MediPharm Labs Awarded Payment of $9.8M in Connection to a 2020 Statement of Claim Against a Previous Customer

BARRIE, ON, July 27, 2022 /PRNewswire/ - MediPharm Labs Corp. (TSX: LABS) (OTCQX: MEDIF) (FSE: MLZ) ("MediPharm", "MediPharm Labs" or the "Company") a pharmaceutical company specialized in precision-based cannabinoids, today announced that it has been awarded a favourable summary of judgement in the Ontario Court of Justice in connection with a supply agreement dispute in the amount of $9.8M.

On January 24, 2020, MediPharm Labs filed a statement of claim ("Claim") in the Ontario Superior Court of Justice against one of its long-term customers of cannabis concentrates. The Claim related to, among other things, the payment of outstanding amounts due to the Company for products shipped to and received by the customer and deposits owed to the Company for committed amounts not yet shipped.

On February 26, 2020, the defendant in the Claim filed a statement of defense and counterclaim. The Ontario Court of Justice has dismissed this counterclaim.

This summary judgement and subsequent payment, and recent conditional sale of the Company's Australian facility, will add over $16M in cash, strengthening the balance sheet.

David Pidduck, CEO of MediPharm Labs commented, "In the early days of the nascent cannabis industry many companies faced risks in collecting large receivables. This summary judgement will allow us to collect this $9.8M, which will dramatically strengthen our balance sheet. MediPharm now has many customers across multiple channels and our accounts receivable are healthy. The collection of this cash will significantly improve MediPharm's cash position and give us flexibility to consider M&A opportunities."

Founded in 2015, MediPharm Labs specializes in the development and manufacture of purified, pharmaceutical-quality cannabis concentrates, active pharmaceutical ingredients (API) and advanced derivative products utilizing a Good Manufacturing Practices certified facility with ISO standard-built clean rooms. MediPharm Labs has invested in an expert, research driven team, state-of-the-art technology, downstream purification methodologies and purpose-built facilities with five primary extraction lines for delivery of pure, trusted and precision-dosed cannabis products for its customers. Through its wholesale and white label platforms, MediPharm Labs formulates, develops (including through sensory testing), processes, packages and distributes cannabis extracts and advanced cannabinoid-based products to domestic and international markets.

In 2021, MediPharm Labs received a Pharmaceutical Drug Establishment Licence from Health Canada, becoming the only company in North America to hold a domestic Good Manufacturing Licence for the extraction of natural cannabinoids. The Company carries out its operations in compliance with all applicable laws in the countries in which it operates.

This news release contains "forward-looking information" and "forward-looking statements" (collectively, "forward-looking statements") within the meaning of the applicable Canadian securities legislation. All statements, other than statements of historical fact, are forward-looking statements and are based on expectations, estimates and projections as at the date of this news release. Any statement that involves discussions with respect to predictions, expectations, beliefs, plans, projections, objectives, assumptions, future events or performance (often but not always using phrases such as "expects", or "does not expect", "is expected", "anticipates" or "does not anticipate", "plans", "budget", "scheduled", "forecasts", "estimates", "believes" or "intends" or variations of such words and phrases or stating that certain actions, events or results "may" or "could", "would", "might" or "will" be taken to occur or be achieved) are not statements of historical fact and may be forward-looking statements. In this news release, forward-looking statements relate to, among other things, statements regarding: collection of the court award, the need to raise capital through equity or debt vehicles, and MediPharm's ability to execute M&A opportunities in the future. Forward-looking statements are necessarily based upon several estimates and assumptions that, while considered reasonable, are subject to known and unknown risks, uncertainties, and other factors which may cause the actual results and future events to differ materially from those expressed or implied by such forward-looking statements. Such factors include, but are not limited to: general business, economic, competitive, political and social uncertainties; the inability of MediPharm Labs to obtain adequate financing; the delay or failure to receive regulatory approvals; and other factors discussed in MediPharm Labs' filings, available on the SEDAR website at www.sedar.com. There can be no assurance that such 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 the forward-looking statements and information contained in this news release. Except as required by law, MediPharm Labs assumes no obligation to update the forward-looking statements of beliefs, opinions, projections, or other factors, should they change.

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SOURCE MediPharm Labs Corp.