THC Global signs cannabis medicine production deal with local cultivator Cannatrek
Cannatrek will provide THC Global with dried cannabis flower to produce medicinal cannabis under the Cannatrek brand and THC’s owns Canndeo brand.
THC Global Group (ASX: THC) has signed a 12-month supply and production deal with Australian “seed-to-patient” medical cannabis business Cannatrek to develop and manufacture Cannatrek-branded medicines on contract.
Under the terms of the agreement, Cannatrek will provide dried cannabis flower to THC for production of oil-based medical cannabis marketed under the Cannatrek brand.
It will also supply an equal quantity of flower to THC for the manufacture of its own Canndeo-branded products.
Minimum annual dried flower supply has been contracted at 480 kilograms, to be split equally for the production of Cannatrek and Canndeo medicines.
The production deal will combine Cannatrek’s agronomic expertise with THC’s high-volume production facility in Southport, Queensland.
End products will be supplied to the Tetra Health group of medicinal cannabis clinics, acquired by THC last month in a $3 million deal.
They will be distributed through Tetra’s network of over 600 prescribing doctors.
Cannabis cultivation
Cannatrek cultivates a number of medicinal cannabis strains with diverse cannabinoid levels at facilities near Brisbane.
The company was recently granted Major Project Status by the Australian Federal Government for a new $160 million growing facility in the Victorian regional city of Shepparton.
The 160,000 square metre facility will produce 160 tonnes of medicinal cannabis a year for Australia’s pharmaceutical industry, which currently has no local supplier at scale.
Low-cost supply
THC chief executive officer Ken Charteris said the production deal with Cannatrek would be a low-cost means of acquiring cannabis plant material to scale up the production of proprietary medicines.
“This is a significant milestone for us and for the Australian medicinal cannabis industry,” he said.
“By utilising our Southport facility to produce high-quality products for the Cannatrek and Canndeo brands, we are increasing the number of locally-made medicines available to patients and supporting the development of the industry as a whole.”
The supply of dried cannabis flower from Cannatrek is expected to commence later this year, with the first batch of Cannatrek-branded medicines to be released by THC shortly after.
At mid-afternoon, shares in THC were up 5.33% to $0.395.