- Cronos Group (CRON) has amended its collaboration and license agreement with Ginkgo Bioworks, enabling the companies to accelerate the commercialization of CBG
- With the amended agreement in hand, the company commenced the commercial production of CBG today and expects that the final productivity target for CBG will be reached before September 2021
- Cronos Group is an innovative global cannabinoid company with international production and distribution across five continents
- Cronos Group Inc. (CRON) is up 0.87 per cent, trading at $10.45 per share
Cronos Group (CRON) has amended its collaboration and license agreement with Ginkgo Bioworks.
The amended agreement will enable the companies to accelerate the commercialization of CBG.
In addition to signing the amended agreement, Gronos Fermentation recently received both its processing license and CRA license. With the amended agreement and both licenses in hand, Cronos Fermentation commenced the commercial production of CBG today.
Under the original agreement, Cronos Group agreed to issue to Ginkgo up to 14.7 million common shares once Ginkgo had demonstrated that certain microorganisms were capable of producing eight target cannabinoids, such as CBG, above minimum productivity levels.
The amended agreement allows Cronos Group to commercialize products incorporating the target cannabinoids once certain milestone events have been reached.
Like in the original agreement, tranches of common shares will be issued upon reaching each of the eight milestone events.
However, in the amended agreement, one-third of the shares in each tranche will be issued when Cronos Group sells a product that incorporates one of the target cannabinoids to a third party.
The remaining two-thirds will be issued once Ginkgo can demonstrate that the relevant microorganisms can produce the target cannabinoid above the productivity level set out in the original agreement.
Cronos Group expects that the final productivity target for CBG will be reached before September 2021.
Kurt Schmidt, president and CEO of Cronos Group, commented on the milestone.
“Beginning commercial production demonstrates the significant progress underway with our Ginkgo partnership and the competitive benefits we see in being first to market with innovative consumer products,” he said.
Jason, Kelly, CEO and co-founder of Ginkgo, also commented on the partnership.
“Biological manufacturing is unlocking access to important cannabinoids that can be scaled up and produced reliably, consistently and economically,” he remarked. “We look forward to continuing our work with Cronos to facilitate innovation bringing this powerful technology to the cannabis industry.”
Cronos Group is an innovative global cannabinoid company with international production and distribution across five continents.
Cronos Group Inc. (CRON) is up 0.87 per cent, trading at $10.45 per share as of 3:28 pm ET.