Medicinal cannabis company THC Global (ASX: THC) has revealed several major strategic shifts to carve a bigger slice of the wider healthcare and pharmaceutical markets including a rebranding to reflect the move.
As part of the rebrand, THC will be renamed Epsilon Healthcare. Shareholders will be required to approve the change at an extraordinary general meeting next month.
THC said this will assist with altering perception of THC being associated with the recreational cannabis market.
The company said the rebrand will underpin its move towards patient led healthcare and high-value pharmaceutical production.
Shift to toll pharmaceutical manufacturing
Another adjustment for THC will involve leveraging its significant fully licenced GMP manufacturing capabilities at Southport and transitioning to toll manufacturing.
This will involve toll and contract manufacturing high value pharmaceuticals. The shift from primarily “own brand” manufacturing will boost volume throughput, deliver revenue while cutting per-unit production costs.
As part of this, THC is already in discussions with potential parties and expects to make binding agreements in the “near term”.
Cannabis cultivation changes
Changes have been planned across THC’s cannabis divisions including a $1 million saving in cannabis cultivation, with a total of $3 million in annualised run rate savings identified and implemented across the entire THC business.
These savings are anticipated to be realised over the current quarter.
Overall, in the cultivation division, THC is reviewing the value of continuing to develop its own cannabis in Australia and has decided not proceed with the Ballina and other Australian cultivation projects until after the new strategy is in place.
The company also plans to source and cultivate higher yielding plants. It will also look at leveraging its existing Bundaberg facilities and licences by offering contract cultivation solutions.
Launch of Uno
In its medicinal cannabis formulation division, THC will taper production of its CanndeoCare brand over early 2021 and launch Uno.
The company anticipates Uno will be a new niche market cannabis brand that will comprise vapes and other medicine forms.
Uno branded THC and CBD vape liquids are expected to be launched later this year and will be exported to New Zealand, Canada and Europe.
The company will also launch the Medimar platform which has been designed as a unique end-to-end e-commerce vehicle for medicinal cannabis in Australia using THC Southport Facility as a distribution hub.
THC anticipates Medimar will streamline application processes and reduce administration for prescribers and pharmacists.
Pharmacies will be able to purchase products in bulk, while patients will have a single point of contact for enquiries and choose any pharmacy.
THC said this system will replace existing high cost legacy pharma distributors and reduce the time-frame.
Other business units
Across its other business units including Hydroponics Equipment and Canadian Cannabis, THC plans to continue growing revenue, expanding services and distribution and diversifying its offerings.
Meanwhile, the company noted its Tetra Health clinic has continued to perform with plans underway to continue increasing patient uptake and its prescriber network.