6-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 6-K

REPORT OF FOREIGN PRIVATE ISSUER
PURSUANT TO RULE 13a-16 OR 15d-16

UNDER THE SECURITIES EXCHANGE ACT OF 1934

For the month of September 2023

Commission File Number: 001-40851

Procaps Group, S.A.

(Translation of registrant’s name in English)

9 rue de Bitbourg, L-1273

Luxembourg

Grand Duchy of Luxembourg

R.C.S. Luxembourg: B253360

Tel : +356 7995-6138

(Address of Principal Executive Offices)

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.

Form 20-F ☒ Form 40-F ☐

INFORMATION CONTAINED IN THIS REPORT ON FORM 6-K

Financial Results for the Three and Six Months Ended June 30, 2023

On September 5, 2023, Procaps Group, S.A. (the “Company”) released its unaudited interim financial statements for the three and six months ended June 30, 2023 (the “First Half Financials”). In addition, the Company released certain supplementary financial information relating to the three and six months ended June 30, 2023 (Supplemental Financial Information”).

The First Half Financials and the Supplemental Financial Information are attached as Exhibit 99.1 and Exhibit 99.2, respectively, to this Report on Form 6-K and are incorporated by reference herein and into the Company’s Post-Effective Amendment No. 2 to Form F-1 on Form F-3 (File No. 333-261366), filed with the Securities and Exchange Commission.

Exhibit Index

Exhibit Number	Exhibit Title
99.1	Unaudited Interim Financial Statements for the Three and Six Months Ended June 30, 2023
99.2	Supplementary Financial Information Relating to the Three and Six Months Ended June 30, 2023
101.SCH	Inline XBRL Taxonomy Extension Schema Document.
101.CAL	Inline XBRL Taxonomy Extension Calculation Linkbase Document.
101.DEF	Inline XBRL Taxonomy Extension Definition Linkbase Document.
101.LAB	Inline XBRL Taxonomy Extension Label Linkbase Document.
101.PRE	Inline XBRL Taxonomy Extension Presentation Linkbase Document.
104	Cover Page Interactive Data File (embedded within the Inline XBRL document)

1

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

PROCAPS GROUP, S.A.
By:	/s/ Ruben Minski
Name:	Ruben Minski
Title:	Chief Executive Officer

Dated: September 5, 2023

2

EX-99.1

Exhibit 99.1

Procaps Group, S.A. and subsidiaries (The Group)

Unaudited Condensed Consolidated Interim Financial Statements

For the three and six months ended June 30, 2023 and 2022

1

Procaps Group, S.A. and subsidiaries (The Group) 

Unaudited Condensed Consolidated Interim Statement of Profit or Loss and Other Comprehensive Income 

For the three and six months ended June 30, 2023 and 2022 

(In thousands of United States Dollars, unless otherwise stated)

		For the three months ended June 30						For the six months ended June 30
	Notes	2023			2022			2023			2022
Revenue	5	$	110,057		$	112,420		$	194,219		$	198,050
Cost of sales			(48,869	)		(39,786	)		(86,969	)		(78,294	)
Gross profit			61,188			72,634			107,250			119,756
Sales and marketing expenses			(21,497	)		(25,665	)		(42,167	)		(45,822	)
Administrative expenses			(24,602	)		(28,845	)		(46,721	)		(53,400	)
Finance expenses, net	7		(6,780	)		(18,791	)		(5,131	)		(4,209	)
Other income (expenses), net	8		29,627			(8,626	)		33,585			(3,503	)
Income/(Loss) before tax			37,936			(9,293	)		46,816			12,822
Income tax expense	9		(10,981	)		2,374			(13,240	)		(3,295	)
Income/(Loss) for the period		$	26,955		$	(6,919	)	$	33,576		$	9,527
Income/(Loss) for the period attributable to:
Owners of the Company			26,955			(6,919	)		33,576			9,527
Non-controlling interests			—			—			—			—
Earnings per share:
Basic and diluted, income/(loss) for the period attributable to ordinary equity holders of the Company (USD) 1			0.27			(0.07	)		0.33			0.09

¹ The Group reports net earnings per share in accordance with IAS 33 - Earnings Per Share. Basic income/(loss) per share is calculated by dividing the income/(loss) attributable to ordinary equity holders of the Group by the weighted average number of ordinary shares outstanding during the period. No dilutive effect has been identified for the three and six months ended June 30, 2023 and 2022. The weighted average number of ordinary shares used as the denominator in calculating basic earnings per share for the three and six months ended June 30, 2023 and 2022 is 101,106,853 and 101,109,572, respectively.

The accompanying notes are an integral part of these Unaudited Condensed Consolidated Interim Financial Statements.

2

Procaps Group, S.A. and subsidiaries (The Group) 

Unaudited Condensed Consolidated Interim Statement of Profit or Loss and Other Comprehensive Income 

For the three and six months ended June 30, 2023 and 2022 

(In thousands of United States Dollars, unless otherwise stated)

	For the three months ended June 30						For the six months ended June 30
	2023			2022			2023			2022
Income/(Loss) for the period	$	26,955		$	(6,919	)	$	33,576		$	9,527
Other comprehensive income/(loss)
Items that will not be reclassified to profit or loss:
Remeasurement of net defined benefit liability		(83	)		—			(83	)		—
Items that will be reclassified subsequently to profit or loss:
Exchange differences on translation of foreign operations		2,611			(3,001	)		3,039			(767	)
Net investment hedge		(2,473	)		—			(2,473	)		—
Other comprehensive income/(loss) for the period		55			(3,001	)		483			(767	)
Total comprehensive income/(loss) for the period	$	27,010		$	(9,920	)	$	34,059		$	8,760
Total comprehensive income/(loss) for the period attributable to:
Owners of the Company		27,008			(9,929	)		34,057			8,750
Non-controlling interests		2			9			2			10

The accompanying notes are an integral part of these Unaudited Condensed Consolidated Interim Financial Statements.

3

Procaps Group, S.A. and subsidiaries (The Group)

Unaudited Condensed Consolidated Interim Statement of Financial Position

As of June 30, 2023 and December 31, 2022

(In thousands of United States Dollars, unless otherwise stated)

	Notes		As of June 30, 2023			As of December 31, 2022
Assets
Non-current assets
Property, plant and equipment, net		11		91,825			73,965
Right-of-use assets, net				40,771			39,013
Goodwill				5,791			5,791
Intangible assets, net		10		39,158			32,208
Investments in joint ventures				2,079			1,505
Other financial assets				6,111			210
Deferred tax assets, net				7,010			6,974
Other assets				2,424			3,078
Total non-current assets			$	195,169		$	162,744
Current assets
Cash				11,538			43,003
Trade and other receivables, net		13		136,541			129,602
Inventories, net		12		103,475			96,833
Amounts owed by related parties, net				2,226			2,474
Current tax assets, net				30,826			21,187
Other current assets				2,518			4,344
Other financial assets				8,429			—
Total current assets			$	295,553		$	297,443
Total assets			$	490,722		$	460,187
Liabilities and Stockholders’ Equity (Deficit)
Equity (Deficit)
Share capital				1,011			1,011
Share premium				377,677			377,677
Reserves				50,082			45,743
Accumulated deficit				(362,432	)		(391,513	)
Accumulated other comprehensive loss				(33,376	)		(33,859	)
Equity (deficit) attributable to owners of the company			$	32,962		$	(941	)
Non-controlling interest				(935	)		(937	)
Total equity (deficit)			$	32,027		$	(1,878	)
Non-Current liabilities
Borrowings		14		169,635			28,410
Warrant liabilities		16		4,461			10,916
Shares held in escrow		17		30,399			40,064
Deferred tax liabilities, net				3,400			7,821
Other liabilities				6,917			6,480
Total non-current liabilities			$	214,812		$	93,691
Current liabilities
Borrowings		14		118,684			257,525
Derivative financial liabilities				2,473			—
Trade and other payables				85,970			90,187
Amounts owed to related parties				3,922			2,914
Current tax liabilities, net				21,841			6,133
Provisions		15		195			138
Other liabilities				10,798			11,477
Total current liabilities			$	243,883		$	368,374
Total liabilities and stockholders’ equity (deficit)			$	490,722		$	460,187

The accompanying notes are an integral part of these Unaudited Condensed Consolidated Interim Financial Statements.

4

Procaps Group, S.A. and subsidiaries (The Group)

Unaudited Condensed Consolidated Interim Statement of Changes in Equity

For the six months ended June 30, 2023 and 2022

(In thousands of United States Dollars, unless otherwise stated)

	Attributable to equity holders of the Group
	Issued Capital		Share premium		Treasury shares reserve 1			Reserves 2		Accumulated deficit			Other Comprehensive Income			Total			Non-controlling interest			Total equity (deficit)
Balance as of January 1, 2022	$	1,011	$	377,677	$	—		$	42,749	$	(431,059	)	$	(27,778	)	$	(37,400	)	$	(940	)	$	(38,340	)
Income for the period		—		—		—			—		9,527			—			9,527			—			9,527
Transfer reserves		—		—		—			2,994		(2,994	)		—			—			—			—
Other comprehensive income		—		—		—			—		—			(777	)		(777	)		10			(767	)
Non-controlling interest		—		—		—			—		—			10			10			—			10
Balance as of June 30, 2022	$	1,011	$	377,677	$	—		$	45,743	$	(424,526	)	$	(28,545	)	$	(28,640	)	$	(930	)	$	(29,570	)
Balance as of January 1, 2023		1,011		377,677		—			45,743		(391,513	)		(33,859	)		(941	)		(937	)		(1,878	)
Income for the period		—		—		—			—		33,576			—			33,576			—			33,576
Transfer reserves		—		—		—			4,495		(4,495	)		—			—			—			—
Other comprehensive income		—		—		—			—		—			481			481			2			483
Non-controlling interest		—		—		—			—		—			2			2			—			2
Treasury shares acquired		—		—		(156	)		—		—			—			(156	)		—			(156	)
Balance as of June 30, 2023		1,011		377,677		(156	)		50,238		(362,432	)		(33,376	)		32,962			(935	)		32,027

¹ Comprises the cost of the Company’s shares held by the Group. As of June 30, 2023, the Group held 35,798 of the Company’s shares.

² Includes the appropriate values from net income to comply with legal provisions related to asset protection according to applicable jurisdictions with cumulative earnings.

The accompanying notes are an integral part of these Unaudited Condensed Consolidated Interim Financial Statements.

5

Procaps Group, S.A. and subsidiaries (The Group)

Unaudited Condensed Consolidated Interim Statement of Cash Flows

For the six months ended June 30, 2023 and 2022

(In thousands of United States Dollars, unless otherwise stated)

			For the six months ended June 30
	Notes		2023			2022
Operating activities
Income for the period			$	33,576		$	9,527
Adjustments to reconcile net income with cash flow from operating activities before changes in working capital:
Depreciation of property, plant and equipment		11		2,662			2,932
Depreciation of right-of-use assets				3,070			3,005
Amortization of intangibles		10		2,291			2,436
Income tax expense		9		13,240			3,295
Finance expenses, net		7		5,131			4,209
Unrealized currency exchange rate differences				(15,793	)		—
Share of result of joint ventures				(561	)		109
Net loss (gain) on sale and disposal of property, plant and equipment		11		49			(590	)
Net loss on disposal of intangibles		10		51			—
Inventory provision		12		2,502			1,010
Provision for bad debt		13		442			1,304
Provisions		15		91			7
Cash flow from operating activities before changes in working capital				46,751			27,244
Changes in working capital:
Trade and other receivables, net				2,054			(3,793	)
Amounts owed by related parties, net				675			(1,057	)
Inventories, net				3,083			(20,941	)
Current tax assets, net				(7,175	)		(6,958	)
Other current assets				1,822			(3,154	)
Trade and other payables				(5,320	)		26,648
Amounts owed to related parties				613			2,030
Current tax liabilities, net				2,619			(442	)
Other liabilities				(1,133	)		563
Provisions		15		(42	)		(41	)
Other financial assets				(14,328	)		12
Other assets				687			778
Cash generated from operations				30,306			20,889
Interest paid				(1,879	)		(946	)
Income tax paid				(4,889	)		(3,649	)
Cash flow provided by operating activities			$	23,538		$	16,294
Investing activities
Acquisition of property, plant and equipment		11		(7,224	)		(10,518	)
Proceeds from sale of property, plant and equipment				—			2,689
Acquisition of intangibles		10		(5,496	)		(5,106	)
Advances to related parties				(182	)		(139	)
Cash flow used in investing activities			$	(12,902	)	$	(13,074	)
Financing activities
Proceeds from borrowings		14		42,137			54,085
Payments on borrowings		14		(68,201	)		(74,242	)
Payments to related parties				—			(4,525	)
Interest paid on borrowings		14		(15,010	)		(8,639	)
Payment of lease liabilities		14		(2,374	)		(2,867	)
Repurchase of treasury shares				(156	)		—
Cash flow used in financing activities			$	(43,604	)	$	(36,188	)
Net decrease in cash				(32,968	)		(32,968	)
Cash at beginning of the period				43,003			72,112
Effect of exchange rate fluctuations				1,503			(1,592	)
Cash at end of the period			$	11,538		$	37,552
Non-cash financing and investing activities 1			$	23,274		$	32,737

¹ Non-cash investing and financing activities include new lease liabilities $1,063 (for the six months ended June 30, 2022: $7,804), invoices from suppliers financed via reverse factoring classified as Trade and other payables $3,089 (for the six months ended June 30, 2022: $1,013), invoices from suppliers financed via reverse factoring classified as Borrowings $16,649 (for the six months ended June 30, 2022: $23,920) and derivative financial liabilities $2,473 (for the six months ended June 30, 2022: $0).

The accompanying notes are an integral part of these Unaudited Condensed Consolidated Interim Financial Statements.

6

Procaps Group, S.A. and subsidiaries (The Group)

Notes to Unaudited Condensed Consolidated Interim Financial Statements

For the three and six months ended June 30, 2023 and 2022

(In thousands of United States Dollars, unless otherwise stated)

Note 1. General Company Information

Procaps Group, S.A, (the “Company”), a public limited liability company (société anonyme) governed by the laws of the Grand Duchy of Luxembourg and its subsidiaries (collectively “the Group”) primarily engages in developing, producing, and marketing pharmaceutical solutions. Further information about the Group’s business activities, reportable segments and key management personnel of the Group is included in Note 5. Revenue, Note 6. Segment reporting and Note 19. Key management personnel, respectively.

The Group’s principal subsidiaries as of June 30, 2023 and December 31, 2022, are set out below. Unless otherwise stated, they have share capital consisting solely of ordinary shares that are held directly by the Group, and the proportion of ownership interests held equals the voting rights held by the Group. The country of incorporation or registration is also their principal place of business.

		Ownership interests held by:
	Place of business/country	The Group				Non-controlling interests
Name of entity	of incorporation	2023		2022		2023		2022		Principal activities
Procaps S.A.	Colombia	100	%	100	%	—	%	—	%	Manufacturing and distribution of prescription and over-the-counter pharmaceutical products.
C.I. Procaps S.A.	Colombia	100	%	100	%	—	%	—	%
Procaps S.A. de C.V	El Salvador	100	%	100	%	—	%	—	%
Softcaps - Colbras	Brazil	100	%	100	%	—	%	—	%
Diabetrics Healthcare S.A.S.	Colombia	100	%	100	%	—	%	—	%	Diabetes solutions and chronic disease management tool.

There are no significant restrictions on the ability of the Group to access or use assets to settle liabilities.

The Unaudited Condensed Consolidated Interim Financial Statements of the Group for the three and six months ended June 30, 2023 and 2022 comprise the Group and its interest in joint ventures, investments and operations.

The Unaudited Condensed Consolidated Interim Financial Statements are presented in USD (the Group’s presentation currency) and all amounts are rounded to the nearest thousands of USD, unless otherwise stated.

Emerging Growth Company Status

The Group is an emerging growth company, as defined in the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”). The Group will remain an emerging growth company until the earliest of:

● The last day of the first fiscal year (a) following the fifth anniversary of a public equity offering, (b) in which its annual gross revenue totals at least $1.07 billion or (c) when the Group is deemed to be a large, accelerated filer, which means the market value of the Group’s ordinary shares held by non-affiliates exceeds $700.0 million as of the prior June 30th; and

● The date on which the Group has issued more than $1.0 billion in non-convertible debt securities during the prior three-year period.

7

Procaps Group, S.A. and subsidiaries (The Group)

Notes to Unaudited Condensed Consolidated Interim Financial Statements

For the three and six months ended June 30, 2023 and 2022

(In thousands of United States Dollars, unless otherwise stated)

Ongoing Military Operation in Ukraine and Related Sanctions

The ongoing military operation in Ukraine and the related sanctions targeted against the Russian Federation have disrupted international commerce and the global economy. The Group does not have any direct exposure to Ukraine, Russia or Belarus considering there are not any existing operations or sales in those locations.

Although the Group does not currently operate in Ukraine or Russia, the duration and severity of the effects on its business and the global economy are inherently unpredictable. Management will continue to monitor the effects of the war in Ukraine and its potential further impacts, including global supply chain disruptions, inflation, and rising interest rates, when making certain estimates and judgments relating to the preparation of the Unaudited Condensed Consolidated Interim Financial Statements of the Group.

Grupo Somar and Pearl Mexico Acquisition

Refer to the last annual Consolidated Financial Statements as of and for the year ended December 31, 2022 (“last annual financial statements”) for background information on the Acquisition of Grupo Somar and Pearl Mexico. Following the failure of the transaction to close on December 31, 2022, the Group provided the sellers a formal notice on January 1, 2023 terminating the Stock Purchase Agreement (the “SPA”) in accordance with the terms thereof.

Bridge Loan Credit Agreement

Following the Group’s termination of the SPA, the Group advised the joint arrangers and book runners on January 1, 2023 of its desire to terminate the transaction documents (including, without limitation, the commitments under the bridge credit agreement and, for the avoidance of doubt, any commitments under the commitment letter) and pay all outstanding obligations, amounting to $5,719, under the bridge credit agreement and any other transaction document as of January 10, 2023.

Note 2. Basis of preparation and accounting

These Unaudited Condensed Consolidated Interim Financial Statements of the Group as of June 30, 2023 have been prepared on a going concern basis, and in accordance with IAS 34 Interim Financial Reporting, and should be read in conjunction with the last annual financial statements. They do not include all of the information required for a complete set of financial statements prepared in accordance with IFRS Standards. However, selected explanatory notes are included to explain events and transactions that are significant to an understanding of the changes in the Group’s financial position and performance since the last annual financial statements.

These Unaudited Condensed Consolidated Interim Financial Statements were authorized for issue by the Group’s Audit Committee on August 29, 2023.

8

Procaps Group, S.A. and subsidiaries (The Group)

Notes to Unaudited Condensed Consolidated Interim Financial Statements

For the three and six months ended June 30, 2023 and 2022

(In thousands of United States Dollars, unless otherwise stated)

Note 2.1. Going concern

Management identified the following events and conditions which cast significant doubt on the Group’s ability to continue as a going concern:

As of December 31, 2022, the Group was in breach of certain of the covenants included under the Note Purchase Agreement (“NPA”), the Syndicated Loan Agreement and the BTG Credit Agreement. Refer to the last annual financial statements for further details regarding the breach of each covenant. Although none of the lenders declared an event of default under the applicable agreements, these breaches resulted in the lenders having the right to require immediate repayment of the applicable indebtedness and as a result, the Group classified the respective indebtedness, amounting to $139,155 in the aggregate, to current liabilities as of December 31, 2022.

On March 28, March 31 and May 2, 2023 the Group obtained Waiver Agreements (“Waivers” or “Waiver”) from each lender under the NPA, the Syndicated Loan Agreement and the BTG Credit Agreement for the applicable covenant breaches. Under the terms of the Waivers, the lenders permanently waived their rights to accelerate the repayment of the loans related to the events of default as of December 31, 2022. In addition, the Group executed Waivers with the lenders to adjust the applicable covenant ratios for the periods ending March 31, June 30, and September 30, 2023, if applicable, as noted further within Note 14. Borrowings. For the period ending December 31, 2023, the applicable covenant ratios in the original borrowing arrangements are unmodified.

On June 30, 2023, the Group obtained an Additional Waiver under the NPA (the “Additional Waiver”) in anticipation of a potential breach of the Indebtedness Indicator and EBITDA Interest Coverage ratios contained within the March 31, 2023 Waiver. The Additional Waiver with the lenders adjusts the Indebtedness Indicator and EBITDA Interest Coverage ratios for the periods ended June 30, and September 30, 2023, as further noted within Note 14. Borrowings. Since the Additional Waiver was obtained as of June 30, 2023 and the Group was in compliance with the new covenants, the outstanding balance of $115,000 remains classified as non-current borrowing.

Working capital

As of June 30, 2023, the Group had a net working capital surplus (excess of current assets over current liabilities) of $51,670 (working capital deficit of $70,931 as of December 31, 2022).

Management’s assessment

Management assessed the Group’s cash flow projections, ability to meet future covenants and other measures of liquidity for the next twelve months from the balance sheet date. Based on the Group’s cash flow projections and adjusted financial covenant ratios as a result of the Waivers and Additional Waiver, Management believes they will have sufficient funds to repay their obligations as they fall due and to meet its financial covenants. However, due to the uncertainty caused by current economic conditions, including rapid growth in inflation, increasing interest rates, global disruption to the supply chain, volatility in foreign exchange rates and industry price regulations, there is material uncertainty regarding the Group’s ability to meet its financial covenants. The Group’s failure to comply with such financial covenants would result in an event of default, which if that were to occur would materially and adversely affect the Group’s business, financial condition, liquidity and results of operations. In that event, the Group would seek additional waivers or alternative financing arrangements. As a result of these material uncertainties, Management concluded the above conditions and events raise significant doubt about the Group’s ability to continue as a going concern.

9

Procaps Group, S.A. and subsidiaries (The Group)

Notes to Unaudited Condensed Consolidated Interim Financial Statements

For the three and six months ended June 30, 2023 and 2022

(In thousands of United States Dollars, unless otherwise stated)

Management has implemented or is in the process of implementing the following plans to mitigate the effect of these events and conditions:

Cost saving and revenue growth

The Group has implemented certain measures with an aim to reduce its operating costs and generate additional revenue in 2023 including: 1) strict controlling and reducing business marketing and advertising expenses; 2) reducing headcount across multiple business units; and 3) focus on increasing sales volumes for core products and sell trademarks and sanitary records to generate additional revenue.

Renegotiation of existing loans

On August 16, 2023, the Group successfully renegotiated the terms of the Syndicated Loan Agreement with Bancolombia and Davivienda, which extends the payment terms for a six-year period. In addition, on August 18, 2023, the Group renegotiated their short-term loan with BTG into a thirty-month period loan. Refer to Note 14. Borrowings and Note 20. Events after the reporting period for further details regarding these renegotiated loans. The Group has the ability to further renegotiate existing loans to maintain and meet its liquidity needs and requirements. However, the Group’s ability to renegotiate with its lenders is not within the Group’s control. As of the date of these Unaudited Condensed Consolidated Interim Financial Statements, the Group cannot assure that it will be able to reach an agreement with its lenders, or to waive any potential non-compliance.

Additional measures

If the above actions do not generate sufficient liquidity for the Group to meet its contractual obligations, Management has identified additional measures which could be implemented to further reduce costs and increase total revenues in order to provide sufficient cash flow to meet obligations as they fall due including: 1) reduce discretionary spending on research and development, marketing and capital expenditures; 2) sell additional trademarks and sanitary records; and 3) further reduce headcount.

Summary

Management has evaluated the Group’s capital position, its ability to continue in the normal course of business for the foreseeable future and ability to meet its financial obligations for the next twelve months from the balance sheet date. While Management believes that their cost savings, revenue growth, and loan renegotiation will allow the group to be able to meet its financial obligations and finance its growth, there is no assurance that these plans can be successfully implemented to generate the liquidity required to meet the Group’s need. Failure to successfully implement these plans may have a material adverse effect on the Group’s business, results of operations and financial position, and may materially adversely affect its ability to continue as a going concern. As a result, Management concluded there is material uncertainty related to the events and conditions noted above that cast significant doubt on the entity’s ability to continue as a going concern.

However, Management believes that the Group will be successful in implementing the above plan and, accordingly, have prepared the Unaudited Condensed Consolidated Interim Financial Statements on a going concern basis. As a result, the Unaudited Condensed Consolidated Interim Financial Statements do not include any adjustments related to the recoverability and classification of recorded assets or the amounts and classification of liabilities or any other adjustments that might be necessary should the Group be unable to continue as a going concern.

10

Procaps Group, S.A. and subsidiaries (The Group)

Notes to Unaudited Condensed Consolidated Interim Financial Statements

For the three and six months ended June 30, 2023 and 2022

(In thousands of United States Dollars, unless otherwise stated)

Note 3. Summary of significant accounting policies

Note 3.1. Change in accounting policy

Except as described below, the accounting policies applied in these Unaudited Condensed Consolidated Interim Financial Statements are the same as those applied in the Group’s last annual financial statements.

The policy for recognizing and measuring income taxes in the interim periods is consistent with that applied in the previous interim period and is described in Note 9. Income tax.

Note 3.1.1. Derivative financial instrument and hedge accounting

Derivative financial instruments are initially measured at fair value. Subsequent to initial recognition, they are measured at fair value, and changes therein are generally recognized in profit or loss.

The Group designates certain derivatives as hedging instruments to hedge foreign currency exposure related to net investments in foreign operations. At the inception of the hedge relationship, the Group documents the economic relationship between the hedging instrument and the hedged item, along with its risk management objectives and its strategy for undertaking the hedge.

Hedges of net investments in foreign operations

When a derivative instrument or a non-derivative financial liability is designated as the hedging instrument in a hedge of a net investment in a foreign operation, the effective portion of changes in the fair value of a derivative or foreign exchange gains and losses for a non-derivative is recognized as Exchange differences on translation of foreign operations in Other Comprehensive Income and presented under such concept within Equity. The gain or loss relating to the ineffective portion is recognized immediately in profit or loss, and is included in the ‘Other income (expense), net’ line item. Gains and losses on the hedging instrument accumulated in Other Comprehensive Income are reclassified to profit or loss on the disposal or partial disposal of the foreign operation.

Note 3.2. New and amended IFRS Standards that are effective for the current period

Certain new accounting standards, interpretations or amendments to accounting standards are effective for annual periods beginning after January 1, 2023. The Group has not early adopted any standard, interpretation or amendment that has been issued but is not yet effective in the preparation of these Unaudited Condensed Consolidated Interim Financial Statements.

The Group adopted the following accounting standard amendments from January 1, 2023. The evaluation performed by management determined that these amendments did not result in a significant impact in relation to the Group’s Unaudited Condensed Consolidated Interim Financial Statements.

Disclosure of Accounting Policies (Amendments to IAS 1 and IFRS Practice Statement 2) - Effective January 1, 2023

The amendments to IAS 1 and IFRS Practice Statement 2 Making Materiality Judgements provide guidance and examples to help entities apply materiality judgements to accounting policy disclosures. The amendments aim to help entities provide accounting policy disclosures that are more useful by replacing the requirement for entities to disclose their ‘significant’ accounting policies with a requirement to disclose their ‘material’ accounting policies and adding guidance on how entities apply the concept of materiality in making decisions about accounting policy disclosures.

11

Procaps Group, S.A. and subsidiaries (The Group)

Notes to Unaudited Condensed Consolidated Interim Financial Statements

For the three and six months ended June 30, 2023 and 2022

(In thousands of United States Dollars, unless otherwise stated)

The amendments had no impact on the Group’s Unaudited Condensed Consolidated Interim Financial Statements, but are expected to affect the accounting policy disclosures in the Group’s annual Consolidated Financial Statements.

Definition of Accounting Estimate (Amendments to IAS 8) - Effective January 1, 2023

The amendments introduce a new definition for accounting estimates, clarifying that they are monetary amounts in the financial statements that are subject to measurement uncertainty. The amendments also clarify the relationship between accounting policies and accounting estimates by specifying that a company develops an accounting estimate to achieve the objective set out by an accounting policy. The distinction between the two is important because changes in accounting policies are applied retrospectively, whereas changes in accounting estimates are applied prospectively.

The Group has determined the amendment has no significant impact in its Unaudited Condensed Consolidated Interim Financial Statements.

Deferred Tax Related to Assets and Liabilities Arising from a Single Transaction – Amendments to IAS 12 Income Taxes - Effective January 1, 2023

The amendments to IAS 12 Income Tax narrow the scope of the initial recognition exception, so that it no longer applies to transactions that give rise to equal taxable and deductible temporary differences such as leases and decommissioning liabilities. The amendments had no impact on the Group’s Unaudited Condensed Consolidated Interim Financial Statements.

Note 4. Critical accounting judgements and key sources of estimation uncertainty

In preparing these Unaudited Condensed Consolidated Interim Financial Statements, management has made judgments, estimates and assumptions about the carrying amounts of the assets and liabilities that are not readily observable in other sources. The estimates and underlying assumptions are based on historical experience and other relevant factors. Actual results may differ from these estimates.

The significant judgements made by Management in applying the Group’s accounting policies and the key sources of estimation uncertainty were the same as those described in the Group’s last annual financial statements.

Note 5. Revenue

The Group recognizes its revenues from the transfer of goods and services to the fulfillment of its performance obligations. The Group’s revenue for the three and six months ended June 30, 2023 includes $1,298 and $2,080 (for the three and six months ended June 30, 2022: $7,545 and $8,848) in revenue recognized from intellectual property licensing and dossier generation.

Disaggregation of revenue from contracts with customers

Revenue from contracts with customers is disaggregated by primary geographical market and major products (refer to Note 6. Segment reporting) and by timing of revenue recognition in the table below.

12

Procaps Group, S.A. and subsidiaries (The Group)

Notes to Unaudited Condensed Consolidated Interim Financial Statements

For the three and six months ended June 30, 2023 and 2022

(In thousands of United States Dollars, unless otherwise stated)

For the three months ended June 30	Reportable segments
2023	NextGel			Procaps Colombia			CAN			CASAND			Diabetrics			Total
Segment revenue		62,678			38,067			18,471			25,285			9,945			154,446
Inter-segment revenue		(30,698	)		(25	)		(4,658	)		(4,267	)		(4,741	)		(44,389	)
Revenue from contracts with customers		31,980			38,042			13,813			21,018			5,204			110,057
Timing of revenue recognition
Goods transferred at a point in time		30,682			38,042			13,813			21,018			5,204			108,759
Services transferred over time		1,298			—			—			—			—			1,298
Total revenue from contracts with customers		31,980			38,042			13,813			21,018			5,204			110,057

For the three months ended June 30	Reportable segments
2022	NextGel			Procaps Colombia			CAN			CASAND			Diabetrics			Total
Segment revenue		64,883			41,253			22,122			22,666			12,143			163,067
Inter-segment revenue		(31,960	)		(1,658	)		(5,287	)		(5,566	)		(6,176	)		(50,647	)
Revenue from contracts with customers		32,923			39,595			16,835			17,100			5,967			112,420
Timing of revenue recognition
Goods transferred at a point in time		29,045			38,187			14,576			17,100			5,967			104,875
Services transferred over time		3,878			1,408			2,259			—			—			7,545
Total revenue from contracts with customers		32,923			39,595			16,835			17,100			5,967			112,420

For the six months ended June 30	Reportable segments
2023	NextGel			Procaps Colombia			CAN			CASAND			Diabetrics			Total
Segment revenue		107,432			67,834			33,618			44,994			16,760			270,638
Inter-segment revenue		(50,491	)		(236	)		(10,239	)		(7,954	)		(7,499	)		(76,419	)
Revenue from contracts with customers		56,941			67,598			23,379			37,040			9,261			194,219
Timing of revenue recognition
Goods transferred at a point in time		54,861			67,598			23,379			37,040			9,261			192,139
Services transferred over time		2,080			—			—			—			—			2,080
Total revenue from contracts with customers		56,941			67,598			23,379			37,040			9,261			194,219

13

Procaps Group, S.A. and subsidiaries (The Group)

Notes to Unaudited Condensed Consolidated Interim Financial Statements

For the three and six months ended June 30, 2023 and 2022

(In thousands of United States Dollars, unless otherwise stated)

For the six months ended June 30	Reportable segments
2022	NextGel			Procaps Colombia			CAN			CASAND			Diabetrics			Total
Segment revenue		123,038			72,802			37,522			39,191			19,737			292,290
Inter-segment revenue		(64,778	)		(1,349	)		(9,417	)		(9,529	)		(9,167	)		(94,240	)
Revenue from contracts with customers		58,260			71,453			28,105			29,662			10,570			198,050
Timing of revenue recognition
Goods transferred at a point in time		53,531			70,045			25,846			29,210			10,570			189,202
Services transferred over time		4,729			1,408			2,259			452			—			8,848
Total revenue from contracts with customers		58,260			71,453			28,105			29,662			10,570			198,050

Revenue recognized from goods transferred at a point in time include revenues related to “sales of goods” and “sales of trademarks and sanitary provisions”. Revenue recognized from services transferred over time include revenues related to “intellectual property licensing” and “dossier generation”. Revenues, other than sales of goods, are not material to the group.

Note 6. Segment reporting

Segment information is presented at a combination of geographical segments and business units, consistent with the information that is available and evaluated regularly by the chief operating decision maker.

The Group operates its business through five segments which are its reportable segments for financial reporting purposes: Procaps Colombia, Central America North (“CAN”), Central America South and North Andes (“CASAND”), NextGel and Diabetrics. Segment management, the respective Vice Presidents, are responsible for managing performance, underlying risks and operations. Management uses a broad set of performance indicators to measure segment performance and to make decisions around resource allocation.

The Group’s customer revenue recognition (external revenue) policy has been consistent with inter-segment revenue generated.

	NextGel							Procaps Colombia							CAN							CASAND
Three months ended June 30, 2023	Total		Inter- segment eliminations			External		Total		Inter- segment eliminations			External		Total		Inter- segment eliminations			External		Total		Inter- segment eliminations			External
Revenue		62,678		(30,698	)		31,980		38,067		(25	)		38,042		18,471		(4,658	)		13,813		25,285		(4,267	)		21,018
Contribution margin 1		12,473		(926	)		11,547		11,389		(133	)		11,256		5,214		622			5,836		5,847		4,286			10,133

14

Procaps Group, S.A. and subsidiaries (The Group)

Notes to Unaudited Condensed Consolidated Interim Financial Statements

For the three and six months ended June 30, 2023 and 2022

(In thousands of United States Dollars, unless otherwise stated)

	Diabetrics							Corporate									Total
Three months ended  June 30, 2023	Total		Inter- segment eliminations			External		Total			Inter- segment eliminations			External			Total			Inter- segment eliminations			External
Revenue		9,945		(4,741	)		5,204		—			—			—			154,446			(44,389	)		110,057
Contribution margin1		201		(133	)		68		700			151			851			35,824			3,867			39,691
Administrative expenses		—		—			—		25,150			(548	)		24,602			25,150			(548	)		24,602
Finance expenses		—		—			—		6,739			41			6,780			6,739			41			6,780
Other (income) expenses, net		—		—			—		(31,681	)		2,054			(29,627	)		(31,681	)		2,054			(29,627	)
Income (loss) before tax																		35,616			2,320			37,936

	NextGel							Procaps Colombia							CAN							CASAND
Three months ended  June 30, 2022	Total		Inter- segment eliminations			External		Total		Inter- segment eliminations			External		Total		Inter- segment eliminations			External		Total		Inter- segment eliminations			External
Revenue		64,883		(31,960	)		32,923		41,253		(1,658	)		39,595		22,122		(5,287	)		16,835		22,666		(5,566	)		17,100
Contribution margin1		18,044		(552	)		17,492		15,804		(695	)		15,109		6,280		(20	)		6,260		4,443		2,505			6,948

	Diabetrics							Corporate								Total
Three months ended June 30, 2022	Total		Inter-segment eliminations			External		Total		Inter-segment eliminations			External			Total			Inter-segment eliminations			External
Revenue		12,143		(6,176	)		5,967		—		—			—			163,067			(50,647	)		112,420
Contribution margin1		1,383		40			1,423		441		(704	)		(263	)		46,394			575			46,969
Administrative expenses		—		—			—		28,844		1			28,845			28,844			1			28,845
Finance expenses		—		—			—		18,791		—			18,791			18,791			—			18,791
Other (income) expenses, net		—		—			—		8,626		—			8,626			8,626			—			8,626
Income (loss) before tax																	(9,868	)		574			(9,293	)

	NextGel							Procaps Colombia							CAN							CASAND
Six months ended June 30, 2023	Total		Inter- segment eliminations			External		Total		Inter- segment eliminations			External		Total		Inter- segment eliminations			External		Total		Inter-segment eliminations			External
Revenue		107,432		(50,491	)		56,941		67,834		(236	)		67,598		33,618		(10,239	)		23,379		44,994		(7,954	)		37,040
Contribution margin1		21,564		(1,591	)		19,973		20,393		(67	)		20,326		7,267		1,371			8,638		8,518		8,152			16,670

15

Procaps Group, S.A. and subsidiaries (The Group)

Notes to Unaudited Condensed Consolidated Interim Financial Statements

For the three and six months ended June 30, 2023 and 2022

(In thousands of United States Dollars, unless otherwise stated)

	Diabetrics									Corporate									Total
Six months ended  June 30, 2023	Total			Inter-segment eliminations			External			Total			Inter- segment eliminations			External			Total			Inter-segment eliminations			External
Revenue		16,760			(7,499	)		9,261			—			—			—			270,638			(76,419	)		194,219
Contribution margin1		(12	)		(420	)		(432	)		(14,075	)		13,983			(92	)		43,655			21,428			65,083
Administrative expenses		—			—			—			2,545			44,176			46,721			2,545			44,176			46,721
Finance expenses		—			—			—			8,408			(3,277	)		5,131			8,408			(3,277	)		5,131
Other (income) expenses, net		—			—			—			(27,003	)		(6,582	)		(33,585	)		(27,003	)		(6,582	)		(33,585	)
Income (loss) before tax																				59,705			(12,889	)		46,816

	NextGel							Procaps Colombia							CAN							CASAND
Six months ended  June 30, 2022	Total		Inter- segment eliminations			External		Total		Inter- segment eliminations			External		Total		Inter- segment eliminations			External		Total		Inter- segment eliminations			External
Revenue		123,038		(64,778	)		58,260		72,802		(1,349	)		71,453		37,522		(9,417	)		28,105		39,191		(9,529	)		29,662
Contribution margin1		35,775		(8,071	)		27,704		24,705		155			24,860		9,045		(651	)		8,394		6,037		5,810			11,847

	Diabetrics							Corporate								Total
Six months ended June 30, 2022	Total		Inter- segment eliminations			External		Total		Inter- segment eliminations			External			Total		Inter- segment eliminations			External
Revenue		19,737		(9,167	)		10,570				—						292,290		(94,240	)		198,050
Contribution margin1		1,432		(93	)		1,339		1,937		(2,147	)		(210	)		78,930		(4,996	)		73,934
Administrative expenses		—		—			—		53,400		—			53,400			53,400		—			53,400
Finance expenses		—		—			—		4,209		—			4,209			4,209		—			4,209
Other (income) expenses, net		—		—			—		3,503		—			3,503			3,503		—			3,503
Income (loss) before tax																	17,817		(4,996	)		12,822

¹ Contribution margin is determined by subtracting sales and marketing expenses from gross profit. The Group’s customer revenue recognition (external revenue) policy has been consistent with inter-segment revenue generated.

Major customer

The Group does not have revenue from a single customer comprising more than ten percent of its consolidated revenue.

16

Procaps Group, S.A. and subsidiaries (The Group)

Notes to Unaudited Condensed Consolidated Interim Financial Statements

For the three and six months ended June 30, 2023 and 2022

(In thousands of United States Dollars, unless otherwise stated)

Geographical information

In presenting geographical information, the Group’s revenue is based on the geographical location of the customers.

	For the three months ended June 30				For the six months ended June 30
	2023		2022		2023		2022
South America	$	75,362	$	73,956	$	135,104	$	133,156
Central America		23,733		26,265		39,480		42,546
North America		9,136		9,072		16,562		17,304
Europe		1,826		3,127		3,073		5,044
Total	$	110,057	$	112,420	$	194,219	$	198,050

Seasonality of operations

The Group has been subject to normal seasonal fluctuations that generate less income during the first half of the year. In general, there are no significant variations on sales to customers throughout the year.

Note 7. Finance expenses, net

	For the three months ended June 30						For the six months ended June 30
	2023			2022			2023			2022
Banking expenses	$	(564	)	$	(58	)	$	(787	)	$	(374	)
Bank fees		(295	)		(304	)		(502	)		(411	)
Other financial expenses1		(315	)		(280	)		(611	)		(429	)
Net fair value gain/(loss) of warrant liabilities2		2,510			(1,092	)		6,456			636
Net fair value gain/(loss) of shares held in escrow2		2,460			(10,778	)		9,665			7,732
Interest expense		(10,576	)		(6,279	)		(19,352	)		(11,363	)
Total	$	(6,780	)	$	(18,791	)	$	(5,131	)	$	(4,209	)

¹ For the three and six months ended June 30, 2023, interest on lease liabilities amounted to $315 and $611 (for the three and six months ended June 30, 2022: $248 and $429).

² Refer to Note 16. Warrant liabilities, Note 17. Shares in escrow and Note 18. Financial instruments for further information related to net fair value gains for the six months ended June 30, 2023.

Net fair value gains recognized in Finance expenses, net for the three and six months ended June 30, 2023 and 2022 are unrealized.

17

Procaps Group, S.A. and subsidiaries (The Group)

Notes to Unaudited Condensed Consolidated Interim Financial Statements

For the three and six months ended June 30, 2023 and 2022

(In thousands of United States Dollars, unless otherwise stated)

Note 8. Other income (expenses), net

	For the three months ended June 30						For the six months ended June 30
	2023			2022			2023			2022
Currency exchange rate differences1	$	10,464		$	(8,357	)	$	14,394		$	(3,188	)
Economic emergency contribution expenses		(320	)		(407	)		(637	)		(680	)
Fines, surcharges, penalties and taxes assumed		(40	)		(13	)		(120	)		(95	)
Donations		(160	)		(93	)		(315	)		(173	)
Other2		19,683			244			20,263			633
Total	$	29,627		$	(8,626	)	$	33,585		$	(3,503	)

¹ The increase in currency exchange rate differences income (expense) for the three and six months ended June 30, 2023 is mainly related to a decrease of 10% and 13% (increase for the three and six months ended June 30, 2022 11% and 4%) in the Colombian Pesos/USD exchange rate for the period and the Group’s Colombian entities’ liability position towards USD.

² Includes income from a legal settlement with a third party to recover costs incurred relating to a business opportunity with such third party. The open receivable balance as of June 30, 2023 is included within Other financial assets in the Consolidated Interim Statement of Financial Position. The amount, counter party and any further details can’t be disclosed due to contractual restrictions within the settlement agreement.

Note 9. Income tax

Income tax recognized through profit or loss

Income tax expense is recognized at an amount determined by multiplying the profit before tax for the interim reporting period by management’s best estimate of the weighted-average annual income tax rate expected for the full financial year, adjusted for the tax effect of certain items recognized in full in the interim period. As such, the effective tax rate in the condensed consolidated interim financial statements may differ from management’s estimate of the effective tax rate for the annual financial statements.

The Group’s consolidated income (loss) before tax for the three and six months ended June 30, 2023 amounts to $37,936 and $46,816(for the three and six months ended June 30, 2022: $(9,293) and $12,822). The income tax expense for the three and six months ended June 30, 2023 was $(10,981) and $(13,240) (for the three and six months ended June 30, 2022: $2,374 and $(3,295)). The Group’s consolidated effective tax rate with respect to continuing operations for the six months ended June 30, 2023 was 28.28% (for the six months ended June 30, 2022: 25.64%) The change in the consolidated effective tax rate was mainly caused by the following factors: (i) Optimization of the use of tax credits, tax rate changed from 25% up to 30% in Colombia, and (ii) by concentration of profits in countries where the tax rate is higher.

The tax rate used for the six months ended June 30, 2023 represents the tax rate of 35% (for the six months ended June 30, 2022: 35%) on the taxable income payable by the most representative entities of the Group in Colombia, in accordance with the tax laws of said jurisdiction. Taxation for other jurisdictions is calculated at the rates prevailing in the respective jurisdiction.

18

Procaps Group, S.A. and subsidiaries (The Group)

Notes to Unaudited Condensed Consolidated Interim Financial Statements

For the three and six months ended June 30, 2023 and 2022

(In thousands of United States Dollars, unless otherwise stated)

Note 10. Intangible assets, net

Cost	Total
Balance as of January 1, 2022	$	53,926
Additions		860
Additions from internal developments		4,246
Foreign currency exchange		(1,687	)
Balance as of June 30, 2022	$	57,345
Balance as of January 1, 2023	$	57,831
Additions		1,465
Additions from internal developments		4,031
Derecognition of assets		(51	)
Foreign currency exchange		6,535
Transfers		113
Balance as of June 30, 2023	$	69,924

Accumulated amortization	Total
Balance as of January 1, 2022	$	23,755
Amortization expense		2,436
Foreign currency exchange		(723	)
Balance as of June 30, 2022	$	25,468
Balance as of January 1, 2023	$	25,623
Amortization expense		2,291
Foreign currency exchange		2,852
Balance as of June 30, 2023	$	30,766
As of June 30, 2022
Net book value	$	31,877
As of June 30, 2023
Net book value	$	39,158

For the three and six months ended June 30, 2023 and 2022, amortization expenses were recognized within the Unaudited Condensed Consolidated Interim Statement of Profit or Loss and Other Comprehensive Income as administrative expenses.

Foreign currency exchange corresponds to the effect of translating the intangible asset amounts attributable to the subsidiaries of the Group whose functional currencies are different from that of the Group.

19

Procaps Group, S.A. and subsidiaries (The Group)

Notes to Unaudited Condensed Consolidated Interim Financial Statements

For the three and six months ended June 30, 2023 and 2022

(In thousands of United States Dollars, unless otherwise stated)

Note 11. Property, plant and equipment, net

Cost	Total
Balance as of January 1, 2022	$	116,654
Additions		10,518
Disposals		(2,275	)
Effect of exchange differences in foreign currency		(2,544	)
Transfers		(54	)
Balance as of June 30, 2022	$	122,299
Balance as of January 1, 2023	$	121,898
Additions		13,110
Disposals		(276	)
Effect of exchange differences in foreign currency		12,664
Transfers		(116	)
Balance as of June 30, 2023	$	147,280

Accumulated depreciation	Total
Balance as of January 1, 2022	$	44,016
Disposals		(174	)
Depreciation expense		2,932
Effect of exchange differences in foreign currency		(1,071	)
Balance as of June 30, 2022	$	45,703
Balance as of January 1, 2023	$	47,933
Disposals		(227	)
Depreciation expense		2,662
Effect of exchange differences in foreign currency		5,125
Transfers		(38	)
Balance as of June 30, 2023	$	55,455
As of June 30, 2022
Net book value	$	76,596
As of June 30, 2023
Net book value	$	91,825

For the six months ended June 30, 2023, depreciation expense was recognized as follows: $2,061 was recognized as cost of goods sold (for the six months ended June 30, 2022: $1,678) and $601 for the six months ended June 30, 2022: $1,254) within administrative expense.

Financial Commitments

As of June 30, 2023, the Group has commitments to acquire capital expenditures for $6,110 (as of June 30, 2022: $9,229).

20

Procaps Group, S.A. and subsidiaries (The Group)

Notes to Unaudited Condensed Consolidated Interim Financial Statements

For the three and six months ended June 30, 2023 and 2022

(In thousands of United States Dollars, unless otherwise stated)

Note 12. Inventories, net

	As of June 30, 2023			As of December 31, 2022
Raw materials and supplies	$	50,371		$	42,701
Products in process		6,600			7,412
Finished products and merchandise		42,094			41,492
Inventory in transit		9,950			11,531
Subtotal	$	109,015		$	103,136
Less: Provision		(5,540	)		(6,303	)
Total	$	103,475		$	96,833

Inventories recognized as cost of goods sold for the six months ended June 30, 2023 amounted to $86,969 (for the six months ended June 30, 2022: $78,294). Inventories used as samples for the six months ended June 30, 2023 amounted to $3,026 (for the six months ended June 30, 2022: $4,068), were recognized as marketing expenses.

Write-downs of inventories to net realizable value and obsolescence adjustments for the six months ended June 30, 2023 amounted to $2,502 (for the six months ended June 30, 2022: $1,010), were recognized within sales expenses.

Note 13. Trade and other receivables, net

	As of June 30, 2023			As of December 31, 2022
Trade receivables, net of discounts 1	$	137,587		$	126,456
Other receivables		12,860			15,211
Impairment of trade and other receivables 2		(13,906	)		(12,065	)
Trade receivables, net of discounts and impairment	$	136,541		$	129,602

¹ Discount and return provision amounts to $14,793 (as of December 31, 2022: $13,443).

² Total impairment balance is comprised of $11,744 (as of December 31, 2022: $10,768) for trade receivables and $2,162 (as of December 31, 2022 $1,297) for other receivables.

Refer to Note 18. Financial instruments for the Group’s disclosures on credit risk management and expected credit losses.

The Group has entered into factoring arrangements to sell certain trade receivables to third parties under recourse programs, retaining all risk and rewards incidental to the trade receivables, so no derecognition of the financial assets has been performed. Trade receivables which collateralize factoring obligations as of June 30, 2023 amounts to 4,225 (as of December 31, 2022: $2,547).

21

Procaps Group, S.A. and subsidiaries (The Group)

Notes to Unaudited Condensed Consolidated Interim Financial Statements

For the three and six months ended June 30, 2023 and 2022

(In thousands of United States Dollars, unless otherwise stated)

Note 14. Borrowings

	As of June 30, 2023		As of December 31, 2022
Borrowings at amortized cost(a)
Syndicated term loan (1)	$	40,191	$	38,626
Other term loan (2)		93,788		95,720
Lease liabilities (3)		34,966		34,192
Factoring obligations (4)		4,017		2,317
Bank overdrafts (5)		357		80
Notes (6)		115,000		115,000
Total Interest bearing liabilities	$	288,319	$	285,935
Current		118,684		257,525
Non- Current	$	169,635	$	28,410

^(a) Borrowings at amortized cost are unsecured, with the exception of factoring obligations which are collateralized by trade receivables. Refer to Note 13. Trade and other receivables, net.

1. Syndicated term loan

	Currency	Range of Interest	Maturity Year	As of June 30, 2023			As of December 31, 2022
Syndicated term loan	COP	IBR + 5.30%	2023-2025	$	40,652		$	39,156
Amortized cost	COP	N/A	2023		(461	)		(530	)
Total Syndicated term loan				$	40,191		$	38,626

On November 20, 2018, Procaps S.A. entered into a syndicated term loan agreement the “Syndicated Loan Agreement”) with the following banks: Portion in Colombian pesos (COP) - Davivienda and Bancolombia; US dollar portion (USD) - Banco de Credito del Peru, Bancolombia Panama and Banco Sabadell. The total value of the syndicated loan amounts to $200,434 million COP (portion in COP) and $35 million USD (portion in USD), Fiduciaria Bancolombia acts as the agent of the loan. C.I. Procaps S.A., Procaps S.A. de C.V, Biokemical S.A., Pharmarketing S.A. (Panama), Pharmarketing Salvador S.A. de C.V., Pharmarketing S.A. (Guatemala S.A.), C.D.I. Salvador S.A. de C.V., C.D.I. Nicaragua S.A., C.D.I. Guatemala S.A., Pharmarketing Dominicana SRL, and Pharmarketing Costa Rica S.A., act as co-debtors, while Pharmayect S.A., Inversiones Crynssen S.A.S., Inversiones Ganeden S.A.S., Inversiones Henia S.A.S., Inversiones Jades S.A.S., and Industrias Kadima S.A.S., act as guarantors.

The resources obtained were used for advance payment and/or novation of some obligations to be refinanced. The conditions of the loan had a term of 5 years for installment payments and the interest rates agreed are as follows: IBR + 5.30% for the portion in COP and Libor + 4.80% for the USD portion.

22

Procaps Group, S.A. and subsidiaries (The Group)

Notes to Unaudited Condensed Consolidated Interim Financial Statements

For the three and six months ended June 30, 2023 and 2022

(In thousands of United States Dollars, unless otherwise stated)

The significant covenants required by the Syndicated Loan Agreement are as follows:

Financial covenants

● Indebtedness Indicator (Indebtedness/EBITDA) as of June 30 and December 31 of each year, during the loan term, must be less than or equal to 3.5 times. If the indicator is greater than 3.0 and less than 3.5, it proceeds to the extent that this value is originated by causes other than additional debt and the justification of the increase must be presented to the agent.

● Short-term leverage ratio < 1.0 on the last day of each semester.

● EBITDA ratio / financial expenses = or > 3.0 on the last day of each semester.

Other covenants

● The Syndicated Loan Agreement establishes that each of the jointly obligated parties, unless they have the express, prior and written authorization of the Agent, will refrain from incurring any type of financial debt when the proforma indebtedness indicator, once acquired the additional financial debt, is greater than 3.0 times and maintaining any type of financial debt when the pro forma indebtedness indicator, once the national debt is acquired, is greater than 3.5 times.

● Each of the joint obligated parties, except with express, prior and written authorization of the Agent to do otherwise, will refrain from contracting finance and/or operating lease obligations with purchase option with a joint balance payable greater than $85,000,000 (Eighty-Five Billion Pesos, local currency) or its equivalent in another currency. For purposes of clarity, the reclassification of obligations as financial lease obligations by application of the Accounting Standards will not consume the balance set forth herein and may not be renewed.

● The payment of dividends is restricted to anyone other than the jointly obligated parties.

The Syndicated Loan Agreement establishes that, in the event of breach of covenants by the debtor, the lenders shall be entitled to declare early maturity of the debts.

As mentioned in Note 2.1. Going concern, as of December 31, 2022, the Group was not in compliance with certain covenants under the Syndicated Loan Agreement. As a result, as of December 31, 2022, $19,665 unpaid principal balance previously classified as non-current borrowings, was reclassified to current borrowings within the Group’s Consolidated Statement of Financial Position.

On May 2, 2023 the Group obtained a Waiver for the loan covenant breaches described above. Under the terms of the Waiver, the lenders agreed to waive the event of default as of December 31, 2022.For the period ending June 30, 2023, as part of the Waiver negotiations, the lenders agreed to adjust the convent ratios as noted below (the covenants will return to the original terms from December 31, 2023, onwards):

● Indebtedness Indicator (Indebtedness/EBITDA) must be less than or equal to 4.5 times (original covenant: less than or equal to 3.5 times).

● Short-term leverage ratio less than 1.6 (original covenant: less than 1.0).

● EBITDA ratio / financial expenses greater than or equal to 1.8 (original covenant: greater than or equal to 3.0).

As a result, the unpaid principal balance is classified as non-current borrowings as of June 30, 2023.

23

Procaps Group, S.A. and subsidiaries (The Group)

Notes to Unaudited Condensed Consolidated Interim Financial Statements

For the three and six months ended June 30, 2023 and 2022

(In thousands of United States Dollars, unless otherwise stated)

Additionally, as mentioned in Note 2.1. Going concern, on August 16, 2023, the Group renegotiated the terms of the Syndicated Loan Agreement which extends the payment terms for a six-year period. Refer to Note 20. Events after the reporting period for further details regarding the renegotiation.

2. Other term loan

	Currency	Range of Interest	Maturity Year	As of June 30, 2023		As of December 31, 2022
Other term loan	COP	IBR+ 9.0%, 23.5% (2022: IBR+ 5.0%, DTF+ 3%, 13.99%-25.3%)	2022-2025	$	12,407	$	9,549
	COP	IBR + 2.25%- IBR 7.95% (2022: IBR+2.25%-10.2%)	2022-2025		23,342		21,267
	Soles	8.0% - 14.50% (Fixed) (2022: 8.0% - 12.79% (Fixed))	2022-2024		6,619		6,837
	Reales	9.84% - 18% N.A.	2023-2024		1,137		2,176
	USD	SOFR+ (5.80%-7.00%), SOFR6M + (2%-3%) (2022: SOFR+ (4.80%-5.80%))	2023		24,669		23,454
	USD	6.5%-16.8% N.A. (2022: 6.36%-16.8%)	2022-2025		25,614		32,437
Total Other term loans				$	93,788	$	95,720

On June 28, 2022, Procaps, S.A. (the “Company”) entered into a credit agreement with BTG to borrow $8,672. The covenants required by the loan contract are:

● The Company’s consolidated Indebtedness Indicator (Indebtedness / EBITDA) should not be greater than 3.5x.

● The Company’s consolidated EBITDA/Finance expense should not be less than 3x.

As mentioned in Note 2.1. Going concern, as of December 31, 2022, the Group was not in compliance with the loan covenants related to the BTG Credit Agreement. As a result, the $4,490 unpaid principal balance previously classified as a non-current borrowings, was reclassified to current borrowings within the Group’s Consolidated Statement of Financial Position as of December 31, 2022.

On March 28, 2023 the Group obtained a Waiver for the loan covenant breach. Under the terms of the Waiver, BTG Pactual agreed to waive the event of default as of December 31, 2022. For the period ending June 30, 2023, as part of the Waiver negotiations, the lenders agreed to adjust the covenant ratios as noted below (the covenants will return to the original terms from December 31, 2023, onwards):

● The Company’s consolidated Indebtedness Indicator (Indebtedness / EBITDA) must not be greater than 4.5x (original covenant: greater than 3.5x).

24

Procaps Group, S.A. and subsidiaries (The Group)

Notes to Unaudited Condensed Consolidated Interim Financial Statements

For the three and six months ended June 30, 2023 and 2022

(In thousands of United States Dollars, unless otherwise stated)

● The Company’s consolidated EBITDA/Finance expense must not be less than 1.8x (original covenant: less than 3.0x).

As a result, the unpaid principal balance is classified as non-current borrowings as of June 30, 2023.

Along with the BTG Credit Agreement, the Group borrowed $19,000 on October 14, 2022 as part of a short-term agreement with BTG Pactual which is payable in 2023. Additionally, as mentioned in Note 2.1. Going concern, on August 18, 2023, the Group renegotiated their short-term agreement with BTG into a thirty-month period loan. Refer to Note 20. Events after the reporting period for further details regarding the renegotiation.

3. Lease liabilities

	Currency	Range of  Interest	Maturity Year	As of June 30, 2023		As of December 31, 2022
Lease liabilities	COP	IBR+(3.82%-7.3%), DTF + 5.5% (2022: DTF + (5,18% - 10,11%) T.A., IBR+7.5%)	2022-2030	$	10,170	$	10,475
	COP	IBR+ (4.2%-8.2%) (2022: DTF+ 4.54%-10.42 T.A.	2022-2025		3,944		3,653
	USD	0.75%-21.48%, DTF+5.50%, IBR+4.10% (2022: 0.75%-21.48%)	2023-2032		20,852		14,787
	COP	1.91%-12.23%, IBR+4.68%	2023		—		4,703
	Reales	0.70-8.72% (Fixed)	2023-2024		—		574
Total Lease Liabilities				$	34,966	$	34,192

4. Factoring obligations

	Currency	Range of Interest	Maturity Year	As of June 30, 2023		As of December 31, 2022
Portfolio factoring	COP	DTF+7% (2022: DTF+8%)	2023	$	1,583	$	1,508
	COP	2% - 22.4% (2022: 15.0% - 27% N.A.)	2023		2,434		809
Total Factoring				$	4,017	$	2,317

5. Bank overdraft

	Currency	Range of Interest	Maturity Year	As of June 30, 2023		As of December 31, 2022
Overdrafts and credit cards	COP	19.68% - 32% E.A.  (Fixed)	2023	$	357	$	80

25

Procaps Group, S.A. and subsidiaries (The Group)

Notes to Unaudited Condensed Consolidated Interim Financial Statements

For the three and six months ended June 30, 2023 and 2022

(In thousands of United States Dollars, unless otherwise stated)

6. Notes

On November 12, 2021, the Group closed the private placement offering of $115 million aggregate principal amount of 4.75% guaranteed senior notes (the “Senior Notes”) issued by Procaps, S.A., a subsidiary of the Group, due November 12, 2031, pursuant to the NPA entered into on November 5, 2021 with The Prudential Insurance Company of America, Prudential Annuities Life Assurance Corporation, Healthspring Life & Health Insurance Company, Inc. and Cigna Health and Life Insurance Company Inc.

The Senior Notes are a senior unsecured obligations of Procaps, S.A. and unconditionally guaranteed by Procaps Group, S.A. and the following subsidiaries of the Group: C.I. Procaps, S.A., Diabetrics Healthcare S.A.S., Pharmayect S.A., Procaps, S.A. de C.V., Biokemical, S.A. de C.V., Colbras Indústria e Comércio Ltda., and Sofgen Pharmaceuticals LLC.

Debt issuance costs related to the Senior Notes of $2,142, comprised of commissions payable to the initial purchasers of $1,390 and attorneys’ costs of $752, were allocated to the liability of the Notes based on their relative values. Issuance incremental costs are part of the effective rate and amortized to interest expense using the effective interest method over the contractual term.

As mentioned in Note 1. General Company Information, the Notes Payoff did not occur on or prior to November 30, 2022, therefore triggering the 3.75% per annum waiver fee on the outstanding principal amount of Senior Notes, raising the interest rate from 4.75% to 8.50%. As a result, the Group has treated the rate increase as a debt extinguishment, derecognised a liability in the amount of $113,400, expensed $1,600 in unamortized transaction costs, and recognized a new liability in the amount of $115,000 as of December 31, 2022.

The Senior Notes require Procaps, S.A., the Group and the following subsidiaries of the Group: C.I. Procaps, S.A., Diabetrics Healthcare S.A.S., Pharmayect S.A., Procaps, S.A. de C.V., Biokemical, S.A. de C.V., Colbras Indústria e Comércio Ltda., and Sofgen Pharmaceuticals LLC. to comply with the following financial ratios:

● The consolidated total debt of Procaps, S.A., the Group and the other obligors thereunder to consolidated EBITDA for the last twelve months of 3.50:1.00 or less (Indebtedness Indicator), measured at certain dates of determination and;

● An EBITDA interest coverage ratio (calculated as the consolidated EBITDA for the last twelve months of Procaps, S.A. and the other obligors thereunder divided by the consolidated interest expenses of Procaps, S.A. and the other obligors thereunder) in excess of, or equal to, 3.00:1.00, calculated at certain dates of determination.

● Short-term leverage ratio equal to or less than 1.00

Complying with the Note Purchase Agreement protocols and as a result of the more favorable provisions of the Syndicated Loan Agreement, the Group gave notice on April 7, 2022 that specific provisions related to reporting covenants, affirmative covenants, negative covenants, events of default, and mandatory prepayment events, as set forth in the Syndicated Loan Agreement, shall apply to the Senior Notes.

As mentioned in Note 2.1. Going concern, as of December 31, 2022, the Group was not in compliance with the financial covenants related to the Senior Notes. As a result, the $115,000 unpaid principal balance previously classified as a non-current borrowings, was reclassified to current borrowings within the Group’s Consolidated Statement of Financial Position as of December 31, 2022.

26

Procaps Group, S.A. and subsidiaries (The Group)

Notes to Unaudited Condensed Consolidated Interim Financial Statements

For the three and six months ended June 30, 2023 and 2022

(In thousands of United States Dollars, unless otherwise stated)

On March 31, 2023 the Group obtained a Waiver for the NPA covenant breaches described above. Under the terms of the Waiver, the noteholders agreed to waive the event of default as of December 31, 2022. For the periods ending March 31, June 30 and September 30, 2023, as part of the Waiver negotiations, the lenders agreed to adjust the covenant ratios as noted below (the covenants. will return to the original terms from December 31, 2023, onwards):

● The consolidated total debt of Procaps, S.A., the Group and the other obligors thereunder to consolidated EBITDA for the last twelve months of 4.00:1.00 or less (original covenant: 3.50:1.00 or less).

● An EBITDA interest coverage ratio in excess of, or equal to, 2.20:1.00 (original covenant: in excess of, or equal to, 3.00:1.00).

● Short-term leverage ratio equal to or less than 1.60:1:00 (original covenant: equal to or less than 1.00:1.00).

As mentioned in Note 2.1. Going concern, as of June 30, 2023 the Group obtained an Additional Waiver under the NPA in anticipation of a potential breach of the covenant ratios contained within the March 31, 2023 Waiver. For the periods ending June 30 and September 30, 2023, the lenders agreed to adjust the covenant ratios as noted below (the covenants will return to the original terms from December 31, 2023, onwards):

● The consolidated total debt of Procaps, S.A., the Group and the other obligors thereunder to consolidated EBITDA for the last twelve months of 4.30:1.00 or less (original covenant: 3.50:1.00 or less).

● An EBITDA interest coverage ratio in excess of, or equal to, 1.90:1.00 (original covenant: in excess of, or equal to, 3.00:1.00).

The Additional Waiver was obtained on June 30, 2023, therefore, the unpaid principal balance is classified as non-current borrowings as of June 30, 2023.

	Currency	Range of Interest	Maturity Year	As of June 30, 2023		As of December 31, 2022
The Prudential Insurance Company Of America	USD	8.50% (Fixed)	2031	$	60,020	$	60,020
Prudential Annuities Life Assurance Corporation	USD	8.50% (Fixed)	2031		29,980		29,980
Healthspring Life & Health Insurance Company, Inc	USD	8.50% (Fixed)	2031		18,350		18,350
CIGNA Health and Life Insurance Company	USD	8.50% (Fixed)	2031		6,650		6,650
Total Senior Notes				$	115,000	$	115,000

27

Procaps Group, S.A. and subsidiaries (The Group)

Notes to Unaudited Condensed Consolidated Interim Financial Statements

For the three and six months ended June 30, 2023 and 2022

(In thousands of United States Dollars, unless otherwise stated)

Note 15. Provisions and contingencies

	2023			2022
Contingencies
Balance as of January 1	$	138		$	501
Effect of changes in foreign exchange rates		8			28
Provisions made		91			7
Provisions used		(42	)		(41	)
Balance as of June 30	$	195		$	495

The Group recognizes provisions for contingencies that are probable of requiring an outflow of resources due to adverse effects. The Group recognized the estimated probable losses against the company for labor, administrative and tax litigation, which are calculated based on the best estimate of the disbursement required to cancel the obligation. Such contingencies are disclosed with possible adverse effects for the entity, as follows:

Legal provisions

Softcaps legal proceedings - The total balance of $73 (as of June 30, 2022: $448) is comprised of labor, administrative, and civil ligation. As of June 30, 2022, balance for tax litigation amounted to $372, there are no tax litigation provisions recognized as of June 30, 2023.

The remaining balance of 122 (as of June 30, 2022: 47) is for labor litigation in the following entities: Procaps, S.A., Unimed del Perú, CDI Nicaragua, and Diabetrics.

Contingencies

Procaps SA de CV legal proceedings - The General Tax Directorate of El Salvador (DGII), determined that the company failed to declare taxable and presumed income from revenue obtained and loans made to non-domiciled companies in 2018, the proposed tax charge and sanction amounts to $1,087. Also, the DGII determined that the company incurred in the infraction of non-intentional evasion due to the incorrect filing of the “VAT” declarations for 2019. The proposed tax charge and penalty amounts to $348.

However, the Group’s external advisor indicates that it is not probable for this claim to proceed, therefore, there is no provision for the effect of this contingency.

Note 16. Warrant liabilities

	As of June 30, 2023		As of December 31, 2022
Public warrants	$	3,800	$	9,200
Private warrants1		661		1,716
	$	4,461	$	10,916

¹ Private warrants include 2,875,000 held by the former SPAC sponsors deposited in an escrow account.

28

Procaps Group, S.A. and subsidiaries (The Group)

Notes to Unaudited Condensed Consolidated Interim Financial Statements

For the three and six months ended June 30, 2023 and 2022

(In thousands of United States Dollars, unless otherwise stated)

Note 16.1. Public warrants

	As of June 30, 2023			As of December 31, 2022
As of January 1	$	9,200		$	16,000
Acquired public warrants		—			—
Fair value remeasurement		(5,400	)		(6,800	)
Balance as of June 30/December 31	$	3,800		$	9,200

The fair value of the Public Warrants decreased for the six months ended June 30, 2023 by $5,400 (decreased for the year ended December 31, 2022: $6,800). Refer to Note 7. Finance expenses, net.

Note 16.2. Private warrants

	As of June 30, 2023			As of December 31, 2022
As of January 1	$	1,716		$	7,112
Acquired private warrants		—			—
Fair value remeasurement		(1,055	)		(5,396	)
Balance as of June 30/December 31	$	661		$	1,716

The fair value of the Private Warrants decreased for the six months ended June 30, 2023 by $1,055 (decreased for the year ended December 31, 2022: $5,396). Refer to Note 7. Finance expenses, net.

Note 17. Shares in escrow

	As of June 30, 2023			As of December 31, 2022
As of January 1	$	40,064		$	101,859
Escrowed shares		—			—
Fair value remeasurement		(9,665	)		(61,795	)
Balance as of June 30/December 31	$	30,399		$	40,064

The fair value of the Shares in escrow decreased for the six months ended June 30, 2023 by $9,665 (decreased for the year ended December 31, 2022: $61,795). Refer to Note 7. Finance expenses, net.

Note 18. Financial instruments

18.1 Accounting classification and fair value

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. When measuring fair value, the Group uses observable market data whenever possible. Fair values are categorized into different levels in a hierarchy based on the inputs used in the valuation techniques as follows:

● Level 1: inputs are unadjusted quoted prices in active markets for identical assets or liabilities.

● Level 2: inputs are observable either directly (e.g. as prices) or indirectly (e.g. derived from prices).

● Level 3: fair value measurements incorporate significant inputs that are based on unobservable market data.

29

Procaps Group, S.A. and subsidiaries (The Group)

Notes to Unaudited Condensed Consolidated Interim Financial Statements

For the three and six months ended June 30, 2023 and 2022

(In thousands of United States Dollars, unless otherwise stated)

The following table shows the carrying amounts of financial assets and financial liabilities. The amortized cost basis of the financial assets and liabilities not measured at fair value approximates their fair value.

	As of June 30, 2023						As of December 31, 2022
	FVTPL1		FVOCI2		Amortized cost3		FVTPL1		Amortized cost3
Financial assets not measured at fair value
Trade and other receivables, net	$	—	$	—	$	136,541	$	—	$	129,602
Amounts owed by related parties, net		—		—		2,225		—		2,474
Cash		—		—		11,537		—		43,003
Other financial assets		—		—		14,538		—		210
Total financial assets not measured at fair value	$	—	$	—	$	164,841	$	—	$	175,289
Financial liabilities measured at fair value
Warrant liabilities	$	4,461	$	—	$	—	$	10,916	$	—
Shares held in escrow		30,399		—		—		40,064		—
Derivative financial liabilities		—		2,473		—		—		—
Total financial liabilities measured at fair value	$	34,860	$	2,473	$	—	$	50,980	$	—
Financial liabilities not measured at fair value
Borrowings		—		—		288,319		—		285,934
Trade and other payables		—		—		85,970		—		90,187
Amounts owed to related parties		—		—		3,922		—		2,914
Total financial liabilities not measured at fair value	$	—	$	—	$	378,211	$	—	$	379,035

¹ The fair value of the exhibited figures as of June 30, 2023 is comprised of $3,800 Level 1 (as of December 31, 2022: $9,200) and $31,060 Level 3 (as of December 31, 2022: $41,780).

² The fair value of the exhibited figures as of June 30, 2023 is Level 2.

³ The fair value of the exhibited figures is similar to their amortized cost as of June 30, 2023 and December 31, 2022, respectively.

30

Procaps Group, S.A. and subsidiaries (The Group)

Notes to Unaudited Condensed Consolidated Interim Financial Statements

For the three and six months ended June 30, 2023 and 2022

(In thousands of United States Dollars, unless otherwise stated)

18.2 Measurement of fair values

The following tables show the valuation techniques used in measuring Level 3 fair values for financial instruments in the Unaudited Condensed Consolidated Interim Statement of Financial Position, as well as the significant unobservable inputs used.

				Significant unobservable	Relationship between significant unobservable	Sensitivity of  significant unobservable input to fair value
Type	Fair value		Valuation Technique	input	input to fair value		+5%		-5%
Private warrants	$	100	The fair value of the Private Warrants is estimated using the Black-Scholes option pricing formula for European calls, since the underlying stock is not expected to pay dividends over the term of the Warrants.	Volatility of 36.6% (2022: 36.6%)	The higher (lower) the volatility, the higher (lower) the fair value.	$	155	$	55
Private warrants in escrow		561	The fair value of the Private Warrants in escrow is estimated using Monte Carlo simulation in a risk-neutral framework assuming a Geometric Brownian Motion for the future stock price.	Volatility of 36.6% (2022: 37.5%)	The higher (lower) the volatility, the higher (lower) the fair value.		877		316
Shares held in escrow		30,399	The fair value of the shares to be delivered  is estimated using Monte Carlo simulation in a risk-neutral framework assuming a Geometric Brownian Motion for the future stock price.	Volatility of 41.0% (2022: 36.5%)	The higher (lower) the volatility, the higher (lower) the fair value.		30,737		29,999

18.3 Financial risk management

The Group has exposure to the following risks arising from financial instruments:

● Credit risk

● Liquidity risk

● Market risk, including currency and interest rate risk

18.3.1. Credit risk

Exposure to credit risk

The carrying amount of financial assets represents the maximum credit exposure of the Group. The carrying amount is presented net of impairment losses. None of the receivable balances as of June 30, 2023 and December 31, 2022 constitutes a significant concentration of credit risk. There are no other single customers representing more than 10% of total gross trade receivables as of June 30, 2023 and December 31, 2022.

Expected credit losses

The average credit period on the sale of medicines is 60 to 120 days. In some cases, depending on market conditions and strategy, longer payment periods are granted. No interest surcharge is made on commercial accounts receivable.

The Group has recognized a provision for doubtful accounts. The Group evaluates the impairment of its accounts receivable for the expected credit loss model, where it determines its value based on the probability of default, the loss due to default (i.e., the extent of the loss in case of default) and the exposure, by the application of the ‘simplified method’ for trade receivables without a significant financing component. The assessment of the probability of default and the loss due to default is mainly based on historical data and adjust historical loss rates to reflect information about current conditions and reasonable and supportable forecasts of future economic conditions.

31

Procaps Group, S.A. and subsidiaries (The Group)

Notes to Unaudited Condensed Consolidated Interim Financial Statements

For the three and six months ended June 30, 2023 and 2022

(In thousands of United States Dollars, unless otherwise stated)

June 30, 2023	Current (not past due)			1-30 days past due			31-60 days past due			61-90 days past due			91-120 days past due			More than 120 days past due			Total
Weighted-average loss rate		0.36	%		2.43	%		5.26	%		7.34	%		12.04	%		84.44	%		14.34	%
Gross carrying amount		120,839			16,815			8,524			3,162			1,620			28,420			179,380
Impairment loss allowance		(441	)		(408	)		(448	)		(232	)		(195	)		(23,997	)		(25,721	)
	$	120,398		$	16,407		$	8,076		$	2,930		$	1,425		$	4,423		$	153,659

December 31, 2022	Current (not past due)			1-30 days past due			31-60 days past due			61-90 days past due			91-120 days past due			More than 120 days past due			Total
Weighted-average loss rate		0.39	%		3.42	%		4.50	%		14.25	%		19.89	%		83.88	%		14.07	%
Gross carrying amount		124,219			11,816			3,864			1,958			890			26,605			169,352
Impairment loss allowance		(483	)		(404	)		(174	)		(279	)		(177	)		(22,317	)		(23,834	)
	$	123,736		$	11,412		$	3,690		$	1,679		$	713		$	4,288		$	145,518

As of June 30, 2023 no impairment losses were recognized for balances in connection with related parties. However, as of June 30, 2023 and December 31, 2022, an allowance is maintained for open balances referred to goods sold to Industrias Intercaps de Venezuela C.A. and Laboratorios Vivax Pharmaceuticals C.A., due to the critical political and social situation that the location country of precedence is experiencing.

18.3.2.Market Risk

Net Investment Hedges

A foreign currency exposure arises from the Group’s net investment in its subsidiary Procaps, S.A., that is a Colombian Peso functional currency entity. The risk arises from the fluctuation in spot exchange rates between the Colombian Peso and the USD, which causes the amount of that net investment to vary.

Part of the Group’s net investment in Procaps, S.A. is hedged by average rate forward contracts (pay Colombian Peso and receive USD), which mitigates the foreign currency risk arising from the subsidiary’s net assets. The forward contracts are designated as hedging instruments for the changes in the value of the net investment that are attributable to changes in the Colombian Peso/USD spot rate. The counterparty is a top-tier financial institution with low credit risk.

The hedged risk in the net investment hedge is the risk of a weakening Colombian Peso against the USD that will result in a reduction in the carrying amount of the Group’s net investment in Procaps, S.A. The Group has established a hedge ratio of 1:1 where the notional amounts of the hedging instruments match the carrying amount of the hedged net investment.

The Group assesses hedge effectiveness qualitatively, as the critical terms (i.e., the notional amount and underlying exchange rate) of the hedging instruments are closely aligned with those of the hedged net investment in Procaps, S.A. It is expected that the value of the hedging instruments and the value of the hedged net investment will systematically change in opposite directions in response to movements in the Columbian Peso/USD exchange rate.

The main potential sources of ineffectiveness identified by the Group in these hedging relationships are timing mismatches, forward points used to calculate the settlement amount of the hedging instruments which are not reflected in the value changes of the hedged net investment, and changes in the Group’s and/or derivative counterparty’s credit that would result in movements in fair value of the hedging instruments that would not be reflected in the movements in the value of the hedged net investment.

32

Procaps Group, S.A. and subsidiaries (The Group)

Notes to Unaudited Condensed Consolidated Interim Financial Statements

For the three and six months ended June 30, 2023 and 2022

(In thousands of United States Dollars, unless otherwise stated)

The amounts related to items designated as hedging instruments were as follows:

Average Currency Forward Contracts (Sell COP)	Settlement Date	Forward Exchange rate		Notional amount (COP)		Notional amount (USD)
Less than 3 months	7/6/2023		4,625		36,110,000,000		8,649,102
3-6 months	10/3/2023		4,715		42,800,000,000		10,251,497
Over 6 months	1/3/2024		4,791		48,837,000,000		11,697,485

	As of June 30, 2023
	Carrying amount				Line item in the statement of financial position where the hedging instrument	Change in value used for calculatinghedge
Average Currency Forward Contracts (Sell COP)	Assets		Liabilities		is included	ineffectiveness
Less than 3 months		—		368	Derivative Financial Liability		368
3-6 months		—		1,019	Derivative Financial Liability		1,019
Over 6 months		—		1,086	Derivative Financial Liability		1,086

	As of June 30, 2023
Average Currency Forward Contracts (Sell COP)	Change in value of hedging instruments recognized in OCI		Hedge ineffectiveness recognized in PL		Line item in profit or loss that includes hedge ineffectiveness
Less than 3 months		368		—	Other income (expenses), net
3-6 months		1,019		—	Other income (expenses), net
Over 6 months		1,086		—	Other income (expenses), net

The amounts related to items designated as hedged items were as follows:

	As of June 30, 2023
		Change in value used for calculating hedge ineffectiveness	Foreign currency translation reserve for continued hedges	Balances remaining in the foreign currency translation reserve from hedging relationships for which hedge accounting is no longer applied
Net Investment in Procaps S.A.		2,473	2,473	—

33

Procaps Group, S.A. and subsidiaries (The Group)

Notes to Unaudited Condensed Consolidated Interim Financial Statements

For the three and six months ended June 30, 2023 and 2022

(In thousands of United States Dollars, unless otherwise stated)

Note 19. Key management personnel

Transactions with directors and executive board management members

Total management compensation included in the Unaudited Condensed Consolidated Interim Statement of Profit or Loss and Other Comprehensive Income are as follows:

	For the three months ended June 30				For the six months ended June 30
	2023		20221		2023		20221
Short-term employee benefits		758		598		1,510		1,133
Consulting fees		658		1,126		1,233		1,739
	$	1,416	$	1,724	$	2,743	$	2,872

¹ The Group corrected the disclosure of short-term employee benefits and consulting fees for the three and six months periods ended June 31, 2022. The correction does not impact the results presented in the prior period.

Note 20. Events after the reporting period

Management has considered subsequent events through the date these Unaudited Condensed Consolidated Interim Financial Statements were issued and identified the following events that require disclosure.

Syndicated Loan Refinancing

On August 16, 2023, Procaps S.A. and other subsidiaries of the Group as guarantors (collectively, the “Obligors”) entered into a Credit Agreement with Bancolombia S.A. and Banco Davivienda S.A (the “New Banco Credit Agreement”). The New Banco Credit Agreement provides for a loan of up to $247,817 million COP and the proceeds are to be used exclusively for the prepayment of existing indebtedness of the Group, including the Syndicated Loan Agreement. The New Banco Credit Agreement provides for a term of six-years, and interest accrues thereunder at a rate equal to the Colombian Central Bank’s reference rate (for a three-month tenor) plus 8.50% per annum.

The New Banco Credit Agreement contains customary affirmative and negative covenants, including limitations on the ability of the Group to incur additional debt, guarantee other obligations, grant liens on assets, make investments or acquisitions, dispose of assets, pay dividends or other payments on capital stock, make restricted payments, engage in mergers or consolidations, engage in transactions with affiliates, and enter into certain restrictive agreements.

Additionally, the New Banco Credit Agreement requires the Group’s compliance with the following financial covenants, each measured on a trailing twelve-month basis on the final day of each fiscal quarter of the Group:

● Consolidated debt to consolidated EBITDA ratio of no greater than 3.50:1:00 (other than for the twelve-month period ended September 30, 2023, for which the ratio shall be no greater than 4.30:1.00); and

● Ratio of consolidated EBITDA to consolidated interest expense of greater than 3.00:1.00 (other than for the twelve-month period ended September 30, 2023, for which the ratio shall be greater than 1.90:1.00).

● Additionally, the Obligors are required to maintain combined total assets and combined EBITDA equal to no less than 80% of the Group’s consolidated total assets and consolidated EBITDA, respectively, as of June 30 and December 31 of each year.

BTG Refinancing

On August 18, 2023, the Group entered into a Credit Agreement with Banco BTG Pactual S.A.-Cayman Branch. (the “New BTG Credit Agreement”). The New BTG Credit Agreement provides for a loan of up to $19 million USD and the proceeds are to be used exclusively for the prepayment of existing indebtedness of the Group, including short term debt dated October 13, 2022. The New BTG Credit Agreement provides for a term of 30 months, and interest accrues thereunder at a rate equal to SOFR (for a three-month tenor) plus 5.80%.

34

Procaps Group, S.A. and subsidiaries (The Group)

Notes to Unaudited Condensed Consolidated Interim Financial Statements

For the three and six months ended June 30, 2023 and 2022

(In thousands of United States Dollars, unless otherwise stated)

The New BTG Credit Agreement requires the Group’s compliance with the following financial covenants, each measured on a trailing twelve-month basis on the final day of each fiscal quarter of the Group:

● Consolidated debt to consolidated EBITDA ratio of no greater than 3.50:1:00 (other than for the twelve-month period ended September 30 and December 31, 2023, for which the ratio shall be no greater than 4.30:1.00); and

● Ratio of consolidated EBITDA to consolidated interest expense of greater than 3.00:1.00 (other than for the twelve-month period ended September 30 and December 31, 2023, for which the ratio shall be greater than 1.90:1.00).

As of the date of the issuance of these Unaudited Condensed Consolidated Interim Financial Statements, the Group is in the process of performing the required analysis to determine if the debt refinancing described above constitutes an extinguishment or modification of the debt under IFRS 9.

35

EX-99.2

Exhibit 99.2

Second Quarter 2023 Financial Results

Net Revenues

Net revenues totaled $110.1 million in 2Q23, compared to net revenues of $112.4 million for 2Q22, a decrease of 2.1% year-over-year. On a constant currency basis, net revenues increased 4.3% from 2Q22 to 2Q23, totaling $117.3 million. In 2Q22 there was a recognition of sales of brands in the amount of approximately $3.5 million, leading to a higher comparison base.

The YoY decrease was mainly driven by the impact of the devaluation of some local currencies totaling $7.2 million (particularly in Colombia) as well as CDMO order phasing, especially for U.S. clients, a decrease in sales related to Rymco ceased operations, and a decrease of sales in the OTC market in El Salvador.

Net revenues from 2Q23 increased by 30.8% when compared with 1Q23, positively impacted by an increase in sales of (i) $8.5 million in Procaps Colombia, (ii) $7.0 million in Nextgel; (iii) $5.0 million in CASAND; (iv) $4.2 million in CAN, and (v) $1.1 million in Diabetrics. This reflects an uptake of sales in all regions and business segments.

In terms of business lines, Rx (approximately 46% of total net revenues) presented the highest growth for 1H23, followed by Clinical Specialties (approximately 7% of total net revenues) and OTC (approximately 18% of total net revenues).

Net revenues totaled $194.2 million in 1H23 and $211.9 million on a constant currency basis, an increase of 7.0% from 1H22.

Net revenues by strategic business segment are shown below:

U$ million	2Q23	%NR		2Q23*	2Q22	%NR		Δ%		Δ%*
CAN	13.8	12.6	%	13.9	16.8	15.0	%	-18.0	%	-17.6	%
CASAND	21.0	19.1	%	20.9	17.1	15.2	%	22.9	%	22.4	%
Diabetrics	5.2	4.7	%	5.9	6.0	5.3	%	-12.8	%	-1.6	%
Nextgel	32.0	29.1	%	33.5	32.9	29.3	%	-2.9	%	1.9	%
Procaps Colombia	38.0	34.6	%	43.1	39.6	35.2	%	-3.9	%	8.8	%
Total Net Revenues	110.1	100.0	%	117.3	112.4	100.0	%	-2.1	%	4.3	%

U$ million	1H23	%NR		6M23*	1H22	%NR		Δ%		Δ%*
CAN	23.4	12.0	%	23.5	28.1	14.2	%	-16.8	%	-16.3	%
CASAND	37.0	19.1	%	37.3	29.7	15.0	%	24.9	%	25.7	%
Diabetrics	9.3	4.8	%	10.8	10.6	5.3	%	-12.4	%	1.8	%
Nextgel	56.9	29.3	%	61.3	58.3	29.4	%	-2.3	%	5.2	%
Procaps Colombia	67.6	34.8	%	79.0	71.5	36.1	%	-5.4	%	10.6	%
Total Net Revenues	194.2	100.0	%	211.9	198.0	100.0	%	-1.9	%	7.0	%

* Constant currency basis

 

Central America North (CAN)

Net revenues for the CAN business segment were $13.8 million in 2Q23, an increase of 44.4% versus 1Q23, and a decrease of 18.0% versus 2Q22. 2Q23 followed the same trend as 1Q23, which was impacted mainly by a decrease in the OTC VitalCare segment in El Salvador. Also, 2Q22 was positively impacted by the sales of brand in the amount of approximately $3.5 million.

Net revenues for 1H23 were impacted by the effects mentioned above, reaching $$23.4 million in 1H23, a decrease of 16.8% in the period.

We reinforced our sales force in El Salvador, focusing on opening new distributors for the OTC market and we can see the improvement from 1Q23 to 2Q23.

The Rx portfolio grew approximately 5.7% in 2Q23, and Clinical Specialties more than doubled. Nicaragua and Honduras have shown significant improvement from 2Q22, growing approximately 25.6% and 69.8%, respectively, in the period.

Central America South and Andean Region (CASAND)

Net revenues for the CASAND business segment totaled $ 21.0 million in 2Q23, an increase of 31.2% versus 1Q23 and an increase of 22.9% when compared to 2Q22, mainly due to the positive performance of new products launched in the region, such as Dol B-vit, Fortzink and Dexkedol; and a sales increase in the existing product portfolio, such as Merobac, Dayflu, Alercet D, Albisec, among others. On a constant currency basis, net revenues increased by 22.4% in the quarter.

Net revenues for 1H23 reached $37.0 million, an increase of 24.9%. On a constant currency basis net revenues increased by 25.7%.

Panama and Dominican Republic performed well, with net revenues growth of approximately 40.0% and 65.1%, from 2Q22 to 2Q23, respectively.

Diabetrics

Diabetrics net revenues totaled $5.2 million, an increase of 28.3% from 1Q23, and a decrease of 12.8% when compared with 2Q22, mainly impacted by currency devaluation of approximately $0.7 million. On a constant currency basis, net revenues decreased 1.6% from 2Q22 to 2Q23.

2023 is a transition year for this business unit. We are working on several G&A synergies, such as integrating the back office and sales force with Procaps Colombia.

Net revenues for 1H23 reached $9.3 million, and $10.8 million on a constant currency basis, an increase of 1.8% versus 1H22.

We have launched in El Salvador and Ecuador, and we are receiving registration approvals for different products in Mexico, where we expect to launch a more complete portfolio by the end of 2024.

2

 

Nextgel

Net revenues for the Nextgel business segment were $32.0 million in 2Q23, an increase of 28.1% versus 1Q23, and a decrease of 2.9% versus 2Q22, impacted mainly by currency devaluation of approximately $1.6 million. On a constant currency basis, net revenues increased by 1.9%, compared to 2Q22.

The quarter was negatively impacted mainly by order phasing from some of our U.S. clients in gummies and soft gels, phasing of product development services, the ongoing impact of the change of manufacturing site of dronabinol, and the ongoing bioequivalence test for progesterone. We expect to see a positive effect in the second half of the year.

Net revenues for 1H23 totaled $56.9 million, and $61.3 million on a constant currency basis, an increase of 5.2% versus 1H22, positively impacted by the portfolio increase from existing partners from Latin America.

Procaps Colombia

Net revenues for the Procaps Colombia segment totaled $38.0 million in 2Q23, an increase of 28.7% from 1Q23, and a decrease of 3.9% versus 2Q22, impacted by the currency devaluation of approximately $5.0 million and the decrease in sales of the Rymco ceased operations.

The RX Farma Procaps sales grew approximately 14.4% in 2Q23 versus 2Q22, Clinical Specialties grew approximately 9.0% and the OTC VitalCare business unit grew approximately 7.6%, primarily due to the demand increase of its leading brands in the market as well as the positive rollout of new products. Approximately 21% of total net revenues came from new products launched in the last 36 months.

Net revenues for 1H23 totaled $67.6 million, and $79.0 million on a constant currency basis, for an increase of 10.6% in comparison with 1H22, on a constant currency basis.

Gross Profit

Gross profit totaled $61.2 million in 2Q23, with a 55.6% gross margin, and $107.3 million in 1H23, with a 55.2% gross margin for the period.

Gross profit was negatively impacted by currency devaluation of approximately $4.0 million, higher COGS negatively affected by the mix of products sold and the decrease of product development services. There was also a higher comparison base from 2Q22, when there were sales of brands that affected gross profit by approximately $3.5 million.

U$ million	2Q23		2Q22		Δ%		1H23		1H22		Δ%
Net Revenues	110.1		112.4		-2.1	%	194.2		198.0		-1.9	%
COGS	(48.9	)	(39.8	)	22.8	%	(87.0	)	(78.3	)	11.1	%
Gross Profit	61.2		72.6		-15.8	%	107.3		119.8		-10.4	%
Gross Margin	55.6	%	64.6	%	-901.2 bps		55.2	%	60.5	%	-524.6 bps

3

 

Operating Expenses

Operating expenses totaled $16.5 million in 2Q23, a decrease of 73.9% versus 2Q22, mainly due to the positive Other Expenses.

SG&A totaled $46.1 million in 2Q23, a decrease of 15.4% versus 2Q22, representing 41.9% of total net revenues. On a constant currency basis, SG&A decreased 10.0% in the quarter. The decrease was a consequence of the ongoing efforts related to the value creation initiatives.

SG&A totaled $88.9 million in 1H23, a decrease of 10.4% versus 1H22, representing 45.8% of total net revenues. On a constant currency basis, SG&A decreased 2.6% in 1H23.

U$ million	2Q23		%NR		2Q22		%NR		Δ%
Sales and marketing expenses	(21.5	)	19.5	%	(25.7	)	22.8	%	-16.2	%
Administrative expenses	(24.6	)	22.4	%	(28.8	)	25.7	%	-14.7	%
Other expenses	29.6		-26.9	%	(8.6	)	7.7	%	n.a.
Total Operational Expenses	(16.5	)	15.0	%	(63.1	)	56.2	%	-73.9	%

U$ million	6M23		%NR		6M22		%NR		Δ%
Sales and marketing expenses	(42.2	)	21.7	%	(45.8	)	23.1	%	-8.0	%
Administrative expenses	(46.7	)	24.1	%	(53.4	)	27.0	%	-12.5	%
Other expenses	33.6		-17.3	%	(3.5	)	1.8	%	n.a.
Total Operational Expenses	(55.3	)	28.5	%	(102.7	)	51.9	%	-46.2	%

Sales and marketing expenses totaled $21.5 million in 2Q23, a decrease of 16.2% versus 2Q22, mainly due to the efforts of the value creation initiatives. For 1H23, sales and marketing expenses totaled $42.2 million.

Administrative expenses totaled $24.6 million in 2Q23, a decrease of 14.7% versus 2Q22, mainly driven by the execution of the value creation initiatives. For 1H23, expenses totaled $46.7 million, a decrease of 12.5% versus 1H22.

Other expenses for 2Q23 and 1H23 are related mainly to the impact of exchange rate differences from the balance sheet that is reflected in the P&L of approximately $10.5 million and the one-time settlement with third parties with respect to certain matters in favor of the Company of approximately $19.3 million.

Financial Expenses

Net financial expenses totaled $6.8 million in 2Q23 and $5.1 million in 1H23, negatively impacted mainly by interest expenses.

There was a positive impact related to the net fair value gain of the Procaps ordinary shares held in escrow and warrants liabilities, which are non-cash items. Excluding this effect, net financial expenses totaled $11.8 million in 2Q23 and $21.3 million in 1H23, mostly impacted by interest expense ($10.6 million in 2Q23 and $19.4 million in 1H23).

4

U$ million	2Q23		2Q22		Δ%		1H23		1H22		Δ%
Banking expenses and fees	(0.9	)	(0.4	)	137.3	%	(1.3	)	(0.8	)	64.1	%
Others financial expenses	(0.3	)	(0.3	)	12.5	%	(0.6	)	(0.4	)	42.4	%
Net fair value gain/loss of warrants liabilities	2.5		(1.1	)	n.a.		6.5		0.6		914.9	%
Net fair value gain/loss of shares held in escrow	2.5		(10.8	)	n.a.		9.7		7.7		25.0	%
Interest expenses	(10.6	)	(6.3	)	68.4	%	(19.4	)	(11.4	)	70.3	%
Net Financial Expenses	(6.8	)	(18.8	)	-63.9	%	(5.1	)	(4.2	)	21.9	%

Net Income

Procaps reported net income of $27.0 million for 2Q23 and a loss of $6.9 million for 2Q22. Non-cash items totaled $5.0 million in 2Q23 and $11.9 million in 2Q22.

Net income for 1H23 totaled $33.6 million, an increase from $9.5 million in 1H22. Non-cash items totaled $16.1 million in 1H23 and $8.4 million in 1H22.

U$ million	2Q23		%NR		2Q22		%NR		Δ%		1H22		%NR		1H22		%NR		Δ%
EBIT	44.7		40.6	%	9.5		8.4	%	370.9	%	51.9		26.7	%	17.0		8.6	%	205.0	%
Net Financial Expenses	(6.8	)	-6.2	%	(18.8	)	-16.7	%	-63.9	%	(5.1	)	-2.6	%	(4.2	)	-2.1	%	21.9	%
EBT	37.9		34.5	%	(9.3	)	-8.3	%	n.a.		46.8		24.1	%	12.8		6.5	%	265.2	%
Income Tax	(11.0	)	-10.0	%	2.4		2.1	%	n.a.		(13.2	)	-6.8	%	(3.3	)	-1.7	%	301.9	%
Net Income	27.0		24.5	%	(6.9	)	-6.2	%	n.a.		33.6		17.3	%	9.5		4.8	%	252.5	%

Indebtedness

As of June 30, 2023, our total gross debt was $288.3 million, compared to $285.9 million as of December 31, 2022.

Gross debt consisted mainly of Senior Notes in the amount of $115.0 million; other loans in the amount of $93.8 million, a syndicated loan in the amount of $40.2 million, and lease liabilities in the amount of $35.0 million. Total gross debt is carried at an average cost of 13.3%.

The Senior Notes have a fixed interest rate of 8.5% and mature in 2031. Other loans consist of loans in different currencies (COPs, Soles, Brazilian Reais and USD) with differing interest rates, some with variable rates. The syndicated loan is in COPs, with a variable interest rate of IBR+5.30% and maturity by 2025.

5

 

Cash totaled $11.5 million as of June 30, 2023. Cash decrease was impacted mainly by changes in the working capital and the payment of short term debts that were not rolled over.

Total net debt as of June 30, 2023, totaled $276.8 miAllion, of which approximately 29% consisted of short-term obligations.

U$ million	1H23		2022		1H22
Short Term		118.7		257.5		75.7
Long Term		169.6		28.4		181.8
Gross Debt		288.3		285.9		257.5
Cash and cash equiv.		11.5		43.0		37.6
Net Debt		276.8		242.9		220.0

On August 16, 2023, we entered into a Credit Agreement with Bancolombia and Banco Davivienda, as lenders. The Credit Agreement provides for a loan of up to COP$247,817,751,759.49. The proceeds of the loan are to be used exclusively for the prepayment of existing indebtedness of the Company and its subsidiaries, including the full repayment of the outstanding indebtedness under the syndicated loan agreement. The Credit Agreement provides for a term of six years, and interest accrues thereunder at a rate equal to the Colombian Central Bank’s reference rate (for a three-month tenor) plus 8.50%.

Capital Expenditures (“CAPEX”)

As of June 30, 2023, CAPEX totaled $12.7 million, comprised of $7.2 million of property, plant & equipment (“PP&E”) and $ 5.5 million of intangible CAPEX.

PP&E CAPEX refers mainly to the construction of the new Miramar site for Funtrition, the increase of installed capacity in our plants and the expansion of analytical lab capacity.

Intangible CAPEX refers mainly to investments in the development of new products and product sanitary registration fees.

These investments are aligned with our strategic growth plan to increase production capacity, facilities improvements and increase capacity to develop new products.

U$ million	1H23	% NR		1H22	% NR		Δ%
Intangible CAPEX	5.5	2.8	%	5.1	2.6	%	7.6	%
PP&E CAPEX	7.2	3.7	%	10.5	5.3	%	-31.3	%
Total CAPEX	12.7	6.5	%	15.6	7.9	%	-18.6	%

6

 

Cash Flow

Cash flow from operating activities during 2Q23 was $30.3 million, mainly impacted by changes in working capital.

U$ million	1H23		1H22		Δ%
Net Income	33.6		9.5		252.5	%
D&A	8.0		8.4		-4.2	%
Income Tax expenses	13.2		3.3		301.8	%
Finance expenses	5.1		4.2		21.9	%
Other adjustments	(13.2	)	1.8		n.a.
Changes in working capital	(16.4	)	(6.4	)	158.8	%
Cash from operations	30.3		20.9		45.1	%
Interest paid	(1.9	)	(0.9	)	98.6	%
Income tax paid	(4.9	)	(3.6	)	34.0	%
Operating Cash Flow	23.5		16.3		44.5	%
CAPEX and R&D investments	(12.9	)	(13.1	)	-1.3	%
Free Cash Flow	10.6		3.2		230.4	%
Financing Cash Flow	(43.6	)	(36.2	)	20.8	%
Increase (Decrease) in Cash	(33.0	)	(33.0	)	20.8	%

Cash conversion cycle was 137 days ($154.0 million).

(days)	4Q21	1Q22	2Q22	3Q22	4Q22	1Q23	2Q23
Acounts receivables (DSO)	103	96	100	107	114	103	121.0
Inventories (DIO)	70	85	83	83.1	85.0	87.4	91.7
Accounts payable - suppliers (DPO)	75	78	76	78.8	79.2	70.4	76.2
Working Capital	98	103	107	111	120	120	137

Board of Director Update

Effective August 29, 2023, Mr. Alejandro Weinstein respectfully resigned from the board of directors (the “Board”) of Procaps Group, S.A. (the “Company”). Mr. Weinstein decided to resign based on disagreements with the Board regarding the strategic priorities and direction of the Company.

Alberto Eguiguren Correa, who was originally appointed to the Board pursuant to the nomination rights of Hoche Partners Pharma Holding S.A. (of which Mr. Weinstein is the sole beneficial owner), shall continue his service on the Board.

The Company is considering and evaluating potential candidates for a successor to Mr. Weinstein.

About Procaps Group

Procaps Group, S.A. ("Procaps”) (NASDAQ: PROC) is a developer of pharmaceutical and nutraceutical solutions, medicines, and hospital supplies that reach more than 50 countries in all five continents. Procaps has a direct presence in 13 countries in the Americas and more than 5,500 employees working under a sustainable model. Procaps develops, manufactures, and markets over the counter (OTC) pharmaceutical products and prescription pharmaceutical drugs (Rx), nutritional supplements and high-potency clinical solutions. For more information, visit www.procapsgroup.com or Procaps Group’s investor relations website investor.procapsgroup.com.

7

 

APPENDIX

Portfolio Overview

Procaps´ portfolio is comprised by 5 business lines: Nextgel, Diabetrics, Farma Procaps, Clinical Specialties, and Vital Care.

Nextgel

Nextgel is the iCDMO (integral contract development and manufacturing organization) arm of Procaps. We develop and manufacture proprietary Softgel technology, such as Unigel, Versagel, Chewgel, G-tabs and specialized gummies. We export to over 50 countries and partner with global and regional pharmas. This is exclusively a B2B channel.

Diabetrics

Diabetrics is a health solution for diabetes patients. It is a patient-centric solution, offering a comprehensive portfolio of products and differentiated services. This solution is offered in Colombia, and we expect to launch in Central America and Mexico beginning in 2023.

Farma Procaps

Farma Procaps formulates, manufactures and markets branded prescription drugs. It represents a high-growth portfolio that focuses on nine therapeutic areas: feminine care products, pain relief, skin care, digestive health, growth and development, cardiology, vision care, central nervous system and respiratory.

Clinical Specialties

Clinical Specialties business line develops, manufactures, and markets high-complexity drugs for hospitals and clinics, such as antibiotics, blood clots, immunosuppressants, oncology, and analgesics products.

VitalCare

VitalCare business line develops, manufactures, and markets OTC consumer healthcare products through an extensive portfolio focused on high-prevalence therapeutic areas, including gastrointestinal, skin care, cough, and cold, analgesics, urological, and vitamins, minerals, and supplements.

Our Farma Procaps, VitalCare and Clinical Specialties business units are part of three business segments: CAN, CASAND, and Procaps Colombia.

Procaps Colombia primarily serves the Colombian market; CAN primarily serves the Honduras, Nicaragua, El Salvador, United States, and Guatemala markets; and CASAND primarily serves the Panama, Costa Rica, Ecuador, Dominican Republic, Peru, and Bolivia markets.

Use of Non-IFRS Financial Measures

Our management uses and discloses EBITDA, Contribution Margin, Contribution Margin on a constant currency basis and net revenue on a constant currency basis, which are non-IFRS financial information to assess our operating performance across periods and for business planning purposes. We believe the presentation of these non-IFRS financial measures is useful to investors as it provides additional information to facilitate comparisons of historical operating results, identify trends in our underlying operating results and provide additional insight and transparency on how we evaluate our business. These non-IFRS measures are not meant to be considered in isolation or as a substitute for financial information presented in accordance with International Financial Reporting Standards (“IFRS”) issued by the International Accounting Standards Board and should be viewed as supplemental and in addition to our financial information presented in accordance with IFRS.

8

 

Use of Constant Currency

As exchange rates are an important factor in understanding period-to-period comparisons, we believe the presentation of certain financial metrics and results on a constant currency basis in addition to the IFRS reported results helps improve investors’ ability to understand our operating results and evaluate our performance in comparison to prior periods. Constant currency information is non-IFRS financial information that compares results between periods as if exchange rates had remained constant period-over-period. We use results on a constant currency basis as one measure to evaluate our performance. We currently present net revenue on a constant currency basis. We calculate constant currency by calculating three month-end period for the three months and six months ended June 30, 2023 using prior-period (three months and six months ended June 30, 2022) foreign currency exchange rates. The functional foreign currencies for the primary regional markets where we operate, such as the Colombian Peso and the Brazilian Real, were adjusted on a constant currency basis at the exchange rates of COP$3,914.46 per U.S. $1.00 and R$5.0782 per U.S. $1.00, for the three months and six months ended June 30, 2022. We generally refer to such amounts calculated on a constant currency basis as excluding the impact of foreign exchange. These results should be considered in addition to, not as a substitute for, results reported in accordance with IFRS. Results on a constant currency basis, as we present them, may not be comparable to similarly titled measures used by other companies and are not measures of performance presented in accordance with IFRS.

9 

XML

Document And Entity Information	6 Months Ended
	Jun. 30, 2023
Document Information Line Items
Entity Registrant Name	Procaps Group, S.A.
Document Type	6-K
Current Fiscal Year End Date	--12-31
Amendment Flag	false
Entity Central Index Key	0001863362
Document Period End Date	Jun. 30, 2023
Document Fiscal Year Focus	2023
Document Fiscal Period Focus	Q2
Entity File Number	001-40851

XML

Unaudited Condensed Consolidated Interim Statement of Profit or Loss and Other Comprehensive Income - USD ($) $ in Thousands		3 Months Ended		6 Months Ended
		Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Consolidated Statement of Profit or Loss and Other Comprehensive Income [Abstract]
Revenue		$ 110,057	$ 112,420	$ 194,219	$ 198,050
Cost of sales		(48,869)	(39,786)	(86,969)	(78,294)
Gross profit		61,188	72,634	107,250	119,756
Sales and marketing expenses		(21,497)	(25,665)	(42,167)	(45,822)
Administrative expenses		(24,602)	(28,845)	(46,721)	(53,400)
Finance expenses, net		(6,780)	(18,791)	(5,131)	(4,209)
Other income (expenses), net		29,627	(8,626)	33,585	(3,503)
Income/(Loss) before tax		37,936	(9,293)	46,816	12,822
Income tax expense		(10,981)	2,374	(13,240)	(3,295)
Income/(Loss) for the period		26,955	(6,919)	33,576	9,527
Items that will not be reclassified to profit or loss:
Remeasurement of net defined benefit liability		(83)		(83)
Items that will be reclassified subsequently to profit or loss:
Exchange differences on translation of foreign operations		2,611	(3,001)	3,039	(767)
Net investment hedge		(2,473)		(2,473)
Other comprehensive income/(loss) for the period		55	(3,001)	483	(767)
Total comprehensive income/(loss) for the period		27,010	(9,920)	34,059	8,760
Total comprehensive income/(loss) for the period attributable to:
Owners of the Company		27,008	(9,929)	34,057	8,750
Non-controlling interests		2	9	2	10
Income/(Loss) for the period attributable to:
Owners of the Company		26,955	(6,919)	33,576	9,527
Non-controlling interests
Earnings per share:
Basic, income/(loss) for the period attributable to ordinary equity holders of the Company (USD) 1 (in Dollars per share)	[1]	$ 0.27	$ (0.07)	$ 0.33	$ 0.09

[1] The Group reports net earnings per share in accordance with IAS 33 - Earnings Per Share. Basic income/(loss) per share is calculated by dividing the income/(loss) attributable to ordinary equity holders of the Group by the weighted average number of ordinary shares outstanding during the period. No dilutive effect has been identified for the three and six months ended June 30, 2023 and 2022. The weighted average number of ordinary shares used as the denominator in calculating basic earnings per share for the three and six months ended June 30, 2023 and 2022 is 101,106,853 and 101,109,572, respectively.

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Unaudited Condensed Consolidated Interim Statement of Profit or Loss and Other Comprehensive Income (Parentheticals) - $ / shares		3 Months Ended		6 Months Ended
		Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Consolidated Statement of Profit or Loss and Other Comprehensive Income [Abstract]
Diluted, income/(loss) for the period attributable to ordinary equity holders of the Company	[1]	$ 0.27	$ (0.07)	$ 0.33	$ 0.09

[1] The Group reports net earnings per share in accordance with IAS 33 - Earnings Per Share. Basic income/(loss) per share is calculated by dividing the income/(loss) attributable to ordinary equity holders of the Group by the weighted average number of ordinary shares outstanding during the period. No dilutive effect has been identified for the three and six months ended June 30, 2023 and 2022. The weighted average number of ordinary shares used as the denominator in calculating basic earnings per share for the three and six months ended June 30, 2023 and 2022 is 101,106,853 and 101,109,572, respectively.

XML

Unaudited Condensed Consolidated Interim Statement of Financial Position - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
Non-current assets
Property, plant and equipment, net	$ 91,825	$ 73,965
Right-of-use assets, net	40,771	39,013
Goodwill	5,791	5,791
Intangible assets, net	39,158	32,208
Investments in joint ventures	2,079	1,505
Other financial assets	6,111	210
Deferred tax assets, net	7,010	6,974
Other assets	2,424	3,078
Total non-current assets	195,169	162,744
Current assets
Cash	11,538	43,003
Trade and other receivables, net	136,541	129,602
Inventories, net	103,475	96,833
Amounts owed by related parties, net	2,226	2,474
Current tax assets, net	30,826	21,187
Other current assets	2,518	4,344
Other financial assets	8,429
Total current assets	295,553	297,443
Total assets	490,722	460,187
Equity (Deficit)
Share capital	1,011	1,011
Share premium	377,677	377,677
Reserves	50,082	45,743
Accumulated deficit	(362,432)	(391,513)
Accumulated other comprehensive loss	(33,376)	(33,859)
Equity (deficit) attributable to owners of the company	32,962	(941)
Non-controlling interest	(935)	(937)
Total equity (deficit)	32,027	(1,878)
Non-Current liabilities
Borrowings	169,635	28,410
Warrant liabilities	4,461	10,916
Shares held in escrow	30,399	40,064
Deferred tax liabilities, net	3,400	7,821
Other liabilities	6,917	6,480
Total non-current liabilities	214,812	93,691
Current liabilities
Borrowings	118,684	257,525
Derivative financial liabilities	2,473
Trade and other payables	85,970	90,187
Amounts owed to related parties	3,922	2,914
Current tax liabilities, net	21,841	6,133
Provisions	195	138
Other liabilities	10,798	11,477
Total current liabilities	243,883	368,374
Total liabilities and stockholders’ equity (deficit)	$ 490,722	$ 460,187

XML

Unaudited Condensed Consolidated Interim Statement of Changes in Equity - USD ($) $ in Thousands	Issued Capital	Share premium	Treasury shares reserve	[1]	Reserves	[2]	Accumulated deficit	Other Comprehensive Income	Total	Non-controlling interest	Total
Balance at Dec. 31, 2021	$ 1,011	$ 377,677			$ 42,749		$ (431,059)	$ (27,778)	$ (37,400)	$ (940)	$ (38,340)
Income for the period							9,527		9,527		9,527
Transfer reserves					2,994		(2,994)
Other comprehensive income								(777)	(777)	10	(767)
Non-controlling interest								10	10		10
Balance at Jun. 30, 2022	1,011	377,677			45,743		(424,526)	(28,545)	(28,640)	(930)	(29,570)
Balance at Dec. 31, 2022	1,011	377,677			45,743		(391,513)	(33,859)	(941)	(937)	(1,878)
Income for the period							33,576		33,576		33,576
Transfer reserves					4,495		(4,495)
Other comprehensive income								481	481	2	483
Non-controlling interest								2	2		2
Treasury shares acquired			(156)						(156)		(156)
Balance at Jun. 30, 2023	$ 1,011	$ 377,677	$ (156)		$ 50,238		$ (362,432)	$ (33,376)	$ 32,962	$ (935)	$ 32,027

[1] Comprises the cost of the Company’s shares held by the Group. As of June 30, 2023, the Group held 35,798 of the Company’s shares.

[2] Includes the appropriate values from net income to comply with legal provisions related to asset protection according to applicable jurisdictions with cumulative earnings.

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Unaudited Condensed Consolidated Interim Statement of Cash Flows - USD ($) $ in Thousands		6 Months Ended
		Jun. 30, 2023	Jun. 30, 2022
Operating activities
Income for the period		$ 33,576	$ 9,527
Adjustments to reconcile net income with cash flow from operating activities before changes in working capital:
Depreciation of property, plant and equipment		2,662	2,932
Depreciation of right-of-use assets		3,070	3,005
Amortization of intangibles		2,291	2,436
Income tax expense		13,240	3,295
Finance expenses, net		5,131	4,209
Unrealized currency exchange rate differences		(15,793)
Share of result of joint ventures		(561)	109
Net loss (gain) on sale and disposal of property, plant and equipment		49	(590)
Net loss on disposal of intangibles		51
Inventory provision		2,502	1,010
Provision for bad debt		442	1,304
Provisions		91	7
Cash flow from operating activities before changes in working capital		46,751	27,244
Changes in working capital:
Trade and other receivables, net		2,054	(3,793)
Amounts owed by related parties		675	(1,057)
Inventories, net		3,083	(20,941)
Current tax assets, net		(7,175)	(6,958)
Other current assets		1,822	(3,154)
Trade and other payables		(5,320)	26,648
Amounts owed to related parties		613	2,030
Current tax liabilities, net		2,619	(442)
Other liabilities		(1,133)	563
Provisions		(42)	(41)
Other financial assets		(14,328)	12
Other assets		687	778
Cash generated from operations		30,306	20,889
Interest paid		(1,879)	(946)
Income tax paid		(4,889)	(3,649)
Cash flow provided by operating activities		23,538	16,294
Investing activities
Acquisition of property, plant and equipment		(7,224)	(10,518)
Proceeds from sale of property, plant and equipment			2,689
Acquisition of intangibles		(5,496)	(5,106)
Advances to related parties		(182)	(139)
Cash flow used in investing activities		(12,902)	(13,074)
Financing activities
Proceeds from borrowings		42,137	54,085
Payments on borrowings		(68,201)	(74,242)
Payments to related parties			(4,525)
Interest paid on borrowings		(15,010)	(8,639)
Payment of lease liabilities		(2,374)	(2,867)
Repurchase of treasury shares		(156)
Cash flow used in financing activities		(43,604)	(36,188)
Net decrease in cash		(32,968)	(32,968)
Cash at beginning of the period		43,003	72,112
Effect of exchange rate fluctuations		1,503	(1,592)
Cash at end of the period		11,538	37,552
Non-cash financing and investing activities	[1]	$ 23,274	$ 32,737

[1] Non-cash investing and financing activities include new lease liabilities $1,063 (for the six months ended June 30, 2022: $7,804), invoices from suppliers financed via reverse factoring classified as Trade and other payables $3,089 (for the six months ended June 30, 2022: $1,013), invoices from suppliers financed via reverse factoring classified as Borrowings $16,649 (for the six months ended June 30, 2022: $23,920) and derivative financial liabilities $2,473 (for the six months ended June 30, 2022: $0).

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General Company Information

6 Months Ended

Jun. 30, 2023

General Company Information [Abstract]

General Company Information

Note 1. General Company Information

Procaps Group, S.A, (the “Company”), a public limited liability company (société anonyme) governed by the laws of the Grand Duchy of Luxembourg and its subsidiaries (collectively “the Group”) primarily engages in developing, producing, and marketing pharmaceutical solutions. Further information about the Group’s business activities, reportable segments and key management personnel of the Group is included in Note 5. Revenue, Note 6. Segment reporting and Note 19. Key management personnel, respectively.

The Group’s principal subsidiaries as of June 30, 2023 and December 31, 2022, are set out below. Unless otherwise stated, they have share capital consisting solely of ordinary shares that are held directly by the Group, and the proportion of ownership interests held equals the voting rights held by the Group. The country of incorporation or registration is also their principal place of business.

		Ownership interests held by:
	Place of business/country	The Group				Non-controlling interests
Name of entity	of incorporation	2023		2022		2023		2022		Principal activities
Procaps S.A.	Colombia	100	%	100	%	—	%	—	%	Manufacturing and distribution of prescription and over-the-counter pharmaceutical products.
C.I. Procaps S.A.	Colombia	100	%	100	%	—	%	—	%
Procaps S.A. de C.V	El Salvador	100	%	100	%	—	%	—	%
Softcaps - Colbras	Brazil	100	%	100	%	—	%	—	%
Diabetrics Healthcare S.A.S.	Colombia	100	%	100	%	—	%	—	%	Diabetes solutions and chronic disease management tool.

There are no significant restrictions on the ability of the Group to access or use assets to settle liabilities.

The Unaudited Condensed Consolidated Interim Financial Statements of the Group for the three and six months ended June 30, 2023 and 2022 comprise the Group and its interest in joint ventures, investments and operations.

The Unaudited Condensed Consolidated Interim Financial Statements are presented in USD (the Group’s presentation currency) and all amounts are rounded to the nearest thousands of USD, unless otherwise stated.

Emerging Growth Company Status

The Group is an emerging growth company, as defined in the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”). The Group will remain an emerging growth company until the earliest of:

● The last day of the first fiscal year (a) following the fifth anniversary of a public equity offering, (b) in which its annual gross revenue totals at least $1.07 billion or (c) when the Group is deemed to be a large, accelerated filer, which means the market value of the Group’s ordinary shares held by non-affiliates exceeds $700.0 million as of the prior June 30th; and

● The date on which the Group has issued more than $1.0 billion in non-convertible debt securities during the prior three-year period.

Ongoing Military Operation in Ukraine and Related Sanctions

The ongoing military operation in Ukraine and the related sanctions targeted against the Russian Federation have disrupted international commerce and the global economy. The Group does not have any direct exposure to Ukraine, Russia or Belarus considering there are not any existing operations or sales in those locations.

Although the Group does not currently operate in Ukraine or Russia, the duration and severity of the effects on its business and the global economy are inherently unpredictable. Management will continue to monitor the effects of the war in Ukraine and its potential further impacts, including global supply chain disruptions, inflation, and rising interest rates, when making certain estimates and judgments relating to the preparation of the Unaudited Condensed Consolidated Interim Financial Statements of the Group.

Grupo Somar and Pearl Mexico Acquisition

Refer to the last annual Consolidated Financial Statements as of and for the year ended December 31, 2022 (“last annual financial statements”) for background information on the Acquisition of Grupo Somar and Pearl Mexico. Following the failure of the transaction to close on December 31, 2022, the Group provided the sellers a formal notice on January 1, 2023 terminating the Stock Purchase Agreement (the “SPA”) in accordance with the terms thereof.

Bridge Loan Credit Agreement

Following the Group’s termination of the SPA, the Group advised the joint arrangers and book runners on January 1, 2023 of its desire to terminate the transaction documents (including, without limitation, the commitments under the bridge credit agreement and, for the avoidance of doubt, any commitments under the commitment letter) and pay all outstanding obligations, amounting to $5,719, under the bridge credit agreement and any other transaction document as of January 10, 2023.

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Basis of Preparation and Accounting

6 Months Ended

Jun. 30, 2023

Basis of Preparation and Accounting [Abstract]

Basis of preparation and accounting

Note 2. Basis of preparation and accounting

These Unaudited Condensed Consolidated Interim Financial Statements of the Group as of June 30, 2023 have been prepared on a going concern basis, and in accordance with IAS 34 Interim Financial Reporting, and should be read in conjunction with the last annual financial statements. They do not include all of the information required for a complete set of financial statements prepared in accordance with IFRS Standards. However, selected explanatory notes are included to explain events and transactions that are significant to an understanding of the changes in the Group’s financial position and performance since the last annual financial statements.

These Unaudited Condensed Consolidated Interim Financial Statements were authorized for issue by the Group’s Audit Committee on August 29, 2023.

Note 2.1. Going concern

Management identified the following events and conditions which cast significant doubt on the Group’s ability to continue as a going concern:

As of December 31, 2022, the Group was in breach of certain of the covenants included under the Note Purchase Agreement (“NPA”), the Syndicated Loan Agreement and the BTG Credit Agreement. Refer to the last annual financial statements for further details regarding the breach of each covenant. Although none of the lenders declared an event of default under the applicable agreements, these breaches resulted in the lenders having the right to require immediate repayment of the applicable indebtedness and as a result, the Group classified the respective indebtedness, amounting to $139,155 in the aggregate, to current liabilities as of December 31, 2022.

On March 28, March 31 and May 2, 2023 the Group obtained Waiver Agreements (“Waivers” or “Waiver”) from each lender under the NPA, the Syndicated Loan Agreement and the BTG Credit Agreement for the applicable covenant breaches. Under the terms of the Waivers, the lenders permanently waived their rights to accelerate the repayment of the loans related to the events of default as of December 31, 2022. In addition, the Group executed Waivers with the lenders to adjust the applicable covenant ratios for the periods ending March 31, June 30, and September 30, 2023, if applicable, as noted further within Note 14. Borrowings. For the period ending December 31, 2023, the applicable covenant ratios in the original borrowing arrangements are unmodified.

On June 30, 2023, the Group obtained an Additional Waiver under the NPA (the “Additional Waiver”) in anticipation of a potential breach of the Indebtedness Indicator and EBITDA Interest Coverage ratios contained within the March 31, 2023 Waiver. The Additional Waiver with the lenders adjusts the Indebtedness Indicator and EBITDA Interest Coverage ratios for the periods ended June 30, and September 30, 2023, as further noted within Note 14. Borrowings. Since the Additional Waiver was obtained as of June 30, 2023 and the Group was in compliance with the new covenants, the outstanding balance of $115,000 remains classified as non-current borrowing.

Working capital

As of June 30, 2023, the Group had a net working capital surplus (excess of current assets over current liabilities) of $51,670 (working capital deficit of $70,931 as of December 31, 2022).

Management’s assessment

Management assessed the Group’s cash flow projections, ability to meet future covenants and other measures of liquidity for the next twelve months from the balance sheet date. Based on the Group’s cash flow projections and adjusted financial covenant ratios as a result of the Waivers and Additional Waiver, Management believes they will have sufficient funds to repay their obligations as they fall due and to meet its financial covenants. However, due to the uncertainty caused by current economic conditions, including rapid growth in inflation, increasing interest rates, global disruption to the supply chain, volatility in foreign exchange rates and industry price regulations, there is material uncertainty regarding the Group’s ability to meet its financial covenants. The Group’s failure to comply with such financial covenants would result in an event of default, which if that were to occur would materially and adversely affect the Group’s business, financial condition, liquidity and results of operations. In that event, the Group would seek additional waivers or alternative financing arrangements. As a result of these material uncertainties, Management concluded the above conditions and events raise significant doubt about the Group’s ability to continue as a going concern.

Management has implemented or is in the process of implementing the following plans to mitigate the effect of these events and conditions:

Cost saving and revenue growth

The Group has implemented certain measures with an aim to reduce its operating costs and generate additional revenue in 2023 including: 1) strict controlling and reducing business marketing and advertising expenses; 2) reducing headcount across multiple business units; and 3) focus on increasing sales volumes for core products and sell trademarks and sanitary records to generate additional revenue.

Renegotiation of existing loans

On August 16, 2023, the Group successfully renegotiated the terms of the Syndicated Loan Agreement with Bancolombia and Davivienda, which extends the payment terms for a six-year period. In addition, on August 18, 2023, the Group renegotiated their short-term loan with BTG into a thirty-month period loan. Refer to Note 14. Borrowings and Note 20. Events after the reporting period for further details regarding these renegotiated loans. The Group has the ability to further renegotiate existing loans to maintain and meet its liquidity needs and requirements. However, the Group’s ability to renegotiate with its lenders is not within the Group’s control. As of the date of these Unaudited Condensed Consolidated Interim Financial Statements, the Group cannot assure that it will be able to reach an agreement with its lenders, or to waive any potential non-compliance.

Additional measures

If the above actions do not generate sufficient liquidity for the Group to meet its contractual obligations, Management has identified additional measures which could be implemented to further reduce costs and increase total revenues in order to provide sufficient cash flow to meet obligations as they fall due including: 1) reduce discretionary spending on research and development, marketing and capital expenditures; 2) sell additional trademarks and sanitary records; and 3) further reduce headcount.

Summary

Management has evaluated the Group’s capital position, its ability to continue in the normal course of business for the foreseeable future and ability to meet its financial obligations for the next twelve months from the balance sheet date. While Management believes that their cost savings, revenue growth, and loan renegotiation will allow the group to be able to meet its financial obligations and finance its growth, there is no assurance that these plans can be successfully implemented to generate the liquidity required to meet the Group’s need. Failure to successfully implement these plans may have a material adverse effect on the Group’s business, results of operations and financial position, and may materially adversely affect its ability to continue as a going concern. As a result, Management concluded there is material uncertainty related to the events and conditions noted above that cast significant doubt on the entity’s ability to continue as a going concern.

However, Management believes that the Group will be successful in implementing the above plan and, accordingly, have prepared the Unaudited Condensed Consolidated Interim Financial Statements on a going concern basis. As a result, the Unaudited Condensed Consolidated Interim Financial Statements do not include any adjustments related to the recoverability and classification of recorded assets or the amounts and classification of liabilities or any other adjustments that might be necessary should the Group be unable to continue as a going concern.

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Summary of Significant Accounting Policies

6 Months Ended

Jun. 30, 2023

Summary of Significant Accounting Policies [Abstract]

Summary of significant accounting policies

Note 3. Summary of significant accounting policies

Note 3.1. Change in accounting policy

Except as described below, the accounting policies applied in these Unaudited Condensed Consolidated Interim Financial Statements are the same as those applied in the Group’s last annual financial statements.

The policy for recognizing and measuring income taxes in the interim periods is consistent with that applied in the previous interim period and is described in Note 9. Income tax.

Note 3.1.1. Derivative financial instrument and hedge accounting

Derivative financial instruments are initially measured at fair value. Subsequent to initial recognition, they are measured at fair value, and changes therein are generally recognized in profit or loss.

The Group designates certain derivatives as hedging instruments to hedge foreign currency exposure related to net investments in foreign operations. At the inception of the hedge relationship, the Group documents the economic relationship between the hedging instrument and the hedged item, along with its risk management objectives and its strategy for undertaking the hedge.

Hedges of net investments in foreign operations

When a derivative instrument or a non-derivative financial liability is designated as the hedging instrument in a hedge of a net investment in a foreign operation, the effective portion of changes in the fair value of a derivative or foreign exchange gains and losses for a non-derivative is recognized as Exchange differences on translation of foreign operations in Other Comprehensive Income and presented under such concept within Equity. The gain or loss relating to the ineffective portion is recognized immediately in profit or loss, and is included in the ‘Other income (expense), net’ line item. Gains and losses on the hedging instrument accumulated in Other Comprehensive Income are reclassified to profit or loss on the disposal or partial disposal of the foreign operation.

Note 3.2. New and amended IFRS Standards that are effective for the current period

Certain new accounting standards, interpretations or amendments to accounting standards are effective for annual periods beginning after January 1, 2023. The Group has not early adopted any standard, interpretation or amendment that has been issued but is not yet effective in the preparation of these Unaudited Condensed Consolidated Interim Financial Statements.

The Group adopted the following accounting standard amendments from January 1, 2023. The evaluation performed by management determined that these amendments did not result in a significant impact in relation to the Group’s Unaudited Condensed Consolidated Interim Financial Statements.

Disclosure of Accounting Policies (Amendments to IAS 1 and IFRS Practice Statement 2) - Effective January 1, 2023

The amendments to IAS 1 and IFRS Practice Statement 2 Making Materiality Judgements provide guidance and examples to help entities apply materiality judgements to accounting policy disclosures. The amendments aim to help entities provide accounting policy disclosures that are more useful by replacing the requirement for entities to disclose their ‘significant’ accounting policies with a requirement to disclose their ‘material’ accounting policies and adding guidance on how entities apply the concept of materiality in making decisions about accounting policy disclosures.

The amendments had no impact on the Group’s Unaudited Condensed Consolidated Interim Financial Statements, but are expected to affect the accounting policy disclosures in the Group’s annual Consolidated Financial Statements.

Definition of Accounting Estimate (Amendments to IAS 8) - Effective January 1, 2023

The amendments introduce a new definition for accounting estimates, clarifying that they are monetary amounts in the financial statements that are subject to measurement uncertainty. The amendments also clarify the relationship between accounting policies and accounting estimates by specifying that a company develops an accounting estimate to achieve the objective set out by an accounting policy. The distinction between the two is important because changes in accounting policies are applied retrospectively, whereas changes in accounting estimates are applied prospectively.

The Group has determined the amendment has no significant impact in its Unaudited Condensed Consolidated Interim Financial Statements.

Deferred Tax Related to Assets and Liabilities Arising from a Single Transaction – Amendments to IAS 12 Income Taxes - Effective January 1, 2023

The amendments to IAS 12 Income Tax narrow the scope of the initial recognition exception, so that it no longer applies to transactions that give rise to equal taxable and deductible temporary differences such as leases and decommissioning liabilities. The amendments had no impact on the Group’s Unaudited Condensed Consolidated Interim Financial Statements.

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Critical Accounting Judgements and Key Sources of Estimation Uncertainty

6 Months Ended

Jun. 30, 2023

Disclosure of Critical Accounting Judgements and Key Sources of Estimation Uncertainty [Abstract]

Critical accounting judgements and key sources of estimation uncertainty

Note 4. Critical accounting judgements and key sources of estimation uncertainty

In preparing these Unaudited Condensed Consolidated Interim Financial Statements, management has made judgments, estimates and assumptions about the carrying amounts of the assets and liabilities that are not readily observable in other sources. The estimates and underlying assumptions are based on historical experience and other relevant factors. Actual results may differ from these estimates.

The significant judgements made by Management in applying the Group’s accounting policies and the key sources of estimation uncertainty were the same as those described in the Group’s last annual financial statements.

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Revenue

6 Months Ended

Jun. 30, 2023

Revenue [Abstract]

Revenue

Note 5. Revenue

The Group recognizes its revenues from the transfer of goods and services to the fulfillment of its performance obligations. The Group’s revenue for the three and six months ended June 30, 2023 includes $1,298 and $2,080 (for the three and six months ended June 30, 2022: $7,545 and $8,848) in revenue recognized from intellectual property licensing and dossier generation.

Disaggregation of revenue from contracts with customers

Revenue from contracts with customers is disaggregated by primary geographical market and major products (refer to Note 6. Segment reporting) and by timing of revenue recognition in the table below.

For the three months ended June 30	Reportable segments
2023	NextGel			Procaps Colombia			CAN			CASAND			Diabetrics			Total
Segment revenue		62,678			38,067			18,471			25,285			9,945			154,446
Inter-segment revenue		(30,698	)		(25	)		(4,658	)		(4,267	)		(4,741	)		(44,389	)
Revenue from contracts with customers		31,980			38,042			13,813			21,018			5,204			110,057
Timing of revenue recognition
Goods transferred at a point in time		30,682			38,042			13,813			21,018			5,204			108,759
Services transferred over time		1,298			—			—			—			—			1,298
Total revenue from contracts with customers		31,980			38,042			13,813			21,018			5,204			110,057

For the three months ended June 30	Reportable segments
2022	NextGel			Procaps Colombia			CAN			CASAND			Diabetrics			Total
Segment revenue		64,883			41,253			22,122			22,666			12,143			163,067
Inter-segment revenue		(31,960	)		(1,658	)		(5,287	)		(5,566	)		(6,176	)		(50,647	)
Revenue from contracts with customers		32,923			39,595			16,835			17,100			5,967			112,420
Timing of revenue recognition
Goods transferred at a point in time		29,045			38,187			14,576			17,100			5,967			104,875
Services transferred over time		3,878			1,408			2,259			—			—			7,545
Total revenue from contracts with customers		32,923			39,595			16,835			17,100			5,967			112,420

For the six months ended June 30	Reportable segments
2023	NextGel			Procaps Colombia			CAN			CASAND			Diabetrics			Total
Segment revenue		107,432			67,834			33,618			44,994			16,760			270,638
Inter-segment revenue		(50,491	)		(236	)		(10,239	)		(7,954	)		(7,499	)		(76,419	)
Revenue from contracts with customers		56,941			67,598			23,379			37,040			9,261			194,219
Timing of revenue recognition
Goods transferred at a point in time		54,861			67,598			23,379			37,040			9,261			192,139
Services transferred over time		2,080			—			—			—			—			2,080
Total revenue from contracts with customers		56,941			67,598			23,379			37,040			9,261			194,219

For the six months ended June 30	Reportable segments
2022	NextGel			Procaps Colombia			CAN			CASAND			Diabetrics			Total
Segment revenue		123,038			72,802			37,522			39,191			19,737			292,290
Inter-segment revenue		(64,778	)		(1,349	)		(9,417	)		(9,529	)		(9,167	)		(94,240	)
Revenue from contracts with customers		58,260			71,453			28,105			29,662			10,570			198,050
Timing of revenue recognition
Goods transferred at a point in time		53,531			70,045			25,846			29,210			10,570			189,202
Services transferred over time		4,729			1,408			2,259			452			—			8,848
Total revenue from contracts with customers		58,260			71,453			28,105			29,662			10,570			198,050

Revenue recognized from goods transferred at a point in time include revenues related to “sales of goods” and “sales of trademarks and sanitary provisions”. Revenue recognized from services transferred over time include revenues related to “intellectual property licensing” and “dossier generation”. Revenues, other than sales of goods, are not material to the group.

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Segment Reporting

6 Months Ended

Jun. 30, 2023

Segment Reporting [Abstract]

Segment reporting

Note 6. Segment reporting

Segment information is presented at a combination of geographical segments and business units, consistent with the information that is available and evaluated regularly by the chief operating decision maker.

The Group operates its business through five segments which are its reportable segments for financial reporting purposes: Procaps Colombia, Central America North (“CAN”), Central America South and North Andes (“CASAND”), NextGel and Diabetrics. Segment management, the respective Vice Presidents, are responsible for managing performance, underlying risks and operations. Management uses a broad set of performance indicators to measure segment performance and to make decisions around resource allocation.

The Group’s customer revenue recognition (external revenue) policy has been consistent with inter-segment revenue generated.

	NextGel							Procaps Colombia							CAN							CASAND
Three months ended June 30, 2023	Total		Inter- segment eliminations			External		Total		Inter- segment eliminations			External		Total		Inter- segment eliminations			External		Total		Inter- segment eliminations			External
Revenue		62,678		(30,698	)		31,980		38,067		(25	)		38,042		18,471		(4,658	)		13,813		25,285		(4,267	)		21,018
Contribution margin 1		12,473		(926	)		11,547		11,389		(133	)		11,256		5,214		622			5,836		5,847		4,286			10,133

	Diabetrics							Corporate									Total
Three months ended  June 30, 2023	Total		Inter- segment eliminations			External		Total			Inter- segment eliminations			External			Total			Inter- segment eliminations			External
Revenue		9,945		(4,741	)		5,204		—			—			—			154,446			(44,389	)		110,057
Contribution margin1		201		(133	)		68		700			151			851			35,824			3,867			39,691
Administrative expenses		—		—			—		25,150			(548	)		24,602			25,150			(548	)		24,602
Finance expenses		—		—			—		6,739			41			6,780			6,739			41			6,780
Other (income) expenses, net		—		—			—		(31,681	)		2,054			(29,627	)		(31,681	)		2,054			(29,627	)
Income (loss) before tax																		35,616			2,320			37,936

	NextGel							Procaps Colombia							CAN							CASAND
Three months ended  June 30, 2022	Total		Inter- segment eliminations			External		Total		Inter- segment eliminations			External		Total		Inter- segment eliminations			External		Total		Inter- segment eliminations			External
Revenue		64,883		(31,960	)		32,923		41,253		(1,658	)		39,595		22,122		(5,287	)		16,835		22,666		(5,566	)		17,100
Contribution margin1		18,044		(552	)		17,492		15,804		(695	)		15,109		6,280		(20	)		6,260		4,443		2,505			6,948

	Diabetrics							Corporate								Total
Three months ended June 30, 2022	Total		Inter-segment eliminations			External		Total		Inter-segment eliminations			External			Total			Inter-segment eliminations			External
Revenue		12,143		(6,176	)		5,967		—		—			—			163,067			(50,647	)		112,420
Contribution margin1		1,383		40			1,423		441		(704	)		(263	)		46,394			575			46,969
Administrative expenses		—		—			—		28,844		1			28,845			28,844			1			28,845
Finance expenses		—		—			—		18,791		—			18,791			18,791			—			18,791
Other (income) expenses, net		—		—			—		8,626		—			8,626			8,626			—			8,626
Income (loss) before tax																	(9,868	)		574			(9,293	)

	NextGel							Procaps Colombia							CAN							CASAND
Six months ended June 30, 2023	Total		Inter- segment eliminations			External		Total		Inter- segment eliminations			External		Total		Inter- segment eliminations			External		Total		Inter-segment eliminations			External
Revenue		107,432		(50,491	)		56,941		67,834		(236	)		67,598		33,618		(10,239	)		23,379		44,994		(7,954	)		37,040
Contribution margin1		21,564		(1,591	)		19,973		20,393		(67	)		20,326		7,267		1,371			8,638		8,518		8,152			16,670

	Diabetrics									Corporate									Total
Six months ended  June 30, 2023	Total			Inter-segment eliminations			External			Total			Inter- segment eliminations			External			Total			Inter-segment eliminations			External
Revenue		16,760			(7,499	)		9,261			—			—			—			270,638			(76,419	)		194,219
Contribution margin1		(12	)		(420	)		(432	)		(14,075	)		13,983			(92	)		43,655			21,428			65,083
Administrative expenses		—			—			—			2,545			44,176			46,721			2,545			44,176			46,721
Finance expenses		—			—			—			8,408			(3,277	)		5,131			8,408			(3,277	)		5,131
Other (income) expenses, net		—			—			—			(27,003	)		(6,582	)		(33,585	)		(27,003	)		(6,582	)		(33,585	)
Income (loss) before tax																				59,705			(12,889	)		46,816

	NextGel							Procaps Colombia							CAN							CASAND
Six months ended  June 30, 2022	Total		Inter- segment eliminations			External		Total		Inter- segment eliminations			External		Total		Inter- segment eliminations			External		Total		Inter- segment eliminations			External
Revenue		123,038		(64,778	)		58,260		72,802		(1,349	)		71,453		37,522		(9,417	)		28,105		39,191		(9,529	)		29,662
Contribution margin1		35,775		(8,071	)		27,704		24,705		155			24,860		9,045		(651	)		8,394		6,037		5,810			11,847

	Diabetrics							Corporate								Total
Six months ended June 30, 2022	Total		Inter- segment eliminations			External		Total		Inter- segment eliminations			External			Total		Inter- segment eliminations			External
Revenue		19,737		(9,167	)		10,570				—						292,290		(94,240	)		198,050
Contribution margin1		1,432		(93	)		1,339		1,937		(2,147	)		(210	)		78,930		(4,996	)		73,934
Administrative expenses		—		—			—		53,400		—			53,400			53,400		—			53,400
Finance expenses		—		—			—		4,209		—			4,209			4,209		—			4,209
Other (income) expenses, net		—		—			—		3,503		—			3,503			3,503		—			3,503
Income (loss) before tax																	17,817		(4,996	)		12,822

¹ Contribution margin is determined by subtracting sales and marketing expenses from gross profit. The Group’s customer revenue recognition (external revenue) policy has been consistent with inter-segment revenue generated.

Major customer

The Group does not have revenue from a single customer comprising more than ten percent of its consolidated revenue.

Geographical information

In presenting geographical information, the Group’s revenue is based on the geographical location of the customers.

	For the three months ended June 30				For the six months ended June 30
	2023		2022		2023		2022
South America	$	75,362	$	73,956	$	135,104	$	133,156
Central America		23,733		26,265		39,480		42,546
North America		9,136		9,072		16,562		17,304
Europe		1,826		3,127		3,073		5,044
Total	$	110,057	$	112,420	$	194,219	$	198,050

Seasonality of operations

The Group has been subject to normal seasonal fluctuations that generate less income during the first half of the year. In general, there are no significant variations on sales to customers throughout the year.

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Finance expenses, net

6 Months Ended

Jun. 30, 2023

Finance Expenses, Net [Abstract]

Finance expenses, net

Note 7. Finance expenses, net

	For the three months ended June 30						For the six months ended June 30
	2023			2022			2023			2022
Banking expenses	$	(564	)	$	(58	)	$	(787	)	$	(374	)
Bank fees		(295	)		(304	)		(502	)		(411	)
Other financial expenses1		(315	)		(280	)		(611	)		(429	)
Net fair value gain/(loss) of warrant liabilities2		2,510			(1,092	)		6,456			636
Net fair value gain/(loss) of shares held in escrow2		2,460			(10,778	)		9,665			7,732
Interest expense		(10,576	)		(6,279	)		(19,352	)		(11,363	)
Total	$	(6,780	)	$	(18,791	)	$	(5,131	)	$	(4,209	)

¹ For the three and six months ended June 30, 2023, interest on lease liabilities amounted to $315 and $611 (for the three and six months ended June 30, 2022: $248 and $429).

² Refer to Note 16. Warrant liabilities, Note 17. Shares in escrow and Note 18. Financial instruments for further information related to net fair value gains for the six months ended June 30, 2023.

Net fair value gains recognized in Finance expenses, net for the three and six months ended June 30, 2023 and 2022 are unrealized.

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Other Income (Expenses), Net

6 Months Ended

Jun. 30, 2023

Other Income and Expenses Net [Abstract]

Other income (expenses), net

Note 8. Other income (expenses), net

	For the three months ended June 30						For the six months ended June 30
	2023			2022			2023			2022
Currency exchange rate differences1	$	10,464		$	(8,357	)	$	14,394		$	(3,188	)
Economic emergency contribution expenses		(320	)		(407	)		(637	)		(680	)
Fines, surcharges, penalties and taxes assumed		(40	)		(13	)		(120	)		(95	)
Donations		(160	)		(93	)		(315	)		(173	)
Other2		19,683			244			20,263			633
Total	$	29,627		$	(8,626	)	$	33,585		$	(3,503	)

¹ The increase in currency exchange rate differences income (expense) for the three and six months ended June 30, 2023 is mainly related to a decrease of 10% and 13% (increase for the three and six months ended June 30, 2022 11% and 4%) in the Colombian Pesos/USD exchange rate for the period and the Group’s Colombian entities’ liability position towards USD.

² Includes income from a legal settlement with a third party to recover costs incurred relating to a business opportunity with such third party. The open receivable balance as of June 30, 2023 is included within Other financial assets in the Consolidated Interim Statement of Financial Position. The amount, counter party and any further details can’t be disclosed due to contractual restrictions within the settlement agreement.

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Income Tax

6 Months Ended

Jun. 30, 2023

Income Tax [Abstract]

Income tax

Note 9. Income tax

Income tax recognized through profit or loss

Income tax expense is recognized at an amount determined by multiplying the profit before tax for the interim reporting period by management’s best estimate of the weighted-average annual income tax rate expected for the full financial year, adjusted for the tax effect of certain items recognized in full in the interim period. As such, the effective tax rate in the condensed consolidated interim financial statements may differ from management’s estimate of the effective tax rate for the annual financial statements.

The Group’s consolidated income (loss) before tax for the three and six months ended June 30, 2023 amounts to $37,936 and $46,816(for the three and six months ended June 30, 2022: $(9,293) and $12,822). The income tax expense for the three and six months ended June 30, 2023 was $(10,981) and $(13,240) (for the three and six months ended June 30, 2022: $2,374 and $(3,295)). The Group’s consolidated effective tax rate with respect to continuing operations for the six months ended June 30, 2023 was 28.28% (for the six months ended June 30, 2022: 25.64%) The change in the consolidated effective tax rate was mainly caused by the following factors: (i) Optimization of the use of tax credits, tax rate changed from 25% up to 30% in Colombia, and (ii) by concentration of profits in countries where the tax rate is higher.

The tax rate used for the six months ended June 30, 2023 represents the tax rate of 35% (for the six months ended June 30, 2022: 35%) on the taxable income payable by the most representative entities of the Group in Colombia, in accordance with the tax laws of said jurisdiction. Taxation for other jurisdictions is calculated at the rates prevailing in the respective jurisdiction.

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Intangible Assets Net

6 Months Ended

Jun. 30, 2023

Intangible Assets Net [Abstract]

INTANGIBLE ASSETS NET

Note 10. Intangible assets, net

Cost	Total
Balance as of January 1, 2022	$	53,926
Additions		860
Additions from internal developments		4,246
Foreign currency exchange		(1,687	)
Balance as of June 30, 2022	$	57,345
Balance as of January 1, 2023	$	57,831
Additions		1,465
Additions from internal developments		4,031
Derecognition of assets		(51	)
Foreign currency exchange		6,535
Transfers		113
Balance as of June 30, 2023	$	69,924

Accumulated amortization	Total
Balance as of January 1, 2022	$	23,755
Amortization expense		2,436
Foreign currency exchange		(723	)
Balance as of June 30, 2022	$	25,468
Balance as of January 1, 2023	$	25,623
Amortization expense		2,291
Foreign currency exchange		2,852
Balance as of June 30, 2023	$	30,766
As of June 30, 2022
Net book value	$	31,877
As of June 30, 2023
Net book value	$	39,158

For the three and six months ended June 30, 2023 and 2022, amortization expenses were recognized within the Unaudited Condensed Consolidated Interim Statement of Profit or Loss and Other Comprehensive Income as administrative expenses.

Foreign currency exchange corresponds to the effect of translating the intangible asset amounts attributable to the subsidiaries of the Group whose functional currencies are different from that of the Group.

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Property, Plant and Equipment, Net

6 Months Ended

Jun. 30, 2023

Disclosure of Property, Plant and Equipment, Net [Abstract]

Property, plant and equipment, net

Note 11. Property, plant and equipment, net

Cost	Total
Balance as of January 1, 2022	$	116,654
Additions		10,518
Disposals		(2,275	)
Effect of exchange differences in foreign currency		(2,544	)
Transfers		(54	)
Balance as of June 30, 2022	$	122,299
Balance as of January 1, 2023	$	121,898
Additions		13,110
Disposals		(276	)
Effect of exchange differences in foreign currency		12,664
Transfers		(116	)
Balance as of June 30, 2023	$	147,280

Accumulated depreciation	Total
Balance as of January 1, 2022	$	44,016
Disposals		(174	)
Depreciation expense		2,932
Effect of exchange differences in foreign currency		(1,071	)
Balance as of June 30, 2022	$	45,703
Balance as of January 1, 2023	$	47,933
Disposals		(227	)
Depreciation expense		2,662
Effect of exchange differences in foreign currency		5,125
Transfers		(38	)
Balance as of June 30, 2023	$	55,455
As of June 30, 2022
Net book value	$	76,596
As of June 30, 2023
Net book value	$	91,825

For the six months ended June 30, 2023, depreciation expense was recognized as follows: $2,061 was recognized as cost of goods sold (for the six months ended June 30, 2022: $1,678) and $601 for the six months ended June 30, 2022: $1,254) within administrative expense.

Financial Commitments

As of June 30, 2023, the Group has commitments to acquire capital expenditures for $6,110 (as of June 30, 2022: $9,229).

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Inventories, Net

6 Months Ended

Jun. 30, 2023

Inventories, Net [Abstract]

Inventories, net

Note 12. Inventories, net

	As of June 30, 2023			As of December 31, 2022
Raw materials and supplies	$	50,371		$	42,701
Products in process		6,600			7,412
Finished products and merchandise		42,094			41,492
Inventory in transit		9,950			11,531
Subtotal	$	109,015		$	103,136
Less: Provision		(5,540	)		(6,303	)
Total	$	103,475		$	96,833

Inventories recognized as cost of goods sold for the six months ended June 30, 2023 amounted to $86,969 (for the six months ended June 30, 2022: $78,294). Inventories used as samples for the six months ended June 30, 2023 amounted to $3,026 (for the six months ended June 30, 2022: $4,068), were recognized as marketing expenses.

Write-downs of inventories to net realizable value and obsolescence adjustments for the six months ended June 30, 2023 amounted to $2,502 (for the six months ended June 30, 2022: $1,010), were recognized within sales expenses.

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Trade and Other Receivables, Net

6 Months Ended

Jun. 30, 2023

Trade and Other Receivables, Net [Abstract]

Trade and other receivables, net

Note 13. Trade and other receivables, net

	As of June 30, 2023			As of December 31, 2022
Trade receivables, net of discounts 1	$	137,587		$	126,456
Other receivables		12,860			15,211
Impairment of trade and other receivables 2		(13,906	)		(12,065	)
Trade receivables, net of discounts and impairment	$	136,541		$	129,602

¹ Discount and return provision amounts to $14,793 (as of December 31, 2022: $13,443).

² Total impairment balance is comprised of $11,744 (as of December 31, 2022: $10,768) for trade receivables and $2,162 (as of December 31, 2022 $1,297) for other receivables.

Refer to Note 18. Financial instruments for the Group’s disclosures on credit risk management and expected credit losses.

The Group has entered into factoring arrangements to sell certain trade receivables to third parties under recourse programs, retaining all risk and rewards incidental to the trade receivables, so no derecognition of the financial assets has been performed. Trade receivables which collateralize factoring obligations as of June 30, 2023 amounts to 4,225 (as of December 31, 2022: $2,547).

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Borrowings

6 Months Ended

Jun. 30, 2023

Borrowings [Abstract]

Borrowings

Note 14. Borrowings

	As of June 30, 2023		As of December 31, 2022
Borrowings at amortized cost(a)
Syndicated term loan (1)	$	40,191	$	38,626
Other term loan (2)		93,788		95,720
Lease liabilities (3)		34,966		34,192
Factoring obligations (4)		4,017		2,317
Bank overdrafts (5)		357		80
Notes (6)		115,000		115,000
Total Interest bearing liabilities	$	288,319	$	285,935
Current		118,684		257,525
Non- Current	$	169,635	$	28,410

^(a) Borrowings at amortized cost are unsecured, with the exception of factoring obligations which are collateralized by trade receivables. Refer to Note 13. Trade and other receivables, net.

1. Syndicated term loan

	Currency	Range of Interest	Maturity Year	As of June 30, 2023			As of December 31, 2022
Syndicated term loan	COP	IBR + 5.30%	2023-2025	$	40,652		$	39,156
Amortized cost	COP	N/A	2023		(461	)		(530	)
Total Syndicated term loan				$	40,191		$	38,626

On November 20, 2018, Procaps S.A. entered into a syndicated term loan agreement the “Syndicated Loan Agreement”) with the following banks: Portion in Colombian pesos (COP) - Davivienda and Bancolombia; US dollar portion (USD) - Banco de Credito del Peru, Bancolombia Panama and Banco Sabadell. The total value of the syndicated loan amounts to $200,434 million COP (portion in COP) and $35 million USD (portion in USD), Fiduciaria Bancolombia acts as the agent of the loan. C.I. Procaps S.A., Procaps S.A. de C.V, Biokemical S.A., Pharmarketing S.A. (Panama), Pharmarketing Salvador S.A. de C.V., Pharmarketing S.A. (Guatemala S.A.), C.D.I. Salvador S.A. de C.V., C.D.I. Nicaragua S.A., C.D.I. Guatemala S.A., Pharmarketing Dominicana SRL, and Pharmarketing Costa Rica S.A., act as co-debtors, while Pharmayect S.A., Inversiones Crynssen S.A.S., Inversiones Ganeden S.A.S., Inversiones Henia S.A.S., Inversiones Jades S.A.S., and Industrias Kadima S.A.S., act as guarantors.

The resources obtained were used for advance payment and/or novation of some obligations to be refinanced. The conditions of the loan had a term of 5 years for installment payments and the interest rates agreed are as follows: IBR + 5.30% for the portion in COP and Libor + 4.80% for the USD portion.

The significant covenants required by the Syndicated Loan Agreement are as follows:

Financial covenants

● Indebtedness Indicator (Indebtedness/EBITDA) as of June 30 and December 31 of each year, during the loan term, must be less than or equal to 3.5 times. If the indicator is greater than 3.0 and less than 3.5, it proceeds to the extent that this value is originated by causes other than additional debt and the justification of the increase must be presented to the agent.

● Short-term leverage ratio < 1.0 on the last day of each semester.

● EBITDA ratio / financial expenses = or > 3.0 on the last day of each semester.

Other covenants

● The Syndicated Loan Agreement establishes that each of the jointly obligated parties, unless they have the express, prior and written authorization of the Agent, will refrain from incurring any type of financial debt when the proforma indebtedness indicator, once acquired the additional financial debt, is greater than 3.0 times and maintaining any type of financial debt when the pro forma indebtedness indicator, once the national debt is acquired, is greater than 3.5 times.

● Each of the joint obligated parties, except with express, prior and written authorization of the Agent to do otherwise, will refrain from contracting finance and/or operating lease obligations with purchase option with a joint balance payable greater than $85,000,000 (Eighty-Five Billion Pesos, local currency) or its equivalent in another currency. For purposes of clarity, the reclassification of obligations as financial lease obligations by application of the Accounting Standards will not consume the balance set forth herein and may not be renewed.

● The payment of dividends is restricted to anyone other than the jointly obligated parties.

The Syndicated Loan Agreement establishes that, in the event of breach of covenants by the debtor, the lenders shall be entitled to declare early maturity of the debts.

As mentioned in Note 2.1. Going concern, as of December 31, 2022, the Group was not in compliance with certain covenants under the Syndicated Loan Agreement. As a result, as of December 31, 2022, $19,665 unpaid principal balance previously classified as non-current borrowings, was reclassified to current borrowings within the Group’s Consolidated Statement of Financial Position.

On May 2, 2023 the Group obtained a Waiver for the loan covenant breaches described above. Under the terms of the Waiver, the lenders agreed to waive the event of default as of December 31, 2022.For the period ending June 30, 2023, as part of the Waiver negotiations, the lenders agreed to adjust the convent ratios as noted below (the covenants will return to the original terms from December 31, 2023, onwards):

● Indebtedness Indicator (Indebtedness/EBITDA) must be less than or equal to 4.5 times (original covenant: less than or equal to 3.5 times).

● Short-term leverage ratio less than 1.6 (original covenant: less than 1.0).

● EBITDA ratio / financial expenses greater than or equal to 1.8 (original covenant: greater than or equal to 3.0).

As a result, the unpaid principal balance is classified as non-current borrowings as of June 30, 2023.

Additionally, as mentioned in Note 2.1. Going concern, on August 16, 2023, the Group renegotiated the terms of the Syndicated Loan Agreement which extends the payment terms for a six-year period. Refer to Note 20. Events after the reporting period for further details regarding the renegotiation.

2. Other term loan

	Currency	Range of Interest	Maturity Year	As of June 30, 2023		As of December 31, 2022
Other term loan	COP	IBR+ 9.0%, 23.5% (2022: IBR+ 5.0%, DTF+ 3%, 13.99%-25.3%)	2022-2025	$	12,407	$	9,549
	COP	IBR + 2.25%- IBR 7.95% (2022: IBR+2.25%-10.2%)	2022-2025		23,342		21,267
	Soles	8.0% - 14.50% (Fixed) (2022: 8.0% - 12.79% (Fixed))	2022-2024		6,619		6,837
	Reales	9.84% - 18% N.A.	2023-2024		1,137		2,176
	USD	SOFR+ (5.80%-7.00%), SOFR6M + (2%-3%) (2022: SOFR+ (4.80%-5.80%))	2023		24,669		23,454
	USD	6.5%-16.8% N.A. (2022: 6.36%-16.8%)	2022-2025		25,614		32,437
Total Other term loans				$	93,788	$	95,720

On June 28, 2022, Procaps, S.A. (the “Company”) entered into a credit agreement with BTG to borrow $8,672. The covenants required by the loan contract are:

● The Company’s consolidated Indebtedness Indicator (Indebtedness / EBITDA) should not be greater than 3.5x.

● The Company’s consolidated EBITDA/Finance expense should not be less than 3x.

As mentioned in Note 2.1. Going concern, as of December 31, 2022, the Group was not in compliance with the loan covenants related to the BTG Credit Agreement. As a result, the $4,490 unpaid principal balance previously classified as a non-current borrowings, was reclassified to current borrowings within the Group’s Consolidated Statement of Financial Position as of December 31, 2022.

On March 28, 2023 the Group obtained a Waiver for the loan covenant breach. Under the terms of the Waiver, BTG Pactual agreed to waive the event of default as of December 31, 2022. For the period ending June 30, 2023, as part of the Waiver negotiations, the lenders agreed to adjust the covenant ratios as noted below (the covenants will return to the original terms from December 31, 2023, onwards):

● The Company’s consolidated Indebtedness Indicator (Indebtedness / EBITDA) must not be greater than 4.5x (original covenant: greater than 3.5x).

● The Company’s consolidated EBITDA/Finance expense must not be less than 1.8x (original covenant: less than 3.0x).

As a result, the unpaid principal balance is classified as non-current borrowings as of June 30, 2023.

Along with the BTG Credit Agreement, the Group borrowed $19,000 on October 14, 2022 as part of a short-term agreement with BTG Pactual which is payable in 2023. Additionally, as mentioned in Note 2.1. Going concern, on August 18, 2023, the Group renegotiated their short-term agreement with BTG into a thirty-month period loan. Refer to Note 20. Events after the reporting period for further details regarding the renegotiation.

3. Lease liabilities

	Currency	Range of  Interest	Maturity Year	As of June 30, 2023		As of December 31, 2022
Lease liabilities	COP	IBR+(3.82%-7.3%), DTF + 5.5% (2022: DTF + (5,18% - 10,11%) T.A., IBR+7.5%)	2022-2030	$	10,170	$	10,475
	COP	IBR+ (4.2%-8.2%) (2022: DTF+ 4.54%-10.42 T.A.	2022-2025		3,944		3,653
	USD	0.75%-21.48%, DTF+5.50%, IBR+4.10% (2022: 0.75%-21.48%)	2023-2032		20,852		14,787
	COP	1.91%-12.23%, IBR+4.68%	2023		—		4,703
	Reales	0.70-8.72% (Fixed)	2023-2024		—		574
Total Lease Liabilities				$	34,966	$	34,192

4. Factoring obligations

	Currency	Range of Interest	Maturity Year	As of June 30, 2023		As of December 31, 2022
Portfolio factoring	COP	DTF+7% (2022: DTF+8%)	2023	$	1,583	$	1,508
	COP	2% - 22.4% (2022: 15.0% - 27% N.A.)	2023		2,434		809
Total Factoring				$	4,017	$	2,317

5. Bank overdraft

	Currency	Range of Interest	Maturity Year	As of June 30, 2023		As of December 31, 2022
Overdrafts and credit cards	COP	19.68% - 32% E.A.  (Fixed)	2023	$	357	$	80

6. Notes

On November 12, 2021, the Group closed the private placement offering of $115 million aggregate principal amount of 4.75% guaranteed senior notes (the “Senior Notes”) issued by Procaps, S.A., a subsidiary of the Group, due November 12, 2031, pursuant to the NPA entered into on November 5, 2021 with The Prudential Insurance Company of America, Prudential Annuities Life Assurance Corporation, Healthspring Life & Health Insurance Company, Inc. and Cigna Health and Life Insurance Company Inc.

The Senior Notes are a senior unsecured obligations of Procaps, S.A. and unconditionally guaranteed by Procaps Group, S.A. and the following subsidiaries of the Group: C.I. Procaps, S.A., Diabetrics Healthcare S.A.S., Pharmayect S.A., Procaps, S.A. de C.V., Biokemical, S.A. de C.V., Colbras Indústria e Comércio Ltda., and Sofgen Pharmaceuticals LLC.

Debt issuance costs related to the Senior Notes of $2,142, comprised of commissions payable to the initial purchasers of $1,390 and attorneys’ costs of $752, were allocated to the liability of the Notes based on their relative values. Issuance incremental costs are part of the effective rate and amortized to interest expense using the effective interest method over the contractual term.

As mentioned in Note 1. General Company Information, the Notes Payoff did not occur on or prior to November 30, 2022, therefore triggering the 3.75% per annum waiver fee on the outstanding principal amount of Senior Notes, raising the interest rate from 4.75% to 8.50%. As a result, the Group has treated the rate increase as a debt extinguishment, derecognised a liability in the amount of $113,400, expensed $1,600 in unamortized transaction costs, and recognized a new liability in the amount of $115,000 as of December 31, 2022.

The Senior Notes require Procaps, S.A., the Group and the following subsidiaries of the Group: C.I. Procaps, S.A., Diabetrics Healthcare S.A.S., Pharmayect S.A., Procaps, S.A. de C.V., Biokemical, S.A. de C.V., Colbras Indústria e Comércio Ltda., and Sofgen Pharmaceuticals LLC. to comply with the following financial ratios:

● The consolidated total debt of Procaps, S.A., the Group and the other obligors thereunder to consolidated EBITDA for the last twelve months of 3.50:1.00 or less (Indebtedness Indicator), measured at certain dates of determination and;

● An EBITDA interest coverage ratio (calculated as the consolidated EBITDA for the last twelve months of Procaps, S.A. and the other obligors thereunder divided by the consolidated interest expenses of Procaps, S.A. and the other obligors thereunder) in excess of, or equal to, 3.00:1.00, calculated at certain dates of determination.

● Short-term leverage ratio equal to or less than 1.00

Complying with the Note Purchase Agreement protocols and as a result of the more favorable provisions of the Syndicated Loan Agreement, the Group gave notice on April 7, 2022 that specific provisions related to reporting covenants, affirmative covenants, negative covenants, events of default, and mandatory prepayment events, as set forth in the Syndicated Loan Agreement, shall apply to the Senior Notes.

As mentioned in Note 2.1. Going concern, as of December 31, 2022, the Group was not in compliance with the financial covenants related to the Senior Notes. As a result, the $115,000 unpaid principal balance previously classified as a non-current borrowings, was reclassified to current borrowings within the Group’s Consolidated Statement of Financial Position as of December 31, 2022.

On March 31, 2023 the Group obtained a Waiver for the NPA covenant breaches described above. Under the terms of the Waiver, the noteholders agreed to waive the event of default as of December 31, 2022. For the periods ending March 31, June 30 and September 30, 2023, as part of the Waiver negotiations, the lenders agreed to adjust the covenant ratios as noted below (the covenants. will return to the original terms from December 31, 2023, onwards):

● The consolidated total debt of Procaps, S.A., the Group and the other obligors thereunder to consolidated EBITDA for the last twelve months of 4.00:1.00 or less (original covenant: 3.50:1.00 or less).

● An EBITDA interest coverage ratio in excess of, or equal to, 2.20:1.00 (original covenant: in excess of, or equal to, 3.00:1.00).

● Short-term leverage ratio equal to or less than 1.60:1:00 (original covenant: equal to or less than 1.00:1.00).

As mentioned in Note 2.1. Going concern, as of June 30, 2023 the Group obtained an Additional Waiver under the NPA in anticipation of a potential breach of the covenant ratios contained within the March 31, 2023 Waiver. For the periods ending June 30 and September 30, 2023, the lenders agreed to adjust the covenant ratios as noted below (the covenants will return to the original terms from December 31, 2023, onwards):

● The consolidated total debt of Procaps, S.A., the Group and the other obligors thereunder to consolidated EBITDA for the last twelve months of 4.30:1.00 or less (original covenant: 3.50:1.00 or less).

● An EBITDA interest coverage ratio in excess of, or equal to, 1.90:1.00 (original covenant: in excess of, or equal to, 3.00:1.00).

The Additional Waiver was obtained on June 30, 2023, therefore, the unpaid principal balance is classified as non-current borrowings as of June 30, 2023.

	Currency	Range of Interest	Maturity Year	As of June 30, 2023		As of December 31, 2022
The Prudential Insurance Company Of America	USD	8.50% (Fixed)	2031	$	60,020	$	60,020
Prudential Annuities Life Assurance Corporation	USD	8.50% (Fixed)	2031		29,980		29,980
Healthspring Life & Health Insurance Company, Inc	USD	8.50% (Fixed)	2031		18,350		18,350
CIGNA Health and Life Insurance Company	USD	8.50% (Fixed)	2031		6,650		6,650
Total Senior Notes				$	115,000	$	115,000

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Provisions and Contingencies

6 Months Ended

Jun. 30, 2023

Provisions and contingencies [Abstract]

Provisions and contingencies

Note 15. Provisions and contingencies

	2023			2022
Contingencies
Balance as of January 1	$	138		$	501
Effect of changes in foreign exchange rates		8			28
Provisions made		91			7
Provisions used		(42	)		(41	)
Balance as of June 30	$	195		$	495

The Group recognizes provisions for contingencies that are probable of requiring an outflow of resources due to adverse effects. The Group recognized the estimated probable losses against the company for labor, administrative and tax litigation, which are calculated based on the best estimate of the disbursement required to cancel the obligation. Such contingencies are disclosed with possible adverse effects for the entity, as follows:

Legal provisions

Softcaps legal proceedings - The total balance of $73 (as of June 30, 2022: $448) is comprised of labor, administrative, and civil ligation. As of June 30, 2022, balance for tax litigation amounted to $372, there are no tax litigation provisions recognized as of June 30, 2023.

The remaining balance of 122 (as of June 30, 2022: 47) is for labor litigation in the following entities: Procaps, S.A., Unimed del Perú, CDI Nicaragua, and Diabetrics.

Contingencies

Procaps SA de CV legal proceedings - The General Tax Directorate of El Salvador (DGII), determined that the company failed to declare taxable and presumed income from revenue obtained and loans made to non-domiciled companies in 2018, the proposed tax charge and sanction amounts to $1,087. Also, the DGII determined that the company incurred in the infraction of non-intentional evasion due to the incorrect filing of the “VAT” declarations for 2019. The proposed tax charge and penalty amounts to $348.

However, the Group’s external advisor indicates that it is not probable for this claim to proceed, therefore, there is no provision for the effect of this contingency.

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Warrant Liabilities

6 Months Ended

Jun. 30, 2023

Warrant Liabilities [Abstract]

Warrant liabilities

Note 16. Warrant liabilities

	As of June 30, 2023		As of December 31, 2022
Public warrants	$	3,800	$	9,200
Private warrants1		661		1,716
	$	4,461	$	10,916

¹ Private warrants include 2,875,000 held by the former SPAC sponsors deposited in an escrow account.

Note 16.1. Public warrants

	As of June 30, 2023			As of December 31, 2022
As of January 1	$	9,200		$	16,000
Acquired public warrants		—			—
Fair value remeasurement		(5,400	)		(6,800	)
Balance as of June 30/December 31	$	3,800		$	9,200

The fair value of the Public Warrants decreased for the six months ended June 30, 2023 by $5,400 (decreased for the year ended December 31, 2022: $6,800). Refer to Note 7. Finance expenses, net.

Note 16.2. Private warrants

	As of June 30, 2023			As of December 31, 2022
As of January 1	$	1,716		$	7,112
Acquired private warrants		—			—
Fair value remeasurement		(1,055	)		(5,396	)
Balance as of June 30/December 31	$	661		$	1,716

The fair value of the Private Warrants decreased for the six months ended June 30, 2023 by $1,055 (decreased for the year ended December 31, 2022: $5,396). Refer to Note 7. Finance expenses, net.

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Shares in Escrow

6 Months Ended

Jun. 30, 2023

Shares in escrow [Abstract]

Shares in escrow

Note 17. Shares in escrow

	As of June 30, 2023			As of December 31, 2022
As of January 1	$	40,064		$	101,859
Escrowed shares		—			—
Fair value remeasurement		(9,665	)		(61,795	)
Balance as of June 30/December 31	$	30,399		$	40,064

The fair value of the Shares in escrow decreased for the six months ended June 30, 2023 by $9,665 (decreased for the year ended December 31, 2022: $61,795). Refer to Note 7. Finance expenses, net.

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Financial Instruments

6 Months Ended

Jun. 30, 2023

Financial Instruments [Abstract]

Financial instruments

Note 18. Financial instruments

18.1 Accounting classification and fair value

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. When measuring fair value, the Group uses observable market data whenever possible. Fair values are categorized into different levels in a hierarchy based on the inputs used in the valuation techniques as follows:

● Level 1: inputs are unadjusted quoted prices in active markets for identical assets or liabilities.

● Level 2: inputs are observable either directly (e.g. as prices) or indirectly (e.g. derived from prices).

● Level 3: fair value measurements incorporate significant inputs that are based on unobservable market data.

The following table shows the carrying amounts of financial assets and financial liabilities. The amortized cost basis of the financial assets and liabilities not measured at fair value approximates their fair value.

	As of June 30, 2023						As of December 31, 2022
	FVTPL1		FVOCI2		Amortized cost3		FVTPL1		Amortized cost3
Financial assets not measured at fair value
Trade and other receivables, net	$	—	$	—	$	136,541	$	—	$	129,602
Amounts owed by related parties, net		—		—		2,225		—		2,474
Cash		—		—		11,537		—		43,003
Other financial assets		—		—		14,538		—		210
Total financial assets not measured at fair value	$	—	$	—	$	164,841	$	—	$	175,289
Financial liabilities measured at fair value
Warrant liabilities	$	4,461	$	—	$	—	$	10,916	$	—
Shares held in escrow		30,399		—		—		40,064		—
Derivative financial liabilities		—		2,473		—		—		—
Total financial liabilities measured at fair value	$	34,860	$	2,473	$	—	$	50,980	$	—
Financial liabilities not measured at fair value
Borrowings		—		—		288,319		—		285,934
Trade and other payables		—		—		85,970		—		90,187
Amounts owed to related parties		—		—		3,922		—		2,914
Total financial liabilities not measured at fair value	$	—	$	—	$	378,211	$	—	$	379,035

¹ The fair value of the exhibited figures as of June 30, 2023 is comprised of $3,800 Level 1 (as of December 31, 2022: $9,200) and $31,060 Level 3 (as of December 31, 2022: $41,780).

² The fair value of the exhibited figures as of June 30, 2023 is Level 2.

³ The fair value of the exhibited figures is similar to their amortized cost as of June 30, 2023 and December 31, 2022, respectively.

18.2 Measurement of fair values

The following tables show the valuation techniques used in measuring Level 3 fair values for financial instruments in the Unaudited Condensed Consolidated Interim Statement of Financial Position, as well as the significant unobservable inputs used.

				Significant unobservable	Relationship between significant unobservable	Sensitivity of  significant unobservable input to fair value
Type	Fair value		Valuation Technique	input	input to fair value		+5%		-5%
Private warrants	$	100	The fair value of the Private Warrants is estimated using the Black-Scholes option pricing formula for European calls, since the underlying stock is not expected to pay dividends over the term of the Warrants.	Volatility of 36.6% (2022: 36.6%)	The higher (lower) the volatility, the higher (lower) the fair value.	$	155	$	55
Private warrants in escrow		561	The fair value of the Private Warrants in escrow is estimated using Monte Carlo simulation in a risk-neutral framework assuming a Geometric Brownian Motion for the future stock price.	Volatility of 36.6% (2022: 37.5%)	The higher (lower) the volatility, the higher (lower) the fair value.		877		316
Shares held in escrow		30,399	The fair value of the shares to be delivered  is estimated using Monte Carlo simulation in a risk-neutral framework assuming a Geometric Brownian Motion for the future stock price.	Volatility of 41.0% (2022: 36.5%)	The higher (lower) the volatility, the higher (lower) the fair value.		30,737		29,999

18.3 Financial risk management

The Group has exposure to the following risks arising from financial instruments:

● Credit risk

● Liquidity risk

● Market risk, including currency and interest rate risk

18.3.1. Credit risk

Exposure to credit risk

The carrying amount of financial assets represents the maximum credit exposure of the Group. The carrying amount is presented net of impairment losses. None of the receivable balances as of June 30, 2023 and December 31, 2022 constitutes a significant concentration of credit risk. There are no other single customers representing more than 10% of total gross trade receivables as of June 30, 2023 and December 31, 2022.

Expected credit losses

The average credit period on the sale of medicines is 60 to 120 days. In some cases, depending on market conditions and strategy, longer payment periods are granted. No interest surcharge is made on commercial accounts receivable.

The Group has recognized a provision for doubtful accounts. The Group evaluates the impairment of its accounts receivable for the expected credit loss model, where it determines its value based on the probability of default, the loss due to default (i.e., the extent of the loss in case of default) and the exposure, by the application of the ‘simplified method’ for trade receivables without a significant financing component. The assessment of the probability of default and the loss due to default is mainly based on historical data and adjust historical loss rates to reflect information about current conditions and reasonable and supportable forecasts of future economic conditions.

June 30, 2023	Current (not past due)			1-30 days past due			31-60 days past due			61-90 days past due			91-120 days past due			More than 120 days past due			Total
Weighted-average loss rate		0.36	%		2.43	%		5.26	%		7.34	%		12.04	%		84.44	%		14.34	%
Gross carrying amount		120,839			16,815			8,524			3,162			1,620			28,420			179,380
Impairment loss allowance		(441	)		(408	)		(448	)		(232	)		(195	)		(23,997	)		(25,721	)
	$	120,398		$	16,407		$	8,076		$	2,930		$	1,425		$	4,423		$	153,659

December 31, 2022	Current (not past due)			1-30 days past due			31-60 days past due			61-90 days past due			91-120 days past due			More than 120 days past due			Total
Weighted-average loss rate		0.39	%		3.42	%		4.50	%		14.25	%		19.89	%		83.88	%		14.07	%
Gross carrying amount		124,219			11,816			3,864			1,958			890			26,605			169,352
Impairment loss allowance		(483	)		(404	)		(174	)		(279	)		(177	)		(22,317	)		(23,834	)
	$	123,736		$	11,412		$	3,690		$	1,679		$	713		$	4,288		$	145,518

As of June 30, 2023 no impairment losses were recognized for balances in connection with related parties. However, as of June 30, 2023 and December 31, 2022, an allowance is maintained for open balances referred to goods sold to Industrias Intercaps de Venezuela C.A. and Laboratorios Vivax Pharmaceuticals C.A., due to the critical political and social situation that the location country of precedence is experiencing.

18.3.2.Market Risk

Net Investment Hedges

A foreign currency exposure arises from the Group’s net investment in its subsidiary Procaps, S.A., that is a Colombian Peso functional currency entity. The risk arises from the fluctuation in spot exchange rates between the Colombian Peso and the USD, which causes the amount of that net investment to vary.

Part of the Group’s net investment in Procaps, S.A. is hedged by average rate forward contracts (pay Colombian Peso and receive USD), which mitigates the foreign currency risk arising from the subsidiary’s net assets. The forward contracts are designated as hedging instruments for the changes in the value of the net investment that are attributable to changes in the Colombian Peso/USD spot rate. The counterparty is a top-tier financial institution with low credit risk.

The hedged risk in the net investment hedge is the risk of a weakening Colombian Peso against the USD that will result in a reduction in the carrying amount of the Group’s net investment in Procaps, S.A. The Group has established a hedge ratio of 1:1 where the notional amounts of the hedging instruments match the carrying amount of the hedged net investment.

The Group assesses hedge effectiveness qualitatively, as the critical terms (i.e., the notional amount and underlying exchange rate) of the hedging instruments are closely aligned with those of the hedged net investment in Procaps, S.A. It is expected that the value of the hedging instruments and the value of the hedged net investment will systematically change in opposite directions in response to movements in the Columbian Peso/USD exchange rate.

The main potential sources of ineffectiveness identified by the Group in these hedging relationships are timing mismatches, forward points used to calculate the settlement amount of the hedging instruments which are not reflected in the value changes of the hedged net investment, and changes in the Group’s and/or derivative counterparty’s credit that would result in movements in fair value of the hedging instruments that would not be reflected in the movements in the value of the hedged net investment.

The amounts related to items designated as hedging instruments were as follows:

Average Currency Forward Contracts (Sell COP)	Settlement Date	Forward Exchange rate		Notional amount (COP)		Notional amount (USD)
Less than 3 months	7/6/2023		4,625		36,110,000,000		8,649,102
3-6 months	10/3/2023		4,715		42,800,000,000		10,251,497
Over 6 months	1/3/2024		4,791		48,837,000,000		11,697,485

	As of June 30, 2023
	Carrying amount				Line item in the statement of financial position where the hedging instrument	Change in value used for calculatinghedge
Average Currency Forward Contracts (Sell COP)	Assets		Liabilities		is included	ineffectiveness
Less than 3 months		—		368	Derivative Financial Liability		368
3-6 months		—		1,019	Derivative Financial Liability		1,019
Over 6 months		—		1,086	Derivative Financial Liability		1,086

	As of June 30, 2023
Average Currency Forward Contracts (Sell COP)	Change in value of hedging instruments recognized in OCI		Hedge ineffectiveness recognized in PL		Line item in profit or loss that includes hedge ineffectiveness
Less than 3 months		368		—	Other income (expenses), net
3-6 months		1,019		—	Other income (expenses), net
Over 6 months		1,086		—	Other income (expenses), net

The amounts related to items designated as hedged items were as follows:

	As of June 30, 2023
		Change in value used for calculating hedge ineffectiveness	Foreign currency translation reserve for continued hedges	Balances remaining in the foreign currency translation reserve from hedging relationships for which hedge accounting is no longer applied
Net Investment in Procaps S.A.		2,473	2,473	—

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Key Management Personnel

6 Months Ended

Jun. 30, 2023

Key Management Personnel [Abstract]

Key management personnel

Note 19. Key management personnel

Transactions with directors and executive board management members

Total management compensation included in the Unaudited Condensed Consolidated Interim Statement of Profit or Loss and Other Comprehensive Income are as follows:

	For the three months ended June 30				For the six months ended June 30
	2023		20221		2023		20221
Short-term employee benefits		758		598		1,510		1,133
Consulting fees		658		1,126		1,233		1,739
	$	1,416	$	1,724	$	2,743	$	2,872

¹ The Group corrected the disclosure of short-term employee benefits and consulting fees for the three and six months periods ended June 31, 2022. The correction does not impact the results presented in the prior period.

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Events After the Reporting Period

6 Months Ended

Jun. 30, 2023

Events After the Reporting Period [Abstract]

Events after the reporting period

Note 20. Events after the reporting period

Management has considered subsequent events through the date these Unaudited Condensed Consolidated Interim Financial Statements were issued and identified the following events that require disclosure.

Syndicated Loan Refinancing

On August 16, 2023, Procaps S.A. and other subsidiaries of the Group as guarantors (collectively, the “Obligors”) entered into a Credit Agreement with Bancolombia S.A. and Banco Davivienda S.A (the “New Banco Credit Agreement”). The New Banco Credit Agreement provides for a loan of up to $247,817 million COP and the proceeds are to be used exclusively for the prepayment of existing indebtedness of the Group, including the Syndicated Loan Agreement. The New Banco Credit Agreement provides for a term of six-years, and interest accrues thereunder at a rate equal to the Colombian Central Bank’s reference rate (for a three-month tenor) plus 8.50% per annum.

The New Banco Credit Agreement contains customary affirmative and negative covenants, including limitations on the ability of the Group to incur additional debt, guarantee other obligations, grant liens on assets, make investments or acquisitions, dispose of assets, pay dividends or other payments on capital stock, make restricted payments, engage in mergers or consolidations, engage in transactions with affiliates, and enter into certain restrictive agreements.

Additionally, the New Banco Credit Agreement requires the Group’s compliance with the following financial covenants, each measured on a trailing twelve-month basis on the final day of each fiscal quarter of the Group:

● Consolidated debt to consolidated EBITDA ratio of no greater than 3.50:1:00 (other than for the twelve-month period ended September 30, 2023, for which the ratio shall be no greater than 4.30:1.00); and

● Ratio of consolidated EBITDA to consolidated interest expense of greater than 3.00:1.00 (other than for the twelve-month period ended September 30, 2023, for which the ratio shall be greater than 1.90:1.00).

● Additionally, the Obligors are required to maintain combined total assets and combined EBITDA equal to no less than 80% of the Group’s consolidated total assets and consolidated EBITDA, respectively, as of June 30 and December 31 of each year.

BTG Refinancing

On August 18, 2023, the Group entered into a Credit Agreement with Banco BTG Pactual S.A.-Cayman Branch. (the “New BTG Credit Agreement”). The New BTG Credit Agreement provides for a loan of up to $19 million USD and the proceeds are to be used exclusively for the prepayment of existing indebtedness of the Group, including short term debt dated October 13, 2022. The New BTG Credit Agreement provides for a term of 30 months, and interest accrues thereunder at a rate equal to SOFR (for a three-month tenor) plus 5.80%.

The New BTG Credit Agreement requires the Group’s compliance with the following financial covenants, each measured on a trailing twelve-month basis on the final day of each fiscal quarter of the Group:

● Consolidated debt to consolidated EBITDA ratio of no greater than 3.50:1:00 (other than for the twelve-month period ended September 30 and December 31, 2023, for which the ratio shall be no greater than 4.30:1.00); and

● Ratio of consolidated EBITDA to consolidated interest expense of greater than 3.00:1.00 (other than for the twelve-month period ended September 30 and December 31, 2023, for which the ratio shall be greater than 1.90:1.00).

As of the date of the issuance of these Unaudited Condensed Consolidated Interim Financial Statements, the Group is in the process of performing the required analysis to determine if the debt refinancing described above constitutes an extinguishment or modification of the debt under IFRS 9.

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Accounting Policies, by Policy (Policies)

6 Months Ended

Jun. 30, 2023

Accounting Policies [Abstract]

Derivative financial instrument and hedge accounting

Note 3.1. Change in accounting policy

Except as described below, the accounting policies applied in these Unaudited Condensed Consolidated Interim Financial Statements are the same as those applied in the Group’s last annual financial statements.

The policy for recognizing and measuring income taxes in the interim periods is consistent with that applied in the previous interim period and is described in Note 9. Income tax.

Derivative financial instrument and hedge accounting

Note 3.1.1. Derivative financial instrument and hedge accounting

Derivative financial instruments are initially measured at fair value. Subsequent to initial recognition, they are measured at fair value, and changes therein are generally recognized in profit or loss.

The Group designates certain derivatives as hedging instruments to hedge foreign currency exposure related to net investments in foreign operations. At the inception of the hedge relationship, the Group documents the economic relationship between the hedging instrument and the hedged item, along with its risk management objectives and its strategy for undertaking the hedge.

Hedges of net investments in foreign operations

When a derivative instrument or a non-derivative financial liability is designated as the hedging instrument in a hedge of a net investment in a foreign operation, the effective portion of changes in the fair value of a derivative or foreign exchange gains and losses for a non-derivative is recognized as Exchange differences on translation of foreign operations in Other Comprehensive Income and presented under such concept within Equity. The gain or loss relating to the ineffective portion is recognized immediately in profit or loss, and is included in the ‘Other income (expense), net’ line item. Gains and losses on the hedging instrument accumulated in Other Comprehensive Income are reclassified to profit or loss on the disposal or partial disposal of the foreign operation.

New and amended IFRS Standards that are effective for the current period

Note 3.2. New and amended IFRS Standards that are effective for the current period

Certain new accounting standards, interpretations or amendments to accounting standards are effective for annual periods beginning after January 1, 2023. The Group has not early adopted any standard, interpretation or amendment that has been issued but is not yet effective in the preparation of these Unaudited Condensed Consolidated Interim Financial Statements.

The Group adopted the following accounting standard amendments from January 1, 2023. The evaluation performed by management determined that these amendments did not result in a significant impact in relation to the Group’s Unaudited Condensed Consolidated Interim Financial Statements.

Disclosure of Accounting Policies (Amendments to IAS 1 and IFRS Practice Statement 2) - Effective January 1, 2023

The amendments to IAS 1 and IFRS Practice Statement 2 Making Materiality Judgements provide guidance and examples to help entities apply materiality judgements to accounting policy disclosures. The amendments aim to help entities provide accounting policy disclosures that are more useful by replacing the requirement for entities to disclose their ‘significant’ accounting policies with a requirement to disclose their ‘material’ accounting policies and adding guidance on how entities apply the concept of materiality in making decisions about accounting policy disclosures.

The amendments had no impact on the Group’s Unaudited Condensed Consolidated Interim Financial Statements, but are expected to affect the accounting policy disclosures in the Group’s annual Consolidated Financial Statements.

Definition of Accounting Estimate (Amendments to IAS 8) - Effective January 1, 2023

The amendments introduce a new definition for accounting estimates, clarifying that they are monetary amounts in the financial statements that are subject to measurement uncertainty. The amendments also clarify the relationship between accounting policies and accounting estimates by specifying that a company develops an accounting estimate to achieve the objective set out by an accounting policy. The distinction between the two is important because changes in accounting policies are applied retrospectively, whereas changes in accounting estimates are applied prospectively.

The Group has determined the amendment has no significant impact in its Unaudited Condensed Consolidated Interim Financial Statements.

Deferred Tax Related to Assets and Liabilities Arising from a Single Transaction – Amendments to IAS 12 Income Taxes - Effective January 1, 2023

The amendments to IAS 12 Income Tax narrow the scope of the initial recognition exception, so that it no longer applies to transactions that give rise to equal taxable and deductible temporary differences such as leases and decommissioning liabilities. The amendments had no impact on the Group’s Unaudited Condensed Consolidated Interim Financial Statements.

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General Company Information (Tables)

6 Months Ended

Jun. 30, 2023

General Company Information [Abstract]

Schedule of Group’s Principal Subsidiaries

The country of incorporation or registration is also their principal place of business

		Ownership interests held by:
	Place of business/country	The Group				Non-controlling interests
Name of entity	of incorporation	2023		2022		2023		2022		Principal activities
Procaps S.A.	Colombia	100	%	100	%	—	%	—	%	Manufacturing and distribution of prescription and over-the-counter pharmaceutical products.
C.I. Procaps S.A.	Colombia	100	%	100	%	—	%	—	%
Procaps S.A. de C.V	El Salvador	100	%	100	%	—	%	—	%
Softcaps - Colbras	Brazil	100	%	100	%	—	%	—	%
Diabetrics Healthcare S.A.S.	Colombia	100	%	100	%	—	%	—	%	Diabetes solutions and chronic disease management tool.

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Revenue (Tables)

6 Months Ended

Jun. 30, 2023

Revenue [Abstract]

Schedule of Primary Geographical Market and Major Products

For the three months ended June 30	Reportable segments
2023	NextGel			Procaps Colombia			CAN			CASAND			Diabetrics			Total
Segment revenue		62,678			38,067			18,471			25,285			9,945			154,446
Inter-segment revenue		(30,698	)		(25	)		(4,658	)		(4,267	)		(4,741	)		(44,389	)
Revenue from contracts with customers		31,980			38,042			13,813			21,018			5,204			110,057
Timing of revenue recognition
Goods transferred at a point in time		30,682			38,042			13,813			21,018			5,204			108,759
Services transferred over time		1,298			—			—			—			—			1,298
Total revenue from contracts with customers		31,980			38,042			13,813			21,018			5,204			110,057

For the three months ended June 30	Reportable segments
2022	NextGel			Procaps Colombia			CAN			CASAND			Diabetrics			Total
Segment revenue		64,883			41,253			22,122			22,666			12,143			163,067
Inter-segment revenue		(31,960	)		(1,658	)		(5,287	)		(5,566	)		(6,176	)		(50,647	)
Revenue from contracts with customers		32,923			39,595			16,835			17,100			5,967			112,420
Timing of revenue recognition
Goods transferred at a point in time		29,045			38,187			14,576			17,100			5,967			104,875
Services transferred over time		3,878			1,408			2,259			—			—			7,545
Total revenue from contracts with customers		32,923			39,595			16,835			17,100			5,967			112,420

For the six months ended June 30	Reportable segments
2023	NextGel			Procaps Colombia			CAN			CASAND			Diabetrics			Total
Segment revenue		107,432			67,834			33,618			44,994			16,760			270,638
Inter-segment revenue		(50,491	)		(236	)		(10,239	)		(7,954	)		(7,499	)		(76,419	)
Revenue from contracts with customers		56,941			67,598			23,379			37,040			9,261			194,219
Timing of revenue recognition
Goods transferred at a point in time		54,861			67,598			23,379			37,040			9,261			192,139
Services transferred over time		2,080			—			—			—			—			2,080
Total revenue from contracts with customers		56,941			67,598			23,379			37,040			9,261			194,219

For the six months ended June 30	Reportable segments
2022	NextGel			Procaps Colombia			CAN			CASAND			Diabetrics			Total
Segment revenue		123,038			72,802			37,522			39,191			19,737			292,290
Inter-segment revenue		(64,778	)		(1,349	)		(9,417	)		(9,529	)		(9,167	)		(94,240	)
Revenue from contracts with customers		58,260			71,453			28,105			29,662			10,570			198,050
Timing of revenue recognition
Goods transferred at a point in time		53,531			70,045			25,846			29,210			10,570			189,202
Services transferred over time		4,729			1,408			2,259			452			—			8,848
Total revenue from contracts with customers		58,260			71,453			28,105			29,662			10,570			198,050

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Segment Reporting (Tables)

6 Months Ended

Jun. 30, 2023

Segment Reporting [Abstract]

Schedule of Customer Revenue Recognition (External Revenue)

The Group’s customer revenue recognition (external revenue) policy has been consistent with inter-segment revenue generated.

	NextGel							Procaps Colombia							CAN							CASAND
Three months ended June 30, 2023	Total		Inter- segment eliminations			External		Total		Inter- segment eliminations			External		Total		Inter- segment eliminations			External		Total		Inter- segment eliminations			External
Revenue		62,678		(30,698	)		31,980		38,067		(25	)		38,042		18,471		(4,658	)		13,813		25,285		(4,267	)		21,018
Contribution margin 1		12,473		(926	)		11,547		11,389		(133	)		11,256		5,214		622			5,836		5,847		4,286			10,133

	Diabetrics							Corporate									Total
Three months ended  June 30, 2023	Total		Inter- segment eliminations			External		Total			Inter- segment eliminations			External			Total			Inter- segment eliminations			External
Revenue		9,945		(4,741	)		5,204		—			—			—			154,446			(44,389	)		110,057
Contribution margin1		201		(133	)		68		700			151			851			35,824			3,867			39,691
Administrative expenses		—		—			—		25,150			(548	)		24,602			25,150			(548	)		24,602
Finance expenses		—		—			—		6,739			41			6,780			6,739			41			6,780
Other (income) expenses, net		—		—			—		(31,681	)		2,054			(29,627	)		(31,681	)		2,054			(29,627	)
Income (loss) before tax																		35,616			2,320			37,936

	NextGel							Procaps Colombia							CAN							CASAND
Three months ended  June 30, 2022	Total		Inter- segment eliminations			External		Total		Inter- segment eliminations			External		Total		Inter- segment eliminations			External		Total		Inter- segment eliminations			External
Revenue		64,883		(31,960	)		32,923		41,253		(1,658	)		39,595		22,122		(5,287	)		16,835		22,666		(5,566	)		17,100
Contribution margin1		18,044		(552	)		17,492		15,804		(695	)		15,109		6,280		(20	)		6,260		4,443		2,505			6,948

	Diabetrics							Corporate								Total
Three months ended June 30, 2022	Total		Inter-segment eliminations			External		Total		Inter-segment eliminations			External			Total			Inter-segment eliminations			External
Revenue		12,143		(6,176	)		5,967		—		—			—			163,067			(50,647	)		112,420
Contribution margin1		1,383		40			1,423		441		(704	)		(263	)		46,394			575			46,969
Administrative expenses		—		—			—		28,844		1			28,845			28,844			1			28,845
Finance expenses		—		—			—		18,791		—			18,791			18,791			—			18,791
Other (income) expenses, net		—		—			—		8,626		—			8,626			8,626			—			8,626
Income (loss) before tax																	(9,868	)		574			(9,293	)

	NextGel							Procaps Colombia							CAN							CASAND
Six months ended June 30, 2023	Total		Inter- segment eliminations			External		Total		Inter- segment eliminations			External		Total		Inter- segment eliminations			External		Total		Inter-segment eliminations			External
Revenue		107,432		(50,491	)		56,941		67,834		(236	)		67,598		33,618		(10,239	)		23,379		44,994		(7,954	)		37,040
Contribution margin1		21,564		(1,591	)		19,973		20,393		(67	)		20,326		7,267		1,371			8,638		8,518		8,152			16,670

	Diabetrics									Corporate									Total
Six months ended  June 30, 2023	Total			Inter-segment eliminations			External			Total			Inter- segment eliminations			External			Total			Inter-segment eliminations			External
Revenue		16,760			(7,499	)		9,261			—			—			—			270,638			(76,419	)		194,219
Contribution margin1		(12	)		(420	)		(432	)		(14,075	)		13,983			(92	)		43,655			21,428			65,083
Administrative expenses		—			—			—			2,545			44,176			46,721			2,545			44,176			46,721
Finance expenses		—			—			—			8,408			(3,277	)		5,131			8,408			(3,277	)		5,131
Other (income) expenses, net		—			—			—			(27,003	)		(6,582	)		(33,585	)		(27,003	)		(6,582	)		(33,585	)
Income (loss) before tax																				59,705			(12,889	)		46,816

	NextGel							Procaps Colombia							CAN							CASAND
Six months ended  June 30, 2022	Total		Inter- segment eliminations			External		Total		Inter- segment eliminations			External		Total		Inter- segment eliminations			External		Total		Inter- segment eliminations			External
Revenue		123,038		(64,778	)		58,260		72,802		(1,349	)		71,453		37,522		(9,417	)		28,105		39,191		(9,529	)		29,662
Contribution margin1		35,775		(8,071	)		27,704		24,705		155			24,860		9,045		(651	)		8,394		6,037		5,810			11,847

	Diabetrics							Corporate								Total
Six months ended June 30, 2022	Total		Inter- segment eliminations			External		Total		Inter- segment eliminations			External			Total		Inter- segment eliminations			External
Revenue		19,737		(9,167	)		10,570				—						292,290		(94,240	)		198,050
Contribution margin1		1,432		(93	)		1,339		1,937		(2,147	)		(210	)		78,930		(4,996	)		73,934
Administrative expenses		—		—			—		53,400		—			53,400			53,400		—			53,400
Finance expenses		—		—			—		4,209		—			4,209			4,209		—			4,209
Other (income) expenses, net		—		—			—		3,503		—			3,503			3,503		—			3,503
Income (loss) before tax																	17,817		(4,996	)		12,822

¹ Contribution margin is determined by subtracting sales and marketing expenses from gross profit. The Group’s customer revenue recognition (external revenue) policy has been consistent with inter-segment revenue generated.

Schedule of Revenue is Based on The Geographical Location of the Customers

In presenting geographical information, the Group’s revenue is based on the geographical location of the customers.

	For the three months ended June 30				For the six months ended June 30
	2023		2022		2023		2022
South America	$	75,362	$	73,956	$	135,104	$	133,156
Central America		23,733		26,265		39,480		42,546
North America		9,136		9,072		16,562		17,304
Europe		1,826		3,127		3,073		5,044
Total	$	110,057	$	112,420	$	194,219	$	198,050

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Finance expenses, net (Tables)

6 Months Ended

Jun. 30, 2023

Finance Expenses, Net [Abstract]

Schedule of Finance Expenses, Net

	For the three months ended June 30						For the six months ended June 30
	2023			2022			2023			2022
Banking expenses	$	(564	)	$	(58	)	$	(787	)	$	(374	)
Bank fees		(295	)		(304	)		(502	)		(411	)
Other financial expenses1		(315	)		(280	)		(611	)		(429	)
Net fair value gain/(loss) of warrant liabilities2		2,510			(1,092	)		6,456			636
Net fair value gain/(loss) of shares held in escrow2		2,460			(10,778	)		9,665			7,732
Interest expense		(10,576	)		(6,279	)		(19,352	)		(11,363	)
Total	$	(6,780	)	$	(18,791	)	$	(5,131	)	$	(4,209	)

¹ For the three and six months ended June 30, 2023, interest on lease liabilities amounted to $315 and $611 (for the three and six months ended June 30, 2022: $248 and $429).

² Refer to Note 16. Warrant liabilities, Note 17. Shares in escrow and Note 18. Financial instruments for further information related to net fair value gains for the six months ended June 30, 2023.

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Other Income (Expenses), Net (Tables)

6 Months Ended

Jun. 30, 2023

Other Expenses Net [Abstract]

Schedule of Other Expenses, Net

	For the three months ended June 30						For the six months ended June 30
	2023			2022			2023			2022
Currency exchange rate differences1	$	10,464		$	(8,357	)	$	14,394		$	(3,188	)
Economic emergency contribution expenses		(320	)		(407	)		(637	)		(680	)
Fines, surcharges, penalties and taxes assumed		(40	)		(13	)		(120	)		(95	)
Donations		(160	)		(93	)		(315	)		(173	)
Other2		19,683			244			20,263			633
Total	$	29,627		$	(8,626	)	$	33,585		$	(3,503	)

¹ The increase in currency exchange rate differences income (expense) for the three and six months ended June 30, 2023 is mainly related to a decrease of 10% and 13% (increase for the three and six months ended June 30, 2022 11% and 4%) in the Colombian Pesos/USD exchange rate for the period and the Group’s Colombian entities’ liability position towards USD.

² Includes income from a legal settlement with a third party to recover costs incurred relating to a business opportunity with such third party. The open receivable balance as of June 30, 2023 is included within Other financial assets in the Consolidated Interim Statement of Financial Position. The amount, counter party and any further details can’t be disclosed due to contractual restrictions within the settlement agreement.

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Intangible Assets Net (Tables)

6 Months Ended

Jun. 30, 2023

Intangible Assets Net [Abstract]

Schedule of Intangible Assets

Cost	Total
Balance as of January 1, 2022	$	53,926
Additions		860
Additions from internal developments		4,246
Foreign currency exchange		(1,687	)
Balance as of June 30, 2022	$	57,345
Balance as of January 1, 2023	$	57,831
Additions		1,465
Additions from internal developments		4,031
Derecognition of assets		(51	)
Foreign currency exchange		6,535
Transfers		113
Balance as of June 30, 2023	$	69,924

Accumulated amortization	Total
Balance as of January 1, 2022	$	23,755
Amortization expense		2,436
Foreign currency exchange		(723	)
Balance as of June 30, 2022	$	25,468
Balance as of January 1, 2023	$	25,623
Amortization expense		2,291
Foreign currency exchange		2,852
Balance as of June 30, 2023	$	30,766
As of June 30, 2022
Net book value	$	31,877
As of June 30, 2023
Net book value	$	39,158

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Property, Plant and Equipment, Net (Tables)

6 Months Ended

Jun. 30, 2023

Property, Plant and Equipment, Net [Abstract]

Schedule of Accumulated Depreciation

Cost	Total
Balance as of January 1, 2022	$	116,654
Additions		10,518
Disposals		(2,275	)
Effect of exchange differences in foreign currency		(2,544	)
Transfers		(54	)
Balance as of June 30, 2022	$	122,299
Balance as of January 1, 2023	$	121,898
Additions		13,110
Disposals		(276	)
Effect of exchange differences in foreign currency		12,664
Transfers		(116	)
Balance as of June 30, 2023	$	147,280

Accumulated depreciation	Total
Balance as of January 1, 2022	$	44,016
Disposals		(174	)
Depreciation expense		2,932
Effect of exchange differences in foreign currency		(1,071	)
Balance as of June 30, 2022	$	45,703
Balance as of January 1, 2023	$	47,933
Disposals		(227	)
Depreciation expense		2,662
Effect of exchange differences in foreign currency		5,125
Transfers		(38	)
Balance as of June 30, 2023	$	55,455
As of June 30, 2022
Net book value	$	76,596
As of June 30, 2023
Net book value	$	91,825

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Inventories, Net (Tables)

6 Months Ended

Jun. 30, 2023

Inventories, Net [Abstract]

Schedule of Inventories Net

	As of June 30, 2023			As of December 31, 2022
Raw materials and supplies	$	50,371		$	42,701
Products in process		6,600			7,412
Finished products and merchandise		42,094			41,492
Inventory in transit		9,950			11,531
Subtotal	$	109,015		$	103,136
Less: Provision		(5,540	)		(6,303	)
Total	$	103,475		$	96,833

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Trade and Other Receivables, Net (Tables)

6 Months Ended

Jun. 30, 2023

Disclosure Of Trade And Other Receivables Text Block [Abstract]

Schedule of Trade and Other Receivables, Net

	As of June 30, 2023			As of December 31, 2022
Trade receivables, net of discounts 1	$	137,587		$	126,456
Other receivables		12,860			15,211
Impairment of trade and other receivables 2		(13,906	)		(12,065	)
Trade receivables, net of discounts and impairment	$	136,541		$	129,602

¹ Discount and return provision amounts to $14,793 (as of December 31, 2022: $13,443).

² Total impairment balance is comprised of $11,744 (as of December 31, 2022: $10,768) for trade receivables and $2,162 (as of December 31, 2022 $1,297) for other receivables.

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Borrowings (Tables)

6 Months Ended

Jun. 30, 2023

Borrowings [Abstract]

Schedule of Unsecured Borrowings at Amortized Cost

	As of June 30, 2023		As of December 31, 2022
Borrowings at amortized cost(a)
Syndicated term loan (1)	$	40,191	$	38,626
Other term loan (2)		93,788		95,720
Lease liabilities (3)		34,966		34,192
Factoring obligations (4)		4,017		2,317
Bank overdrafts (5)		357		80
Notes (6)		115,000		115,000
Total Interest bearing liabilities	$	288,319	$	285,935
Current		118,684		257,525
Non- Current	$	169,635	$	28,410

^(a) Borrowings at amortized cost are unsecured, with the exception of factoring obligations which are collateralized by trade receivables. Refer to Note 13. Trade and other receivables, net.

Schedule of Borrowings

	Currency	Range of Interest	Maturity Year	As of June 30, 2023			As of December 31, 2022
Syndicated term loan	COP	IBR + 5.30%	2023-2025	$	40,652		$	39,156
Amortized cost	COP	N/A	2023		(461	)		(530	)
Total Syndicated term loan				$	40,191		$	38,626

	Currency	Range of Interest	Maturity Year	As of June 30, 2023		As of December 31, 2022
Other term loan	COP	IBR+ 9.0%, 23.5% (2022: IBR+ 5.0%, DTF+ 3%, 13.99%-25.3%)	2022-2025	$	12,407	$	9,549
	COP	IBR + 2.25%- IBR 7.95% (2022: IBR+2.25%-10.2%)	2022-2025		23,342		21,267
	Soles	8.0% - 14.50% (Fixed) (2022: 8.0% - 12.79% (Fixed))	2022-2024		6,619		6,837
	Reales	9.84% - 18% N.A.	2023-2024		1,137		2,176
	USD	SOFR+ (5.80%-7.00%), SOFR6M + (2%-3%) (2022: SOFR+ (4.80%-5.80%))	2023		24,669		23,454
	USD	6.5%-16.8% N.A. (2022: 6.36%-16.8%)	2022-2025		25,614		32,437
Total Other term loans				$	93,788	$	95,720

	Currency	Range of  Interest	Maturity Year	As of June 30, 2023		As of December 31, 2022
Lease liabilities	COP	IBR+(3.82%-7.3%), DTF + 5.5% (2022: DTF + (5,18% - 10,11%) T.A., IBR+7.5%)	2022-2030	$	10,170	$	10,475
	COP	IBR+ (4.2%-8.2%) (2022: DTF+ 4.54%-10.42 T.A.	2022-2025		3,944		3,653
	USD	0.75%-21.48%, DTF+5.50%, IBR+4.10% (2022: 0.75%-21.48%)	2023-2032		20,852		14,787
	COP	1.91%-12.23%, IBR+4.68%	2023		—		4,703
	Reales	0.70-8.72% (Fixed)	2023-2024		—		574
Total Lease Liabilities				$	34,966	$	34,192

	Currency	Range of Interest	Maturity Year	As of June 30, 2023		As of December 31, 2022
Portfolio factoring	COP	DTF+7% (2022: DTF+8%)	2023	$	1,583	$	1,508
	COP	2% - 22.4% (2022: 15.0% - 27% N.A.)	2023		2,434		809
Total Factoring				$	4,017	$	2,317

	Currency	Range of Interest	Maturity Year	As of June 30, 2023		As of December 31, 2022
Overdrafts and credit cards	COP	19.68% - 32% E.A.  (Fixed)	2023	$	357	$	80

	Currency	Range of Interest	Maturity Year	As of June 30, 2023		As of December 31, 2022
The Prudential Insurance Company Of America	USD	8.50% (Fixed)	2031	$	60,020	$	60,020
Prudential Annuities Life Assurance Corporation	USD	8.50% (Fixed)	2031		29,980		29,980
Healthspring Life & Health Insurance Company, Inc	USD	8.50% (Fixed)	2031		18,350		18,350
CIGNA Health and Life Insurance Company	USD	8.50% (Fixed)	2031		6,650		6,650
Total Senior Notes				$	115,000	$	115,000

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Provisions and Contingencies (Tables)

6 Months Ended

Jun. 30, 2023

Provisions and contingencies [Abstract]

Schedule of Provisions and Contingencies

	2023			2022
Contingencies
Balance as of January 1	$	138		$	501
Effect of changes in foreign exchange rates		8			28
Provisions made		91			7
Provisions used		(42	)		(41	)
Balance as of June 30	$	195		$	495

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Warrant Liabilities (Tables)

6 Months Ended

Jun. 30, 2023

Warrant Liabilities [Abstract]

Schedule of Warrant Liabilities

	As of June 30, 2023		As of December 31, 2022
Public warrants	$	3,800	$	9,200
Private warrants1		661		1,716
	$	4,461	$	10,916

¹ Private warrants include 2,875,000 held by the former SPAC sponsors deposited in an escrow account.

Schedule of Public Warrants

Public warrants

	As of June 30, 2023			As of December 31, 2022
As of January 1	$	9,200		$	16,000
Acquired public warrants		—			—
Fair value remeasurement		(5,400	)		(6,800	)
Balance as of June 30/December 31	$	3,800		$	9,200

Schedule of Private Warrants

Private warrants

	As of June 30, 2023			As of December 31, 2022
As of January 1	$	1,716		$	7,112
Acquired private warrants		—			—
Fair value remeasurement		(1,055	)		(5,396	)
Balance as of June 30/December 31	$	661		$	1,716

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Shares in Escrow (Tables)

6 Months Ended

Jun. 30, 2023

Shares in escrow [Abstract]

Schedule of Shares in Escrow

	As of June 30, 2023			As of December 31, 2022
As of January 1	$	40,064		$	101,859
Escrowed shares		—			—
Fair value remeasurement		(9,665	)		(61,795	)
Balance as of June 30/December 31	$	30,399		$	40,064

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Financial Instruments (Tables)

6 Months Ended

Jun. 30, 2023

Financial Instruments [Abstract]

Schedule of Carrying Amounts of Financial Assets and Financial Liabilities

The following table shows the carrying amounts of financial assets and financial liabilities. The amortized cost basis of the financial assets and liabilities not measured at fair value approximates their fair value.

	As of June 30, 2023						As of December 31, 2022
	FVTPL1		FVOCI2		Amortized cost3		FVTPL1		Amortized cost3
Financial assets not measured at fair value
Trade and other receivables, net	$	—	$	—	$	136,541	$	—	$	129,602
Amounts owed by related parties, net		—		—		2,225		—		2,474
Cash		—		—		11,537		—		43,003
Other financial assets		—		—		14,538		—		210
Total financial assets not measured at fair value	$	—	$	—	$	164,841	$	—	$	175,289
Financial liabilities measured at fair value
Warrant liabilities	$	4,461	$	—	$	—	$	10,916	$	—
Shares held in escrow		30,399		—		—		40,064		—
Derivative financial liabilities		—		2,473		—		—		—
Total financial liabilities measured at fair value	$	34,860	$	2,473	$	—	$	50,980	$	—
Financial liabilities not measured at fair value
Borrowings		—		—		288,319		—		285,934
Trade and other payables		—		—		85,970		—		90,187
Amounts owed to related parties		—		—		3,922		—		2,914
Total financial liabilities not measured at fair value	$	—	$	—	$	378,211	$	—	$	379,035

¹ The fair value of the exhibited figures as of June 30, 2023 is comprised of $3,800 Level 1 (as of December 31, 2022: $9,200) and $31,060 Level 3 (as of December 31, 2022: $41,780).

² The fair value of the exhibited figures as of June 30, 2023 is Level 2.

³ The fair value of the exhibited figures is similar to their amortized cost as of June 30, 2023 and December 31, 2022, respectively.

Schedule of Valuation Techniques used in Measuring Level 3 Fair Values for Financial Instruments in the Statement of Financial Position

The following tables show the valuation techniques used in measuring Level 3 fair values for financial instruments in the Unaudited Condensed Consolidated Interim Statement of Financial Position, as well as the significant unobservable inputs used.

				Significant unobservable	Relationship between significant unobservable	Sensitivity of  significant unobservable input to fair value
Type	Fair value		Valuation Technique	input	input to fair value		+5%		-5%
Private warrants	$	100	The fair value of the Private Warrants is estimated using the Black-Scholes option pricing formula for European calls, since the underlying stock is not expected to pay dividends over the term of the Warrants.	Volatility of 36.6% (2022: 36.6%)	The higher (lower) the volatility, the higher (lower) the fair value.	$	155	$	55
Private warrants in escrow		561	The fair value of the Private Warrants in escrow is estimated using Monte Carlo simulation in a risk-neutral framework assuming a Geometric Brownian Motion for the future stock price.	Volatility of 36.6% (2022: 37.5%)	The higher (lower) the volatility, the higher (lower) the fair value.		877		316
Shares held in escrow		30,399	The fair value of the shares to be delivered  is estimated using Monte Carlo simulation in a risk-neutral framework assuming a Geometric Brownian Motion for the future stock price.	Volatility of 41.0% (2022: 36.5%)	The higher (lower) the volatility, the higher (lower) the fair value.		30,737		29,999

Schedule of Assessment of the Probability of Default and the Loss Due to Default is Mainly Based on Historical Data and Adjust Historical Loss Rates

June 30, 2023	Current (not past due)			1-30 days past due			31-60 days past due			61-90 days past due			91-120 days past due			More than 120 days past due			Total
Weighted-average loss rate		0.36	%		2.43	%		5.26	%		7.34	%		12.04	%		84.44	%		14.34	%
Gross carrying amount		120,839			16,815			8,524			3,162			1,620			28,420			179,380
Impairment loss allowance		(441	)		(408	)		(448	)		(232	)		(195	)		(23,997	)		(25,721	)
	$	120,398		$	16,407		$	8,076		$	2,930		$	1,425		$	4,423		$	153,659

December 31, 2022	Current (not past due)			1-30 days past due			31-60 days past due			61-90 days past due			91-120 days past due			More than 120 days past due			Total
Weighted-average loss rate		0.39	%		3.42	%		4.50	%		14.25	%		19.89	%		83.88	%		14.07	%
Gross carrying amount		124,219			11,816			3,864			1,958			890			26,605			169,352
Impairment loss allowance		(483	)		(404	)		(174	)		(279	)		(177	)		(22,317	)		(23,834	)
	$	123,736		$	11,412		$	3,690		$	1,679		$	713		$	4,288		$	145,518

Schedule of Designated as Hedging Instruments

The amounts related to items designated as hedging instruments were as follows:

Average Currency Forward Contracts (Sell COP)	Settlement Date	Forward Exchange rate		Notional amount (COP)		Notional amount (USD)
Less than 3 months	7/6/2023		4,625		36,110,000,000		8,649,102
3-6 months	10/3/2023		4,715		42,800,000,000		10,251,497
Over 6 months	1/3/2024		4,791		48,837,000,000		11,697,485

Schedule of Balances of Other Financial Liabilities Such as Suppliers and Accounts Payable Have No Financial Cost and their Payment Period Ranges

	As of June 30, 2023
	Carrying amount				Line item in the statement of financial position where the hedging instrument	Change in value used for calculatinghedge
Average Currency Forward Contracts (Sell COP)	Assets		Liabilities		is included	ineffectiveness
Less than 3 months		—		368	Derivative Financial Liability		368
3-6 months		—		1,019	Derivative Financial Liability		1,019
Over 6 months		—		1,086	Derivative Financial Liability		1,086

Schedule of Cash and Cash Equivalents

	As of June 30, 2023
Average Currency Forward Contracts (Sell COP)	Change in value of hedging instruments recognized in OCI		Hedge ineffectiveness recognized in PL		Line item in profit or loss that includes hedge ineffectiveness
Less than 3 months		368		—	Other income (expenses), net
3-6 months		1,019		—	Other income (expenses), net
Over 6 months		1,086		—	Other income (expenses), net

Schedule of Detailed Information About Hedged Items

The amounts related to items designated as hedged items were as follows:

	As of June 30, 2023
		Change in value used for calculating hedge ineffectiveness	Foreign currency translation reserve for continued hedges	Balances remaining in the foreign currency translation reserve from hedging relationships for which hedge accounting is no longer applied
Net Investment in Procaps S.A.		2,473	2,473	—

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Key Management Personnel (Tables)

6 Months Ended

Jun. 30, 2023

Key Management Personnel [Abstract]

Schedule of Unaudited Condensed Consolidated Interim Statement of Profit or Loss and Other Comprehensive Income

Total management compensation included in the Unaudited Condensed Consolidated Interim Statement of Profit or Loss and Other Comprehensive Income are as follows:

	For the three months ended June 30				For the six months ended June 30
	2023		20221		2023		20221
Short-term employee benefits		758		598		1,510		1,133
Consulting fees		658		1,126		1,233		1,739
	$	1,416	$	1,724	$	2,743	$	2,872

¹ The Group corrected the disclosure of short-term employee benefits and consulting fees for the three and six months periods ended June 31, 2022. The correction does not impact the results presented in the prior period.

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General Company Information (Details) $ in Thousands	Jun. 30, 2023 USD ($)
General Company Information [Abstract]
Annual gross revenue	$ 1,070,000
Non-affiliates exceeds	700,000
Non convertible debt securities	1,000,000
Bridge loan	$ 5,719

XML

General Company Information (Details) - Schedule of Group’s Principal Subsidiaries	6 Months Ended	12 Months Ended
	Jun. 30, 2023	Dec. 31, 2022
Procaps S.A. [Member]
General Company Information (Details) - Schedule of Group’s Principal Subsidiaries [Line Items]
Place of business/country of incorporation	Colombia
Percentage of Ownership Interests	100.00%	100.00%
Percentage of Non-controlling interests
Principal activities	Manufacturing and distribution of prescription and over-the-counter pharmaceutical products.
C.I. Procaps S.A. [Member]
General Company Information (Details) - Schedule of Group’s Principal Subsidiaries [Line Items]
Place of business/country of incorporation	Colombia
Percentage of Ownership Interests	100.00%	100.00%
Percentage of Non-controlling interests
Procaps S.A. de C.V [Member]
General Company Information (Details) - Schedule of Group’s Principal Subsidiaries [Line Items]
Place of business/country of incorporation	El Salvador
Percentage of Ownership Interests	100.00%	100.00%
Percentage of Non-controlling interests
Softcaps - Colbras [Member]
General Company Information (Details) - Schedule of Group’s Principal Subsidiaries [Line Items]
Place of business/country of incorporation	Brazil
Percentage of Ownership Interests	100.00%	100.00%
Percentage of Non-controlling interests
Diabetrics Healthcare S.A.S. [Member]
General Company Information (Details) - Schedule of Group’s Principal Subsidiaries [Line Items]
Place of business/country of incorporation	Colombia
Percentage of Ownership Interests	100.00%	100.00%
Percentage of Non-controlling interests
Principal activities	Diabetes solutions and chronic disease management tool.

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Basis of Preparation and Accounting (Details) - USD ($)	6 Months Ended	12 Months Ended
	Jun. 30, 2023	Dec. 31, 2022
Basis of Preparation and Accounting [Abstract]
Current liabilities		$ 139,155
Non-current borrowing	$ 115,000
Net working capital surplus	$ 51,670
Working capital deficit		$ 70,931

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Revenue (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Revenue [Abstract]
Revenue	$ 1,298	$ 7,545	$ 2,080	$ 8,848

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Revenue (Details) - Schedule of Primary Geographical Market and Major Products - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Revenue (Details) - Schedule of Primary Geographical Market and Major Products [Line Items]
Segment revenue	$ 154,446	$ 163,067	$ 270,638	$ 292,290
Inter-segment revenue	(44,389)	(50,647)	(76,419)	(94,240)
Revenue from contracts with customers	110,057	112,420	194,219	198,050
Timing of revenue recognition
Goods transferred at a point in time	108,759	104,875	192,139	189,202
Services transferred over time	1,298	7,545	2,080	8,848
Total revenue from contracts with customers	110,057	112,420	194,219	198,050
NextGel [Member]
Revenue (Details) - Schedule of Primary Geographical Market and Major Products [Line Items]
Segment revenue	62,678	64,883	107,432	123,038
Inter-segment revenue	(30,698)	(31,960)	(50,491)	(64,778)
Revenue from contracts with customers	31,980	32,923	56,941	58,260
Timing of revenue recognition
Goods transferred at a point in time	30,682	29,045	54,861	53,531
Services transferred over time	1,298	3,878	2,080	4,729
Total revenue from contracts with customers	31,980	32,923	56,941	58,260
Procaps Colombia [Member]
Revenue (Details) - Schedule of Primary Geographical Market and Major Products [Line Items]
Segment revenue	38,067	41,253	67,834	72,802
Inter-segment revenue	(25)	(1,658)	(236)	(1,349)
Revenue from contracts with customers	38,042	39,595	67,598	71,453
Timing of revenue recognition
Goods transferred at a point in time	38,042	38,187	67,598	70,045
Services transferred over time		1,408		1,408
Total revenue from contracts with customers	38,042	39,595	67,598	71,453
CAN [Member]
Revenue (Details) - Schedule of Primary Geographical Market and Major Products [Line Items]
Segment revenue	18,471	22,122	33,618	37,522
Inter-segment revenue	(4,658)	(5,287)	(10,239)	(9,417)
Revenue from contracts with customers	13,813	16,835	23,379	28,105
Timing of revenue recognition
Goods transferred at a point in time	13,813	14,576	23,379	25,846
Services transferred over time		2,259		2,259
Total revenue from contracts with customers	13,813	16,835	23,379	28,105
CASAND [Member]
Revenue (Details) - Schedule of Primary Geographical Market and Major Products [Line Items]
Segment revenue	25,285	22,666	44,994	39,191
Inter-segment revenue	(4,267)	(5,566)	(7,954)	(9,529)
Revenue from contracts with customers	21,018	17,100	37,040	29,662
Timing of revenue recognition
Goods transferred at a point in time	21,018	17,100	37,040	29,210
Services transferred over time				452
Total revenue from contracts with customers	21,018	17,100	37,040	29,662
Diabetrics [Member]
Revenue (Details) - Schedule of Primary Geographical Market and Major Products [Line Items]
Segment revenue	9,945	12,143	16,760	19,737
Inter-segment revenue	(4,741)	(6,176)	(7,499)	(9,167)
Revenue from contracts with customers	5,204	5,967	9,261	10,570
Timing of revenue recognition
Goods transferred at a point in time	5,204	5,967	9,261	10,570
Services transferred over time
Total revenue from contracts with customers	$ 5,204	$ 5,967	$ 9,261	$ 10,570

XML

Segment Reporting (Details)	6 Months Ended
	Jun. 30, 2023
Segment Reporting [Line Items]
Revenue concentration percentage	10.00%

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Segment Reporting (Details) - Schedule of Customer Revenue Recognition (External Revenue) - USD ($) $ in Thousands		3 Months Ended		6 Months Ended
		Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Total
Segment Reporting (Details) - Schedule of Customer Revenue Recognition (External Revenue) [Line Items]
Revenue		$ 154,446	$ 163,067	$ 270,638	$ 292,290
Contribution margin	[1]	35,824	46,394	43,655	78,930
Administrative expenses		25,150	28,844	2,545	53,400
Finance expenses		6,739	18,791	8,408	4,209
Other (income) expenses, net		(31,681)	8,626	(27,003)	3,503
Income (loss) before tax		35,616	(9,868)	59,705	17,817
Total | NextGel [Member]
Segment Reporting (Details) - Schedule of Customer Revenue Recognition (External Revenue) [Line Items]
Revenue		62,678	64,883	107,432	123,038
Contribution margin	[1]	12,473	18,044	21,564	35,775
Total | Procaps Colombia [Member]
Segment Reporting (Details) - Schedule of Customer Revenue Recognition (External Revenue) [Line Items]
Revenue		38,067	41,253	67,834	72,802
Contribution margin	[1]	11,389	15,804	20,393	24,705
Total | CAN [Member]
Segment Reporting (Details) - Schedule of Customer Revenue Recognition (External Revenue) [Line Items]
Revenue		18,471	22,122	33,618	37,522
Contribution margin	[1]	5,214	6,280	7,267	9,045
Total | CASAND [Member]
Segment Reporting (Details) - Schedule of Customer Revenue Recognition (External Revenue) [Line Items]
Revenue		25,285	22,666	44,994	39,191
Contribution margin	[1]	5,847	4,443	8,518	6,037
Total | Diabetrics [Member]
Segment Reporting (Details) - Schedule of Customer Revenue Recognition (External Revenue) [Line Items]
Revenue		9,945	12,143	16,760	19,737
Contribution margin	[1]	201	1,383	(12)	1,432
Administrative expenses
Finance expenses
Other (income) expenses, net
Total | Corporate [Member]
Segment Reporting (Details) - Schedule of Customer Revenue Recognition (External Revenue) [Line Items]
Revenue
Contribution margin	[1]	700	441	(14,075)	1,937
Administrative expenses		25,150	28,844	2,545	53,400
Finance expenses		6,739	18,791	8,408	4,209
Other (income) expenses, net		(31,681)	8,626	(27,003)	3,503
Inter- segment eliminations [Member]
Segment Reporting (Details) - Schedule of Customer Revenue Recognition (External Revenue) [Line Items]
Revenue		(44,389)	(50,647)	(76,419)	(94,240)
Contribution margin	[1]	3,867	575	21,428	(4,996)
Administrative expenses		(548)	1	44,176
Finance expenses		41		(3,277)
Other (income) expenses, net		2,054		(6,582)
Income (loss) before tax		2,320	574	(12,889)	(4,996)
Inter- segment eliminations [Member] | NextGel [Member]
Segment Reporting (Details) - Schedule of Customer Revenue Recognition (External Revenue) [Line Items]
Revenue		(30,698)	(31,960)	(50,491)	(64,778)
Contribution margin	[1]	(926)	(552)	(1,591)	(8,071)
Inter- segment eliminations [Member] | Procaps Colombia [Member]
Segment Reporting (Details) - Schedule of Customer Revenue Recognition (External Revenue) [Line Items]
Revenue		(25)	(1,658)	(236)	(1,349)
Contribution margin	[1]	(133)	(695)	(67)	155
Inter- segment eliminations [Member] | CAN [Member]
Segment Reporting (Details) - Schedule of Customer Revenue Recognition (External Revenue) [Line Items]
Revenue		(4,658)	(5,287)	(10,239)	(9,417)
Contribution margin	[1]	622	(20)	1,371	(651)
Inter- segment eliminations [Member] | CASAND [Member]
Segment Reporting (Details) - Schedule of Customer Revenue Recognition (External Revenue) [Line Items]
Revenue		(4,267)	(5,566)	(7,954)	(9,529)
Contribution margin	[1]	4,286	2,505	8,152	5,810
Inter- segment eliminations [Member] | Diabetrics [Member]
Segment Reporting (Details) - Schedule of Customer Revenue Recognition (External Revenue) [Line Items]
Revenue		(4,741)	(6,176)	(7,499)	(9,167)
Contribution margin	[1]	(133)	40	(420)	(93)
Administrative expenses
Finance expenses
Other (income) expenses, net
Inter- segment eliminations [Member] | Corporate [Member]
Segment Reporting (Details) - Schedule of Customer Revenue Recognition (External Revenue) [Line Items]
Revenue
Contribution margin	[1]	151	(704)	13,983	(2,147)
Administrative expenses		(548)	1	44,176
Finance expenses		41		(3,277)
Other (income) expenses, net		2,054		(6,582)
External [Member]
Segment Reporting (Details) - Schedule of Customer Revenue Recognition (External Revenue) [Line Items]
Revenue		110,057	112,420	194,219	198,050
Contribution margin	[1]	39,691	46,969	65,083	73,934
Administrative expenses		24,602	28,845	46,721	53,400
Finance expenses		6,780	18,791	5,131	4,209
Other (income) expenses, net		(29,627)	8,626	(33,585)	3,503
Income (loss) before tax		37,936	(9,293)	46,816	12,822
External [Member] | NextGel [Member]
Segment Reporting (Details) - Schedule of Customer Revenue Recognition (External Revenue) [Line Items]
Revenue		31,980	32,923	56,941	58,260
Contribution margin	[1]	11,547	17,492	19,973	27,704
External [Member] | Procaps Colombia [Member]
Segment Reporting (Details) - Schedule of Customer Revenue Recognition (External Revenue) [Line Items]
Revenue		38,042	39,595	67,598	71,453
Contribution margin	[1]	11,256	15,109	20,326	24,860
External [Member] | CAN [Member]
Segment Reporting (Details) - Schedule of Customer Revenue Recognition (External Revenue) [Line Items]
Revenue		13,813	16,835	23,379	28,105
Contribution margin	[1]	5,836	6,260	8,638	8,394
External [Member] | CASAND [Member]
Segment Reporting (Details) - Schedule of Customer Revenue Recognition (External Revenue) [Line Items]
Revenue		21,018	17,100	37,040	29,662
Contribution margin	[1]	10,133	6,948	16,670	11,847
External [Member] | Diabetrics [Member]
Segment Reporting (Details) - Schedule of Customer Revenue Recognition (External Revenue) [Line Items]
Revenue		5,204	5,967	9,261	10,570
Contribution margin	[1]	68	1,423	(432)	1,339
Administrative expenses
Finance expenses
Other (income) expenses, net
External [Member] | Corporate [Member]
Segment Reporting (Details) - Schedule of Customer Revenue Recognition (External Revenue) [Line Items]
Revenue
Contribution margin	[1]	851	(263)	(92)	(210)
Administrative expenses		24,602	28,845	46,721	53,400
Finance expenses		6,780	18,791	5,131	4,209
Other (income) expenses, net		$ (29,627)	$ 8,626	$ (33,585)	$ 3,503

[1] Contribution margin is determined by subtracting sales and marketing expenses from gross profit. The Group’s customer revenue recognition (external revenue) policy has been consistent with inter-segment revenue generated.

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Segment Reporting (Details) - Schedule of Revenue is Based on The Geographical Location of the Customers - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Schedule of Revenue is Based on The Geographical Location of the Customers [Abstract]
Segment revenue	$ 110,057	$ 112,420	$ 194,219	$ 198,050
South America [Member]
Schedule of Revenue is Based on The Geographical Location of the Customers [Abstract]
Segment revenue	75,362	73,956	135,104	133,156
Central America [Member]
Schedule of Revenue is Based on The Geographical Location of the Customers [Abstract]
Segment revenue	23,733	26,265	39,480	42,546
North America [Member]
Schedule of Revenue is Based on The Geographical Location of the Customers [Abstract]
Segment revenue	9,136	9,072	16,562	17,304
Europe [Member]
Schedule of Revenue is Based on The Geographical Location of the Customers [Abstract]
Segment revenue	$ 1,826	$ 3,127	$ 3,073	$ 5,044

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Finance expenses, net (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Finance Expenses, Net [Abstract]
Interest on lease liabilities	$ 315	$ 248	$ 611	$ 429

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Finance expenses, net (Details) - Schedule of Finance Expenses, Net - USD ($) $ in Thousands		3 Months Ended		6 Months Ended
		Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Schedule of Finance Expenses Net [Abstract]
Banking expenses		$ (564)	$ (58)	$ (787)	$ (374)
Bank fees		(295)	(304)	(502)	(411)
Other financial expenses	[1]	(315)	(280)	(611)	(429)
Net fair value gain/(loss) of warrant liabilities	[2]	2,510	(1,092)	6,456	636
Net fair value gain/(loss) of shares held in escrow	[2]	2,460	(10,778)	9,665	7,732
Interest expense		(10,576)	(6,279)	(19,352)	(11,363)
Total		$ (6,780)	$ (18,791)	$ (5,131)	$ (4,209)

[1] For the three and six months ended June 30, 2023, interest on lease liabilities amounted to $315 and $611 (for the three and six months ended June 30, 2022: $248 and $429).

[2] Refer to Note 16. Warrant liabilities, Note 17. Shares in escrow and Note 18. Financial instruments for further information related to net fair value gains for the six months ended June 30, 2023.

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Other Income (Expenses), Net (Details)	3 Months Ended	6 Months Ended
	Jun. 30, 2023	Jun. 30, 2023
Other Income and Expenses Net [Abstract]
Income expenses decrease rate	10.00%	13.00%
Income expenses increase rate	11.00%	4.00%

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Other Income (Expenses), Net (Details) - Schedule of Other Expenses, Net - USD ($) $ in Thousands		3 Months Ended		6 Months Ended
		Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Schedule Of Other Expenses Net Abstract
Currency exchange rate differences	[1]	$ 10,464	$ (8,357)	$ 14,394	$ (3,188)
Economic emergency contribution expenses		(320)	(407)	(637)	(680)
Fines, surcharges, penalties and taxes assumed		(40)	(13)	(120)	(95)
Donations		(160)	(93)	(315)	(173)
Other	[2]	19,683	244	20,263	633
Total		$ 29,627	$ (8,626)	$ 33,585	$ (3,503)

[1] The increase in currency exchange rate differences income (expense) for the three and six months ended June 30, 2023 is mainly related to a decrease of 10% and 13% (increase for the three and six months ended June 30, 2022 11% and 4%) in the Colombian Pesos/USD exchange rate for the period and the Group’s Colombian entities’ liability position towards USD.

[2] Includes income from a legal settlement with a third party to recover costs incurred relating to a business opportunity with such third party. The open receivable balance as of June 30, 2023 is included within Other financial assets in the Consolidated Interim Statement of Financial Position. The amount, counter party and any further details can’t be disclosed due to contractual restrictions within the settlement agreement.

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Income Tax (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Income Tax (Details) [Line Items]
Income (loss) before tax	$ 37,936	$ (9,293)	$ 46,816	$ 12,822
Income tax expense	$ 10,981	$ (2,374)	$ 13,240	$ 3,295
Percentage effective tax rate			28.28%	25.64%
Tax rate			35.00%	35.00%
Maximum [Member]
Income Tax (Details) [Line Items]
Percentage of tax credits rate			25.00%
Minimum [Member]
Income Tax (Details) [Line Items]
Percentage of tax credits rate			30.00%

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Intangible Assets Net (Details) - Schedule of Intangible Assets - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022
Intangible Assets Net (Details) - Schedule of Intangible Assets [Line Items]
Beginning balance	$ 32,208
Ending balance	39,158	$ 31,877
Net book value	39,158	31,877
Cost [Member]
Intangible Assets Net (Details) - Schedule of Intangible Assets [Line Items]
Beginning balance	57,831	53,926
Ending balance	69,924	57,345
Net book value	69,924	57,345
Additions	1,465	860
Additions from internal developments	4,031	4,246
Derecognition of assets	(51)
Foreign currency exchange	6,535	(1,687)
Transfers	113
Accumulated amortization and impairment losses [Member]
Intangible Assets Net (Details) - Schedule of Intangible Assets [Line Items]
Beginning balance	25,623	23,755
Ending balance	30,766	25,468
Net book value	30,766	25,468
Amortization expense	2,291	2,436
Foreign currency exchange	$ 2,852	$ (723)

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Property, Plant and Equipment, Net (Details) - Property, Plant and Equipment [Member] - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022
Property, Plant and Equipment, Net (Details) [Line Items]
Cost of goods sold	$ 2,061	$ 1,678
Administrative expense	1,254	601
Acquire capital expenditures	$ 6,110	$ 9,229

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Property, Plant and Equipment, Net (Details) - Schedule of Property, Plant and Equipment, Net - Land and buildings [Member] - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022
As of June 30, 2022
Net book value	$ 91,825	$ 76,596
Cost [Member]
Property, Plant and Equipment, Net (Details) - Schedule of Property, Plant and Equipment, Net [Line Items]
Balance beginning	121,898	116,654
As of June 30, 2022
Additions	13,110	10,518
Disposals	(276)	(2,275)
Effect of exchange differences in foreign currency	12,664	(2,544)
Transfers	(116)	(54)
Balance ending	147,280	122,299
Accumulated depreciation and amortization [Member]
Property, Plant and Equipment, Net (Details) - Schedule of Property, Plant and Equipment, Net [Line Items]
Balance beginning	47,933	44,016
As of June 30, 2022
Disposals	(227)	(174)
Depreciation expense	2,662	2,932
Effect of exchange differences in foreign currency	5,125	(1,071)
Transfers	(38)
Balance ending	$ 55,455	$ 45,703

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Inventories, Net (Details) - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022
Inventories, Net [Abstract]
Inventories recognized	$ 86,969	$ 78,294
Recognized as marketing expenses	3,026	4,068
Write-down to net realizable value	$ 2,502	$ 1,010

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Inventories, Net (Details) - Schedule of Inventories Net - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
Schedule of inventories, net [Abstract]
Raw materials and supplies	$ 50,371	$ 42,701
Products in process	6,600	7,412
Finished products and merchandise	42,094	41,492
Inventory in transit	9,950	11,531
Subtotal	109,015	103,136
Less: Provision	(5,540)	(6,303)
Total	$ 103,475	$ 96,833

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Trade and Other Receivables, Net (Details) - USD ($) $ in Thousands		6 Months Ended		12 Months Ended
		Jun. 30, 2023	Dec. 31, 2022	Dec. 31, 2022
Disclosure of Trade and Other Receivables Text Block [Abstract]
Discount and return provision amounts		$ 14,793	$ 13,443	$ 13,443
Receivable	[1]	13,906	12,065
Trade receivables		4,225	$ 2,547	2,547
Trade Receivables [Member]
Disclosure of Trade and Other Receivables Text Block [Abstract]
Receivable		11,744		10,768
Other Receivable [Member]
Disclosure of Trade and Other Receivables Text Block [Abstract]
Receivable		$ 2,162		$ 1,297

[1] Total impairment balance is comprised of $11,744 (as of December 31, 2022: $10,768) for trade receivables and $2,162 (as of December 31, 2022 $1,297) for other receivables.

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Trade and Other Receivables, Net (Details) - Schedule of Trade and Other Receivables, Net - USD ($) $ in Thousands		6 Months Ended
		Jun. 30, 2023	Dec. 31, 2022
Schedule of Trade and Other Receivables, Net [Abstract]
Trade receivables, net of discounts	[1]	$ 137,587	$ 126,456
Other receivables		12,860	15,211
Impairment of trade and other receivables	[2]	(13,906)	(12,065)
Trade receivables, net of discounts and impairment		$ 136,541	$ 129,602

[1] Discount and return provision amounts to $14,793 (as of December 31, 2022: $13,443).

[2] Total impairment balance is comprised of $11,744 (as of December 31, 2022: $10,768) for trade receivables and $2,162 (as of December 31, 2022 $1,297) for other receivables.

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Borrowings (Details) $ in Thousands, $ in Millions		1 Months Ended		6 Months Ended	12 Months Ended
	Nov. 12, 2021 USD ($)	Nov. 20, 2018 USD ($)	Nov. 20, 2018 COP ($)	Jun. 30, 2023 USD ($)	Dec. 31, 2022 USD ($)	Nov. 30, 2022	Oct. 14, 2022 USD ($)	Jun. 28, 2022 USD ($)
Borrowings [Line Items]
Loan amounts		$ 35,000	$ 200,434
Loan installment term				5 years
Percentage of interest rate				5.30%
Internal rate						3.75%
Financial covenants, description				●Indebtedness Indicator (Indebtedness/EBITDA) as of June 30 and December 31 of each year, during the loan term, must be less than or equal to 3.5 times. If the indicator is greater than 3.0 and less than 3.5, it proceeds to the extent that this value is originated by causes other than additional debt and the justification of the increase must be presented to the agent. ●Short-term leverage ratio < 1.0 on the last day of each semester. ●EBITDA ratio / financial expenses = or > 3.0 on the last day of each semester.
Other covenants, description				●The Syndicated Loan Agreement establishes that each of the jointly obligated parties, unless they have the express, prior and written authorization of the Agent, will refrain from incurring any type of financial debt when the proforma indebtedness indicator, once acquired the additional financial debt, is greater than 3.0 times and maintaining any type of financial debt when the pro forma indebtedness indicator, once the national debt is acquired, is greater than 3.5 times. ●Each of the joint obligated parties, except with express, prior and written authorization of the Agent to do otherwise, will refrain from contracting finance and/or operating lease obligations with purchase option with a joint balance payable greater than $85,000,000 (Eighty-Five Billion Pesos, local currency) or its equivalent in another currency. For purposes of clarity, the reclassification of obligations as financial lease obligations by application of the Accounting Standards will not consume the balance set forth herein and may not be renewed. ●The payment of dividends is restricted to anyone other than the jointly obligated parties.
Unpaid principal balance					$ 115,000
Borrow amount								$ 8,672
Other term loan, description				●The Company’s consolidated Indebtedness Indicator (Indebtedness / EBITDA) must not be greater than 4.5x (original covenant: greater than 3.5x).   ●The Company’s consolidated EBITDA/Finance expense must not be less than 1.8x (original covenant: less than 3.0x).
Aggregate principal amount	$ 115,000
Aggregate principal amount percentage	4.75%
Issuance costs related				$ 2,142
Initial purchasers				1,390
Attorneys’ costs				$ 752
Increase debt extinguishment amount					113,400
Expensed unamortized transaction costs					1,600
Recognized liability amount					115,000
Bottom of range [Member]
Borrowings [Line Items]
Internal rate						4.75%
Top of range [Member]
Borrowings [Line Items]
Internal rate						8.50%
BTG Credit Agreement [Member]
Borrowings [Line Items]
Unpaid principal balance					4,490
Borrow amount							$ 19,000
COP and Libor [Member]
Borrowings [Line Items]
Internal rate				4.80%
Syndicated Loan Agreement [Member]
Borrowings [Line Items]
Unpaid principal balance					$ 19,665
Senior Notes require Procaps, S.A. [Member]
Borrowings [Line Items]
Description of financial ratios				●The consolidated total debt of Procaps, S.A., the Group and the other obligors thereunder to consolidated EBITDA for the last twelve months of 3.50:1.00 or less (Indebtedness Indicator), measured at certain dates of determination and; ●An EBITDA interest coverage ratio (calculated as the consolidated EBITDA for the last twelve months of Procaps, S.A. and the other obligors thereunder divided by the consolidated interest expenses of Procaps, S.A. and the other obligors thereunder) in excess of, or equal to, 3.00:1.00, calculated at certain dates of determination. ●Short-term leverage ratio equal to or less than 1.00Complying with the Note Purchase Agreement protocols and as a result of the more favorable provisions of the Syndicated Loan Agreement, the Group gave notice on April 7, 2022 that specific provisions related to reporting covenants, affirmative covenants, negative covenants, events of default, and mandatory prepayment events, as set forth in the Syndicated Loan Agreement, shall apply to the Senior Notes.

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Borrowings (Details) - Schedule of Unsecured Borrowings at Amortized Cost - USD ($) $ in Thousands		Jun. 30, 2023	Dec. 31, 2022
Borrowings at amortized cost(a)
Syndicated term loan	[1]	$ 40,191	$ 38,626
Other term loan	[1]	93,788	95,720
Lease liabilities	[1]	34,966	34,192
Factoring obligations	[1]	4,017	2,317
Bank overdrafts	[1]	357	80
Notes	[1]	115,000	115,000
Total Interest bearing liabilities	[1]	288,319	285,935
Current		118,684	257,525
Non- Current		$ 169,635	$ 28,410

[1] Borrowings at amortized cost are unsecured, with the exception of factoring obligations which are collateralized by trade receivables. Refer to Note 13. Trade and other receivables, net.

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Borrowings (Details) - Schedule of Borrowings - USD ($) $ in Thousands		6 Months Ended
		Jun. 30, 2023	Dec. 31, 2022
Borrowings [Line Items]
Total Syndicated term loan	[1]	$ 40,191	$ 38,626
Total Other term loan	[1]	93,788	95,720
Total Lease liabilities	[1]	34,966	34,192
Total Factoring obligations	[1]	4,017	2,317
Total Notes		$ 115,000	115,000
Syndicated Term Loan One [Member]
Borrowings [Line Items]
Currency		COP
Range of Interest		IBR + 5.30%
Maturity Year		2023-2025
Total Syndicated term loan		$ 40,652	39,156
Amortized Cost [Member]
Borrowings [Line Items]
Currency		COP
Range of Interest		N/A
Maturity Year		2023
Total Syndicated term loan		$ (461)	(530)
Other Term Loan One [Member]
Borrowings [Line Items]
Currency		COP
Range of Interest		IBR+ 9.0%, 23.5% (2022: IBR+ 5.0%, DTF+ 3%, 13.99%-25.3%)
Maturity Year		2022-2025
Total Other term loan		$ 12,407	9,549
Other Term Loan Two [Member]
Borrowings [Line Items]
Currency		COP
Range of Interest		IBR + 2.25%- IBR 7.95% (2022: IBR+2.25%-10.2%)
Maturity Year		2022-2025
Total Other term loan		$ 23,342	21,267
Other Term Loan Three [Member]
Borrowings [Line Items]
Currency		Soles
Range of Interest		8.0% - 14.50% (Fixed) (2022: 8.0% - 12.79% (Fixed))
Maturity Year		2022-2024
Total Other term loan		$ 6,619	6,837
Other Term Loan Four [Member]
Borrowings [Line Items]
Currency		Reales
Range of Interest		9.84% - 18% N.A.
Maturity Year		2023-2024
Total Other term loan		$ 1,137	2,176
Other Term Loan Five [Member]
Borrowings [Line Items]
Currency		USD
Range of Interest		SOFR+ (5.80%-7.00%), SOFR6M + (2%-3%) (2022: SOFR+ (4.80%-5.80%))
Maturity Year		2023
Total Other term loan		$ 24,669	23,454
Other Term Loan Six [Member]
Borrowings [Line Items]
Currency		USD
Range of Interest		6.5%-16.8% N.A. (2022: 6.36%-16.8%)
Maturity Year		2022-2025
Total Other term loan		$ 25,614	32,437
Lease Liabilities One [Member]
Borrowings [Line Items]
Currency		COP
Range of Interest		IBR+(3.82%-7.3%), DTF + 5.5% (2022: DTF + (5,18% - 10,11%) T.A., IBR+7.5%)
Maturity Year		2022-2030
Total Lease liabilities		$ 10,170	10,475
Lease Liabilities Two [Member]
Borrowings [Line Items]
Currency		COP
Range of Interest		IBR+ (4.2%-8.2%) (2022: DTF+ 4.54%-10.42 T.A.
Maturity Year		2022-2025
Total Lease liabilities		$ 3,944	3,653
Lease Liabilities Three [Member]
Borrowings [Line Items]
Currency		USD
Range of Interest		0.75%-21.48%, DTF+5.50%, IBR+4.10% (2022: 0.75%-21.48%)
Maturity Year		2023-2032
Total Lease liabilities		$ 20,852	14,787
Lease Liabilities Four [Member]
Borrowings [Line Items]
Currency		COP
Range of Interest		1.91%-12.23%, IBR+4.68%
Maturity Year		2023
Total Lease liabilities			4,703
Lease Liabilities Five [Member]
Borrowings [Line Items]
Currency		Reales
Range of Interest		0.70-8.72% (Fixed)
Maturity Year		2023-2024
Total Lease liabilities			574
Portfolio Factoring One [Member]
Borrowings [Line Items]
Currency		COP
Range of Interest		DTF+7% (2022: DTF+8%)
Maturity Year		2023
Total Factoring obligations		$ 1,583	1,508
Portfolio Factoring Two [Member]
Borrowings [Line Items]
Currency		COP
Range of Interest		2% - 22.4% (2022: 15.0% - 27% N.A.)
Maturity Year		2023
Total Factoring obligations		$ 2,434	809
Overdrafts and Credit Cards [Member]
Borrowings [Line Items]
Currency		COP
Range of Interest		19.68% - 32% E.A.  (Fixed)
Maturity Year		2023
Overdrafts and credit cards		$ 357	80
The Prudential Insurance Company Of America [Member]
Borrowings [Line Items]
Currency		USD
Range of Interest		8.50% (Fixed)
Maturity Year		2031
Total Notes		$ 60,020	60,020
Prudential Annuities Life Assurance Corporation [Member]
Borrowings [Line Items]
Currency		USD
Range of Interest		8.50% (Fixed)
Maturity Year		2031
Total Notes		$ 29,980	29,980
Healthspring Life & Health Insurance Company, Inc [Member]
Borrowings [Line Items]
Currency		USD
Range of Interest		8.50% (Fixed)
Maturity Year		2031
Total Notes		$ 18,350	18,350
CIGNA Health and Life Insurance Company [Member]
Borrowings [Line Items]
Currency		USD
Range of Interest		8.50% (Fixed)
Maturity Year		2031
Total Notes		$ 6,650	$ 6,650

[1] Borrowings at amortized cost are unsecured, with the exception of factoring obligations which are collateralized by trade receivables. Refer to Note 13. Trade and other receivables, net.

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Provisions and Contingencies (Details) - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022
Provisions and contingencies [Abstract]
Labor and civil litigation	$ 73	$ 448
Tax litigation provisions		372
Labor litigation	122	$ 47
Proposed sanction amount	1,087
Proposed tax charge amount	$ 348

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Provisions and Contingencies (Details) - Schedule of Provisions and Contingencies - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022
Contingencies
Balance as of January 1	$ 138	$ 501
Effect of changes in foreign exchange rates	8	28
Provisions made	91	7
Provisions used	(42)	(41)
Balance as of June 30	$ 195	$ 495

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Warrant Liabilities (Details) - USD ($)	6 Months Ended
	Jun. 30, 2023	Dec. 31, 2022
Warrant Liabilities [Abstract]
Private warrants (in Shares)	2,875,000
Fair value public warrants	$ 5,400	$ 6,800
Decreased private warrants	$ 1,055	$ 5,396

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Warrant Liabilities (Details) - Schedule of Warrant Liabilities - USD ($) $ in Thousands		6 Months Ended	12 Months Ended
		Jun. 30, 2023	Dec. 31, 2022
Schedule of Warrant Liabilities [Abstract]
Public warrants		$ 3,800	$ 9,200
Private warrants	[1]	661	1,716
Warrant liability		$ 4,461	$ 10,916

[1] Private warrants include 2,875,000 held by the former SPAC sponsors deposited in an escrow account.

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Warrant Liabilities (Details) - Schedule of Public Warrants - USD ($) $ in Thousands	3 Months Ended
	Jun. 30, 2023	Dec. 31, 2022
Schedule of Public Warrants [Abstract]
Balance at beginning	$ 9,200	$ 16,000
Acquired public warrants
Fair value remeasurement	(5,400)	(6,800)
Balance at ending	$ 3,800	$ 9,200

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Warrant Liabilities (Details) - Schedule of Private Warrants - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2023	Dec. 31, 2022
Schedule of Private Warrants [Abstract]
Balance at begining	$ 1,716	$ 7,112
Acquired private warrants
Fair value remeasurement	(1,055)	(5,396)
Balance at ending	$ 661	$ 1,716

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Shares in Escrow (Details) - USD ($)	Jun. 30, 2023	Dec. 31, 2022
Shares in escrow [Abstract]
Increase decrease fair value of shares escrow	$ 9,665	$ 61,795

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Shares in Escrow (Details) - Schedule of Shares in Escrow - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2023	Dec. 31, 2022
Shares in escrow [Abstract]
Balance at beginning	$ 40,064	$ 101,859
Balance at ending	30,399	40,064
Escrowed shares
Fair value remeasurement	$ (9,665)	$ (61,795)

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Financial Instruments (Details) - USD ($) $ in Thousands	6 Months Ended	12 Months Ended
	Jun. 30, 2023	Dec. 31, 2022
Financial Instruments [Line Items]
Concentration of credit risk percentage	10.00%	10.00%
Level 1 [Member]
Financial Instruments [Line Items]
Fair value of the exhibited figures	$ 3,800	$ 9,200
Level 3 [Member]
Financial Instruments [Line Items]
Fair value of the exhibited figures	$ 31,060	$ 41,780

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Financial Instruments (Details) - Schedule of Carrying Amounts of Financial Assets and Financial Liabilities - USD ($) $ in Thousands		3 Months Ended		6 Months Ended
		Dec. 31, 2022		Jun. 30, 2023
FVTPL [Member]
Financial assets not measured at fair value
Trade and other receivables, net	[1]
Amounts owed by related parties	[1]
Cash	[1]
Other financial assets	[1]
Total financial assets not measured at fair value	[1]
Financial liabilities measured at fair value
Warrant liabilities	[1]	10,916		4,461
Shares held in escrow	[1]	40,064		30,399
Derivative financial liabilities			[1]
Total financial liabilities measured at fair value	[1]	50,980		34,860
Financial liabilities not measured at fair value
Borrowings	[1]
Trade and other payables	[1]
Amounts owed to related parties	[1]
Total financial liabilities not measured at fair value	[1]
FVOCI [Member]
Financial assets not measured at fair value
Trade and other receivables, net	[2]
Amounts owed by related parties	[2]
Cash	[2]
Other financial assets	[2]
Total financial assets not measured at fair value	[2]
Financial liabilities measured at fair value
Warrant liabilities	[2]
Shares held in escrow	[2]
Derivative financial liabilities				2,473
Total financial liabilities measured at fair value	[2]			2,473
Financial liabilities not measured at fair value
Borrowings	[2]
Trade and other payables	[2]
Amounts owed to related parties	[2]
Total financial liabilities not measured at fair value	[2]
Amortized cost [Member]
Financial assets not measured at fair value
Trade and other receivables, net	[3]			136,541
Amounts owed by related parties	[3]			2,225
Cash	[3]			11,537
Other financial assets	[3]			14,538
Total financial assets not measured at fair value	[3]			164,841
Financial liabilities measured at fair value
Warrant liabilities	[3]
Shares held in escrow	[3]
Derivative financial liabilities	[3]
Total financial liabilities measured at fair value	[3]
Financial liabilities not measured at fair value
Borrowings	[3]			288,319
Trade and other payables	[3]			85,970
Amounts owed to related parties	[3]			3,922
Total financial liabilities not measured at fair value	[3]			$ 378,211
Amortized cost [Member]
Financial assets not measured at fair value
Trade and other receivables, net	[3]	129,602
Amounts owed by related parties	[3]	2,474
Cash	[3]	43,003
Other financial assets	[3]	210
Total financial assets not measured at fair value	[3]	175,289
Financial liabilities measured at fair value
Warrant liabilities	[3]
Shares held in escrow	[3]
Derivative financial liabilities	[3]
Total financial liabilities measured at fair value	[3]
Financial liabilities not measured at fair value
Borrowings	[3]	285,934
Trade and other payables	[3]	90,187
Amounts owed to related parties	[3]	2,914
Total financial liabilities not measured at fair value	[3]	$ 379,035

[1] The fair value of the exhibited figures as of June 30, 2023 is comprised of $3,800 Level 1 (as of December 31, 2022: $9,200) and $31,060 Level 3 (as of December 31, 2022: $41,780).

[2] The fair value of the exhibited figures as of June 30, 2023 is Level 2.

[3] The fair value of the exhibited figures is similar to their amortized cost as of June 30, 2023 and December 31, 2022, respectively.

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Financial Instruments (Details) - Schedule of Valuation Techniques used in Measuring Level 3 Fair Values for Financial Instruments in the Statement of Financial Position $ in Thousands	6 Months Ended
	Jun. 30, 2023 USD ($)
Level 3 of fair value hierarchy [member] | Private Warrants [Member]
Schedule of Valuation Techniques used in Measuring Level 3 Fair Values for Financial Instruments in the Statement of Financial Position [Line Items]
Fair value	$ 100
Valuation Technique	The fair value of the Private Warrants is estimated using the Black-Scholes option pricing formula for European calls, since the underlying stock is not expected to pay dividends over the term of the Warrants.
Significant unobservable input	Volatility of 36.6% (2022: 36.6%)
Relationship between significant unobservable input to fair value	The higher (lower) the volatility, the higher (lower) the fair value.
Level 3 of fair value hierarchy [member] | Private Warrants in Escrow [Member]
Schedule of Valuation Techniques used in Measuring Level 3 Fair Values for Financial Instruments in the Statement of Financial Position [Line Items]
Fair value	$ 561
Valuation Technique	The fair value of the Private Warrants in escrow is estimated using Monte Carlo simulation in a risk-neutral framework assuming a Geometric Brownian Motion for the future stock price.
Significant unobservable input	Volatility of 36.6% (2022: 37.5%)
Relationship between significant unobservable input to fair value	The higher (lower) the volatility, the higher (lower) the fair value.
Level 3 of fair value hierarchy [member] | Shares Held in Escrow [Member]
Schedule of Valuation Techniques used in Measuring Level 3 Fair Values for Financial Instruments in the Statement of Financial Position [Line Items]
Fair value	$ 30,399
Valuation Technique	The fair value of the shares to be delivered  is estimated using Monte Carlo simulation in a risk-neutral framework assuming a Geometric Brownian Motion for the future stock price.
Significant unobservable input	Volatility of 41.0% (2022: 36.5%)
Relationship between significant unobservable input to fair value	The higher (lower) the volatility, the higher (lower) the fair value.
+5% [Member] | Private Warrants [Member]
Schedule of Valuation Techniques used in Measuring Level 3 Fair Values for Financial Instruments in the Statement of Financial Position [Line Items]
Sensitivity of significant unobservable input to fair value	$ 155
+5% [Member] | Private Warrants in Escrow [Member]
Schedule of Valuation Techniques used in Measuring Level 3 Fair Values for Financial Instruments in the Statement of Financial Position [Line Items]
Sensitivity of significant unobservable input to fair value	877
+5% [Member] | Shares Held in Escrow [Member]
Schedule of Valuation Techniques used in Measuring Level 3 Fair Values for Financial Instruments in the Statement of Financial Position [Line Items]
Sensitivity of significant unobservable input to fair value	30,737
-5% [Member] | Private Warrants [Member]
Schedule of Valuation Techniques used in Measuring Level 3 Fair Values for Financial Instruments in the Statement of Financial Position [Line Items]
Sensitivity of significant unobservable input to fair value	55
-5% [Member] | Private Warrants in Escrow [Member]
Schedule of Valuation Techniques used in Measuring Level 3 Fair Values for Financial Instruments in the Statement of Financial Position [Line Items]
Sensitivity of significant unobservable input to fair value	316
-5% [Member] | Shares Held in Escrow [Member]
Schedule of Valuation Techniques used in Measuring Level 3 Fair Values for Financial Instruments in the Statement of Financial Position [Line Items]
Sensitivity of significant unobservable input to fair value	$ 29,999

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Financial Instruments (Details) - Schedule of Assessment of the Probability of Default and the Loss Due to Default is Mainly Based on Historical Data and Adjust Historical Loss Rates - USD ($) $ in Thousands	6 Months Ended	12 Months Ended
	Jun. 30, 2023	Dec. 31, 2022
Schedule of Assessment of the Probability of Default and the Loss Due to Default is Mainly Based on Historical Data and Adjust Historical Loss Rates [Line Items]
Weighted-average loss rate	14.34%	14.07%
Gross carrying amount	$ 179,380	$ 169,352
Impairment loss allowance	(25,721)	(23,834)
Total	$ 153,659	$ 145,518
Current (not past due) [Member]
Schedule of Assessment of the Probability of Default and the Loss Due to Default is Mainly Based on Historical Data and Adjust Historical Loss Rates [Line Items]
Weighted-average loss rate	0.36%	0.39%
Gross carrying amount	$ 120,839	$ 124,219
Impairment loss allowance	(441)	(483)
Total	$ 120,398	$ 123,736
1-30 days past due [Member]
Schedule of Assessment of the Probability of Default and the Loss Due to Default is Mainly Based on Historical Data and Adjust Historical Loss Rates [Line Items]
Weighted-average loss rate	2.43%	3.42%
Gross carrying amount	$ 16,815	$ 11,816
Impairment loss allowance	(408)	(404)
Total	$ 16,407	$ 11,412
31-60 days past due [Member]
Schedule of Assessment of the Probability of Default and the Loss Due to Default is Mainly Based on Historical Data and Adjust Historical Loss Rates [Line Items]
Weighted-average loss rate	5.26%	4.50%
Gross carrying amount	$ 8,524	$ 3,864
Impairment loss allowance	(448)	(174)
Total	$ 8,076	$ 3,690
61-90 days past due [Member]
Schedule of Assessment of the Probability of Default and the Loss Due to Default is Mainly Based on Historical Data and Adjust Historical Loss Rates [Line Items]
Weighted-average loss rate	7.34%	14.25%
Gross carrying amount	$ 3,162	$ 1,958
Impairment loss allowance	(232)	(279)
Total	$ 2,930	$ 1,679
91-120 days past due [Member]
Schedule of Assessment of the Probability of Default and the Loss Due to Default is Mainly Based on Historical Data and Adjust Historical Loss Rates [Line Items]
Weighted-average loss rate	12.04%	19.89%
Gross carrying amount	$ 1,620	$ 890
Impairment loss allowance	(195)	(177)
Total	$ 1,425	$ 713
More than 120 days past due [Member]
Schedule of Assessment of the Probability of Default and the Loss Due to Default is Mainly Based on Historical Data and Adjust Historical Loss Rates [Line Items]
Weighted-average loss rate	84.44%	83.88%
Gross carrying amount	$ 28,420	$ 26,605
Impairment loss allowance	(23,997)	(22,317)
Total	$ 4,423	$ 4,288

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Financial Instruments (Details) - Schedule of Designated as Hedging Instruments - 6 months ended Jun. 30, 2023 $ in Thousands	USD ($) shares	COP ($) shares
Less than 3 months [Member]
Schedule of Designated as Hedging Instruments [Line Items]
Settlement Date	Jul. 06, 2023	Jul. 06, 2023
Forward Exchange rate | shares	4,625	4,625
Notional amount (COP)		$ 36,110,000,000
Notional amount (USD)	$ 8,649,102
3-6 months [Member]
Schedule of Designated as Hedging Instruments [Line Items]
Settlement Date	Oct. 03, 2023	Oct. 03, 2023
Forward Exchange rate | shares	4,715	4,715
Notional amount (COP)		$ 42,800,000,000
Notional amount (USD)	$ 10,251,497
Over 6 Months [Member]
Schedule of Designated as Hedging Instruments [Line Items]
Settlement Date	Jan. 03, 2024	Jan. 03, 2024
Forward Exchange rate | shares	4,791	4,791
Notional amount (COP)		$ 48,837,000,000
Notional amount (USD)	$ 11,697,485

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Financial Instruments (Details) - Schedule of Balances of Other Financial Liabilities Such as Suppliers and Accounts Payable Have No Financial Cost and their Payment Period Ranges $ in Thousands	6 Months Ended
	Jun. 30, 2023 USD ($)
Less than 3 Months [Member]
Schedule of Balances of Other Financial Liabilities Such as Suppliers and Accounts Payable Have No Financial Cost and their Payment Period Ranges [Line Items]
Carrying Amount of Assets
Carrying Amount of Liabilities	$ 368
Line Item in the Statement of Financial Position Where the Hedging Instrument is Included	Derivative Financial Liability
Change in Value Used for Calculating Hedge Ineffectiveness	$ 368
3-6 Months [Member]
Schedule of Balances of Other Financial Liabilities Such as Suppliers and Accounts Payable Have No Financial Cost and their Payment Period Ranges [Line Items]
Carrying Amount of Assets
Carrying Amount of Liabilities	$ 1,019
Line Item in the Statement of Financial Position Where the Hedging Instrument is Included	Derivative Financial Liability
Change in Value Used for Calculating Hedge Ineffectiveness	$ 1,019
Over 6 Months [Member]
Schedule of Balances of Other Financial Liabilities Such as Suppliers and Accounts Payable Have No Financial Cost and their Payment Period Ranges [Line Items]
Carrying Amount of Assets
Carrying Amount of Liabilities	$ 1,086
Line Item in the Statement of Financial Position Where the Hedging Instrument is Included	Derivative Financial Liability
Change in Value Used for Calculating Hedge Ineffectiveness	$ 1,086

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Financial Instruments (Details) - Schedule of Cash and Cash Equivalents $ in Thousands	6 Months Ended
	Jun. 30, 2023 USD ($)
Less than 3 Months [Member]
Schedule of Cash and Cash Equivalents [Line Items]
Change in Value of Hedging Instruments Recognized in OCI	$ 368
Hedge Ineffectiveness Recognized in PL
Line Item in Profit or Loss that Includes Hedge Ineffectiveness	Other income (expenses), net
3-6 Months [Member]
Schedule of Cash and Cash Equivalents [Line Items]
Change in Value of Hedging Instruments Recognized in OCI	$ 1,019
Hedge Ineffectiveness Recognized in PL
Line Item in Profit or Loss that Includes Hedge Ineffectiveness	Other income (expenses), net
Over 6 Months [Member]
Schedule of Cash and Cash Equivalents [Line Items]
Change in Value of Hedging Instruments Recognized in OCI	$ 1,086
Hedge Ineffectiveness Recognized in PL
Line Item in Profit or Loss that Includes Hedge Ineffectiveness	Other income (expenses), net

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Financial Instruments (Details) - Schedule of Detailed Information About Hedged Items $ in Thousands	Jun. 30, 2023 USD ($)
Change in Value Used for Calculating Hedge Ineffectiveness [Member]
Schedule of Detailed Information About Hedged Items [Line Items]
Net Investment in Procaps S.A.	$ 2,473
Foreign Currency Translation Reserve for Continued Hedges [Member]
Schedule of Detailed Information About Hedged Items [Line Items]
Net Investment in Procaps S.A.	2,473
Balances Remaining in the Foreign Currency Translation Reserve from Hedging Relationships for Which Hedge Accounting is No Longer Applied [Member]
Schedule of Detailed Information About Hedged Items [Line Items]
Net Investment in Procaps S.A.

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Key Management Personnel (Details) - Schedule of Unaudited Condensed Consolidated Interim Statement of Profit or Loss and Other Comprehensive Income - USD ($) $ in Thousands	3 Months Ended			6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	[1]	Jun. 30, 2023	Jun. 30, 2022	[1]
Schedule of Unaudited Condensed Consolidated Interim Statement of Profit or Loss and Other Comprehensive Income [Abstract]
Short-term employee benefits	$ 758	$ 598		$ 1,510	$ 1,133
Consulting fees	658	1,126		1,233	1,739
Total	$ 1,416	$ 1,724		$ 2,743	$ 2,872

[1] The Group corrected the disclosure of short-term employee benefits and consulting fees for the three and six months periods ended June 31, 2022. The correction does not impact the results presented in the prior period.

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Events After the Reporting Period (Details) - USD ($) $ in Millions	6 Months Ended
	Jun. 30, 2023	Aug. 16, 2023	Oct. 13, 2022
Events After the Reporting Period (Details) [Line Items]
Loan amount			$ 19
Interest rate percentage	8.50%
BTG Credit Agreement [Member]
Events After the Reporting Period (Details) [Line Items]
Interest rate percentage	5.80%
Events after the reporting period [Member]
Events After the Reporting Period (Details) [Line Items]
Loan amount		$ 247,817
Syndicated Loan Agreement [Member]
Events After the Reporting Period (Details) [Line Items]
Description of indicative facts of indebtedness and leverage ratio at CP	●Consolidated debt to consolidated EBITDA ratio of no greater than 3.50:1:00 (other than for the twelve-month period ended September 30, 2023, for which the ratio shall be no greater than 4.30:1.00); and ●Ratio of consolidated EBITDA to consolidated interest expense of greater than 3.00:1.00 (other than for the twelve-month period ended September 30, 2023, for which the ratio shall be greater than 1.90:1.00). ●Additionally, the Obligors are required to maintain combined total assets and combined EBITDA equal to no less than 80% of the Group’s consolidated total assets and consolidated EBITDA, respectively, as of June 30 and December 31 of each year.