Sativa Wellness Group plc (AQUIS:SWEL) Chief Executive Officer Henry Lees-Buckley caught up with DirectorsTalk for an exclusive interview to discuss the merger with Stillcanna, the UK FSA novel foods process, increasing traction for Goodbody brand and the capability to white or private label products and sell raw CDB ingredients.
Q1: For anybody who has not been following the Sativa story recently, you’ve merged with Canadian company Stillcanna to form Sativa Wellness Group, that’s trading under the ticker SWEL, and you began trading yesterday on the CSE and, as of today, the AQUIS. First off, congratulations on the completion of the merger, what does the new combined company look like now?
A1: It’s a, it’s a very exciting time for us so obviously we’ve spent the last number of months, and I know that’s been a challenge as our investors and shareholders were patiently waiting the merger but the merger benefits are significant.
So, we’ve combined, with the company Stillcanna, it’s a Canadian-based company but really all the assets are in Poland so it’s a European company, quite frankly, just happened to be trading in Canada. Of course, our business in the UK, we’re still based in the UK, we’re still a UK- based a European company.
The combination of these two companies is what we think is ideal so they fit, very little overlap and redundancy, in fact, virtually none and this creates today a clear leading European seed to consumer CBD wellness company, so that that’s critically important in today’s environment. So, that really means that the assets of Stillcanna were really focused around cultivation, extraction and making the rare ingredients for a CBD wellness product. We, at Sativa took and bought those ingredients and formulated, tested, and produced high-quality products for the consumer markets.
If you put these two companies together, what we have today is a true seed to consumer company, which is highly unique. We actually get to control and have custody of the product that from the time it is cultivated and the time the CBD is extracted, the product is then tested in Europe at the plant. We then take that product test, tested it again, formulate our finished consumer product, formulate that, test it and then we market that product to consumers online and in retailers across UK and, in the future, Europe.
So, it really is a unique opportunity to create a full value chain company from seed to consumer.
Q2: Now, you mentioned the UK. Here in the UK, the UK FSA novel foods process is being implemented, how does that affect the Group now?
A2: Well, we’re very excited about that process and we’ve been advocating for some level of compliance for quite some time. As you know, from our recent discussions over the past year or so, our company has been designed around and focused around quality and compliance so we’ve always taken that high road, we own our own laboratory PhytoVista laboratory, it does testing for the majority of brands in the UK, but we made a conscious choice of deciding to take the high road, what we call it, and ensure that we have the highest quality and compliant products in the market.
So, for us, this is just normal day to day business but the new novel foods FSA regulations coming into place in March 2021 is, quite frankly to me, very good for us. We’re already in that process today and we expect to be accredited on time with the full range of products.
That means our commitment to quality and compliance is there and we believe that’s, quite frankly, an opportunity because they’re going to be players that are simply not going to be able to hit that hurdle because there are products in the market, as you probably have seen and heard from different newspaper articles, that have in some cases far too much THC and other cases very little CBD.
So, it is a market that does need cleaning up and we’re very pleased and we welcome those regulations so we’re going to be there and we’re going to embrace it and enjoy.
Q3: Goodbody is your consumer brand, it appears to be gaining significant traction?
A3: We were very excited about our brand. We consolidated our brands and we put it all under the Goodbody global brands so what I mean by that is we have two segments of it.
We have Goodbody Botanicals and, in this case, you should see our blue and white packaging, THC-free, all of the data and information we work with trading standards to make sure we’re fully compliant on that. That Botanicals brand is aimed at the grocers and pharmacy market, obviously as well as selling it online, which we do extensively, but it’s aimed at that particular market. We’re having great traction with that.
We introduced a Goodbody Wellness line, which is our premium offer and that offer, I’ll give you an example, one of our signature products is our orange and lemon flavoured product with vitamin D so it’s added vitamin D in it. It is the same quality, it is THC free and if you look at our packaging, it’s got a QR code on it taking it right back to the batch test.
So, if you think about this in the, in the new world of novel foods, retailers and consumers alike are going to be looking for CBD they can trust and that is what we do. At the end of the day, we can stand behind it with all of our company-owned laboratory, we can stand up with external testing, which we do as well, but our product is all designed around that and retailers are, quite frankly, picking that up significantly today because they don’t want to be associated with a brand that is not compliant, and they don’t want to be associated with a brand that’s not high quality.
So very good traction today on the high street, we’re getting more and more all the time we’re in places such as WH Smith Travel so we’ve got a good product array there and it is growing. Additionally, in pharmacies, that may have had Botanicals brand are now picking up our vitamin D brand.
Really good things going on with the brand and we’re continuing to focus on that commitment to quality.
Q4: In your recent press release, you mentioned your capabilities to white or private label products and sell raw CBD ingredients? What can you tell us about that?
A4: So, as a manufacturer, we obviously have our own Goodbody brand product, as we just talked about and shared, the reality is because we are a manufacturer of the raw materials, if you will, the ingredients, we have the capability now of going end to end.
That means we can sell the ingredients so CBD isolate or distillate product, we can sell that raw ingredient to manufacturers, other manufacturers that want the ingredients that they don’t produce themselves, we can sell that as an ingredient.
We can all equally sell it to other brands so, if for example some brands are out there that are having trouble with novel foods, or they’re in different parts of Europe and they need somebody to manufacture it for them, we can supply it from end to end. So, we can supply the raw ingredients, the isolate distillate, we can formulate that product for them, we can test that product for them and then we can manufacture/bottle that product for them and then we can put it in the packages that they choose so if they have a specific brand, we can do that packaging form as well.
So, we can be an end to end, what we call, white label or private label supplier for different brands, and again, not only in the UK but also equally across the continental Europe, our focus is Europe.
Q5: It certainly sounds like Sativa Wellness Group is well positioned?
A5: We think we’ve got the right formula and we’re, quite frankly, more excited about it now that we’ve had a chance to spend time with Stillcanna team. We’ve done the majority of the integration work today so right now we’re just simply focused on going out, growing the brands and growing sales, that’s our key focus.