VANCOUVER, BC, March 29,
2022 /CNW/ - Willow Biosciences
Inc. ("Willow" or the "Company") (TSX: WLLW)
(OTCQB: CANSF), a leading biotechnology company that develops
technology to manufacture pure, consistent and sustainable
compounds via yeast biosynthesis, is pleased to announce its
financial and operating results for the three months and year ended
December 31, 2021, and filing of its
Annual Information Form ("AIF"). Selected financial and operational
information is outlined below and should be read with Willow's
audited consolidated financial statements (the "Financial
Statements") and management's discussion and analysis (the
"MD&A") as of December 31, 2021,
which are available on SEDAR at www.sedar.com and on Willow's
website at www.willowbio.com.
Statement from the CEO
"2021 was both an exciting and challenging year for Willow",
said Trevor Peters, Willow's
President and Chief Executive Officer. "The progress that we
continue to make building out our core platform technology is
setting the company up to be a leader in the bio revolution that is
unfolding around us. While our platform build out is on schedule,
the market for cannabinoids, the company's first group of
compounds, has seen headwinds due to the lack of clarity around the
regulatory future of cannabis, predominantly in the United States. This is causing larger
consumer companies to remain on the sidelines until more certainty
is given by lawmakers. Willow management believes this to only be
temporary, given the bipartisan support, for instance, seen in
the United States toward
decriminalization and ultimate legalization. The message for our
stakeholders in 2022 is that we will continue to progress the
cannabinoid program to a state of readiness for when market
opportunities open, and start to leverage the platform technology
to access new compounds in more well defined markets. The value of
Willow is in the addressable market opportunities that our platform
technology is able to access."
Cannabinoid Program Update
On March 31, 2021, Willow
completed the first commercial scale fermentation of its first
cannabinoid for market, cannabigerol ("CBG"), at its
contract manufacturing organization's ("CMO") facilities in
Europe. Willow manufactured
product through 2021 while also continuing to optimize its CBG
process for improved yield and efficiency. On June 10, 2021, Willow announced a multi-year
supply agreement with Cellular Goods PLC ("Cellular Goods"),
whereby Willow will supply Cellular Goods with its proprietary,
ultra-pure, biosynthetically produced CBG to be used in their
premium cannabinoid-based skin care products. The limited volumes
of CBG produced throughout 2021 were primarily used for delivery to
Cellular Goods to meet their demand, to provide samples to
prospective partners, and to support our continued internal
development efforts.
Willow as an organization is set up to service the companies
that prioritize consistency, purity, and sustainability as their
priorities for their suppliers. Based on the scale at which we can
produce cannabinoids and the favourable supply chain dynamics its
technology offers, the primary counterparties for Willow's
precision fermented cannabinoids are consumer packaged goods
companies and their ingredient suppliers. While many of these
companies have publicly expressed an interest in cannabinoids,
until regulations globally, and especially in the United States, become clearer, they are
reluctant to make new or additional commitments. At this time,
Willow has not executed any long term supply agreements with the
large, multi-national CPG customers we are targeting. The Company
has begun discussions and negotiations with respect to long term
supply agreements, but cannot provide any guidance at this
time.
Throughout 2021, the Company continued to evaluate additional
manufacturing partnerships with the goal of expanding its CMO
network in 2022 to ensure it has access to sufficient commercial
scale fermentation assets. Willow has begun to incorporate a second
CMO into its manufacturing network that offers greater economies of
scale and optionality regarding diversity of compounds to
produce. The manufacturing runs in 2021 provided continued
improvements in our process at scale, while allowing for the
initiation of sales to smaller customers and sampling to larger
customers. Implementation of the improvements has brought the
Company to a point where management is comfortable scaling
production into larger, more fit-for-purpose assets. The addition
of a second CMO will allow Willow to accommodate new programs, both
internal and partnered, in addition to its cannabinoid
portfolio.
On January 13, 2021, the Company
engaged a regulatory consulting group to perform a comprehensive
safety assessment to independently conclude that CBG is Generally
Recognized As Safe (GRAS) for use as an ingredient in food and
beverage applications. The global demand for non-clinical contract
research organization ("CRO") work has been unprecedented,
resulting in delayed toxicology results. We now expect our initial
toxicology studies to finish in the first half of 2022 and the
pivotal trial to be completed in the second half of 2022. The final
conclusion by an independent panel is expected in late 2022 or
early 2023.
Since its formation, Willow's R&D team has placed
significant focus on the development of its core strain engineering
technology platform that enables the generation of key intellectual
property, such as proprietary genes, proteins and microorganisms
for the biosynthesis of cannabinoids. To that end, the Company has
filed ten cannabinoid-related patent applications to-date, with
additional applications being drafted. There is no guarantee that
any or all of these patents will be granted.
Technology Platform Update
Since its inception, Willow has had a mandate as a synthetic
biology company to focus on the development of biobased processes
for production of ingredients, including those for consumer care,
food & beverage, and pharmaceuticals. Willow's first compound,
CBG, opened the door for its entrance into the multi-billion dollar
global cannabis sector. Towards the end of 2021, the R&D effort
devoted to Willow's CBG producing yeast strain was nearing
completion, allowing its team to evaluate new compounds that could
benefit from its platform. Development of synthetic biology enabled
commercial fermentation processes requires a combination of
multiple technologies and capabilities for efficient and successful
execution. Willow combines three key development pillars: (i)
state-of-the-art rapid strain engineering technologies, (ii)
fermentation & downstream process development capabilities, and
(iii) an established manufacturing network. Having all of these
components at Willow allows for expansion of our technology
offering beyond cannabinoids. Willow is currently in discussions
with multiple parties to develop precision fermentation based
processes for compounds outside of cannabis that directly leverage
the R&D capabilities established on cannabinoids. While there
is no guarantee that these will lead to partnerships, Willow is
encouraged with the status of engagement.
Financial Update
Willow ended the year in a strong financial position, with
approximately $29.9 million in
working capital and $30.1 million of
cash on hand. As Willow transitions to a larger CMO through the
course of this 2022, revenue from product sales will continue to be
limited, but will position the Company well to meet demand for CBG
and other products in 2023 and beyond.
Outlook
Willow is positioned to become a leader in precision
fermentation, including cannabinoid biosynthesis, by capturing key
intellectual property around what the Company anticipates being the
most cost-effective methods to produce highly pure ingredients. The
Company's operational capabilities, along with its strategic
partners, span the entire product development pathway, and Willow's
integrated team in Canada and
the United States has full
capabilities to underpin achievement at all stages of the
development cycle. The Company's established technology,
capabilities, and manufacturing network can now enable biobased
production for a diverse set of industries. While the market for
biosynthetically produced cannabinoids is not where the Company
thought it would be a year ago, Willow remains bullish at the long
term market potential. While the Company waits for the cannabinoid
biosynthesis market to develop, Willow will utilize the platform it
has built to work with ingredient and pharmaceutical companies to
provide access to technology that augments existing manufacturing
techniques to build out a better supply chain for compounds that
have strong market potential. This will ultimately allow Willow to
generate early stage revenue based on research and development, as
well as longer term revenue in the form of royalties or profit
sharing. Willow anticipates being able to add new compounds to its
product offering in 2022 to generate revenue for the company.
The underlying fundamentals for the global cannabis industry are
trending upwards. As the future growth in the industry comes from
increased product offerings, it is management's ultimate belief
that the purity, consistency, and above all else, the sustainable
nature in which biosynthetically produced cannabinoids are made,
will be paramount for enabling large multi-national CPG companies
to participate. While Willow can't control the regulatory
environment and ultimate timing of these companies entering the
space, the Company can control the development and commercial
production associated with its cannabinoids, and having all the
necessary safety work needed to be a global supplier. Willow is
ready when the market unfolds.
As the platform expands to include development of new compounds
funded by partners, Willow is in a strong financial position with
$30.1 million cash on the balance
sheet as at January 1, 2022.
About Willow Biosciences Inc.
Willow is a leading biotechnology company that develops and
produces high-purity, plant derived ingredients for the consumer
care, food and beverage, and pharmaceutical markets. Willow's
FutureGrown™ biotechnology platform allows scale production of
pure, consistent, and sustainable product to benefit both B2B
customers. Willow's R&D team has a proven track record of
developing and commercializing bio-based manufacturing processes
and products for both the consumer and pharmaceutical
industries.
Forward-Looking Statements
This news release may include forward-looking statements
including opinions, assumptions, estimates and the Company's
assessment of future plans and operations, and, more particularly,
statements concerning: timing of revenue generation; discussions
with consumer-packaged goods entities; expanding its CMO network;
ability to meet demand for CBG and other products in 2023 and
beyond; the demand and market size potential of the synthetic
cannabinoid industry; Willow's entry into new global markets;
regulatory changes effecting the cannabinoid industry; and the
business plan of the Company, generally, including becoming a
leader in precision fermentation, including cannabinoid
biosynthesis. When used in this news release, the words "will,"
"anticipate," "believe," "estimate," "expect," "intent," "may,"
"project," "should," and similar expressions are intended to be
among the statements that identify forward-looking statements. The
forward-looking statements are founded on the basis of expectations
and assumptions made by the Company which include, but are not
limited to: the success of Willow's strategic partnerships,
including the development of future strategic partnerships; the
financial strength of the Company; the ability of the Company to
fund its business plan using cash on hand and existing resources;
the market for Willow's products; the ability of the Company to
obtain and retain applicable licences; the ability of the Company
to obtain suitable manufacturing partners and other strategic
relationships; and the successful implementation of Willow's
commercialization and production strategy, generally.
Forward-looking statements are subject to a wide range of risks and
uncertainties, and although the Company believes that the
expectations represented by such forward-looking statements are
reasonable, there can be no assurance that such expectations will
be realized. Any number of important factors could cause actual
results to differ materially from those in the forward-looking
statements including, but not limited to, risks associated with:
the cannabinoid industry in general; the success of the Company's
research and development strategies; infringement on intellectual
property; failure to benefit from partnerships or successfully
integrate acquisitions; actions and initiatives of federal and
provincial governments and changes to government policies and the
execution and impact of these actions, initiatives and policies;
import/export and research restrictions for cannabinoid-based
operations; the size of the medical-use and adult-use cannabinoid
market; competition from other industry participants; adverse U.S.,
Canadian and global economic conditions; adverse global events and
public-health crises, including the current COVID-19 outbreak;
failure to comply with certain regulations; departure of key
management personnel or inability to attract and retain talent; and
other factors more fully described from time to time in the reports
and filings made by the Company with securities regulatory
authorities. Please refer to the AIF and MD&A for additional
risk factors relating to Willow, which can be accessed either on
Willow's website at www.willowbio.com or under the Company's
profile on www.sedar.com.
Any financial outlook and future-oriented financial information
contained in this document regarding prospective financial
performance, financial position, cash balances or cash flows is
based on assumptions about future events, including economic
conditions and proposed courses of action based on management's
assessment of the relevant information that is currently available.
Projected operational information contains forward-looking
information and is based on a number of material assumptions and
factors, as are set out above. These projections may also be
considered to contain future-oriented financial information or a
financial outlook. The actual results of the Company's operations
for any period will likely vary from the amounts set forth in these
projections and such variations may be material. Actual results
will vary from projected results. Readers are cautioned that any
such financial outlook and future-oriented financial information
contained herein should not be used for purposes other than those
for which it is disclosed herein.
The forward-looking statements contained in this news release
are made as of the date hereof and the Company does not undertake
any obligation to update publicly or to revise any of the included
forward-looking statements, except as required by applicable law.
The forward-looking statements contained herein are expressly
qualified by this cautionary statement.
SOURCE Willow Biosciences Inc.