Dancann Pharma

Table of content:

• Summary and conclusion of 2023
• Upcoming value drivers
• 2025 guidance
• Delivering on the future business
• Submission of new dossier
• MYCB1 partnership to accelerate growth
• Capital requirements for implementing the adjusted strategy
• Biotech Pharm1 (BP1) – status

Summary and conclusion of 2023

DanCann Pharma has experienced an eventful year in 2023. It is no secret that this headline regarding the adjusted strategic direction has been a focal point, especially the elements concerning the decision temporarily to move away from in-house production and prioritise the part of the business that focuses on sourcing, importing, and distributing, particularly the regulatory aspects of the Danish market.

The adjusted strategy is founded on an asset-light business plan designed for optimal capital efficiency. It reflects our commitment to a sustainable future, one that benefits both our patients and our financial well-being.

However, the topic itself remains unchanged and will continue to revolve around cannabinoids and their associated treatments, initially under the Danish Pilot Programme with medicinal cannabis.

The rationale behind this decision has been driven by changes observed from a macro perspective. Combined with a decline in the Company's market value, these factors have imposed natural limits on its financial structure. Additionally, external factors such as rising interest rates have presented challenges for pharma and biotech companies in need of capital for further development.

The production business remains a development project and requires additional funding. Consequently, the decision was made to put this project on hold and short- and mid-term to focus solely on building the distribution business, which has consistently generated revenue and profit since its inception. The organisation has been right-sized and OPEX-adjusted with fully effect from the beginning of 2024.

Simultaneously, various options for the production component are being explored, including repurposing or sale of the asset. As soon as there is further information to report on this matter, it will be disseminated to the market. However, at the present time, there is nothing more specific to disclose.

As a result, the Company has executed this plan and expects to see the full impact in early 2024. The Company has a clear roadmap for 2024, with continued operation of its current portfolio of prescription medicines (Rx) in its distribution business in the Danish market, including Bedrocan®, Bediol®, and Bedica®. Additionally, the Company plans to launch 2-3 new products in 2024, with the first submission already made in December 2023.

The Company remains positive about its further development and aims for 2024 to be the year it achieves financial sustainability by executing its plan, ensuring a sustainable future for the DanCann Pharma A/S.

Upcoming value drivers

The year 2024 holds several exciting initiatives from DanCann Pharma, primarily focused on performance within its existing portfolio, as well as the introduction of its pipeline and its impact. Furthermore, it is expected that the industry will gain more insights into the future of the Pilot Programme with medicinal cannabis and whether its existing conditions will be met with improvements.

The goal is to ensure a broad product portfolio initially, including extracts (oral drops) with delta-9-tetrahydrocannabinol (THC), cannabidiol (CBD), and mixtures thereof (THC:CBD). The actual product names and trademarks will be disclosed later in the process. The first product was applied for in December 2023 and is expected to be launched in the second quarter of 2024.

2025 guidance

The adjusted strategy and direction are based on our ability to deliver best-in-class results through operational excellence. This implies prioritisingour regulatory efforts, raising the bar on financial performance, and driving value for patients, relatives, and shareholders.

To measure our success, we have set up a series of KPIs for the period:

1. Revenue growth: The goal is to achieve revenue growth exceeding 300% within the specified period.

2. Product expansion: This growth will be primarily driven by introducing 4-6 new products as part of the Pilot Programme with medicinal cannabis.

3. Breakeven target: The strategic plan assumes that the Company will attain the breakeven year by 2025 – with the first profitable month during Q4-2024.

Our financial target for 2025 is ambitious, yet realistic. We are targeting a revenue growth exceeding 300%, and with that, attain the breakeven point by the year 2025. This is not an aspiration or wishful thinking; it is a clear and explicit target with a firm timeline – and we are committed to meeting it.

Delivering on the future business

Below, you will find the most accurate sales data for Denmark (both in graph and table form). This data covers the actual sales at pharmacies and not just what is sold to wholesalers in the ecosystem around the supply of medicinal cannabis in Denmark under the Danish Pilot Programme.

One thing is the sales to wholesalers, another is what the pharmacies dispense based on prescriptions from doctors to patients. The numbers and data therefore provide a good indication of whether the products are performing in the real world or not.

DanCann Pharma and its subsidiary, CannGros, are experiencing positive trends, as evidenced by the data below. There are also positive expectations for the new product launches in 2024 and their additional positive contributions to the product portfolio already launched by CannGros.

The prices include the margin structure for wholesalers, pharmacy fees, and VAT.

The Company will keep the market informed about this data as new figures become available via "E-sundhed" and "Medstat", and to the extent possible, this will be included in the Company's quarterly reports.

Pharmacy sales of medicinal cannabis under the Pilot Programme:

Source: E-sundhed

Submission of new dossier

In December 2023, the Company applied for a new product inclusion under the Danish Pilot Programme for medicinal cannabis. This application aims to introduce a new delivery format in the form of an extract (oral drops).

The anticipated processing timeline based on the guided product introduction of imported cannabis intermediate products from the Danish Medicines Agency (DKMA) includes an estimated validation period of approximately 14 days, followed by an evaluation period of around 50 days. The Company has also factored in some buffer to account for potential DKMA workload.

The Company anticipates that there may be some adjustments required during the application process, resulting in the issuance of a deficiency letter as part of the final assessment. After the submission of this deficiency letter to DKMA, the processing timeline is expected to involve an evaluation period of approximately 40 days.

In summary, this means that the Company is in line with its guidance for the approval of this first new delivery format of extract (oral drops) in Q2-2024. The Company intends to keep the market informed with regular updates, both upon receipt of initial feedback and throughout the subsequent stages of the process.

MYCB1 partnership to accelerate growth

DanCann Pharma proudly reports significant advancements through its exclusive distribution agreement with MYCB1 for Scandinavia. Intense preparation has led to the final stages of our first two applications to the DKMA.

MYCB1 is highly skilled and fits the requirements set by the DKMA and the Danish Pilot Programme. There is enormous expertise to be found at MYCB1, all this based on their origins are rooted in the field of pharmacy, where they have gained experience in magistral preparation and similar processes. This expertise also meant that the final audit of MYCB1 conducted by DanCann Pharma was done in the beginning of November without any findings that gave cause to reassess the collaboration.

Our collaboration is integral to our future, and we have high expectations for this partnership's success. DanCann Pharma distributes today Bedrocan®, Bediol®, and Bedica® products, sourced from Bedrocan B.V (“Bedrocan”), to Danish wholesalers and pharmacies. These form the basis for MYCB1's offerings, which we plan to introduce in extract formats (oral drops) under the Danish Pilot Programme with medicinal cannabis.

MYCB1 GmbH in Germany, certified by the European Medicines Agency (“EMA”) for Good Manufacturing Practice (“GMP”), manufactures these prescription-only medications, utilizing raw materials from Bedrocan. This ensures a seamless standardised product journey from inception to patient.

We are positive that our extracts will be well-received in the Danish Pilot Programme and further enhance patient access. This should ultimately result in a prescription increase. Our familiarity with Bedrocan International, reinforced by the DKMA’s recognition, fuels our confidence in this new product launch. Quality assurance from Bedrocan's input material, processed at MYCB1's GMP-certified German facility, promises a consistent and transparent product offering.

Capital requirements for implementing the adjusted strategy

In 2023, the Company entered into an agreement with Nordic Growth Opportunities ("NGO2"), which includes a commitment totaling 18.9 MDKK, of which the first 6.6 MDKK have been received through the first tranche.

To execute the Company's plan to reach a financially sustainable position, approximately 6 MDKK more are required for the runway towards the Company's first month of positive cash flow. Additionally, the Company needs to secure approximately 3 MDKK to finance its outstanding loans.

The avenues for obtaining this financing in 2024 are under evaluation, and the Company expects to provide more specific details on this matter during the first quarter of 2024, regarding the path being explored to achieve this, in terms of the continued use of the opportunity under the NGO2 agreement or the implementation of another alternative.

Biotech Pharm1 (BP1) – status

As mentioned previously, the facility (BP1) has been scaled down to a minimum and is currently in a state of dormancy until further clarification, as part of the adjusted direction and strategy to maintain the cost-saving plan.

The cost of maintaining this asset has been minimized, amounting to a modest sum of approximately 0.5 million DKK annually, thus keeping these options open for future production. Once a future plan for it is determined, it can be reactivated.

Various options for the production component are being explored, including repurposing or sale of the asset. As soon as there is further information to report on this matter, it will be disseminated to the market. However, at the present time, there is nothing more specific to disclose.

About DanCann Pharma A/S

DanCann Pharma A/S (SS: DANCAN) was founded in 2018 and is a Danish biopharmaceutical Company powered by cannabinoids.

DanCann Pharma A/S (SS: DANCAN) is listed on the Spotlight Stock Market in Copenhagen/Stockholm.

For more information, visit: www.dancann.com

For further information, please contact:

Jeppe Krog Rasmussen, CEO

E-mail: jkr@dancann.com

Forward-looking-statement:

Some statements in this release may contain forward-looking information. All statements, other than of historical fact, that address activities, events, or developments that the Company believes, expects, or anticipates will or may occur in the future (including, without limitation, statements regarding potential acquisitions and financings) are forward-looking statements. Forward-looking statements are generally identifiable by use of the words "may", "will", "should", "continue", "expect", "anticipate", "estimate", "believe", "intend", "plan" or "project" or the negative of these words or other variations on these words or comparable terminology.

Forward-looking statements are subject to several risks and uncertainties, many of which are beyond the Company's ability to control or predict, that may cause the actual results of the Company to differ materially from those discussed in the forward-looking statements. Factors that could cause actual results or events to differ materially from current expectations include, among other things, without limitation, the inability of the Company, to obtain sufficient financing to execute the Company’s business plan; competition; regulation and anticipated and unanticipated costs and delays, the success of the Company’s research strategies, the applicability of the discoveries made therein, the successful and timely completion and uncertainties related to the regulatory process, the timing and outcomes of regulatory or intellectual property decisions and other risks disclosed in the Company's public disclosure record on file with the relevant securities regulatory authorities.

Although the Company has attempted to identify important factors that could cause actual results or events to differ materially from those described in forward-looking statements, there may be other factors that cause results or events not to be as anticipated, estimated or intended. Readers should not place undue reliance on forward-looking statements. The forward-looking statements included in this presentation are made as of the date of this presentation and the Company does not undertake an obligation to publicly update such forward-looking statements to reflect new information, subsequent events or otherwise unless required by applicable securities legislation.