MediPharm Labs Corp. has terminated the previously announced sale of its facility in Napanee, Ontario to Kensana Health Inc. for $5.5 million in cash. 

The agreement, first announced in December 2024, was for the purchase and sale of its 29,000 sq. ft. EU GMP facility through a disposition of all of the company’s indirect equity interests in its wholly-owned subsidiary ABcann Medicinals Inc. to Kensana Health. 

Kensana Health had agreed to acquire all of the issued and outstanding shares in the capital of ABcann from the company’s operating subsidiary, MediPharm Labs Inc. 

On February 10, MediPharm gave notice of termination as required under the purchase agreement, saying that Kensana Health did not meet certain agreed upon terms and conditions within the timelines set out therein. 

MediPharm Labs will retain certain non-refundable deposits received from Kensana Health. The company acquired the Napenee facility from Vivo in 2023.

“Growing our profitable international revenue was a critical element of our success in 2024. We will continue to use the Napanee Facility to capitalize on international opportunities in 2025” said David Pidduck, CEO of MediPharm Labs.

The deal was first expected to close by January 1, 2025, subject to customary closing conditions and receipt of all necessary approvals, as applicable. Then in January, MediPharm agreed to extend the outside closing date as provided in the purchase agreement to January 31, 2025. 

Medipharm Labs brought in $9.8 million in net revenue in its most recent quarterly report for the three months ended September 30, 2024 (Q3 2024), with $3.1 million in gross profit, but a net loss of $2.8 million.

The bulk of the company’s net revenue came from sales into the Canadian market ($6.2 million), increased from $5.9 million in the same quarter in 2023. Another $2.5 million in sales were in Australia, up year-over-year from $2.2 million, $1 million in Germany (up from $319,000 in Q3 2023), and $62,000 in other international sales (up from $5,000).

Of the sales in the Canadian market, $1.7 million were in the adult use and wellness markets, while $3.7 million were in the medical markets.

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