ASX-listed Creso Pharma Limited (ASX:CPH) seems to be in high spirits after an encouraging update on the position of cannabidiol (CBD) products in Europe. The ruling by the highest European court is expected to create a slew of opportunities, which the pharma firm is hoping to cash in on without delay.
The verdict announced by the court of Justice of the European Union (CJEU) on 19 November 2020 revealed that the EU member states are to no longer prohibit the marketing and distribution of legally produced CBD. It was further ruled that CBD does not fall under the narcotic category and therefore it can now freely be distributed in the European Union countries.
Announcing the verdict, the CJEU revealed that no psychotropic effect of CBD was found on the human mind and body. Therefore, it does not qualify as a narcotic. however, it is to be noted that a literal interpretation of a statement made by the UN Single Convention on Narcotic Drugs might put CBD in the category for a narcotic drug.
New trade opportunities for Creso Pharma
This ruling has ushered in several trade opportunities for Creso Pharma which the firm will try to capitalize on instantly. With commercial dealings and agreements with clients in the Iberian markets, the firm is comfortably positioned in terms of funds for growth in days ahead.
As per the reports from the Orian Research group, the current market share for CBD and its derivates in Europe is €450 million, which accounts to about 31% of the market share for CBD oils globally. It is predicted that CBD and its products could account for about 0.5% of the market value for health and wellness by the year 2028.
There was a market growth of 12.9% witnessed in the year 2018 as the value went up from US$3.72 trillion to US$4.2 trillion. It was further revealed that the projected market share for CBD in Europe could be about €1.5 billion.
Creso pharma has closely been tracking regulatory structures globally. With the recent regulatory changes working in the favour of the company; strong demand and supply for CBD products in South Africa and Canada are expected in times ahead.
The management and the board are all actively seeking ways to explore new strategies that could mean market share growth in both Europe and Australia.
Adam Blumenthal, the Non-Executive chairman of the firm is of the view that the recent developments will help the firm grow quickly. He welcomed the latest development adding that they were looking forward to providing more information regarding the same in days ahead.