MedPharm Holdings said it would not be extending their term sheet, which expired yesterday, for acquisition with Schwazze, Inc. (SHWZ), formerly operating as Medicine Man Technologies. This is the second company in two months to walk away from Schwazze as Medicine Man Denver also chose to part ways in August.
“After more than a year and a half of negotiations we have mutually agreed with Schwazze, this transaction no longer serves either party,” said Albert Gutierrez, CEO of MedPharm “We remain as optimistic as ever about MedPharm’s future and our ability to bring groundbreaking research that is enhanced by novel, cannabinoid-containing dosage forms,” Gutierrez says. “I felt it was a good time to move on and seek other qualified partners for investment purposes, as MedPharm retains its role as a leader in the industry.”
MedPharm said it is well-positioned in the industry after experiencing a series of historical business developments since its inception in 2017. In August of 2019, the Drug Enforcement Administration (DEA) announced that MedPharm Research, a wholly-owned subsidiary of MedPharm Holdings, was selected to move forward as one of the first applicants to be considered for a license to grow federally legal cannabis under a new policy statement issued in the Federal Register. The Bulk Manufacturer license will allow MedPharm to provide cannabis and cannabis dosage forms for research purposes.
Justin Dye, Chairman and Chief Executive Officer of Schwazze said, “The decision to terminate the binding term sheet with MedPharm is the right step forward for Schwazze. We are committed to creating shareholder value and generating compelling investment returns and believe that by staying true to our core business strategy of building a vertically integrated platform, we will do just that. Our focus remains unchanged, as our intention is to bring together profitable cannabis operators while growing organically to create a robust, differentiated and most admired cannabis company.”
Schwazze instead has acquired Mesa Organics, a dispensary chain with four locations in Southern Colorado, Purplebee’s a leading extraction and manufacturing business, and remains on track to acquire the 14 Colorado locations of Star Buds which includes 13 retail locations and a cultivation facility. The company said it remains in negotiations with the announced acquisitions Roots Rx and Canyon Cultivation.