European Cannabis Weekly Round-Up

Latin America-Europe: A New Bridge

Two companies from Colombia and Uruguay will become the first Latin American firms to export medical cannabis products to Europe. The first destination will be Germany, the largest market in Europe, where the estimated users of medicinal cannabis amount to about 700,000 people.

Fotmer Life Sciences of Uruguay, which in December 2013 was the first country ever in the world to legalise cannabis cultivation, production, and sale, and Clever Leaves of Colombia. The former is based in Nueva Helvecia and employs 80 people; they sell dried cannabis flowers. The latter is a cannabis oil extractor which produces a wide variety of products -from pills to ointments- indicated for the treatment of epilepsy and to reduce chronic pain.

Cansativa GmbH is the German company which will import products from South America. This new commercial bridge with Latin America would benefit the German and European Markets in two main respects: prices and supply.

Imports from Uruguay and Colombia will expand sources of supply beyond the Netherlands and Canada, which has already encountered some difficulties in producing enough supplies for the German market (see April 1st, roundup). Consequently, as Benedikt Sons, co-founder and director of Cansativa, remarked in a statement, the South American imports will ensure better prices for patients.

Italian acquisitions

Khiron Life Sciences Corp., based in Colombia, is fully licensed for the cultivation, production, domestic distribution, and international export of both THC (tetrahydrocannabinol) and CBD (cannabidiol) medical cannabis.

On Thursday 25th, Khiron announced that it has entered a non-binding letter of agreement to acquire two Italian firms: Canapalife Srl and Campodoro Srl. Khiron would acquire 100% of the securities of Canapalife and 100% of the economic interest of Campodoro.

Alvaro Torres, Khiron CEO and Director, commented, “The proposed transaction offers Khiron an entry to the European market … Canapalife offers the addition of dynamic brands to our product portfolio, access to key retailer partners and relationships with Italy’s leading research facilities.”

The European Cannabis Report issued by Prohibition Partners in January 2019, Italy represents the fourth largest economy in Europe, and is the second largest cannabis market in Europe, with a projected medical cannabis market value of € 7.5 Billion in 2028.

Malta the strategic gateway to Europe

Canadian company MPX International Corporation, based in Toronto, operates in Europe through its Maltese subsidiary, MPXI Malta Property Ltd. On April 23rd, MPXI announced that the company has entered into a definitive agreement to purchase all outstanding shares of Alphafarma Operations Ltd, formerly owned by Alpha Pharma Ltd. The total investment amounts to about 3 million euros (2,591,156.84 GBP).

As for many other companies, Malta is a strategic choice because of its favourable position and climatic conditions in the Mediterranean Sea, representing a key commercial entry point for the European market. On the same day, MPXI Malta has also announced that the Maltese competent authority has awarded them a letter of intent, the first step towards obtaining a licence.

At the end of the process MPXI Malta would be given a licence to import, extract, produce finished products and distribute cannabis and cannabis derivatives for medicinal use in Malta and export into the European Union.

”This is an important step in our European expansion plan. Malta not only provides a strategic gateway to the emerging EU markets, but also upholds high pharmaceutical standards and a strong regulatory framework,” said Daniel Fryer, MPXI’s Head of European Development.

Tilray in Portugal

On Wednesday 24th, Canadian company Tilray opened its European production site in Cantanhede, in the centre of Portugal. The production site cost 20 million euros and has created about a hundred jobs. The production facility consists of two main areas for cultivation, outdoor and in greenhouses.

“We hope to begin exporting to the European Union from Portugal this summer, as well as to South Africa, Australia and New Zealand”, Brendan Kennedy, CEO of Tilray said when opening the site.

He also added that Tilray intends to extend into other European countries like “Ireland and the United Kingdom, and potentially France, Italy and Greece.”

Aurora Cannabis to employ special Tech in the EU

Radiant Energy Dehydration (REV™) is a type of technology that exploits vacuum to dry food-products, as opposed to the classical technologies which involve freeze and air drying. According to EnWave, the patented producer of this kind of machinery, REVTM would optimise energy usage, and therefore be greener. Also, this technology would reduce the drying time from 5-7 days to less than one hour.

On April 26th, Aurora Cannabis and EnWave Corp. announced that they have entered into a commercial licence agreement which will provide Aurora with the rights to employ EnWave’s patented drying technology for the production of cannabis materials in the European Union, excluding Portugal. Aurora obtained permission to exploit this kind of technology in Canada, Australia and South America, excluding Peru.

Both the CEOs of the companies involved have commented on their agreement. For Terry Booth, CEO of Aurora, this kind of technology will provide Aurora with “industrial-scale flow-through, reducing working capital requirements, accelerating time to market from harvest, as well as increasing our ability to produce bulk-sale cannabis for extraction and use in derivative products.”

Similarly, Brent Charleton, CEO of EnWave, declared that EnWave is focused on accelerating its growth, and that they are “delighted to have Aurora as an investor, industry partner and technology collaborator.”