Pivot Pharma executes letter of intent to acquire ACI Foods

Pivot Pharma executes Binding Letter of Intent to acquire ACI Foods ACI intends to submit an application to Health Canada for an authorized Dealer's License which will allow it to produce and supply CBD oil as well as conduct cannabinoid research and development.

Pivot Pharmaceuticals Inc., an emerging biopharmaceutical company engaged in the development and commercialization of therapeutic pharmaceuticals and nutraceuticals, announces the execution of a Binding Letter of Intent to acquire Absorbent Concepts Inc. ("ACI Foods" or "ACI"). Based in Abbotsford, British Columbia, ACI processes, packages and distributes gluten-free, organic hemp nutrition products including hulled seeds, cold-pressed hemp seed oil, and high percentage protein powder.

"We are excited to welcome ACI Foods to the Pivot family and together look forward to becoming a dominant force in the global hemp industry," says Pivot CEO Patrick Frankham. "With impressive revenue and rapid growth in only three years of existence, we see an opportunity to help expand ACI Foods to significantly increase product offerings and sales. We consider this acquisition to be a strategic initiative to enable market share dominance in the hemp segment of the cannabis industry. The timing of this acquisition is in anticipation of the forthcoming legislative changes in Canada regarding the legal status of cannabidiol ("CBD"). Accordingly, the recent announcement by the World Anti-Doping Agency (WADA) that CBD will be removed from its list of banned substances effective January 1, 2018, further solidifies Pivot's strategy of developing fast-to-market cannabinoid based products."

ACI intends to submit an application to Health Canada for an authorized Dealer's License which will allow it to produce and supply CBD oil as well as conduct cannabinoid research and development. Pivot Pharmaceuticals will use CBD produced at ACI's facility, as well as other cannabinoids, to formulate nutraceutical and pharmaceutical products which can support health claims and provide therapeutic benefits. The market for CBDs in the form of functional foods, oils, orals and topicals is expected to show substantial growth, reaching $2.1 billion in consumer sales by 2020, with hemp-based sources attributing for $450 million of sales.

Peter Scales, founder of ACI states that, "With the phenomenal increase in consumer demand for functional food and natural health products, this transaction with Pivot Pharmaceuticals provides ACI with the ability to not only expand our nutritional business, but allows us to accelerate the development of hemp-based nutraceutical, pharmaceutical and veterinary products." Mr. Scales serves as a board member and as chair of the National Standards and Grading Committee of the Canadian Hemp Trade Alliance, and will remain president of ACI.

Industrial hemp, the legalized cousin of marijuana, contains significant quantities of cannabinoids (e.g. CBD), a group of molecules shown through an expanding body of anecdotal and scientific evidence to have potential medical and health benefits. Hemp has less than 0.3% tetrahydrocannabinol ("THC"), the psychoactive ingredient in marijuana.