New EU GMP CBD Manufacturing Agreement

20 May 2021

Kanabo Group Plc

("Kanabo" or "the Company")

New EU GMP CBD Manufacturing Agreement

Kanabo Group Plc (LSE:KNB), a medical cannabis R&D Company that focuses on the distribution of cannabis-derived products for medical patients, and non-THC products for CBD consumers , announces that it has signed an agreement with Pure Origin Limited and its affiliates ("Pure Origin"), to utilise their significant expertise in best practices for EU GMP manufacturing. Good Manufacturing Practices (GMPs) are systems created and authorised by the government to regulate production, verification and validation of drugs, food and/or medical devices, ensuring that finished products are effective and safe for market distribution.

Under the agreement Pure Origin and its affiliates will manufacture, package and supply Kanabo's CBD wellness product line from their EU GMP manufacturing facility in Wales. The partnership for Kanabo's CBD wellness product line with EU GMP manufacturing, ensures that consumers will continue to receive the highest quality of consistent, traceable, safe, and compliant products. As stated in the agreement, Pure Origin and Kanabo will establish a dedicated production line for the VapePod's CBD Wellness formulas that will use Kanabo's equipment, production protocols and IP. Kanabo will supply raw materials to Pure Origin for the preparation of CBD formulations and final packaging. The current production line will have an initial capacity of 44,000 units a month with the ability to further increase production when necessary.

This new agreement marks the end of the period of pilot sales and is the prelude to a full product launch internationally. The pilot period lasted 3 months from admission to the London Stock Exchange and has provided a number of important performance measures in relation to the sale of Kanabo's retail CBD products in the UK. The outcome of the pilot has formed the second phase of Kanabo's strategy to increase revenue from the sale of CBD products, and Kanabo's future long-term strategy involves continued research and development activities to develop a range of Unlicensed Medical Cannabis Oils, which will be sold as unlicensed medical products.

For further information, please visit http://www.kanabogroup.com/ or contact the following:

Kanabo Group Plc

Tel: +(972)52-3173-633

[email protected]

Meirav Horn

Peterhouse Capital Limited (Financial Adviser)

Tel: +44 (0)20 7469 0930

Eran Zucker / Guy Miller / Allie Feuerlein

Peterhouse Capital Limited (Corporate Broker)

Lucy Williams / Charles Goodfellow

ABOUT KANABO

Kanabo aims to be an industry leader in product development and commercialisation of both cannabis-derived products for medical patients and THC-free products for CBD consumers. The company develops high-quality medical cannabis extract formulas, medical device vaporisers, and other innovative delivery methods. Validation activities are conducted at Kanabo's research lab at the Weizmann Science Park in Israel. With a primary focus on the German and UK Markets, Kanabo has already begun penetrating the European Market, and is positioned to scale up to meet growing market demand and projected sales. Currently, Kanabo is selling its line of CBD formulas for inhalation in the UK and Germany and has agreements with distributors in the pharmaceutical and OTC sectors already in place.

ABOUT PURE ORIGIN

Pure Origin Group has been providing Pharma EU GMP contract manufacturing solutions at a facility in Wales for over 20 years (under different trading names). The company has amassed an extensive range of experience working with global brands in the pharmaceutical, cosmetic, food and nicotine industries across several product categories. The company's outstanding GMP disciplines and processes enable the ability to offer Customers all aspects of CBD manufacturing, from the processing and manufacturing of CBD extracts, to the ongoing development of new products (oils/tinctures, e-liquids, vaping pod systems, topicals / cosmetics, balms, soft gel capsules etc), all underpinned by unrivalled product stewardship and testing.