Canadian LP and now global cannabis company Tilray has aggressively targeted Europe for the better part of 18 months now…
The first of the Canadians to establish a beachhead in Europe, the company began exporting cannabis oil to Croatia last year.
This year, however the company has clearly focussed on Germany as the place to be. And their entrance strategy has been interesting. The company eschewed the domestic grow bid tender opportunity to establish a grow and processing plant in Portugal earlier this year.
Hard on the heels of this announcement, the company also issued statements in October announcing the first national distribution deal of cannabis oil into German pharmacies. The deal is significant. NOWEDA is owned by a cooperative of more than 9,000 pharmacists. It is one of the largest distributors to pharmacies in the country. Located in Essen, with 21 affiliates throughout the country, NOWEDA has €6 billion in annual revenues. Paesel + Lorei, the German service provider who is also part of this deal, has extensive experience with narcotic distribution in Germany – and has been in business since 1961.
Get free samples, try quality products and enjoy special offers available only to our members.
Join The CBD Testers Program
The company has also just announced a distribution deal of its cannabis oil to New Zealand.
Germany Is Turning Into The EU’s Hot Cannabis Medical Market
With this announcement, the tables are certainly set for a competitive import cannabis business well before the country starts growing its own domestic cannabis. Tilray joins Canadian firms Aurora, Canopy/Spektrum Cannabis, Abcann and Maricann at the table for one of the more interesting cannabis markets globally.
And it is also clear that it is not just Germany right now that is the centre of all things cannabis distribution, although clearly the country, as the EU’s most valuable pharmacy market, is seen as the grand prize.
With a distribution deal of cannabis oil to pharmacies nationwide, Tilray now opens another conversation if not door to the ongoing cannabis discussion in the country. Other producers have so far concentrated in importing bud flower from either Canada or Holland. It is clear that the raw product market here is large. However, as raw cannabis is considered an unprocessed flower, the price has jumped dramatically in a year from around €1,600 per month to over €2,400 as pharmacies added “processing fees” of between €7-10 per gram dispensed. Cannabis oil is a different kettle of fish altogether.
What does this mean for the development of the market here? Not to mention what patients will be able to access?
Concentrates and Oils Will Dominate The Market
One obvious outcome of this development of course, is that the market here will now be driven not only by price – but by oil rather than unprocessed bud. That this was in the cards has been hinted at by several developments here over the last year. That starts with the mysteriously low total amount required by the German government in the grow bid this year (only 2,000kgs by 2019). If this is processed concentrate rather than flower, it heralds good news for all the potential growers here.
And in the meantime, opens the floodgates in Germany at least for cheaper canna product – although by no means does this solve a greater problem – patient coverage by insurers.
The latter have been balking since the new law which went into effect in March, of covering medical cannabis – even though required by law to do so now.
While the presence of cheaper oil will not solve this problem entirely, what it will do is bring cannabis oil at least, into line with prices for bud cannabis as late as last summer. And this is likely to also help the national market grow, as the domestic cultivation process gets underway.