Medical grade cannabis developer MGC Pharmaceuticals’ (ASX: MXC) stock was up 5% in early afternoon trade after it announced it had signed a five-year supply agreement regarding its medicinal cannabis flower products with European-based pharmaceutical distributor Lenis farmacevtika (Lenis).
The agreement encompasses Lenis taking on marketing, sales, logistics, exporting, handling and pharmacovigilance of MGC Pharmaceuticals’ four cannabinoids-rich medicinal flower products throughout central and eastern Europe.
However, MGC Pharmaceuticals and Lenis will jointly market the products in other European jurisdictions including Germany, Croatia, Greece and Italy.
Part of a revenue sharing arrangement, Lenis will be responsible for distributing the products for five years with a possible two-year extension. Lenis also has the first right of refusal for selling into new European territories. Specific values and portions of revenue sharing arrangement were not disclosed.
The medicinal cannabis flower products to be sold into central and eastern Europe are: MGC MX201, MGC MX21, MGC MX11 and MGC MX120.
These products include the branded DermaPlus topical cream for autoimmune conditions and the CannEpil MGC Epilepsy medicine.
According to MGC Pharmaceuticals, the cannabis flower products will be sold in pharmacies and are beneficial for treating nausea, vomiting, pain, Tourette’s syndrome, multiple sclerosis, uncontrollable epilepsy, inflammatory bowel disease, Crohn’s disease, ulcerative colitis and post-traumatic stress disorder.
“This deal follows our recently announced API [phytocannabinoids active pharmaceutical ingredients] deal with leading laboratory supplier, Mikro + Polo, which was signed in June 2017, making it our second European deal,” MGC Pharmaceuticals chief executive officer and founder Roby Zomer said.
Under the initial API agreement, Mikro + Polo has the right to sell, market and distribute MGC Pharmaceuticals’ upcoming APIs to customers within Slovenia, Croatia and Bosnia.
MGC Pharmaceuticals has many years of technical, clinical and commercial experience in medical cannabis. The company develops resins, oils and other cannabinoid-based products using a holistic supply chain approach which sees the company responsible for all production stages from planting to extraction.
MGC Pharmaceuticals claims the medicinal cannabis market is currently worth about US$2.7 billion and this is forecast to expand 10-fold within the next five years as cannabinoid-based products are increasingly legalised throughout the world.
The company is targeting markets in Europe, Australasia and North America.