Canada’s Marihuana for Medical Purposes Regulations (“MMPR”) officially went into effect on April 1, 2014. The new set of rules replaced the old Marihuana Medical Access Regulations (“MMAR”) and require medical marijuana users to purchase the drug directly from Licensed Producers rather than purchasing it from the government or growing it on their own in their homes.
Medican Enterprises, Inc. (OTC: MDCN), a biopharmaceutical company in the emerging global medical marijuana industry, aims to become one of those Licensed Producers with its acquisition of 50% of International Herbs Medical Marijuana Ltd. (“IHMML”). With an MMPR application in place, IHMML’s team of highly skilled contractors is working to retrofit a large-scale cultivation and distribution center.
Medican plans to incorporate these elements with its existing infrastructure to create a well financed research and cultivation facility, cutting edge fulfillment technologies and a direct distribution channel or its products. IHMML’s building is located in Atholville, NB, while it has additional contracts to purchase a 300,000 sq. ft. facility in Pokemoush, NB and a 25,000 sq. ft. facility in Delta, BC.
According to Health Canada, there are only 12 Licensed Producers approved right now to sell or provide eligible persons with medical marijuana, although approximately 450 companies have applied. Similarly, there are only 40,000 eligible patients right now, but those numbers are expected to increase to an estimated 450,000 by 2024, driving the industry to $1.3 billion in size.
Tweed Inc. (TSXV: TWD) became the first publicly traded Licensed Producer in Canada, but others like Medican Enterprises hope to join the fold in the near term. With its extensive platform of products, services, and technologies, the company may be better positioned than most to capitalize on the market’s demand and ultimately unlock long-term value for its shareholders.
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