CannScience Innovations
Investor Deck
April 2016
1
CAUTION REGARDING FORWARD-LOOKING STATEMENTS
This Presentation contains forward-looking statements and forward-looking information. Often, but
not always, forward-looking statements can be identified by the use of words such as “plans”, “expects” or
“does not expect”, “is expected”, “estimates”, “intends”, “anticipates” or “does not anticipate”, or “believes”,
or variations of such words and phrases or state that certain actions, events or results “may”, “could”, “would”,
“might” or “will” be taken, occur or be achieved. Forward-looking statements involve known and unknown risks,
uncertainties and other factors which may cause the actual results, performance or achievements of
CannScience Innovations (“CannScience Innovations” or “the Company”) to be materially different from any
future results, performance or achievements expressed or implied by the forward-looking statements and
information.
Neither the Company or any of its affiliates or representatives makes any representation, warranty
or guaranty of any kind, express or implied, as to the accuracy, completeness or reasonableness of the
information contained herein or any other written or oral communication transmitted or made available to the
recipient. The Company and its affiliates and representatives expressly disclaim any and all liability based on or
arising from, in whole or in part, such information, errors therein or omissions therein.
Actual results and developments are likely to differ, and may differ materially, from those expressed
or implied by the forward-looking statements contained in this Presentation. Such forward-looking statements are
based on a number of assumptions which may prove to be incorrect, including, but not limited to: the ability of
the Company to obtain necessary financing; the ability to complete a going public transaction; the ability to
satisfy the requirements of a stock exchange; the economy generally; the yield from the Company’s marijuana
growing operations; consumer interest in the products of the Company; competition; and anticipated and
unanticipated costs. These forward-looking statements should not be relied upon as representing the
Company’s views as of any date subsequent to the date of this Presentation. Although the Company has
attempted to identify important factors that could cause actual actions, events or results to differ materially from
those described in forward-looking statements, there may be other factors that cause actions, events or results
not to be as anticipated, estimated or intended. There can be no assurance that forward-looking statements will
prove to be accurate, as actual results and future events could differ materially from those anticipated in such
statements. Accordingly, readers should not place undue reliance on forward-looking statements. The forwardlooking statements and information contained in this Presentation are expressly qualified in their entirety by this
cautionary statement. The forward-looking statements and information included in this Presentation are made as
of the date of this Presentation and the Company assumes no obligation to update such forward-looking
statements to reflect new information, subsequent events or otherwise unless required by applicable securities
legislation.
Our History
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CSI started its efforts at a pivotal time in 2014
Centered in the 3rd largest health research
cluster in North America (UofT/Hospitals)
Senior leadership is experienced in life sciences
– patents, inventorship, track record of growing
companies
Licensing approvals – first to get approval to
complex extraction and drug discovery work
with the cannabis plant
Slide 3
Our History
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Exclusive strategic relationship with UHN, a worldclass research hospital
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MMPR Dealer’s License for cannabis-based and controlled
drug substances discovery activities
A multi-million $ discovery laboratory
Plans for UHN to build on CSI seed investment to obtain
$18 M government funding for expansion of controlled
substances centre
Strong IP (20 patents) on drug delivery device, and
plans to expand the IP including a potential
“blocking patent” and composition of matter patents
Potential strategic partnerships with global pharma
companies
Slide 4
Strong management team
Har Grover, Chief Executive Officer
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Co-Founder CannScience
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Experienced life sciences entrepreneur with track record of taking
companies through all stages of growth from startup through proof of
concept to going public and past the $1 billion revenue mark
Lakshmi P. Kotra, Chief Scientific Officer
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Co-Founder CannScience
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One of Canada’s top medicinal chemists
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Senior Scientist at UHN and Associate Professor of Medicinal Chemistry
at UofT
Slide 5
Strong management team
Rav Grover, Executive Vice President & Chief Financial Officer
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Co-Founder CannScience
Successful financial professional (CA, CPA) with significant experience in
corporate development, private equity, capital markets and M&A
Phillip Hemans, Executive Vice President & Chief Operating Officer
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Experienced financial executive (CA, CPA) with capital markets, M&A and
corporate development expertise
Operational and financial restructuring professional with Process, ERP and
GMP experience
Slide 6
Scientific Advisors
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Eleanor Fish, PhD
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Barry Greenberg, PhD
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U of T Transplant Institute
Virology and post transplant infection
Orlando Hung, BPharm, MD
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UHN
Neuroscience Drug Discovery and Development
Atul Humar, MSc, MD
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U of T, UHN
World-renowned immunologist and arthritis researcher
QE II Health Sciences, Dalhousie
Anesthesiology, pain management
Donald Weaver, MD, PhD
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Krembil Research Institute, UHN
Neurology, epilepsy
Slide 7
Cannabis research is reaching a
tipping point
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Cannabis has been used in historic cultures for
therapeutic benefit for thousands of years, and is
demonstrated to be safe
A misguided regulatory framework over the last 50 years
has constrained research to fully exploit the therapeutic
benefits of the cannabinoid system
But loosening of the regulatory regime in several
international jurisdictions is now creating a “golden age”
for drug discovery as the knowledge base about the
endocannabinoid system explodes
Israel and Canada are at the forefront with the US only
recently opening up
Slide 8
The Treasure Chest
…One strategy is to target the
endocannabinoid receptors directly, by
designing drugs that will activate or suppress
them. The other is to harness the effects of
the phytocannabinoids and turn these
compounds into drugs. (Nature, Sep, 2015).
CannScience Approach
Slide 9
Cannabinoids role in neuropathic
pain
Cannabinoids’ neuromodulatory and immunomodulatory potential lead to
myriad of therapeutic applications safely and effectively
Slide 10
Chemotherapy Induced Peripheral
Neuropathy
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Chemotherapy Induced Peripheral Neuropathy (CIPN) is a
painful dysfunction of the somatosensory nervous system.
CIPN is associated with many cancers and with many
chemotherapy drugs
CIPN affects 68% of patients undergoing chemotherapy
within the first month, and affects 30% of patients on a
chronic basis [PAIN 155 (2014) 2461–2470].
Severe impact on quality of life, patient treatment
outcomes, and discontinuation of chemotherapy
Estimated cost of the problem in the U.S. alone is $2.3
billion [The Oncologist 2010;15(suppl 2):3–8]
Newer biologics drugs have higher risk for triggering CIPN
Slide 11
Chemotherapy Induced Peripheral
Neuropathy
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The global market for treatment of neuropathic
pain is >$7 billion [Decision Resources Group, November
2015]
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The Global pain treatment market is $22 billion
in 2010, CAGR 9%
There is no approved therapy for CIPN
Current alternatives include
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Modification of the chemotherapy treatment
Palliative care using antidepressants, antiepileptic
drugs, or opioids, all of which have well known
adverse side effects
Slide 12
Our lead product targets CIPN
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There is growing recognition of cannabis derived
compounds in neuropathic pain [Clinical Pharmacology &
Therapeutics, Jun 2015]
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In a 177 patient, blinded randomized trial, a formulation of
THC and CBD demonstrated 30% reduction in CIPN with
good safety and tolerability profile [Journal of Pain and Symptom
Management, February 2010]
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In a follow-up 43 patient open-label study, there were
sustainable results for treatment of chronic cancer pain
demonstrated [Journal of Pain and Symptom Management, August
2013]
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Animal studies demonstrate a synergistic effect of
cannabinoids and opioids in treatment of cancer pain
Slide 13
A rich product pipeline beyond CIPN
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Improvements to existing extraction processes
can create strong blocking patents
Short term product launches based on
incremental regulatory approvals over what is
currently allowed by Health Canada
Medium term product launches utilizing
proprietary drug delivery technologies,
strengthen IP portfolio and barriers to entry
Obtaining regulatory approvals from FDA, EMA
and other international jurisdictions creates
global scope for CSI’s products
Slide 14
Product Development Strategy
Multiple shots on net with low incremental costs
Raw
Materials
Process
Improvements
Extract #1
Route of
Administration
Formulation,
indication
and Dosing
Buccal
CIPN dose #1
Epilepsy dose #2
Oral
Plant
Postherpetic Neuralgia dose #3
Extract #2
Topical
Slide 15
PTSD dose #4
Target Product Indications
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Neuropathic Pain – strong R&D plan and known efficacy
Refractory Epilepsy – keen interest in the clinic
PTSD – supported by VA and reimbursed
Postherpetic neuralgia – no effective drugs
Alzheimer’s disease – neuroprotective effects
Multiple Sclerosis – Spasticity and neuroprotection
Slide 16
Target Product Profile
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Quick onset of action
Direct delivery via buccal cavity
Metered dosing
Easy to self-administer
Established safety profile
Program in preclinical stage with
unique “cost benefit” opportunity
(low risk for development)
Slide 17
Target Product Profile
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Sustained Release
Nano-capsule formulation
Oral delivery
Slide 18
Regulatory Strategy
Again, multiple shots on net
MMPR
NHP
BE
TPD
Lowest cost,
fastest to market
Low cost, access
to naturopathic
community
Data protection
for 8 years,
moderate cost,
moderate time to
market
Strongest IP
protection,
reimbursement,
global reach
Highly fluid and
unpredictable,
low barriers
Unclear product
positioning
Moderate time to
market, difficult
to get off-label
prescribing
patterns
Expensive,
longest time to
market
Slide 19
Fast track potential regulatory
approval
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CSI also has products in pipeline for indications that could achieve fast track
regulatory approvals
CSI expands from neuropathic pain to postherpetic neuralgia
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The most frequent chronic complication of herpes zoster and the most common
neuropathic pain resulting from infection
Qualifies for orphan drug status: Annual incidence of herpes zoster is
approximately 3.4 cases per 1000 persons, and rises sharply from the age of 50
years, to approximately 11 cases per 1000 at age 90
Results in suffering and reduced quality of life as well as individual and societal
Treatment may involve topical therapy (lidocaine or capsaicin) and systemic
therapy, generally with gabapentin pregabalin, or tricyclic antidepressants.
Opioid analgesics are sometimes used, but there is uncertainty about their longterm benefits and concern about risks, including potential for abuse
In clinical trials of available therapies, fewer than half of patients with postherpetic
neuralgia have 50% or greater reduction in pain
Slide 20
CSI has the potential of producing
large investment returns
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CSI is pursuing the same path as a handful of players who
have produced dramatic results in a very short period of time
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UK based GW Pharma has established the leadership position,
launching its natural extract (Sativex) several years ago, and now
available in 27 countries. Recently, a positive Phase III trial with
epilepsy drug candidate Epidiolex buffets the value of natural
cannabinoid extract formulations
CannScience is focusing on variations of natural extracts such as
Epidiolex and Sativex
We are the only organization in Canada that has the
combination of regulatory approvals and resources to conduct
research and product development in this area
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Alternative formulations and routes of administration
Drug drug interaction
Dosing
Slide 21
Cannabinoid based Pharmaceutical
Industry Comparables
2.34 B
As a t 0 8 / 14 / 2 0 15
($ 000's)
2,000
1,500
1,000
Very favourable valuation
prior to IND submission comparable companies
have been valued at $135m
IND submission milestone
600 M
500
318 M
135M
100
$15M
CannSci
Kannalife
Zynerba
private
private
ZYNE
-----------------
Slide 22
Cara
CARA
NAS DAQ
GW Pharma
GWPH
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Financing Strategy
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Start-up Feb 2014 with seed investment of
$330K
Incorporated July 2014
Series A $1M Dec 2014
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$750K private placement
$250K convertible debenture (retired June 2015)
Series B $5M June 2016
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$5M for common shares issued out of treasury
resulting in 33% ownership post-money
$10 M pre-money valuation
$15 M post-money valuation
Slide 23
Use of Proceeds
Phase/Activity
All Figures $000's
Q2
General and admin
Salaries, contract labour, general
Legal and accounting
2016
Q3
Q4
Total
52
164
189
405
Professional fees
100
80
130
310
R&D
Wet lab, dry lab
528
537
537
1,602
Sales, marketing, bus dev
Salaries, travel, consulting
125
160
175
460
Extraction process improvement
130
PK/PD
225
Preclinical
Safety/Toxicology
130
225
220
CMC GMP scale-up
Regulatory
Pre-IND
20
30
IND
General working capital
450
200
420
50
50
40
90
50
50
Required to fund ops thru Q2 2017
1,033
1,180
Slide 24
1,416
1,371
5,000
Near Term Milestone Pathway
- MMPR license application
- UHN one year agreement
- Initial Capital Raise of $1M
2014
2015
Super Critical Fluid extractions
Develop proprietary extraction methods
UHN agreement extension through 2018
Commence development of proprietary
formulations
- Commence discussions with Health Canada
on regulatory pathways
- Develop patent strategy
Q1 2016
- RapidMist™ world wide license
- Commenced R&D and
established baselines
- UHN approval for animal trials
- MMPR license awarded
- Preliminary discussions with Pharma
- Preliminary discussions with other
licensed producers
Valuation $1.5M
Valuation $10M
Q2 2016
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Complete initial animal studies
Finalize pathways with Health Canada
Conduct Pharma collaborative activities
Complete development of lead products
Submit patent applications for extraction
technologies and products
Q4 2016
Q3 2016
- Capital Infusion ($5.0 M)
- Introduce new proprietary extraction
technologies
- Continue proprietary product development
- Commence animal studies
- Produce basic extract and proof of concept
for licensed producers
- Formalize Pharma collaboration
Valuation $15M
Slide 25
- Health Canada approval of dossiers
- Commence commercialization of
Accumar products
- Commence development of 2nd wave
of products
2017
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Submit product approval dossiers to
Health Canada
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Develop regulatory strategy for
international markets
Meetings with FDA and EMA
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Valuation $25M - $35M
Valuation $50M - $75M
We have a winning formula
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Leading lab facilities for product development
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Differentiated product – alternative to smoking,
standardized metered dose
Based on strong, solid science to meet Health
Canada hurdles, positioning in providing safe,
reliable product
Building IP and proprietary barriers
Global Market
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Regulatory path follows fast tracked pharma
model
Slide 26