Aurora Cannabis Inc (NYSE:ACB) announced that it is exercising its license option for EnWave’s REV in the South American cannabis market. The announcement is in line with an exclusive commercial license agreement with a royalty provision signed by the two parties on April 26, 2019. The exclusive master license grants Aurora Cannabis the rights to use EnWave’s proprietary Radiant Energy Vacuum (REV) technology for its operations, as well as receive royalties for all sub-licensing within the South American region excluding Peru.
The two partners will work jointly to secure other sub-licensing deals in the region. They did not, however, make public the royalty share each is entitled to from the sub-licensing of the futuristic dehydration technology in the territory.
The Europe and Canada Deal
The South American deal comes after other similar agreements inked by the two partners. A month ago, the companies signed a similar agreement under which Aurora gets exclusive rights to deploy the dehydration technology for its European operations. Further, Aurora will be entitled to royalty for all sub-licensing of the technology in the region. In the wake of the European deal, Aurora announced plans to purchase an additional 120KW REV machine for its operations in Europe. In Canada however, Aurora was given non-exclusive sub-license rights to use the technology for its operations. This followed a strategic investment of $10 million into EnWave for a share of the company’s intellectual property rights on the technology.
For its South American operations, Aurora signed a LOI to purchase an industrial-scale 60KW REV machine to revamp production at its facilities in the region.
The REV dehydration technology hopes to revolutionize the industry by speeding up production and helping companies save on drying space. Unlike existing drying options, REV technology maintains the integrity of the product including its terpene profile and natural flavor. The vacuum-microwave provision ensures uniform drying unattainable by other drying alternatives.
The technology reportedly cut drying time from almost a week to well under 2 hours resulting to significant savings in time and capital. The technology is suitable for industrial production especially with the growing demand for CBD products.
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