2021 was a transformative year for Pathway Health, and it is our pleasure to provide a summary of the company’s corporate activity during 2021, including a brief discussion of our plans for 2022.

We are pleased to report that we achieved year-over-year patient growth in each of our clinic divisions, with 10% overall growth across all our clinic divisions. Many other important company milestones were also achieved.

Our strategy is focused on strengthening our unique and comprehensive approach to chronic pain management to improve patient outcomes for the 1 in 5 Canadian adults who suffer from chronic pain.  To this end, we plan on driving growth by:

  1. Expanding the breadth and reach of the services and products we offer both organically and through acquisitions, as well as through our pharmacy partnerships. We will continue to look to aggregate patients and strengthen our position as the largest medical cannabis service provider in Canada. We also intend to expand our service offering by acquiring/partnering with allied health and mental health services providers.
  2. Continuing to expand on our preeminent partnership position with some of the leading retail pharmacy companies in the country as they prepare for their anticipated entry into the distribution of Cannabis Health Products (CHPs) following the next round of expected amendments to the Cannabis Act.

In 2021, we successfully reached the following milestones:

  1. Signed agreements with 3 pharmacy companies for our Medical Cannabis Management System (MCMS). These agreements support the direction of our overall strategy of working closely with the pharmacies in preparation for their expected pivotal role in medical cannabis – including potentially being the primary distribution source for CHPs.
  • Following the anticipated launch of CHPs, potential revenues from our product sales could eventually be significantly greater than those derived from our services business unit because of the anticipated growth and acceptance of CHPs by consumers. Our relationship with the pharmacies also allows us to potentially increase patient visits through consultations with their patients. Each participating retail pharmacy location becomes an access point for chronic pain and medical cannabis patients for Pathway Health giving us access to patients across the country
  1. Further entrenched our position as the largest medical cannabis clinical services provider in Canada with the additional acquisition of a medical cannabis company.
  • In September 2021, we acquired the assets of O Cannabis We Stand on Guard for Thee Corporation, which included more than 4,000 active patients.
  1. Focused on expanding our core services by engaging a senior healthcare advisor and internationally respected chiropractor to work with the company on allied health clinic acquisitions and international growth opportunities.
  • In December 2021, we announced the engagement of Dr. Jimmy Nanda to lead an expansion of Pathway Health’s allied health services in Canada and potentially beyond. Dr. Nanda has been a leader in the Canadian and Indian chiropractic doctor space for over 17 years and has been instrumental in developing chiropractic medicine within multidisciplinary chronic pain treatment systems in Canada. Dr. Nanda is also a leader and expert in the implementation of concussion, sports medicine, and clinical protocols for doctors and in chronic pain clinics.
  • In December, we also signed an LOI to acquire the allied health assets of NewLight Pain Clinic, which we expect to close in early-2022.
  1. Entered strategic relationships with 2 advanced formulation and manufacturing partners to work with our product development business.
  • These relationships represent important elements of our CHP product development and supply chain. We anticipate signing additional agreements in 2022.

In 2022, our corporate activities will remain focused on those initiatives that (i) we expect will contribute to the growth of our clinic business and our access to more patients; (ii) expand and support our partnership agreements with the pharmacy companies to help them prepare for anticipated changes to the Cannabis Act – changes that are expected to create significant new revenue channels for the pharmacies and Pathway Health on the distribution of CHPs;  and (iii) to continue to evaluate select international partnership opportunities that could open doors for Pathway Health to participate in the growing international expansion of medical cannabis products and services.  The size of the global medical cannabis market was estimated at USD $16.47 billion in 2021[1] and is forecasted to grow to USD $46.18 billion by 20261, with a CAGR of 22.9%1 during that period. The economic opportunity for Pathway Health to tap into this growth lies in our ability to leverage our experience and our preeminent position in Canada; and in our ability to maximize the commercial effectiveness our relationships with large pharmacy companies.

In the capital markets, we anticipate being more active in our marketing activities to support our shareholders and to support our public listing. Insiders, who own more than 50% of the outstanding shares and who increased their positions in 2021, are very motivated to support the company. Pathway Health has a compelling story to tell, and we will endeavor to make sure that the story is told more widely in the coming months ahead. As part of this initiative, and as an initial step in creating a portal for potential future markets, we announced our shares are now listed on the Frankfurt Exchange. A potential listing in the U.S. is also being evaluated as part of our considerations when evaluating potential international opportunities.

Our leadership team continues to grow as we expand our pharmacy and product division. Marketing, branding and product development expertise is being added to support this business unit in what we believe will be a pivotal year leading up to the creation of CHPs and how they are to be manufactured and distributed.

We believe the ultimate arrival of CHPs represents a unique commercial opportunity for Pathway Health because of our valued relationships with pharmacists and the pharmacy companies. We believe that Health Canada will be recommending changes to the Cannabis Act (‘Cannabis 3.0’) that will see the creation of CHPs, while also establishing retail pharmacy locations as the primary distribution source for these cannabis-based products. Pathway Health currently has agreements with companies representing more than 2,000 pharmacy locations across Canada and this number is expected to increase in 2022. The combination of our leading position in providing medical cannabis services along with our unique partnership position with the pharmacies provides us with a powerful opportunity to capitalize on what is expected to become a $2.3 billion consumer market in 2024[2].

We are excited about the opportunities ahead of us to grow the business in 2022 and beyond and we welcome your involvement.

[1] https://www.marketdataforecast.com/market-reports/medical-cannabis-market

[2] https://chfa.ca/en/regulatory/CBD-Economic-Report