Israel votes to start exporting medical cannabis – here’s one ASX listed company that stands to benefit
Health & Biotech
Health & Biotech
Special Report: A new law allowing for the export of medicinal cannabis out of Israel could shake up the global cannabis market, with ASX-listed stocks poised to benefit.
Israel’s parliament approved the measure late last month, together with a new regulatory structure to approve foreign ownership of Israeli medicinal cannabis operations, paving the way for the country to play a key role in the global medicinal cannabis market, which is expected to be worth $44.7 billion by 2024.
And while the move will likely impact a number of stocks, Creso Pharma (ASX:CPH) is well-placed to take immediate advantage of the changes, specifically via its 74 per cent stake in a joint venture with grower Cohen Propagation Nurseries.
Founded in 1958, Cohen is one of the most experienced agricultural companies in Israel and has significant operational know-how and proven capabilities in establishing high scale production greenhouses to international standards.
It owns and operates farms across south and central Israel with a total greenhouse capacity of 15.7 hectares / 38.7 acres.
Creso estimates that the JV could produce up to 2,500 kg of cannabis each year once its facilities are at full capacity, with the potential to sell domestically in Israel and now, globally.
The partnership means Creso will be able to supply previously unavailable cannabis strains from Israeli cannabis producers, particularly in Canada where it expects to get its cultivation license soon.
Dr Miri Halperin Wernli, Creso chief executive officer and co-founder welcomed the new laws.
“As a vertically integrated cannabis company with CBD products already commercialised and cannabis cultivation soon to start production in Canada as well as Colombia and Israel, Creso’s strategy is rapidly coming together to form a powerful enterprise actively participating in the global cannabis market.”
“The legislation removes the last legal obstacle for medicinal cannabis exports [in Israel] and we look forward to taking advantage of Israel’s cutting-edge technology and access to high-quality, well researched medicinal cannabis.”
A new medicinal cannabis hotspot
Israel is a world leader in medical cannabis agriculture and research.
Its domestic industry has provided medical cannabis products to Israeli patients for over a decade, following the introduction of a medical cannabis program in the mid-1990s and the establishment of a National Medical Cannabis Agency in 2007.
Now, there are currently over 30,000 Israeli patients receiving medical cannabis treatments.
Michael Dor, senior medical adviser at the Israel Ministry of Health’s Medical Cannabis unit says there are more than 110 clinical trials involving cannabis underway in Israel – the most of any country.
This wealth of clinical research has resulted in the development of strains designed to treat specific ailments backed by hard research data, which is missing in most medicinal cannabis product claims.
Israel Agriculture Minister Uri Ariel says the newly approved laws will ensure the country remains at the forefront of medicinal cannabis research.
“The Israeli research conditions for growth in the field precede most of the countries in the world by five to seven years because of progressive regulation,” he said.
Opportunities around the world
Creso has also recently benefitted from changing legislation in Canada, which in October became the second country in the world to legalise recreational marijuana.
It’s the only ASX-listed company that owns a cannabis facility in Canada, via its subsidiary Mernova Medicinal.
Mernova’s new, 24,000 square foot (2,200 square metre) purpose-built, GMP indoor growing facility is designed to produce three to four tonnes of its “Ritual Green” brand of dry cannabis each year, with the goal of helping producers meet the growing demand.