What's happening in the Cannabis space?

What's happening in the Cannabis space?

The Australian cannabis industry is gearing up to become one of the major players in the global cannabis or hemp export market. According to some research and media reports, the Australian cannabis industry is anticipated to generate approximately $55 billion by 2025, because of Australia's agricultural expertise and favourable, cannabis-conducive atmosphere.

The Australian Government also gave the official go-ahead to marijuana exports in 2019, and thus opened the expanding global market to the Australian cannabis companies. In the meantime, several clinical studies were initiated testing the effects of medicinal cannabis on a range of indications such as multiple sclerosis, epilepsy, insomnia, and autism, among others.

The worldwide demand for medical as well as recreational use of cannabis is anticipated to rise consistently at a growth rate of at least ~17% to ~23% annually.

In this article, we are highlighting three ASX-listed cannabis sector players - AC8, AGH, MXC, and their respective recent activities

AusCann Group Holdings Limited (ASX:AC8)

An Australia-based pharmaceutical company, AusCann Group Holdings Limited is into the production, development and supply of cannabinoid-based medicines within Australia and all over the world.

AusCann provides stable, standardised and reliable cannabinoid-based therapeutic products to the physicians for treating their patients. The physicians monitor the outcomes of treatment and modify algorithms of treatment using a portfolio of cannabis products and formulations.

Low-dose form capsule for customised dosing solutions:

According to an ASX announcement dated 18 February 2020, AusCann revealed that the company had completed the production and examination of its proprietary cannabinoid-based hard-shell capsules in a low-dose presentation.

The company has also mentioned that it is on target and progressing for the aim of commercialisation of hard-shell capsules and make them available for the physicians to prescribe in Australia during the first half of the calendar year 2020.

Stock Information:

On 21 February 2020, the AC8 stock closed the day’s trade at $0.280, in line with the previous close. The company’s market capitalisation stood at nearly $88.77 million, with almost 317.05 million shares outstanding. AC8 stock’s 52 weeks high and 52 weeks low price was noted at $0.530 and $0.170, respectively.

Althea Group Holdings Limited (ASX:AGH)

An ASX-listed healthcare company, Althea Group Holdings Limited is engaged in the supply of medicinal cannabis products (pharmaceutical grade) for improving the lives of patients who are suffering from debilitating disorders. The company offers numerous products, access & management services, education to support health care professionals and eligible patients in directing the treatment pathways of medical cannabis.

Althea is a licensed producer, supplier as well as exporter of medicinal cannabis and currently operates in Australia and the United Kingdom cannabis market. Althea has plans to expand its business in Asian and European emerging markets.

Strong patient growth:

On 11 February 2020, Althea revealed that January 2020 had been recorded as the second-best month for the company and approximately 572 new patients were added in this month.

As of 31 January 2020, approximately 4,590 patients in Australia had been prescribed the medicinal cannabis products of Althea by 459 healthcare professionals.

Stock Information:

On 21 February 2020, the AGH stock closed the day’s trade at $0.355 down by 1.389% from its previous close. The company had a market capitalisation of nearly $83.99 million. The total outstanding shares of the company stood at 233.31 million, and its 52-week low and high prices were $0.315 and $1.445 respectively.

THC Global Group Limited (ASX:THC)

NSW, Australia-headquartered medical cannabis company THC Global Group Limited is into the cultivation and manufacturing of pharmaceutical-grade cannabis. The company has all the three essential cannabis licences: a licence for the cultivation of medical cannabis and two licences for the manufacturing of medical cannabis.

The Southport manufacturing facility of the company is the biggest licenced and permitted pharmaceutical bio-floral extraction plant in the Southern Hemisphere.

THC Global owns and operates an established hydroponics equipment wholesaler and retailer- Crystal Mountain Manufacturing. The wholly-owned company is operating across Canada and servicing the rapidly growing cannabis sector in North America.

Launch of Full Range of Medicinal Cannabis:

On 10 February 2020, THC updated the launch of ‘Canndeo’ branded medicines in Australia as well as across the globe. Under the Canndeo brand, THC Global’s medicines are expected to launch by the end of the first quarter of 2020, and initially, there would be four products with a complete spectrum of CBD medicine.

Canadian Medicinal Cannabis Market Entry:

The company revealed that it had submitted applications for licences enabling it to become a supplier, under the medicinal cannabis regulations in Canada, to patients with valid prescriptions for cannabis medication. After the approval of the licence, THC Global, under the Canndeo Canada brand, will supply cannabis medicines in the Canadian market.

THC Global anticipates receiving the first shipment of crude cannabis extract within the next few weeks, enabling the completion of the first GMP medicines utilizing the same material by the end of 2020 first quarter.

Stock Information:

On 21 February 2020, the THC stock closed the day’s trade at $0.365, in line with the previous close. The company had a market capitalisation of nearly $51.38 million. The total outstanding shares of the company stood at 140.77 million, and its 52-week low and high prices are $0.305 and $0.630 respectively.

MGC Pharmaceuticals Ltd (ASX:MXC)

A Europe-based biopharma company, MGC Pharmaceuticals Ltd is a leader in supplying medicines derived from GMP Phytocannabinoid for the patients worldwide. The company is working with the goal of manufacturing and supplying high-quality cannabinoid-based drugs for the emerging markets in North America, Australasia and Europe.

To conducting extensive research and develop the highest quality of pharmaceutical products for the patients, MGC Pharma has collaboration and partnership with universities, academia and companies across the globe. The company has a strong product offering targeting three widespread diseases - epilepsy, Irritable Bowel Syndrome (IBS) and dementia.

Strategic Placement and Share Purchase Plan:

The company updated the market that the document for the share purchase plan, which was announced on 17 February 2020, has been dispatched to the eligible shareholders.

This share purchase plan offered to eligible existing shareholders to raise approximately $3.0 million. Shares under this share purchase plan would be issued at $0.027 per share, and for every two shares subscribed, there is one free attaching option exercisable at approximately $0.045.

Outlook:

  • By June 2020, MGC Pharmaceuticals estimates that it will be delivering more than 2,000 prescription medicines per month, based on current order growth and expressions of interest from new territories and distributors. Moreover, by the end of 2020, the company estimates nearly 5,000 prescriptions per month.
  • For its production capacity of Slovenian facility, MXC plans to rise per month prescriptions from 12,000 to 20,000 for nominal additional capex spending.
  • MXC anticipates achieving operating cash flow breakeven at 5,000 prescriptions per month production rate, based on its current product margins as well as cost structure.

Stock Information:

On 21 February 2020, the MXC stock closed the day’s trade at $0.028, an increase of 3.704% from its previous close. The company has a market capitalisation of nearly $37.02 million. The total outstanding shares of the company stood at 1.37 billion, and its 52-week low and high prices are $ 0.027 and $ 0.067 respectively.


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