Aurora Cannabis Inc. ("Aurora" or the "Company") (TSX: ACB) (OTCQB: ACBFF) (Frankfurt: 21P; WKN: A1C4WM) and CTT Pharmaceutical Holdings Inc. ("CTT") (US-OTC: CTTH) today announced that Aurora is acquiring an initial 9.14% ownership interest in CTT via way of a non-brokered private placement in the form of a US$1 million 5% convertible debenture. The agreement includes an issuance of warrants enabling to Aurora to increase ownership to 42.5%.

Commercial agreement

Additionally, the companies announced that, within 60 days, they intend completing a final commercial agreement, expanding the exclusivity agreement, announced first on April 16, 2018, which related to distribution in Canada only of CTT's novel, patent-protected drug delivery technologies. CTT will now provide Aurora with global exclusivity to develop, manufacture and market CTT's novel oral thin films wafers. The companies will work jointly towards obtaining Health Canada approval for introduction of the new products on the Canadian market, as well as obtaining commercial access to other international jurisdictions in which Aurora is active.

Clinically-Proven Rapid Onset Drug Delivery Technology

CTT is an Ontario based global leader in the development of dose specific fast dissolving oral thin film wafers that provide a dose specific, smoke-free delivery of medical cannabis or other active ingredients. CTT's oral thin film wafer is made from FDA approved non-medical ingredients used in several pharmaceutical formulations and provides the effective oral delivery of a specific dose with rapid onset of action within 5-10 minutes after dosing. Clinical research undertaken by CTT indicates the oral wafer delivery of THC into the blood steam was approximately 40% quicker compared to edible form factors, as well as resulted in approximately 28% more THC in the blood stream at peak bioavailability levels.

Management Commentary

"The investment in CTT reflects our commitment to science-based diversification into higher-margin drug delivery technologies for both the medical and adult consumer use markets" said Terry Booth, CEO.  "The clinically-proven rapid onset of action of CTT's wafers is a key differentiator that, we believe, will resonate strongly with physicians, patients and adult use consumers. This provides us with an important competitive advantage in the rapidly growing market segment for smoke-free form factors."

Dr. Pankaj Modi, CEO of CTT, added, "We believe Aurora more than any other LP, provides the global distribution channels, regulatory affairs expertise, scale and manufacturing ability to successfully commercialize this unique technology on a global basis. We are very pleased to have Aurora as a key strategic investor, delivering additional recognition to our product development capabilities, and increasing both our commercial and capital markets visibility."

Terms of the Investment

Aurora will make an initial US$1 million investment in CTT by way of a non-brokered private placement of convertible debentures (the "Debentures"). The Debentures will have a maturity date of three years from the closing date of the offering (the "Maturity Date") and will bear interest from the date of closing at 5.0% per annum, payable semi-annually. The Debentures will be convertible, at the option of the holder, into common shares of CTT at any time prior to the close of business on the last business day immediately preceding the Maturity Date at a conversion price of $0.268 per Common Share (the "Conversion Price"). 

Consequently the initial investment, Aurora owns approximately 9.14% of the issued and outstanding common shares of CTT Pharma (on a non-diluted basis) In addition, Aurora shall also receive from CTT warrants, such that Aurora will be able to increase its ownership interest in CTT to 42.5% on a fully diluted basis. Each warrant provides the Company with the right to purchase one common share of CTT at a price of $0.35. The warrants are exercisable upon certain conditions being met. The initial investment provides Aurora with the right to appoint one member of CTT's board of directors. Upon achieving 42.5% ownership, the Company shall have the right to appoint a second board member of CTT.

Investor Rights Agreement

Aurora and CTT have also entered into an investor rights agreement that provides Aurora with anti-dilution protections, enabling the Company to maintain its ownership level.