis side of the business — we want to be the largest manufacturer in Africa — this will then be our ‘cash cow’ that will pay for future expansion and acquisitions,” Theron told Business Day.
Later, the business will look at investing in the emerging market for psychedelics as a cure for mental health conditions such as depression. “The expansion model for CCP includes the planned manufacturing of psychedelic branded products at the CCP facilities for the legal medicinal markets, as and when they open,” Theron says.
Other acquisition targets are in the field of biotechnology and biohacking, such as a US-based genetic analysis company that uses genetic and laboratory testing to formulate custom nutrition and supplement plans, a non-invasive testing tool to monitor brain function, and a heart rate variability measuring device. All of these will be combined with artificial intelligence to offer customers customised, individualised, preventive solutions for better health, performance and longevity.
The ultimate target market is North America. That is why the company aims to pursue a Nasdaq listing within about two years after the first phase of its acquisitions.
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