Medicinal cannabis is emerging into mainstream consumption, one approval at a time for MGC Pharmaceuticals (ASX: MXC).
As one of the world’s most avant-garde market niches, medicinal cannabis products could potentially become as lucrative for the Australian biotech sector as pharmaceuticals have been for the healthcare industry.
MGC is hopeful to join up with the growing trend by commencing production of its first batch of CannEpil, at its European medicinal cannabis laboratory and manufacturing facility, just days after receiving its interim Good Manufacturing Practice (GMP) certification in Europe.
There is mounting evidence globally that medical cannabis can treat a wide range of conditions including chronic pain, chemotherapy-induced nausea and vomiting, and multiple sclerosis spasticity symptoms.
The American National Academies of Sciences, Engineering and Medicine published a report studying the health effects of cannabis and cannabinoids last year. The report found there is conclusive evidence that medical cannabis is an effective treatment for chronic pain, chemotherapy-induced nausea and vomiting, and multiple sclerosis spasticity symptoms.
The report also indicated that there is strong evidence for cannabis to be used in the treatment of many other conditions including sleep conditions, anxiety, posttraumatic stress disorder, glaucoma symptoms, symptoms associated with motor system diseases, such as Parkinson’s, and cancer.
From Europe to Australia
One of MGC’s core markets will be Australia where it plans to capitalise on its first-mover advantage by supplying at least A$1 million-worth of its CannEpil product in Australia in its first year of marketing its product to Australian customers.
CannEpil is focused on the psychoactive element of cannabis (tetrahydrocannabinol: THC) as opposed to cannabidiol (CBD) which MGC is pursuing via other products in its arsenal.
The production of this first batch is a major milestone for MGC, with analysis and validation to follow “within a few weeks”.
MGC says its products will be independently inspected by the Agency for Medicinal Products and Medical Devices (Australia’s regulatory body), to validate that its protocols were followed during production.
After this final regulatory hurdle is cleared, MGC will obtain full GMP certification. Eventually, MGC has its eyes on commencing full-scale commercial production of CannEpil later this year.
Furthermore, MGC intends to produce additional pharmaceutical-grade medical cannabis products for use in clinical studies, research pipelines and additional medical products licensed for distribution.
As one potential application for its products, MGC says that CannEpil is its first pharmaceutical-grade medical cannabis product targeting drug-resistant (refractory) epilepsy, which accounts for approximately 30% of the estimated 240,000 people diagnosed with epilepsy in Australia each year.
From the 100 or so patients currently registered with MGC, the company thinks it can generate around $1 million per year, in partnership specialist Australian pharmaceutical distributor, HL Pharma.
Paving a way to legal medical cannabis revenues
Full regulatory approval in the form of GMP certification for its European laboratory and production facility gives MGC a significant competitive advantage when compared to rival producers around the world.
Europe in particular, offers MGC a strong platform compared to its peers because GMP certification places the company at a superior level of authorisation and therefore, can come to the market with the most authoritative endorsement possible.
Full certification is expected to provide MGC with a strong marketing position and could help the company establish an unassailable market position just as the medicinal cannabis market begins to take shape in regions such as Australia and Europe, where legislation has begun to be relaxed significantly in recent years.
Furthermore, MGC is expecting receipt of additional GMP certification for its extraction facility in the second half of this year, which will mean MXC has a “fully integrated GMP facility for the future production and compounding of new pharmaceutical products” to be sold directly into the emergent medical markets in Europe, North America and Australasia, where such sales and distribution are permitted and legal.
“This is an exciting final step for MGC Pharma as we focus on completing full GMP certification of our manufacturing facility to allow us to produce CannEpil in Europe and focus on significantly progressing our medical research and development of our pharmaceutical products pipeline. The production of our first CannEpil batch is a milestone and leaves us well positioned to achieve certification and commence full-scale commercial production in the next few months,” said Roby Zomer, Co-founder and CEO of MGC Pharmaceuticals.
News of today’s GMP approval helped MGC shares to a 6% gain in early morning trade.