Bod Australia (ASX: BDA) will develop a hemp-based, high methylglyoxal manuka honey line to distribute to global markets after pinning down a heads of agreement with New Zealand-based Manuka Pharma.
The agreement provides for Bod to import the finished product and sell under its own or any other brand it chooses, with first sales targeted by the end of June.
Initially, Bod will target sales through pharmacy and independent retailers as well as health food and supplement stores in Australia.
The company will also leverage off existing partnerships in Asia and China to sell the product into those countries before expanding into North America and Europe.
Under the agreement terms, Bod will own all intellectual property and worldwide distribution rights, while Manuka Pharma will source, develop and manufacture the hemp-based manuka honey.
“This is a highly complementary partnership for the business as it will not only enhance our nutritional product portfolio, but it will also provide an additional revenue stream for the company in the near-term,” Bod Australia chief executive officer Jo Patterson said.
“Following the development and manufacture of the product, we expect to realise sales in Australia during the first half of 2018, with sales into Asia and other regions such as the UK and North America to follow,” Ms Patterson added.
Honey has long been lauded for its antibacterial qualities and the higher concentration of methylglyoxal in manuka honey is believed to provide a stronger antibiotic effect. Manuka honey is often used in treating wounds, burns and some believe it can be beneficial in managing cancer, diabetes, cholesterol, infections, gastrointestinal problems and systemic inflammation.
New Zealand’s latest export data reveals the country’s largest manuka honey export markets as Australia, UK, China and Hong Kong, with total export demand for the product valued at about US$2.1 billion.
According to Bod, medical grade manuka honey can fetch up to A$1,000 per kilogram.
Shares in Bod were up more than 4% in early afternoon trade to A$0.62.