Flora Growth Executes International Sales Agreement to Enter Australian Medical Cannabis and Over-The-Counter CBD Market
July 29 2021 - 7:05AM
Business Wire
- Flora signs Letter of Intent with an international distributor
based in Australia to provide raw and finished medical cannabis
products for medical cannabis patients
- Recent Colombian legislative update allows for the sale and
export of raw cannabis materials, namely dried flower, in addition
to derivatives, to international markets
- Australian medical cannabis market estimated to surpass AU$200
million in 2021 and US$1.5 billion by 2025, with patient numbers
growing exponentially in recent years
- Estimates predict the pharmacist-only CBD market in Australia
itself will grow to AU$250 million in product sales at market
maturity, capturing ~2M consumers
- Australian authorities recently down-scheduled cannabidiol
(“CBD”) from Schedule 4 to Schedule 3, allowing the opportunity for
consumers to purchase CBD products over-the-counter
Flora Growth Corp. (NASDAQ: FLGC) (“Flora” or the
“Company”), a leading all-outdoor cultivator and manufacturer of
global cannabis products and brands, is pleased to announce that it
has entered into a non-binding Letter of Intent (“LOI”) with
Evergreen Pharmacare Pty Ltd. (“Evergreen”), a licensed Australian
importer and distributor of medical cannabis products, to supply
its premium dried flower and derivative products. The Company
expects to ship its medical-grade cannabis products upon completion
of its first commercial harvest and obtaining necessary export
licenses.
Data firm, FreshLeaf Analytics, forecasts the Australian medical
cannabis market to surpass AU$200 million in 2021 and notes strong
patient growth metrics by a factor of 15x over the past two years.
Furthermore, Prohibition Partners estimates that the Australian
medical cannabis market could reach US$1.5 billion by 2025.
Evergreen works with patients and healthcare practitioners,
primarily physicians and pharmacists, to provide medical cannabis
products and to educate about the authorization and use of medical
cannabis. Evergreen was born out of necessity for its patients to
have quicker access to premium, affordable, AUGMP-certified
medication via the Special Access Scheme (“SAS”) Category B
application pathway.
“We are absolutely thrilled to enter into this agreement with
Flora and to provide Australian cannabis patients with access to
premium medical-grade cannabis products at a more affordable price
point than ever before due to Flora’s strategic low-cost
cultivation and processing operations, as well as their global
logistics expertise,” said Tristan Hyodo, Chairman of Evergreen.
“Additionally, we were very encouraged by the recent decision from
the Therapeutic Goods Administration to provide a new product
pathway for cannabidiol ("CBD") to be sold over-the-counter without
a prescription. Pharmacy is a natural progression where you can
have medical practitioner oversight for patients consuming it for
health, while also addressing the accessibility issue seen in other
global jurisdictions.”
FreshLeaf estimates the pharmacist-only CBD market in Australia
will grow to AU$250 million in product sales at market maturity,
capturing around 2 million consumers, and also expects that many
existing medical cannabis patients will migrate to the pharmacy
channel once low-dose CBD products become available
over-the-counter. Currently, almost 1-in-4 medicinal cannabis
patients take a CBD product at a daily dose below 150mg, spending
an average of $8.02 per day, or based on the current medical
patient metrics, ~AU$29 million annually.
“The agreement with Evergreen will allow us to establish a local
partner in Australia while generating incremental revenue from our
Colombian cannabis facility and as legislation evolves within
Australia,” said Jason Warnock, Chief Revenue Officer of Flora
Growth. “This agreement also provides significant potential upside
by allowing us to work with Australian regulators directly and
bring our premium brands and established product formulations to
the over-the-counter CBD market. Down-scheduling CBD fits well with
Flora's long term consumer product strategy of providing proven
cannabinoid wellness and beauty products to consumers around the
world and we are excited to work with our partners on this new
opportunity.”
This LOI is the second that Flora has signed since the Colombian
government revised its cannabis laws aimed at improving access to
cannabis products for Colombians and positioning Colombian
cultivators and processors as the leaders to supply the global
cannabis market (see press release dated July 26, 2021, for full
details on the impact of the legislative announcement to Flora
Growth).
About Flora Growth Corp.
Flora is a cannabis company that leverages natural,
cost-effective cultivation practices to supply cannabis derivatives
to its diverse business divisions of cosmetics, hemp textiles, and
food and beverage. As the operator of one of the largest outdoor
cultivation facilities, Flora strives to market a higher-quality
premium product at below market prices. By prioritizing natural
ingredients and value-chain sustainability across its portfolio,
Flora creates premium products that help consumers restore and
thrive. Visit www.floragrowth.ca or follow @floragrowthcorp on
social for more information.
Cautionary Statement Concerning Forward-Looking
Statements
This document contains forward-looking statements. In addition,
from time to time, we or our representatives may make
forward-looking statements orally or in writing. We base these
forward-looking statements on our expectations and projections
about future events, which we derive from the information currently
available to us. Such forward-looking statements relate to future
events or our future performance, including: the impact of
legislative changes in Colombia both in Colombia and
internationally; the size of markets for cannabis and cannabis
products; the Australian market for cannabis products; our
financial performance and projections; our growth in revenue and
earnings; and our business prospects and opportunities. You can
identify forward-looking statements by those that are not
historical in nature, particularly those that use terminology such
as “may,” “should,” “expects,” “anticipates,” “contemplates,”
“estimates,” “believes,” “plans,” “projected,” “predicts,”
“potential,” or “hopes” or the negative of these or similar terms.
In evaluating these forward-looking statements, you should consider
various factors, including: our ability to change the direction of
the Company; our ability to keep pace with new technology and
changing market needs; and the competitive environment of our
business. These and other factors may cause our actual results to
differ materially from any forward-looking statement.
Forward-looking statements are only predictions. The
forward-looking events discussed in this document and other
statements made from time to time by us or our representatives may
not occur, and actual events and results may differ materially and
are subject to risks, uncertainties and assumptions about us. We
undertake no obligation to publicly update or revise any
forward-looking statement, whether as a result of uncertainties and
assumptions, or the forward-looking events discussed in this
document and other statements made from time to time by us or our
representatives not occurring, except as may be required by
applicable law.
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Investor Relations Contact: Evan Veryard
evan.veryard@floragrowth.ca Public Relations Contact:
Cassandra Dowell +1 (858) 264-6600 flora@cmwmedia.com
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