TORONTO, ON--(Marketwired - June 04, 2014) - Easton Pharmaceuticals Inc. (OTC: EAPH) announces it has located a new source of non-dilutional financing.
As a result of Eastons non refundable deposit towards the closing on its recently announced medical marijuana agreement where Easton maintains an exclusive option to purchase up to 49% of a private Canadian medical marijuana company who has submitted an application for a federal growers license, Easton initiated discussions and received a commitment with a private accredited investor for additional financing to replace its existing source. The new financing option is conditional upon funds being solely used towards the purchase of its 49% option in the private Canadian medical marijuana company once a growers license has been issued. The new financing terms calls for funds being advanced as a convertible debenture loan secured by assets purchased in its exercised option in the medical marijuana company whose name is being kept confidential until its final inspection has been completed. Should Easton choose this financing option it would greatly reduce its dependence on its REG. A financing which was recently filed with the Securities and Exchange Commission and is awaiting any comments. Easton was previously financed $1 Million through regulation S 504 offerings.
Easton has been provided a status update and been notified that the build out of the MMJ facility as per the MMPR application with Health Canada is nearing completion and will soon be able to schedule an inspection which is the last step prior to receiving a federal growers license. The facility is situated on acreage already zoned for agriculture and allows for the expected and planned expansion to accommodate a maximum of 50,000 sq. ft. of growing space. Only 13 growers licenses have thus far been issued nationally from Health Canada. The private MMJ company is currently in possession and is one of what is believed to be only 40 plus companies who have received a letter to build from Health Canada. Recent articles and health Canada estimates put the amount of MMPR applications submitted with health Canada at 843 with 25 new applications being submitted every week. It is believed that only a small portion of these applications will have any real chance of obtaining a letter to build, let alone a growers license. Before a license is issued, producers must demonstrate how they meet extensive personnel security requirements, physical security requirements, record keeping equipment, and quality control requirements.
As per statistics obtained from current producing companies who have been growing and producing under the previous MMAR system, medical users on average consume about 1 to 3 grams daily. The costs to grow marijuana range on average $1.40 per gram which does not include marketing and dispensary costs. These grows are then turned around and on average are sold between $8 to $12 per gram. Some compassion clubs do rarely sell the product as low as $4 per gram, but on average there is a substantial profit margin if costs are well maintained, which is why medical marijuana is being classified and expected to become one of the most profitable and fastest growing industries. In August the State Of California is expected to vote on approving and legalizing medical marijuana to possibly join or vote alongside other states such as Colorado, Illinois, Washington, Arizona, Nevada, NY and several others. The current liberal minority government in Canada has already stated and indicated its willingness to possibly legalize marijuana for recreational use and follow the lead from the State of Colorado should it be voted into power.
About Easton Pharmaceuticals
Easton Pharmaceuticals is a specialty pharmaceutical company involved in various pharmaceutical sectors including medical marijuana, that owns, designs, develops, and markets topically-delivered drugs and therapeutic / cosmetic healthcare products, focused on cancer and other health issues related towards male and female sexual dysfunction, wound healing, pain, motion sickness, scar and stretch marks, cellulite, varicose veins and other conditions. The company's gel formulation is thought to be an innovative and unique transdermal delivery system. Easton Pharmaceuticals' product "VIORRA" is an over-the-counter, topical daily use product and aid for the treatment to restore and improve vaginal moisture and elasticity which is believed to have a positive effect on women's sexual desire and arousal, FSAD (Female Sexual Arousal Disorder); the world market for these female conditions and the medical marijuana industry is conservatively estimated to be in the billions.
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