Xebra Brands Acknowledges COFEPRIS Announcement, Marking a Major Turning Point in Mexico’s Cannabis Industry

Rhea-AI Summary

Xebra Brands (XBRAF) welcomes a significant announcement from Mexico's COFEPRIS (Federal Commission for Protection against Sanitary Risks) that condemns illegal marketing of unregulated CBD and cannabis-derived products in Mexico. The regulatory body has explicitly named several unauthorized brands, warning consumers of potential health risks.

As the only company with fully authorized federal permits for legal cannabis commercialization in Mexico, Xebra stands to benefit from this regulatory crackdown. The company has initiated discussions with affected brands to explore potential pathways for legal operation under Xebra's federal authorizations.

CEO Rodrigo Gallardo describes this as a 'game-changer' for Mexico's cannabis industry, indicating a clear shift toward a fully regulated market. The company aims to help legitimate businesses transition into Mexico's formal cannabis sector while ensuring consumer safety and regulatory compliance.

Positive

• Exclusive position as only company with federal cannabis permits in Mexico
• Regulatory crackdown eliminates illegal competition
• Opportunity to partner with existing brands seeking compliance

Negative

• None.

VANCOUVER, BC / ACCESS Newswire / February 27, 2025 / Xebra Brands Ltd. ("Xebra" or the "Company"), (CSE:XBRA)(OTCQB:XBRAF)(FSE:9YC0) a trailblazer in the Mexican cannabis industry, welcomes the latest public announcement from the Federal Commission for the Protection against Sanitary Risks (COFEPRIS), which explicitly condemns the illegal marketing of unregulated CBD and cannabis-derived products in Mexico.

This unprecedented move marks a major turning point for the cannabis sector in Mexico, as COFEPRIS has made it clear that unauthorized brands will no longer be tolerated. The size and magnitude of this public announcement demonstrate a significant shift toward strict enforcement of cannabis regulations, reinforcing Xebra's status as the only company with fully authorized federal permits for legal cannabis commercialization in the country.

https://www.gob.mx/cms/uploads/attachment/file/978590/Aviso_de_Riesgo_cannabis_06022025.pdf

The COFEPRIS statement names several brands engaged in the unauthorized sale of CBD and hemp-based products, warning consumers of potential health risks and clarifying that these products lack any federal authorization. This crackdown is expected to continue, and Xebra anticipates further regulatory actions as COFEPRIS intensifies efforts to eliminate the gray market.

"This announcement is a game-changer for the cannabis industry in Mexico," said Rodrigo Gallardo, CEO of Xebra Brands. "It confirms that the path to a fully regulated market is here, and Xebra remains the only company to have successfully obtained legal federal authorizations. We expect COFEPRIS to continue strengthening enforcement, ensuring that only compliant companies operate in this space."

Recognizing the impact of this regulatory shift, Xebra has begun discussions with some of the affected brands to explore potential pathways for legal operation under Xebra's federal authorizations. By offering a compliant framework, Xebra aims to help legitimate businesses transition into Mexico's formal cannabis sector while ensuring consumer safety and regulatory integrity.

As the industry moves into this new era of enforcement and compliance, Xebra remains committed to leading the charge in building a fully legal, transparent, and sustainable cannabis market in Mexico.

ON BEHALF OF THE BOARD:

Rodrigo Gallardo
Interim CEO

For more information contact:

1(888) XEBRA 88
ir@xebrabrands.com

Cautionary Note Regarding Forward-Looking Statements:

This news release contains certain "forward-looking information" and "forward-looking statements", as such terms are defined under applicable securities laws (collectively, "forward-looking statements"). Forward-looking statements can be identified by the use of words and phrases such as "plans", "expects" ,"is expected", "budget", "scheduled," "estimates", "forecasts", "intends", "anticipates" or "believes" or variations (including negative variations) of such words and phrases, or state that certain actions, events or results "may", "could", "would", "might" or "will" be taken, occur or be achieved. Forward-looking statements herein include, but are not limited to, statements with respect Strategy 2025 and the Company's growth strategy into the CBD market, the roadmap to accelerate growth in the North American CBD market, the Company's expected growth pillars of Cultivation, Manufacturing and Retail and the planned business activities under each such pillar, that the Company is actively seeking to amend current provisions under the Company's Mexican cultivation licences that limit cultivation scale, the aim to collaborate with major agricultural institutions in Mexico for large-scale, low-cost outdoor cannabis cultivation, expectations with respect to the Company's legal proceedings in Mexico, including the results and timing thereof, the expectation that Chapingo University will initiate pilot projects once confined site approval is granted, the anticipation for the importation process the two CBD products, which were manufactured in partnership with Restorative Botanicals, to be completed by April 2025 and the expectation for launch shortly thereafter, the Company's plans for e-commerce partnerships with Amazon Mexico and Mercado Libre is Mexico and the intention to leveraging expertise from a major U.S. e-commerce partner for market expansion and that the Company is seeking partnerships with CBD brands and that such partnerships may expedite the Company's path to self-sustainability.

These forward-looking statements are based on current expectations and are subject to known and unknown risks, uncertainties and other factors, many of which are beyond Xebra's ability to predict or control and could cause actual results to differ materially from those contained in the forward-looking statements. Specific reference is made to Xebra's most recent annual management discussion and analysis on file with certain Canadian provincial securities regulatory authorities for a discussion of some of the factors underlying forward-looking statements, which include, without limitation, the inability of Xebra to retain the authorizations granted by COFEPRIS, the inability to successfully complete financings on terms acceptable to Xebra or at all, the inability to generate sufficient revenues or to raise sufficient funds to carry out its business plan; changes in government legislation, taxation, controls, regulations and political or economic developments in various countries; risks associated with agriculture and cultivation activities generally, including inclement weather, access to supply of seeds, poor crop yields, and spoilage; compliance with import and export laws of various countries; significant fluctuations in cannabis prices and transportation costs; the risk of obtaining necessary licenses and permits; inability to identify, negotiate and complete potential acquisitions, dispositions or joint ventures for any reason; the ability to retain key employees; dependence on third parties for services and supplies; non-performance by contractual counter-parties; general economic conditions; the continued growth in global demand for cannabis products and the continued increase in jurisdictions legalizing cannabis; and the timely receipt of regulatory approvals for license applications on terms satisfactory to Xebra. In addition, there is no assurance Xebra will: be a low-cost producer or exporter; obtain a dominant market position in any jurisdiction; have products that will be unique. The foregoing list is not exhaustive and Xebra undertakes no obligation to update or revise any of the foregoing except as required by law. Many of these uncertainties and contingencies could affect Xebra's actual performance and cause its actual performance to differ materially from what has been expressed or implied in any forward-looking statements made by, or on behalf of, Xebra. Readers are cautioned that forward-looking statements are not guarantees of future performance and readers should not place undue reliance on such forward-looking statements. There can be no assurance that such statements will prove to be accurate and actual results and future events could differ materially from those set out in such statements.

This press release includes market, industry and economic data which was obtained from publicly available sources and other sources believed by Xebra to be true. Although Xebra believes the information to be reliable, it has not independently verified any of the data from third party sources referred to in this press release, or analyzed or verified the underlying reports relied upon or referred to by such sources, or ascertained the underlying economic and other assumptions relied upon by such sources. Xebra believes that its market, industry and economic data is accurate and that its estimates and assumptions are reasonable, but there can be no assurance as to the accuracy or completeness thereof.

Neither the Canadian Securities Exchange nor its Market Regulator (as that term is defined in the policies of the Canadian Securities Exchange) accepts responsibility for the adequacy or accuracy of this release.

SOURCE: Xebra Brands Ltd

View the original press release on ACCESS Newswire

FAQ

What is the significance of COFEPRIS's announcement for Xebra Brands (XBRAF)?

The announcement confirms Xebra as the only company with legal federal authorizations for cannabis commercialization in Mexico, while cracking down on unauthorized competitors.

How is Xebra Brands (XBRAF) planning to capitalize on the COFEPRIS regulatory crackdown?

Xebra is engaging with affected brands to offer pathways for legal operation under its federal authorizations, potentially expanding its market presence.

What actions is COFEPRIS taking against unauthorized CBD products in Mexico?

COFEPRIS is publicly naming unauthorized brands, warning consumers of health risks, and intensifying efforts to eliminate the gray market.

What competitive advantage does Xebra Brands (XBRAF) have in Mexico's cannabis market?

Xebra holds exclusive federal permits for legal cannabis commercialization, positioning it as the only compliant operator in Mexico's regulated market.