Canada-based cannabis company High Tide has entered the German medical cannabis market by purchasing a 51% stake in Frankfurt-based pharmaceutical company Purecan.
Monday’s acquisition announcement comes after Germany legalized recreational hashish for non-public use starting last April, banning it from the list of controlled ingredients and making it less difficult for patients to access medications.
High Tide has acquired a majority 51% stake in Purecan GmbH for €4. 8 million to enter the German hashish market.
This acquisition positions High Tide for Purecan’s established operations, adding its German import license, warehousing and logistics infrastructure, as well as a soon-to-launch telemedicine platform.
With over $1. 5 billion in cumulative sales generated through its hashish operations in Canada, High Tide intends to use this experience to secure a strong position in the thriving German market.
This acquisition supports High Tide’s strategy to expand into high-margin markets, capitalizing on Purecan’s financial results, which include €15 million in annual revenue and a 29% EBITDA margin.
The transaction positions the company well for long-term expansion into the European hashish markets.
High Tide is the first North American hashish company to invest in the German medical hashish market.
In 2022, Curaleaf Holdings acquired a 55% stake in Four 20 Pharma, while Organigram Holdings entered into a source agreement with Sanity Group last year.
In 2023, the Frankfurt-based Bloomwell Group obtained multimillion-dollar financing from the American company Artemis Growth Partners, with the participation of Measure 8 Venture Partners and actor Moritz Bleibtreu.
Previously, Canopy Growth Corporation one of the first hashish corporations to input the German marketplaceplace through obtaining German distributor MedCann in 2016, now operating under the call Spectrum Therapeutics. Similarly, some other Canadian company, Aurora Cannabis, started making an investment in the medical hashish marketplaceplace in Germany since 2017.
These investments underpin the increasing attention toward this country, where demand for medical cannabis has been growing, presenting a goldmine opportunity for North American companies.
Medical hashish is booming in Germany. According to a report by Prohibition Partners, sales of medical hashish in Germany would exceed €420 million by 2024.
The market is growing rapidly, although the investment levels have been inconsistent. After back-to-back approximately €55-million investments in 2021 and 2022, 2023 saw less than €20 million across seven deals.
The explanation for the increase in medical prescriptions for hashish has to do with the reclassification under the Cannabis Law, also known as CanG, which has allowed patients to have access to it.
According to the report, it is a developing market with significant prospects for expansion as import volumes increase and regulatory barriers ease.
Refund policies are also improving, with more and more public insurance covering hashish prices and increasing demand.
Since October 17, most German doctors can prescribe medical hashish in exchange for reimbursement, subject to approval by the health insurance.
The Federal Institute for Medicines and Health Products (BfArM) has knowledge of imports of medicinal cannabis.
This corresponds to an increase of almost 40% over the first quarter’s 8.1 tons, in which 11.7 tons of dried cannabis flowers for medical use were imported in the second quarter.
In 2023, around 32. 5 tons of hashish flowers were imported from 24 countries.
By the first half of 2024, this number reached 19.8 tons, coming from 15 countries. The biggest lots of medical cannabis came from Canada with 11.1 tons, Portugal with 3.5 tons, and Denmark with 1.6 tons.
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