Allied Corp - The Year in Review

Allied Corp.

September 2020 Newsletter

THE YEAR IN REVIEW

AS REPRESENTED BY EACH VERTICAL

Production

ALLIED CORP - Colombian Medicolombias YEAR IN REVIEW

Pharmaceutical

ALLIED CORP - PHARMA VERTICAL YEAR IN REVIEW

Natural Health

Charitable Activities

ALLIED OPTIMAL LOCATION ADVANTAGE

With the equatorial climate Colombian topography, our production site has a steady 12 hours of sunlight per day year round. Unlike Canada and North America, Colombia has one season which provides Allied the unique opportunity for rolling monthly harvests. Colombia offers some of the most suitable environments to efficiently grow excellent quality cannabis at scale.

Not only are the growing conditions ideal, Colombia also provides advantages in the form of a friendly regulatory environment. In May 2016, Law 1767 was passed, allowing for the cultivation, processing and export of medicinal marijuana. By opening the door to exports, Colombia’s regulation has been deemed amongst the most attractive in the medicinal cannabis world.

At Allied, we leverage these ideal growing and regulatory conditions to ensure a consistent, high volume supply of cannabis to support our commercial and research & development efforts. This, along with our national licenses, we are poised for scaled commercialization of our products.

Images are from Allied’s wholly owned subsidiary “MediColombias Cannabis S.A.S”

ADDITIONAL NEWS AND UPDATES

ALLIED CORP CANADIAN BUILDING - YEAR IN REVIEW

US Legalization on the Horizon:

What Does This Mean For Allied?

The U.S. House of Representatives is set to make history next month when it finally votes on legalizing cannabis. The bill, introduced in the House last year, would remove marijuana from Schedule I of the Controlled Substances Act (CSA). It would not, however, immediately legalize cannabis across all 50 states but would allow states to set their own regulations for the production and sale of cannabis products. In addition, the bill would establish a 5% tax on all cannabis products, the revenues from which would go for job training and small-business loans, as well as efforts to minimize barriers to marijuana licensing. It would also create a Cannabis Justice Office tasked with administering grants to individuals most adversely impacted by the War on Drugs.

The eventual U.S. legalization will open up enormous business opportunities for legal marijuana nationwide, and further afield. The larger, more profitable Canadian cannabis companies will be looking to buy their way into niche segments and expand their brands south of the border—opportunities that are dependent on U.S. legalization. However, it could be another quarter before Canadian companies start making cross-border deals.

Allied has been purposeful to establish brands, product presence, sales and distribution networks in the U.S. This foundation will position Allied to be ready for U.S. legalization and all of the opportunities that this will bring.

Some impressive stats as Allied positions for U.S. legalization:

The cannabis industry is absolutely exploding right now. With the legalization of Hemp, the growth of CBD and new states legalizing, the marijuana sector is at an all-time high.

Medical marijuana emerged as the largest marijuana type segment in 2016 and is estimated to be valued at USD 100.03 billion by 2025 – Grand View Research
The global legal marijuana market is expected to reach USD 146.4 billion by end of 2025 – Grand View Research
By product type, marijuana buds segment was estimated to be dominant in 2016 with a revenue share of 62.9% and is estimated to be valued at USD 82.9 billion by end of 2025 – Grand View Research
Sales of legal cannabis in the U.S. amounted to nearly $10 billion in 2018 alone. – Fit Small Business
62% of Americans favor legalizing marijuana. – Fit Small Business
The startup cost for a regulated cannabis dispensary is approximately $775,000. – Fit Small Business
In the cannabis industry, women hold around 36% of executive positions as opposed to only 15% in other industries. – Fit Small Business
The average price for an ounce of high-quality marijuana in the U.S. is $320.- Fit Small Business
A regulated dispensary averages about $3 million per year in revenue.- Fit Small Business
Annual operating costs for a regulated dispensary average about $1.92 million annually.- Fit Small Business
About 18% of American consumers aged 18 to 29 use marijuana.- Fit Small Business
Most people spend an average of $25 to $50 per trip at a marijuana retailer. – Fit Small Business
Legal sales could hit more than $22 billion by 2022 – Fool.com
Recreational pot sales could double medical sales by 2022 – Fool.com
Total U.S. cannabis demand is $52.5 billion – Fool.com
Marijuana jobs growth to average 21% a year through 2022 – Fool.com
Fully legalized cannabis could eventually top U.S. cigarette sales – Fool.com
Two in three Americans support the legalization of recreational marijuana – Flow Hub
Capital raising from North American public cannabis companies totaled $394.1 million in January of 2019 alone – Flow Hub
The forecasted growth of the US cannabis industry is up to $80 billion – Flow Hub
Revenue from the CBD category is forecasted to reach $1 billion per year – Flow Hub
The median salary for cannabis workers is 10.7% higher than the median salary in the US – Flow Hub
Demand for cannabis industry jobs was up 76% from December 2017 to December 2018 – Flow Hub
The median salary for the cannabis industry is $58,511 per year – Flow Hub
CBD market will hit $22 Billion by 2022 – Rolling Stone
Sales of legal recreational and medical cannabis in the United States in 2017 topped those of Oreos and organic produce combined. – MJ Biz Daily
Spending on legal cannabis worldwide is expected to hit $57 billion by 2027 – Forbes

The Global Cannabis Market

Canada:

Household spending on legal cannabis in the second quarter of 2020 outpaced the illicit market for the first time ever. The total cannabis market in Canada, including medical and recreational cannabis products, is expected to generate up to $7 billion in sales in 2020 with $to $4 billion in the legal recreational market. Medical cannabis is anticipated generate and additional $0.7 billion to $1.7 billion in sales. (more here)

USA:

Medical marijuana emerged as the largest marijuana type segment in 2016 and is estimated to be valued at USD 100.03 billion by 2025 (Grand View Research). A surge in demand for medical cannabis for various treatments will lead to implementation of stringent government regulations for cannabis testing that will propel the market growth. (more here)

Europe:

Last month saw Europe’s largest medical cannabis registry go live. The ‘Project Twenty21’ registry aims to assess the efficacy of medical cannabis by monitoring the health outcomes of 20,000 patients who will be prescribed the medicine. The registry will make up Europe’s largest body of evidence on the safety of these medicines. (more here)

Colombia:

The Colombian Intersectoral Commission for Strategic Projects (Comisión Intersectorial de Proyectos Estratégicos – CIIPE) led by the Minister for Medical Cannabis, has identified Cannabis as a “Project of National Strategic Interest” (Proyectos de Interés Nacional Estratégicos – PINE). PINE projects receive immediate support from the Colombian government in recognition of their economic contribution and importance to the nation. Specifically, this reflects complete government structural and policy support for industry progress, and a commitment to streamlined government decision-making and removal of red tape impediments. Other PINE supported industries include oil and gas, mining and coffee production. Colombian cannabis production is here to stay. (more here)

The Complexity of PTSI and OSI

One of Allied’s top priorities is research and development into the effects of cannabis as a treatment for Post Traumatic Stress Disorder (PTSD), or Post Traumatic Stress Injury (PTSI) as it is now more commonly referred to — a psychiatric condition linked to surviving or witnessing a traumatic life event that can cause major depressive episodes and/or suicidal ideation.

Studies suggest that nearly 1 out of 10 people may develop PTSI at some point in their lives, with the odds stacked against those in highly traumatic jobs, such as soldiers, law officers, correctional service workers, firefighters, paramedics and more.

Research is still uncovering if and how cannabis works within the body to affect the course of PTSI, however, a recent study out of Washington State University has shown cannabis products to reduce the severity of PTSI symptoms by more than half, at least in the short term.

With the legalization of cannabis, PTSI sufferers can now treat their illness with premium craft cannabinoid health products, and to help ease the burden of mental illness as a leading cause of disability, Allied will be exploring in more depth the complex relationship between cannabis and PTSI.

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The information provided herein by Allied Corp. (the “Company”) is intended solely for discussion purposes and is not intended as, and does not constitute, an offer to sell or a solicitation of an offer to buy any security, and should not be relied upon in evaluating the merits of investing in any securities. The Company believes the information in this document to be reliable but makes no warranty or representation and assumes no legal liability for the accuracy, completeness or usefulness of any information disclosed. Any estimates, investment strategies, and views expressed in this document are based upon current market conditions and/or data and information provided by unaffiliated third parties and is subject to change without notice. This document may contain “forward-looking statements” within the meaning of applicable Canadian securities legislation. For- ward-looking statements include, but is not limited to, statements about strategic plans, including the Company’s ability to implement its business development strategy. Forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause actual financial results, performance or achievements to be materially different from the estimated future results, performance or achievements expressed or implied by those forward-looking statements. All forward-looking statements contained herein are given as of the date hereof and are based upon the opinions and estimates of management and information available to management as at the date hereof. Except as required by law, the Company disclaims any obligation to update or revise any forward-looking statements, whether as a result of new information, events or otherwise. Readers are cautioned not to put undue reliance on these forward-looking statements.