Together (TASE: TGTR) has announced that its subsidiary Globus Pharma, which specializes in the medical cannabis sector, has signed a Memorandum of Understanding (MoU) to sell medical cannabis or oil to a Canadian company with a license to grow, produce and import medical cannabis to Canada.
Under the terms of the agreement, the Canadian company will buy from Globus 50 tons of dried inflorescences of cannabis each year or five tons of medical cannabis oil (the equivalent amount to 50 tons of inflorescences). The two companies will also collaborate in the field of R&D and promoting technologies in the medical cannabis sector.
As of the date of signing the agreement, the parties estimate that sales revenue will amount to between US$3.17 and US$4.7 per gram of inflorescence. The parties intend contracting a detailed agreement as soon as possible, which will fix the price of the sale of the various cannabis products according to prices on the Canadian market at the time of signing.
Globus plans to provide the Canadian company with medical cannabis from farms in Israel subject to receiving an export permit for medical cannabis, or from its farm in an overseas country, which has an export agreement with Canada. The Canadian company is currently applying for a license to market and sell medical cannabis products in Canada and abroad and according to the information given to Globus, it expects to receive the license within four to five months.
This latest agreement is in addition to Globus Pharma's existing sales agreements for 25 tons a year with a German company and a sales agreement for three tons a year with another Canadian company. Together also reported recently that it is working to establish up to 25 acres of greenhouses in a country outside of Israel in a project that will be self-financed.
Globus Pharma founding partner Nissim Bracha said, "We are continuing to work towards setting up an infrastructure of our business activities in order to realize the major knowhow and experience that we have in growing medical cannabis. This is through producing and selling agricultural produce and its products in Israel and overseas, and with the intention of supplying medical cannabis products to the rapidly growing world market that is worth tens of billions of dollars annually."
He added, "This agreement joins other existing sales agreements in Canada and Germany amounting to an overall about 30 tons. These agreements ensure the creation of revenue and cash flow that are not dependent on export approval from the State of Israel, and which will derive from the sale of medical cannabis and its products from areas that we will set up in countries outside of Israel that have the relevant export agreements."
He continued, "Taking into account the marketing agreements and our preparations for setting up a farm for growing the plants and an advanced factory for processing the agricultural produce, we believe that with the receipt of the required marketing and export approval in Israel and abroad, we can create major value for our shareholders."
Together founder and CEO Arik Filstein said, "We are happy to see the progress of the operations company around the world and the significance of the Memorandum of Understanding that was signed with the Canadian company. The company's strategy continues to be based on deploying several growing locations that will enable us in the future an effective and major pipeline for supplying medical cannabis while reducing being focused on one location and dependency.
Published by Globes [online], Israel business news - www.globes-online.com - on April 15, 2018
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