At least five German companies with Canadian ties have advanced to the next round of the first federal German tender bid to grow cannabis domestically for medical consumption and research
Professor Doctor Werner Knöss, the head of the newly formed Cannabis Agency, said that, “BfArM is following tasks which are defined by the legislation. The ongoing procedure is confidential and we are not allowed to provide any information. The names of the successful participants will be published, when the tender procedure will have been completely finished.”
The list of growers below has been independently verified via industry sources. The companies include:
Spektrum Cannabis. This German company is the result of a buyout of MedCann GmbH which procured the first Canadian import licenses into Germany last year. They were bought out in December 2016 by Canopy Growth Corp (TSE:WEED), one of the largest Canadian LPs in the market today, with global reach already. They are also the only GMP-certified manufacturer and distributor of cannabis in Germany with bud flower in about 500 pharmacies to date.
Maricann. (CSE:MARI). Maricann GmbH, the German subsidiary of the Canadian parent, was established in Munich two weeks after the German government announced the tender bid. Maricann Canada was founded in 2013 and is clearly gearing up for an insurance backed market in both countries.
Bedrocan. This is the oldest contender on the list and perhaps the most familiar to global industry watchers. Once a family firm, the company became the sole supplier of medical grade bud to the country’s pharmacies. Unfortunately, as of Q1 2017, most Dutch insurers stopped covering medical cannabis (in a strange move, given neighbouring events). Bedrocan is an old hand clearly in search of medical markets covered by health insurance.
Aurora Cannabis (TSXV:ACB) (OTCQX:ACBFF)(Frankfurt 21P;WKN:A1C4WM). This large Canadian LP with significant production facilities plus expansions domestically, strategically angled itself into the EU market with a recent acquisition of an existing operation (Pedianos). The buyout occurred about a month after the tender bid was announced. Pedianos GmbH is a large, existing, ex-im company with experience exporting cannabis medical products across Europe.
ABcann (TSX-V:ABCN) and Frankfurt 23Q:GR. Like other Canadian counterparts on the list, ABcann established itself early in the Canadian market after medical legalization. Today, they are, like every other firm on the list, engaged in significant domestic expansion while looking abroad for additional markets. Their board includes Raphael Mechoulam, the Israeli “Father of THC.”
What Is Significant About These Firms?
If there is one thing that’s clear, it’s that the German government has selected companies capable of quick and compliant expansion. There are multiple challenges ahead, including differences in regulatory requirements between (particularly) Canada and Germany. The German medical and insurance market is highly arcane and complex. Major issues regarding data protection and collection as well as logistical challenges loom.
That includes an already widely predicted cannabis shortage starting next year as more German patients begin to be covered by health insurance policies and the Canadian rec market kicks off.
The latter would be a disaster for Germans in particular who are facing an insurance industry leery of the drug and their mandate to cover it. The price of cannabis has zoomed upwards here even since last summer. This is mostly due to the interpretation of the law by pharmacies, who have tacked on a “grinding fee” at the last port of call. As German law mandates that all narcotics (of which cannabis is one) must be handed over in person at apothekes, this means that the price has increased by about 1/3 since last summer to about 2,000 euros a month.
Obviously this is not something that can continue for long, particularly with insurance companies balking at the entire discussion in the first place. The most important thing the German government can do right now to boost confidence in the program is to guarantee a certain level of access – even before domestic grow operations begin to harvest in two years time.
The firms now apparently entering the final round all have the qualifications and experience to deliver top-quality cannabis to a now over-ready German domestic market.
Now the questions are: Will all of them be selected, are there others in consideration, or will this group of highly qualified firms be winnowed down further to meet the requirements of the tender bid? That however, is also not a reliable guide. That document called for an annual production capability from all of the firms involved that is less than the current medical patient population in Germany requires on a yearly basis.
[Image credit- Wikimedia Commons]