CS MEDICA, a Danish Med-Tech company at the forefront of developing CBD-infused medical devices offering safe, effective alternatives for autoimmune and stress-related conditions like arthritis, psoriasis, pain and hair loss, is pleased to announce the public release of a comprehensive valuation analysis conducted by NuWays by Hauck Aufhäuser Lampe[1], an independent and respected German valuation and financial advisory firm specializing in strategic financial insights and analyses. This report provides a detailed assessment of the financial and strategic value within the CS MEDICA Group and its wholly-owned subsidiary, CANNORDIC, ahead of a planned IPO.

The report highlights CS MEDICA’s unique positioning and growth potential within the alternative medicine market, reflecting a strong valuation that underscores CS MEDICA’s strategic assets, regulatory achievements, and future growth trajectory. Given CS MEDICA's current market price of 4.05 DKK (€0.543), these insights are crucial as CANNORDIC advances its IPO on a German growth exchange.

Key Valuation Insights:

1. Valuation Summary
   • Price Target: NuWays initiate the coverage with a "Buy" rating and recommendation and a price target of 17.16 DKK (€2.30) per share based on a SOTP valuation. This price target reflects the anticipated market valuation for CS MEDICA's anticipated growth together with its full asset portfolio, including its intellectual property, trademarks, robust R&D initiatives, and strong compliance pathway.
   • Valuation: Estimated at 357.7 million DKK[2] (€48 million) for CS MEDICA.
      

2. Valuation Methodology
   NuWays Advisory’s valuation report provides a thorough assessment of CS MEDICA, employing a sum-of-the-parts (SOTP) valuation that considers various business dimensions. This multifaceted approach highlights the diverse value drivers of CS MEDICA, taking into account its assets, development stages, and anticipated sales growth, thus setting the foundation for detailed DCF and asset-based evaluations.
   • Discounted Cash Flow (DCF) Analysis: The DCF model places the share value at 13.43 DKK (€1.80) and projects CS MEDICA’s future cash flows and EBITDA growth through a conservative long-term growth rate of 3.0% and a weighted average cost of capital (WACC) of 11%.
   • Asset-Based Approach: By valuing CS MEDICA’s physical and intellectual assets, including trademarks, patents and regulatory achievements, the asset-based valuation estimates a share value of 20.89 DKK (€2.80).
      
3. Strategic Positioning in the CBD as well as the HealthCare Markets
   • CS MEDICA’s hybrid product formulations, which combine R&D, clinical evidence, compliance, and the benefits of CBD, a natural ingredient, set the company apart from competition. Its flagship line, CANNASEN® as white label solutions, includes highly effective treatments for pain, skin disorders, and hair loss, with superior bioavailability when applied topically​.
   • MDR Compliance: As one of only few CBD-infused medical device company registered for sale in pharmacies, CS MEDICA occupies a unique position at the intersection of the pharmaceutical and cosmetics markets, offering clinically proven products with fewer side effects at competitive price points​. CS MEDICA’s achievement in securing EU Medical Device Regulation (MDR) compliance across its portfolio marks it as one of the few companies able to market CBD-infused products within its categories with rigorous safety and efficacy standards. This regulatory status, assessed by the Notified Body BSI, allows CS MEDICA to distribute its products in European pharmacies and mass markets, enhancing market access and establishing a high barrier to entry for competitors who face challenges under the new MDR rules. Besides the European markets, CS MEDICA has achieved a critical mass for product registration and sales approval with authorities in countries such as the UK (MHRA), the US (FDA), Australia (TGA), India (FDA), Israel (Health Ministry), and Malaysia.
   • Unique Market Position: CS MEDICA occupies a rare space at the intersection of the pharmaceutical and cosmetic industries, offering clinically proven topical treatments with bio-active CBD for conditions like pain relief, arthritis, psoriasis, allergy, sleep, and hair loss. The company’s products combine the self-care trend with regulated, scientifically supported health benefits, providing alternatives with fewer side effects compared to traditional medications.
   • Market Expansion with a Pull Effect: CS MEDICA is solidifying its European market position with MDR-compliant classifications while expanding into emerging markets, including the Global South and U.S., to counter sales slowdowns from industry-wide recertification delays or delistings driven by the MDR transition. Through CANNORDIC, which holds exclusive global licensing rights (excluding India, managed by CANNORDIC India Ltd.), CS MEDICA enhances market reach and revenue by generating income through licensing fees and leveraging IP rights across diverse geographic markets.
      
4. Market Trends and Regulatory Advantages
   • Growing Alternative Medicine Market: Global demand for alternative treatments is booming, with the alternative medicine market projected to grow at a 15.7% CAGR until 2031​. CS MEDICA’s compliant, science-backed CBD-infused products align with consumer trends seeking natural, effective, and safer alternatives to conventional drugs, positioning the company to capitalize on this global shift.
   • Compliance as Barrier to Entry:  CS MEDICA’s MDR compliance and its extensive portfolio of trademarks and patents offer a competitive edge, as the regulatory landscape increasingly favors companies with rigorous safety and efficacy credentials.
      
5. Financial Performance and Growth Projections
   • Revenue Growth: Driven by increasing demand in both European and non-European markets, CS MEDICA’s revenue is forecasted to grow at a compound annual growth rate (CAGR) of 61%, reaching DKK 108 million by FY 2027/28. This is supported by the company’s lean, capital-light model, which emphasizes R&D and distribution over manufacturing, thereby optimizing operational efficiency. The company’s private/white-label segment (~ 2/3 of order intake), offers a steady revenue stream, while its CANNASEN® brand continues to expand, contributing to top-line growth and increased cost control.
   • Profitability Timeline: Thanks to the resulting operating leverage, CS MEDICA is expected to turn EBITDA and cash-positive by FY 2025/26, achieving a 25% EBITDA margin by 2027/28 through improved gross margins and operational scaling.
      
6. Spin-Off/IPO of CANNORDIC to emphasize its intrinsic value 
   • CS MEDICA aims to unlock value by spinning off up to 20% of CANNORDIC shares in an IPO on a German growth exchange, marking the first step toward the planned public listing of its subsidiary. The spin-off is based on the DCF valuation and seeks to capitalize on the strong growth potential of the alternative medicine market. This initiative aims to raise up to €6 million from both institutional and retail investors, with proceeds enhancing visibility and clarifying growth prospects for both CS MEDICA and CANNORDIC. Post-IPO, CS MEDICA will retain a majority stake in CANNORDIC, ensuring strategic continuity.
   • Share Distribution and Pre-IPO Opportunity: Upon approval at the Extraordinary General Meeting (EGM) on November 12, 2024, CS MEDICA shareholders will receive one CANNORDIC share for every 200 shares of CS MEDICA held. This distribution allows shareholders to engage directly in the value creation of the forthcoming IPO. Furthermore, shareholders will have the opportunity to purchase additional CANNORDIC shares pre-IPO at a 20% discount, offering a compelling incentive to invest in the subsidiary's future growth.
   • Shareholder Approval: The spin-off has received shareholder approval and is scheduled for completion by the end of 2024.
      

Summary: The NuWays report highlights CS MEDICA’s substantial potential within the alternative medicine, positioning it as an investment with a competitive, regulatory advantage. With a financial trajectory and a unique product offering, CS MEDICA’s spin-off and IPO of CANNORDIC signal a strong opportunity for growth in a sector facing increased demand for regulated, science-backed self-care solutions.

Download the Research Report from NuWays here

This Research Analysis has been prepared as part of CS MEDICA's German IPO initiative to provide a third-party assessment of market conditions. This report may include forward-looking information or statements that reflect the expectations or beliefs of the researchers, referring to our disclaimer concerning forward-looking statements (page 20).
 

For more information about CS MEDICA, please contact:
Gitte Lund Henriksen, CFO
Phone: + (45) 2774 2280
Email: glh@cs-medica.com
Website: https://www.cs-medica.com/
 

CS MEDICA A/S, a Danish MedTech pioneer, specializes in developing evidence-based, CBD-integrated treatments for pain management, autoimmune and stress-related disorders. With a focus on patient-centric care, our products range from innovative R&D to registered over-the-counter substance-based medical devices and dermaceuticals. Our flagship CANNASEN® brand, alongside our own-label solutions, exemplifies our dedication to safe, high-quality treatments for both human and veterinary health globally. The company is listed on Spotlight Stock Market in Stockholm (symbol: "CSMED"). For more information, visit cs-medica.com and LinkedIn.

CANNORDIC A/S, a subsidiary of CS MEDICA Group, is a pioneering MedTech company specializing in innovative substance-based medical devices containing bioactive CBD. Our dedication to enhancing lives by integrating innovation, science, technology, and natural cannabis compounds positions it as a pioneer in the medical technology industry. The company ensures robust research, development, manufacturing, compliance, data insights, and commercialization processes.