INITIATING COVERAGE Institutional Equity Research: LIFE SCIENCES January 7, 2019 Cannabis and Life Sciences Thematic Review of the Canadian, US, and International Cannabis Markets, and the Cannabinoid-derived Pharmaceutical Space Initiating Coverage on 3 Cannabis and Life Sciences Companies: . Valens GroWorks Corporation (VGW-CNQ, Outperform, $5.00 TP) . Auxly Cannabis Group Inc. (XLY-TSXV, Outperform, $1.50 TP) . GW Pharmaceuticals PLC (GWPH-US, Outperform, US$160 TP) David M. Kideckel, PhD, MBA Analyst, Managing Director 647 776 8240
[email protected] Matthew Pallotta, CPA, CA, MBA Associate 647 776 8236
[email protected] Kevin Hoang, CPA, CA Associate 647 776 8220
[email protected] Regulatory Disclosures and policy on the dissemination of research: www.altacorpcapital.com ALTACORP CAPITAL INC. INSTITUTIONAL EQUITY RESEARCH: LIFE SCIENCES Table of Contents Our Investment Thesis ................................................................................................. 3 Understanding the Cannabis Plant ......................................................................................... 4 Industry Overview ......................................................................................................... 5 Canada ................................................................................................................................... 5 Overview of Legal Framework .............................................................................................. 6 Cannabis Market Forecast