CannaPharmaRX, Inc.

What they do

CannaPharmaRx operates a 55,000 square foot indoor cannabis cultivation facility in Cremona, Alberta, Canada, with six growing rooms and one drying/packing room currently in use. It holds a Health Canada operating license (December 2022) and a CRA cannabis license, and began production in 2023 and sales in 2024. The company grows and sells medical cannabis, with plans to expand to 10 growing rooms and a second drying/packing room.

Revenue drivers

• Medical cannabis sales in Canada — Primary revenue source; annual revenue grew from $820,137 in 2024 to $1.36M in 2025, with sales through retail partners and distribution channels.
• European market expansion (Germany/Israel) — Future growth driver; management plans to sell cannabis to European markets, currently using a third-party intermediary for EU-GMP packaging; not yet contributing material revenue.

Recent performance

For fiscal year 2025, the company reported revenue of $1,362,163 (up from $820,137 in 2024), but a gross loss of $2,084,908 and a net loss of $11,131,448. Quarterly revenue fluctuated: $231,608 (June 2025), $656,606 (Sept 2025), $138,630 (Dec 2025), and $627,462 (March 2026). Cash at December 31, 2025 was just $1,804, and at March 31, 2026, cash was $633, with total liabilities of $36.9M and negative shareholder equity of $30.3M. The company fully impaired its $4.5M investment in LTB Management in 2025, recognizing a $4,518,127 impairment loss.

Strategy

Management's stated plan is to increase growing rooms from six to ten and add a second drying/packing room over the next one to two years. They aim to build direct sales networks in Germany and Israel and obtain EU-GMP certification to ship cannabis directly to the EU, reducing costs and shipping times. The company also entered a security and royalty agreement with Koze Investments (a related party) in March 2025, paying royalties on cannabis sales as additional lease consideration. To address liquidity, management plans to secure capital primarily through equity sales, likely from related parties.

Risks

• Going concern uncertainty — Auditors and management have substantial doubt about the company's ability to continue, given cash of $1,804 (Dec 2025), working capital deficit of $30.3M, and expected insufficient cash to fund operations through 2026.
• High cost structure and inventory impairments — The company has persistent gross losses; inventory impairment losses were $1.98M in 2025 and $1.88M in 2024 due to pricing pressure, regulatory changes, and low THC potency products.
• Financing and dilution risk — Lack of profitable operations and penny-stock status limit access to traditional debt; any new funding via equity or convertible debt will likely be dilutive to current shareholders.
• Related-party and legal exposures — A security and royalty agreement with Koze Investments (a related party) and pending litigation could result in significant costs or settlements, and unfavorable outcomes could worsen liquidity.

Outlook

Management expects operating expenses to increase over the next twelve months as it expands capacity and pursues European market entry. They believe cash on hand and operations will not be sufficient to support operations through 2026, so they will need to raise additional capital. If financing is not obtained on a timely basis, they may be required to scale down or cease operations. The company is also subject to the status of its EU-GMP certification and planned expansion to all 10 growing rooms.