The next generation of nature - OTCQB: CANSF
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The next generation
of nature.
June 2020 TSX: WLLW
willowbio.com OTCQB: CANSF
Investment Highlights
Positioned to be leading high-quality pharmaceutical and CPG ingredients manufacturer
willowbio.com
• Produces consistent, pharmaceutical-grade cannabinoid
compounds APPLICATIONS
INCLUDE:
• Ability to reliably supply strong growth markets MEDICINE
‒ Market expected to grow 10 times over next 10 years to $100B COSMETICS
BEVERAGES
• Proven team to successfully commercialize production & MORE
• Strategic partnerships with industry leaders to enable
manufacture and drive commercialization
• Path to commercialization ahead of initial expectations, scale up
achieved in March 2020, pilot production in Q3 2020 and first
commercial molecules in H1 2021
• Strong financial position to fund commercial production
2
Biosynthesis: Nature’s method, industrialized
Learning from nature and making it better
willowbio.com
• Nature’s instructions to produce cannabinoids are coded in the cannabis plant’s genetic information
• Willow transfers the genetic information into a yeast host, creating a miniature cannabinoid factory
• Our process vastly increases cannabinoid production, enabling efficient large-scale manufacturing
• Producing life changing compounds from nature has been happening for hundreds of years
‒ Aspirin was ultimately created from the bark of a willow tree
‒ Insulin and penicillin are also manufactured using biosynthetic methods
‒ Heme is what makes the meat taste like meat in the Impossible Burger and is biosynthetically produced in yeast 3
Fermentation is a More Sustainable Manufacturing Platform
Willow’s process results in higher purity, at lower cost, with significantly less environmental impact
willowbio.com
Willow’s biosynthesis process vs. plant based cannabinoid production1
Biosynthesis Outdoor Grow2 Outdoor Grow3 Indoor Grow
Fermentation (US) (Canada) (Canada)
Energy Use (kWh/kg) 10 70 70 1,270
Land Use (acres)
Scientific and Operational Success Drives Accelerated Progress
Path to commercialization becomes clearer
willowbio.com
Pilot project six months ahead of schedule
• Advancing from 20L scale to 500L scale ahead of expectations
• Expect customer samples available for CBG in Q3 2020 and CBD in Q4 2020
‒ Receiving strong interest from consumer packaged goods companies for the North American recreational market
• Expect to be first company to produce meaningful amounts of synthetic cannabinoids
Additional cannabinoids added to portfolio
• Successfully developed production process for five cannabinoids – CBD, CBG, CBGV, CBDV and THCV
• Confirms yeast fermentation as a commercial production platform
• Biosynthetic production produces commercial quantities of cannabinoids, rather than the small or trace amounts found naturally
in plants
5
Wide Range of Pharmaceutical Applications
Ongoing research increasing the reach of cannabinoid uses
willowbio.com
• Growing knowledge and acceptance of cannabinoid benefits
‒ Epidiolex® - approved by U.S. FDA in 2018 to treat epilepsy seizures
‒ ~50 cannabinoid-based treatments currently in clinical trials
• Requires consistent, high-quality ingredients
• Early stage potential for growing range of cannabinoids for pain, anxiety, obesity, brain disorders, cancer treatments and more
Projected US cannabinoid-based pharmaceuticals market growth
US$2B US$50B
2020 2029
6
Source: Ackrell Capital estimates. See Chapter IV: U.S. Cannabis Market Estimates.
Extensive Growth from Consumer Products
Major global consumer brands are waiting for a consistent, scalable manufacturing process
willowbio.com
• Consumer products market expected to reach $16 billion by 2025 CBD Product categories
revenues by 2025 (millions)1
• Opportunities with cosmetics, pain relievers, beverages and more 0 1,000 2,000 3,000 4,000 5,000 6,000 7,000
Nutraceuticals
• Ingredient quality and consistency is crucial to product reputation
Topicals ~$13B
‒ Large portion of the ~$13B opportunity to require API quality opportunity
Beverages
CBD
Food
• Reliable and scalable manufacturing process required Beauty
Vapor
• Recent US de-scheduling of our partners ultra-high purity CBD
from the Controlled Substances Act signals change in US
regulatory views
1. Cowen Research, Feb 25, 2019 Cowen Research, February 25, 2019
7
Willow’s Best In Class Management & Technical Team
Willow’s team has the necessary experience to achieve success
willowbio.com
Proven scientific team
• Extensive industrial biotech expertise and essential capabilities for building successful cannabinoids producing yeast strain:
gene discovery and high throughput strain optimization
• Prior development of a commercial yeast strain producing a different active pharmaceutical ingredient
• Highly skilled technical team responsible for cannabinoid producing yeast strain, including many with PhDs and prior biosynthesis
experience
Successful business team
• Management team cofounded five companies, all of which successfully sold for > $4 billion in aggregate
‒ Raised more than $1 billion in equity and debt
• Board of directors cofounded seven companies, all of which successfully sold for > $8 billion in aggregate
8
Strategic Partnerships Add Critical Expertise From Pilot to Distribution
Willow is pursuing additional strategic partnerships to add expertise and market access
willowbio.com
AMRI – responsible for strain optimization, pilot batches and commercial scale-up
• Willow delivered proprietary cannabinoid producing yeast strain in March 2020
• Pilot production expected in Q3 2020, expect to advance scale up to larger, commercial-scale
Global contract fermentation vessels by first half of 2021
manufacturing and
research
OPTIMIZATION, SCALE-UP & MANUFACTURING
DISTRIBUTION & MARKETING
Noramco/Purisys – responsible for scale up oversight, regulatory
Leading global
submission, marketing and distribution for CBD only
supplier of APIs
• Following Willow’s successful optimization of CBD yeast strain
• Timing expected from 2021 onwards
Noramco spin-off following
CSA de-scheduling
• Partners share equally in the profits of CBD only
9
Development Plan & Timeline – Development, Scaling and Manufacturing
Scientific success and strategic partnerships are driving accelerated commercialization timing
willowbio.com
Titer (g/L) Accelerated path to commercialization
(6 months ahead of estimates) Continued process engineering for
scale-up toward Pharma cGMP
4.0
CBG
CBD
Commercial Process
CBGV
THCV
3.0 CBDV
Large Commercial Scale Process
Large Scale (>10,000 L)
2.0 Developed platform and accelerated path
enables portfolio expansion
Pilot Scale (>500 L)
1.0 Pilot Scale (>500 L)
0.5 Scale-up Development Scale-up Development
2020 2021 2022
Iterative Strain/Enzyme Optimization Scale-up Development Customer Sampling Expansion Across Entry Into
2020-2021 CBG & CBD 2020-2021 CBG & CBD & Sales for R&D CPG Markets Pharma Markets
2020-2022 CBGV, THCV & CBDV 2021-2022 CBGV, THCV & CBDV 2020 CBG & CBD 2021-2022 2022-onwards
2021 CBGV, THCV & CBDV
10Strong Financial Position
Strategic industry and financial partners position Willow for strong future performance
willowbio.com
• In April 2019, raised $37 million via private placement to Willow Share Capitalization (TSX: WLLW) - As at March 31, 2020
support research, strain development, scale up and
commercial launch Basic Shares Outstanding (mm) 78.9
Employee Options (mm)1 5.3
• Private Placement priced at $0.88 per share
Warrants (mm)2 15.7
‒ Tuatara Capital participated for $20.1 million Performance Warrants (mm)3 12.1
‒ Directors and Officers participated for $5.5 million Fully Diluted Shares Outstanding (mm) 112.0
• Strong insider ownership at 42%
1. Weighted average strike price of $1.40.
• Fully funded to commercialize production of CBD
2. 15.0mm issued in the April 12, 2019, financing to strategic investors, management and board. These warrants
have a strike price of $0.88 per share. Remaining warrants have a weighted average strike price of $8.01 per
share.
3. Additional warrants issued if the 20 day VWAP exceeds a share price of $3.50 per share and Willow is listed on
• Analyst coverage initiated in Sep 2019 the TSX (or equivalent exchange).
• Moved to TSX in Dec 2019 (TSX: WLLW)
• Trade on OTCQB® Venture Market (OTCQB: CANSF)
11Positioned for Future Success
With Pharmaceutical Grade Cannabinoid Product
willowbio.com
• Growing demand for high quality, cannabinoid compounds. Expanding pharmaceutical use and consumer product market
• Proven ability to commercialize yeast-based pharmaceutical ingredients
‒ Scientific success has added multiple new cannabinoids to the portfolio
• Scalable, sustainable manufacturing process to meet growing demand
• Aligned with industry leaders Noramco and AMRI for successful commercialization
‒ Scale up development commenced in March 2020, pilot production accelerated to Q3 2020, and first commercial production in H1 2021
• Fully funded to commercialize production of cannabinoids
Expected market value in
$100B 10 years (10x growth)
Total U.S. Cannabis Consumer Market $100.0 60
($Billions) 50
$80.0
Recreational & Medicinal ($B) 40
$60.0
Cannabinoid-based Pharmaceuticals ($B) 30
Number of consumers (M) $40.0
20
$20.0 10
$0.0 0
2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029
12
Source: Ackrell Capital estimates. See Chapter IV: U.S. Cannabis Market Estimates.Appendix
Development Strategy Will Enable
Commercial Production Of Multiple Targets
willowbio.com
Feedstock Hexanoic Acid Butyric Acid Other Acid
Cannabinoid Cannabinoid Cannabinoid
Precursors GPP Precursors Precursors
Yeast cell (from yeast)
Key Cannabinoid Intermediates CBGA CBGVA
Naturally Occurring
Compound
THCA CBDA CBCA THCVA CBDVA CBCVA
Decarboxylation
TARGET THC CBD CBC THCV CBDV CBCV Novel Target
Commercial titer target of 3-5 g/L necessary for COGS targets is a realistic objective and will be the key optimization driver
14Wide Range of Pharmaceutical Applications
Ongoing research increasing the reach of cannabinoid uses
willowbio.com
Indication THC CBD CBC CBG CBGA CBN THCA CBDA THCV CBDV
Alzheimer's disease ◉ ◉ ◉
Amyotrophic lateral sclerosis (ALS) ◉ ◉
Anorexia ◉
Anxiety ◉
Appetite Suppressant ◉
Arthritis ◉ ◉
Bone Growth ◉
Cachexia ◉ ◉ ◉ ◉ ◉ ◉
Cancer ◉ ◉ ◉ ◉ ◉ ◉
Chronic pain ◉ ◉ ◉
Crohn's disease ◉ ◉
Diabetes ◉
Epilepsy ◉ ◉
Glaucoma ◉ ◉ ◉
Hepatitis C ◉ ◉
HIV/AIDS ◉ ◉
Inflammation ◉ ◉ ◉ ◉ ◉ ◉
Inflammatory bowel diseases ◉
Migraine ◉ ◉
Multiple sclerosis ◉ ◉
Nausea ◉ ◉
Nervous system disorders ◉
Parkinson's disease ◉
Post-traumatic stress disorder (PTSD) ◉ ◉ ◉
Spasms ◉ ◉ ◉ ◉
Source: Ackrell Capital 2018 Cannabis Investment Report and other industry reports. 15Extensive Growth from Consumer Products
willowbio.com
Future cannabis market in-line with current levels of common stimulants and substances1
Alcohol Coffee Tobacco Painkillers Anti-depressant Cannabis (future)
Primary Usage Recreational Recreational Recreational Medicinal Medicinal Recreational / Medicinal
Adult Penetration 50% 50% 17% 40% 25% 20%
Monthly Consumer Spending $45-200 $80-100 $40-80 $40-200 $40-100 $50-500
U.S. Retail Market Size $200 B $35 B $100 B $300 B $60 B $100 B
1. Ackrell Capital 2018 Cannabis Investment Report
16Leadership
Management Technical
willowbio.com
Chris Savile, PhD Travis Doupe, CA CPA Jerry Ericsson, MSc Mathias Schuetz, PhD Troy Talkkari, CFA
Trevor Peters
CEO & Director COO CFO VP Operations VP Research & Development VP Corporate Development
Experienced executive having co- Over 10 years in science, business CA and CPA (Illinois) with 18+ years’ Experienced clean-tech executive Adjunct Professor Dept of Botany UBC,
Over 12 years’ experience in the finance
founded four start-up companies in the development, and commercial experience in the international oil and gas responsible for raising more than $25 researcher and plant molecular
industry and was most recently a Director
past 15 years operations roles industry million to commercialize biologist with extensive expertise in
of Institutional Equity Sales at GMP
thermochemical technologies plant genetics and cannabis
FirstEnergy
Highly experienced (bio)chemist, high VP Finance & CFO of Suroco Energy Inc., a technology
Instrumental in seven public and private
start-up companies in the energy throughput (HTP) assay scientist and publicly-listed company based in Canada 15 years’ experience in research and
Was part of 66 M&A transactions
industry over the past protein engineer with strong technical with operations in Colombia development of novel technologies in Over 14 years’ research experience
totalling over $22 billion in value
20 years background forestry and agricultural industries and author of many peer-reviewed
Roles with PwC in Calgary, Alberta and publications in prestigious plant
science journals Was part of 833 financings, including 279
Raised over $1 billion in equity and debt R&D leader on several programs that Havana, Cuba 8 years experience in integrated pest
as the lead dealer, totalling over $131
financings at various stages of corporate led to commercial manufacturing management (IPM) research in
billion of capital raised
development processes Served in positions of increasing greenhouse and field crops Numerous citations and awards for
importance at Sherritt Oil & Gas, including research excellence
CFA designation and Bachelor of
Successful transactions totalling over $4 PhD in 2005 at McGill University Finance Manager & Controller Authored/co-authored 3 patents and
Commerce in Finance from the University
billion on sale more than 10 peer-reviewed papers in PhD in 2009 at Simon Fraser University
of British Columbia
VP Finance & CFO of Milagro Energy and international journals
Extensive intellectual property and Controller of NAL Resources
patent prosecution background in the
energy
technology sector
17Leadership
Board of Directors
willowbio.com
Peter Seufer-Wasserthal, PhD Donald Archibald Fotis Kalantzis, PhD Al Foremen Sadiq Lalani
Chairman Independent Director Independent Director Director Independent Director
25 years of experience in the technology and Independent businessman with significant 25 years experience in oil and gas exploration Partner and Chief Investment Officer at Tuatara 25 years’ experience as Chief Financial Officer of
biotechnology sector senior executive and board experience for and development Capital publicly-listed issuers, including current Vice
numerous public and private companies President & CFO at Kelt Exploration Ltd.
Currently Chief Commercial Officer of Origenis Co-founder and senior executive of several Previously, Managing Director at JP Morgan in
GmbH Previous director and audit committee member public companies including Spartan Energy the Financial Sponsors Group and Private Equity C-Suite Energy Executive Awards CFO of the Year
of publicly-traded Spartan Energy Corp. and Corp., Spartan Oil Corp. and Spartan Exploration Fund Services Business
Previously VP, Business Development for Spartan Oil Corp. Ltd.
Intrexon Corporation, responsible for business Began his career at Citigroup, and has held
development in Europe and Asia for four years Previously President of Cypress Energy Corp., Holds an M.SC from the University of executive roles at several companies
Chairman & CEO of Cyries Energy Inc. and Saskatchewan and a PhD from the University of
Received a Ph.D. (Technical University of Graz) President & CEO of Cequel Energy Inc. Alberta Holds a B.S. Finance (University of Connecticut)
Trevor Peters
and a dual J.D./MBA (Arizona State University)
Holds a B.Comm (University of Alberta) and Published and presented numerous papers in
CEO & Director
MBA (University of Western Ontario) international journals and conferences see bio under mgmt.
Sony Gill
Corporate Secretary
18Disclaimer
willowbio.com
Forward Looking Statements. Certain information included in this presentation Although Willow believes that the expectations and assumptions on which the FOFI Disclosure. This presentation contains future-oriented financial information and
constitutes forward-looking information under applicable securities legislation. forward-looking statements are based are reasonable, undue reliance should not be financial outlook information (collectively, "FOFI") concerning Willow's financial
Forward-looking information typically contains statements with words such as "will", placed on the forward-looking statements because Willow can give no assurance position, liquidity, available funds, operations, revenue, expenses, ability to fund
"anticipate", "believe", "expect", "plan", "intend", "estimate", "propose" or similar that they will prove to be correct. Since forward-looking statements address future commercial production, market capitalization and components thereof, all of which
words suggesting future outcomes or statements regarding an outlook. Forward- events and conditions, by their very nature they involve inherent risks and are subject to the same assumptions, risk factors, limitations and qualifications as set
looking information in this presentation includes, but is not limited to, statements uncertainties. Actual results could differ materially from those currently anticipated forth in the above paragraphs. FOFI contained in this presentation was approved by
relating to: the business, strategies, expectations, planned operations and future due to a number of factors and risks. These include, but are not limited to, permits, management as of the date of this presentation and was provided for the purpose of
actions of Willow Biosciences Inc. ("Willow" or the "Company"), including research licenses and regulatory and third party approvals not being obtained in the manner providing further information about Willow's anticipated future business operations.
and development programs at the facilities located in Alberta, British Columbia and or timing anticipated by the Company; the ability to implement corporate strategies; Willow disclaims any intention or obligation to update or revise any FOFI contained
California and the timing thereof; the arrangements under, and potential benefits of, failure of counter-parties to perform contractual obligations; the state of domestic in this presentation, whether as a result of new information, future events or
the exclusive strategic partnership with Noramco, Inc. ("Noramco"); other capital markets; risks associated with the cannabis industry in general; infringement otherwise, unless required pursuant to applicable law. Readers are cautioned that
collaborations and partnerships, including in respect of marketing and distribution; on intellectual property; failure to benefit from partnerships or successfully integrate the FOFI contained in this presentation should not be used for purposes other than
the performance of the Company’s business and operations; the Company’s ability acquisitions; actions and initiatives of federal and provincial governments and for which it is disclosed herein.
to biosynthesize commercially and create proprietary genomes; the adequacy of changes to government policies and the execution and impact of these actions,
current funds to achieve commercial scale production of CBD; the performance of initiatives and policies; import/export and research restrictions for cannabinoid- Not an Offer. This presentation does not constitute an offer to sell or solicitation of
the current science team, management and board and the ability to find other based operations; the size of the medical-use and adult-use cannabis market; an offer to buy any of the securities described herein. The sole purpose of this
qualified personnel with operational experience; the competitive conditions of the competition from other industry participants; and other factors more fully described presentation, in paper or electronic form, is strictly for information purposes.
industry in which the Company operates and the competitive advantages of the from time to time in the reports and filings made by the Company with securities U.S. Registration. This presentation is not an offer of the securities for sale in the
Company; and the Company’s future product offerings, including analytical testing, regulatory authorities. United States. The securities have not been registered under the U.S. Securities Act
genetics and cannabinoid production; future production levels, quality, consistency of 1933, as amended, and may not be offered or sold in the United States absent
and costs. Readers are cautioned that the assumptions used in the preparation of forward-
looking information, although considered reasonable at the time of preparation, may registration or an exemption from registration. This presentation shall not constitute
The forward-looking statements contained in this presentation are based on certain prove to be imprecise. Willow's actual results, performance or achievement could an offer to sell or the solicitation of an offer to buy nor shall there be any sale of the
key expectations and assumptions made by Willow, including expectations and differ materially from those expressed in, or implied by, these forward-looking securities in any state in which such offer, solicitation or sale would be unlawful.
assumptions concerning: the future operations of, and transactions completed by, statements and accordingly there can be no assurance that such expectations will be
the Company; the potential for the strategic partnership with Noramco to open new realized and/or what benefits Willow will derive therefrom. The forward-looking
and larger markets (including non-pharmaceutical markets); Willow’s ability to information contained in this presentation is made as of the date hereof and Willow
generate higher quality CBDs at lower costs; cost synergies created by the strategic undertakes no obligation to update or revise any forward-looking information,
partnership with Noramco and the successful implementation thereof; the adequacy whether as a result of new information, future events or otherwise, unless required
of current capital; the availability of and access to qualified personnel; the results of by applicable securities laws. The forward-looking information contained in this
scientific research; the Company’s ability to protect its intellectual property; the presentation is expressly qualified by this cautionary statement.
expected growth in the cannabis market, including demand for cultured
cannabinoids; expectations regarding the regulatory framework for cultured Certain information contained herein has been obtained from published sources
cannabinoids; changes in prices and costs of inputs; the medical benefits, viability, prepared by independent industry analysts and third-party sources (including
safety, efficacy, dosing and social acceptance of cannabis; the securities markets and industry publications, surveys and forecasts), While such information is believed to
the general economy; changes to cannabis laws and regulations in Canada; the be reliable for the purpose used herein, Willow does not assume any responsibility
legalization of the use of cannabis for medical and/or adult use in jurisdictions for the accuracy of such information. None of the sources cited in this presentation
outside of Canada; and applicable laws not changing in a manner that is unfavorable have consented to the inclusion of any data from their reports, nor has Willow
to the Company. sought their consent.
19Thank You
Willow Biosciences
3655 36th Street NW
Calgary, AB, T2L 1Y8
Trevor Peters
CEO & Director
T: (403) 669-4848
E: t.peters@willowbio.com
Troy Talkkari, CFA
Vice President, Corporate Development
T: (403) 618-1117
June 2020 E: t.talkkari@willowbio.com
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