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Dragonfly Biosciences sprouts wings for ASX IPO

Dragonfly Biosciences Limited, a prominent UK-based producer of cannabidiol (CBD) supplements and lotions, is making strides towards its IPO on the ASX next month.

Regan Saveall, the CEO of Dragonfly Biosciences, expressed enthusiasm about the upcoming IPO, stating, “We are excited to bring Dragonfly Biosciences to the ASX. This IPO will provide us with the capital to further expand our operations and solidify our position as a market leader in the CBD industry.”

The company aims to raise up to $5 million through the issuance of fully paid ordinary shares priced at $0.20 each. This pricing would value the business between $37 million and $40 million. The financing for the IPO is jointly led by Finexia Securities Limited and RM Corporate Finance Pty Ltd.

While Dragonfly Biosciences had previously pursued an ASX listing in late 2021, the company withdrew its plans due to market volatility and regulatory uncertainties in the UK.

However, the focus has now shifted to the Australian market, driven by the down-scheduling of low-dose CBD by the Therapeutic Goods Administration (TGA) from a prescription medicine to a pharmacist-only medicine.

Dragonfly has obtained Special Access Scheme approval from the TGA for two of its products that meet the regulator’s dosage specifications.

Dragonfly Biosciences distinguishes itself by utilising CBD, a non-psychoactive cannabinoid extracted from cannabis or hemp plants. By avoiding the psychoactive cannabinoid THC, typically associated with recreational and certain medicinal cannabis products, Dragonfly aims to position itself as a provider of oral supplements targeting ailments such as insomnia, anxiety, stress, and potentially chronic pain.

Additionally, the company offers lotions for general skincare, repair, protection, and moisturising.

The decision to list on the ASX is rooted in Australia’s thriving health and wellness segment and serves as a strategic entry point into the Asian market, where Dragonfly has already attracted significant investment.

According to the company’s prospectus, Dragonfly Biosciences reported a loss of $732,000 for its UK business in the six months leading up to June 2021 and a loss of $1.2 million in the six months ending on 31 December 2022, for its Australian operations.

Comparables on the ASX include Cann Group, valued at $55.8 million, known for its large indoor grow facility, while Dragonfly cultivates its products outdoors in Bulgaria. Another notable player is Little Green Pharma, a Western Australia-based biotech and cannabis company.

Dragonfly Biosciences’ forthcoming ASX IPO aims to leverage the growing demand for CBD-based products and strengthen the company’s global presence. With its strategic listing on the ASX, Dragonfly Biosciences is poised to capitalise on the expanding cannabis market, particularly in Australia and the Asian region.

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