IGC Pharma unit sold Vancouver facility assets for supply rights, not cash

IGC Pharma, Inc. filed unaudited pro forma financial statements on November 14, 2025 to show the effect of a sale of assets by Holi Hemp LLC, its wholly owned subsidiary. On September 29, 2025, Holi Hemp completed the disposition of certain manufacturing equipment, leasehold assets and inventory at its Vancouver, Washington facility to Wellness Essentials Northwest LLC under a Sale of Assets and Manufacturing Agreement. The buyer also took on certain employees and short-term lease obligations.

No cash, but a supply contract and a contingent payment

No cash consideration was exchanged. IGC received contractual rights to have its products manufactured at preferential pricing through December 31, 2030. It also received a contingent right to 10% of net proceeds if the buyer sells the business within five years. An independent valuation put the aggregate fair value of that consideration at approximately $2.7 million. The filing does not describe the valuation method.

The value sits in a contract that favors IGC's pricing, not in money the company can spend. The preferential supply rights do not start until 2028, so the benefit of the deal is years away and depends on the buyer keeping that arrangement.

What the pro forma adjustments do

The adjustments remove inventory of about $685 thousand and property, plant and equipment of $851 thousand. They add a finite-lived intangible asset of $2.7 million for the supply-contract right and record a $1,051 thousand gain on disposal. Amortization of about $900 thousand a year starts on January 1, 2028 and runs to the contract's end on December 31, 2030. The notes say no recurring revenue or expense adjustments are included, because those amounts are not directly attributable to the transaction.

The pro forma balance sheet also shows cash falling by $113 thousand, from $454 thousand to $341 thousand at June 30, 2025. The notes state that no cash consideration was exchanged, and the filing does not explain the cash adjustment. Total stockholders' equity would rise from $6,078 thousand to $7,129 thousand. The accumulated deficit would fall from $122,343 thousand to $121,292 thousand.

For the three months ended June 30, 2025, the pro forma statement moves the net loss attributable to common stockholders from $1,599 thousand to $548 thousand. The one-time gain accounts for the whole change. The loss per share moves from $0.02 to $0.01 on 83,027,117 weighted-average shares. The company had 84,141,405 shares outstanding at June 30, 2025.

What the 10-K says about the business

In its annual report for the fiscal year ended March 31, 2025, filed June 27, 2025, IGC describes its mission as improving the lives of people affected by Alzheimer's disease. Its lead candidate, IGC-AD1, is in a Phase 2 trial for agitation in Alzheimer's patients. The company says interim data show a statistically significant reduction in agitation compared with placebo within the first two to six weeks of treatment, while adding that there can be no assurance of a benefit. The 10-K gives no sample size, effect size or full data for these interim results, so they cannot be checked.

The 10-K lists TGR-63, LMP and IGC-M3 as preclinical programs. It also says the company reports one segment focused on Alzheimer's. The Infrastructure segment had revenue in fiscal 2024 but none in fiscal 2025. The 8-K does not say which segment the Vancouver operations belonged to, so the sale cannot be tied to that segment.

What is left open

The 8-K gives no buyer price in cash, no closing payment schedule and no reason for taking a supply right over money. The contingent 10% payment depends on a sale by the buyer within five years, which the filing does not forecast. The pro forma figures are unaudited and, as the filing itself says, actual results might differ materially.

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