MediPharm Labs Adds M&A Back to Growth Strategy

The company made less money sequentially.

MediPharm Labs Corp. (TSX: LABS) (OTCQX: MEDIF) reported its third-quarter financials ending Sept. 30, showing a mixed bag as the cannabis-based pharmaceutical continues to reshape its operations.

The company reported revenue of C$8.5 million, down around C$1 million sequentially but up C$1.3 million over the year. The firm posted a gross profit of C$2.4 million, which it says is the highest since the fourth quarter of 2019 and marks the fourth consecutive quarter of profitability. Still, net loss came out to C$4.3 million, according to regulatory filings.

In a statement, CEO David Pidduck pointed to the company’s focus on “margins, cost reductions and profitability.”

“Now, our strong balance sheet and improving profitability favorably positions us to make strategic investments for revenue growth,” he said.

MediPharm also resolved a longstanding dispute with Tilray Brands, which resulted in a C$9 million gain. That includes C$7.3 million in cash, C$1 million worth of cannabis products from Tilray, and a four-year purchase agreement.

Despite a negative adjusted EBITDA of C$2.4 million, the company witnessed a 53% improvement compared to the same period last year. The integration of VIVO contributed to approximately C$7 million in annualized savings, and the firm said further restructuring in the third quarter is expected to yield an additional C$3 million in savings annually.

MediPharm’s balance sheet saw C$13 million in cash and less than C$3 million in debt as of the end of the quarter. That does not include the cash acquired from the settlement, which would elevate the cash position to around C$19 million.

Pidduck added, “Beyond organic growth investments, there will be many M&A opportunities to consider in the coming quarters to further grow our revenue and shorten the path to profitability.”

Adam Jackson

Adam Jackson writes about the cannabis industry for the Green Market Report. He previously covered the Missouri Statehouse for the Columbia Missourian and has written for the Missouri Independent. He most recently covered retail, restaurants and other consumer companies for Bloomberg Business News. You can find him on Twitter at @adam_sjackson and email him at

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