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Lessons from Pharma for the Medical Cannabis Industry

Ido Kanyon, CEO AusCann25.07.2019

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Agenda

Medical Cannabis Opportunity

Medical Cannabis Fundamentals u

Market Access Drivers

Lessons from Pharma for the Medical Cannabis Industry

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Cannabis

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Cannabinoids

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AdministrationDry flower Oil extract (vape)

Infused food Tablet / Capsule

Topical

Tincture

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The endocannabinoid system is involved in regulating a variety of

physiological and cognitive processes including fertility, pregnancy, during

pre- and postnatal development, mood, appetite, sleep, memory,

pain-sensation, inflammation, and in mediating the pharmacological

effects of cannabis.

Endocannabinoid System (ECS)

|8| Source: 2014 American Academy of Neurology

Cannabis is mostly prescribed

to alleviate symptoms, reduce pain or improve

the patient quality of life

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Example: How Multiple Sclerosis is treated Two main types of drug therapy are available:

Source: 2014 American Academy of Neurology: COMPLEMENTARY AND ALTERNATIVE MEDICINE FOR MULTIPLE SCLEROSIS, https://mswellington.org.nz/whatisms/what-are-the-symptoms-of-ms/

1) Disease-modifying therapiesthese reduce the number of relapses and may help slow disease progression

2) Symptomatic therapiesthese do not affect the course of the disease but help to relieve some of the symptoms

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Medical Cannabis is prescribed to manage the

symptoms of a large array medical conditions

1 Qualifying medical conditions globally varies by country/state regulation Source: company research and https://www.pa.gov/guides/pennsylvania-medical-marijuana-program

▪ Amyotrophic lateral sclerosis▪ Autism▪ Arthritis▪ Cancer, including remission therapy▪ Crohn’s disease▪ Damage to the nervous tissue of the central nervous system

(brain-spinal cord) with objective neurological indication of intractable spasticity, and other associated neuropathies

▪ Dyskinetic and spastic movement disorders▪ Epilepsy▪ End of Life Care/Terminal illness▪ Glaucoma▪ HIV / AIDS▪ Huntington’s disease▪ Inflammatory bowel disease▪ Intractable seizures

▪ Insomnia ▪ Multiple sclerosis▪ Neurodegenerative diseases▪ Neuropathies▪ Opioid use disorder for which conventional therapeutic

interventions are contraindicated or ineffective, or for which adjunctive therapy is indicated in combination with primary therapeutic interventions

▪ Parkinson’s disease▪ Post-traumatic stress disorder▪ Severe chronic or intractable pain of neuropathic origin or

severe chronic or intractable pain▪ Sickle cell anemia▪ Spinal Cord Disease▪ End of Life Care ▪ Tourette syndrome

Partial list of qualifying medical conditions globally1:

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Medical Cannabis Opportunity

Agenda

Medical Cannabis Fundamentals

u

Market Access Drivers

Lessons from Pharma for the Medical Cannabis Industry

|12| Source: IMARC report “Medical Cannabis Market: Global Industry Trends, Share, Size, Growth, Opportunity and Forecast 2018-2023”

The global medical cannabis market is projected to grow from $11B in 2017 to $37B in 2023

Global Medical Cannabis MarketSales Value in US $Billion

Medical Cannabis Market by RegionSales Value in US $Billion

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Medical Cannabis is a multibillion global business opportunity which is projected to grow in double-digit CAGR for the next coming years

The Medical Cannabis global opportunity

|13|Source: https://fortune.com/2018/12/20/cannabis-investments-2018/, https://www.bloomberg.com/press-releases/2019-06-27/medical-marijuana-market-worth-usd-25-25-billion-at-21-cagr-during-2018-2022-technavio, https://www.globenewswire.com/news-

release/2019/06/10/1866360/0/en/Medical-Marijuana-Market-to-Reach-a-Valuation-of-USD-54-677-1-million-through-2023-to-Grow-at-CAGR-of-34-0-Says-MRFR.html, https://www.marketwatch.com/press-release/at-244-cagr-medical-cannabis-market-size-will-reach-20200-

million-usd-by-2025-2019-06-18, https://www.globenewswire.com/news-release/2019/06/12/1867415/0/en/Medical-Cannabis-Market-will-grow-at-CAGR-of-29-3-to-hit-56-70-Bn-by-2026-Global-2019-Analysis-by-Growth-Size-Share-Price-and-Recent-Initiatives-Adroit-Market-

Research.html, https://bdsanalytics.com/new-report-global-legal-cannabis-markets-to-grow-36-in-2019-despite-2018-challenges-to-break-40-billion-by-2024/

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Recreational Wellness Medical Pharmaceuticals

There are four main cannabis segments

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With different regulations around the globe

Source: Marijuana Business Daily, 2018, Industry Insight: Countries to Watch, https://mjbizdaily.com/international-countries-to-watch-report/ (accessed May 2019)

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Recent M&A / Business Development deals

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And also one big Pharma

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Market Access Drivers

Medical Cannabis Opportunity

Medical Cannabis Fundamentals

u

Lessons from Pharma for the Medical Cannabis Industry

Agenda

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Regulators

Health Practitioners

Patients

Market access drivers

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Market access for Cannabinoid-based medicines

Market access is challenged

by lack of standardisation

and medical acceptability

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Regulated medicines are prescribed based on standardized science and validated clinical outcomes

▪ Cost of development: +200MUSD

▪ Exclusivity: 20 years/10 years from launch

▪ The regulatory framework together incentivise companiesto invest

▪ Robust economic engine

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Lessons from Pharma for the Medical Cannabis Industry

Medical Cannabis Opportunity

Agenda

Medical Cannabis Fundamentals

u

Market Access Drivers

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Lesson 1: Apply basic pharmaceuticals science

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Lesson 2:Measure and publish safety and clinical outcome data

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Lesson 3: Know the patient journey, know where to add value

Journey Phase

Origination

Awareness / Presentation

TreatmentFulfillment

Adherence

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Lesson 4: Develop now considering how the treatment paradigm is likely to evolve in the next few years

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Lessons from innovative Pharma

Lesson 5: Invest in your brand 70%Buy “a well known

trusted brand”

Say the most important driver for purchase is

effectiveness

91%

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Apply basic pharmaceuticals science

Measure and publish safety and clinical outcome data

Know the patient journey, know where to add value

Develop now considering how the treatment paradigm is likely to evolve in the next few years

Invest in your brand

Lesson 1

Lesson 2

Lesson 3

Lesson 4

Lesson 5