1-Page seeks rebirth in the medicinal cannabis market
Once Australia’s most popular and well-known ‘fintech’ company, 1-Page (ASX: 1PG), has decided to throw its hat into the medicinal cannabis ring.
Despite being suspended from trading on the ASX since March 2017, 1-Page has restructured its operations and plans to metamorphose into a biotech development/agribusiness company; although details are light so far and a re-listing date remains unknown.
1-Page has signed a conditional binding agreement to fully acquire the parent company of HAPA Medical Group, based in Germany. HAPA is an early mover in the German medicinal cannabis market offering its own pharmaceutical GMP-grade THC/CBD product lines to German patients through a HAPA-owned network of medical cannabis clinics throughout Germany.
1-Page says that two of HAPA’s founders will join its Board following the acquisition with HAPA able to provide direct access to patients in the near-term via its specialist medical clinics in Berlin and Dortmund.
HAPA is also considering other EU countries as potential expansion opportunities and HAPA has also lodged an application for an EU cultivation license in Greece, with final confirmation expected later this year.
The terms of the deal include 1-Page paying €1.3 million plus 90 million 1-Page shares with €430,000 paid as a non-refundable deposit.
The move into the German medicinal cannabis market stems from recent legislative changes, in a similar fashion to other countries that have recently relaxed laws on cannabis such as the United States, Canada and Australia.
Following changes to Germany’s laws in 2017, the country’s medicinal cannabis market has grown quickly with HAPA well-positioned as one of the front-runners in the space. The new law changes mean that German citizens must register as patients to take advantage of the newly-relaxed medicinal cannabis laws, with the number of registered patients “exceeding initial industry forecasts” according to market analysts.
Analysts are also expecting Germany’s robust health insurance system to provide further support for growing demand. In stark contrast to Canada, Australia and the United States, Germany subsidises the cost of cannabis-related medicines which could mean treatments are much faster to be disseminated to patients.
As Europe’s most populous country with the highest level of income per capita, Germany has the potential to become not only the largest EU market for medicinal cannabis but also globally.
The 1-Page story
Less than 18 months ago 1-Page was the first Silicon Valley technology company to go public in Australia, progressing a ‘fintech’ idea to improve recruitment.
In the 12 months after its IPO, 1-Page was trading at over 2,000% above its initial listing price as investors bought into the idea en masse.
In 2015, 1-Page was one of the best-performing stocks on the ASX, raising more than $43 million in two separate offerings and ballooning its market cap to a peak of about $512 million in September 2015.
However, lacklustre services and a failure to deliver on functionality, 1-Page has fallen from grace with its original founder, Joanna Riley, ousted from the Board amidst chaotic company restructuring over the past year.
The company plans to rebrand itself as ‘European Cannabis Corporation Ltd.’, subject to shareholder approval.