Medicinal cannabis company Creso Pharma (ASX: CPH) has been riding the wave of loosening regulations relating to cannabis, with company also revealing it has expanded into Canada’s largest recreational market.
Today’s move into Canada’s largest recreational market follows the United Nations official decision to remove cannabis from the world’s most dangerous drugs list.
The move involved reclassifying cannabis from Schedule IV to a Schedule I substance, which is the least restrictive drug category.
Preceding the UN decision was the European Union’s Court of Justice ruling EU member states must not prohibit marketing of lawfully produced cannabidiol products.
These decisions represent a regulatory shift in favour of medicinal companies.
Canada’s largest recreational cannabis market
Creso has capitalised on this shift, revealing its Canadian subsidiary Mernova Medicinal has branched into Ontario, which is the largest recreational cannabis market in Canada.
According to Creso, Ontario accounts for more than a quarter of Canada’s recreational cannabis market share, with almost C$400 million (A$420 million) in legal sales recorded between 1 April 2019 and 31 March 2020.
Creso’s Canadian subsidiary Mernova received a notice to purchase from the Province of Ontario for its HPG13, Lemon Haze and Mimosa strains which will be sold under Ritual Green products brand.
Once the purchase has been finalised, Mernova’s Ritual Green products will be available throughout Ontario Cannabis Store locations and online.
The Province of Ontario notice to purchase adds to two other purchase orders with all three combined totalling C$275,023 (A$288,159).
Of that, Truro Cannabis Company has purchased C$232,826 (A$243,841) of HPG13, Lemon Haze and Mimosa.
Truro plans to sell the products through its established distribution channels.
Yukon Liquor Corporation has also made its first purchase off Mernova. This order is for C$24,333-worth of HPG13, Lemon Haze and Mimosa, with Creso anticipating repeat orders in the “short-term”.
The positive regulatory developments and Creso’s Canadian market expansion have propelled the company’s share price up more than 360% for the week.
By early afternoon trade today, Creso was trading at $0.345, which was a 46.81% on yesterday’s close.