Little Green Pharma (ASX: LGP) grows lead on $4.5M cannabis deal

Australian cannabis supplier Little Green Pharma has signed a two-year deal with Germany’s Cannamedical to supply bulk cannabis with a potential value of over $4.5 million over two years.

The deal extends LGP’s lead as the pre-eminent non-Canadian global medicinal cannabis group supplying products to Germany and the EU.

It also means LGP now has medicinal cannabis supply agreements with four key
wholesalers and distributors in Germany, including three of the country’s four largest independent, own-brand medicinal cannabis distributors.

“The agreement represents continued validation of LGP’s key strategy of developing bespoke, high-value white label strains for export to lucrative jurisdictions,” the Company said.

About the agreement

LGP will exclusively supply the Product to Cannamedical for sale in Germany, subject to Cannamedical ordering specified minimum quantities every six months to maintain exclusivity. In addition, the Product pricing contemplates a THC adjustment for every percentage point the THC content is above or below 22%, with the payment terms requiring the upfront payment of a portion of the purchase price upon delivery.

About Cannamedical

Cannamedical is a German-based pharmaceutical pioneer with licenses to import medicinal cannabis into Germany and distribute and export it within the European Union. Established in 2016, the Company received the research seal “Innovative through Research” from the Federal Ministry of Education and Research (BMBF) and the International Life Science Award 2022 in the category “Best Medical Cannabis Products Supplier 2022 – Germany” in Q3 2022. Cannamedical has 25% of the German medical cannabis market, with the Company’s exponential year-over-year growth underpinned by a unique boutique product portfolio, long-term partnerships with innovative and carefully selected manufacturers, and the ability to leverage in-house manufacturing infrastructure. Since 2021, the Company has been part of the Senior Pharma Group – one of Europe’s leading specialty pharmaceutical groups specializing in narcotic and medicinal cannabis development, manufacturing, warehousing, and distribution.

Material terms

• LGPwilldeveloptheProductmeetingagreedTHC specifications and Cannamedical requirements
• FinaldevelopmentoftheProductisexpected within two to six months, with the first shipment expected sometime between January and June 2023, depending on final Product licensing requirements
• TheAgreementissubjecttoanumberof conditions precedent, including entry into a QA Agreement, the inclusion of LGP on Cannamedical narcotics licence, irradiation licences in Germany, and a successful audit of LGP Denmark’s facilities; with the QA Agreement and Facility audit both well advanced and expected to be completed in the coming weeks
• All shipmentsareonFCAIncotermsfromLGP’s Danish facilities, with Cannamedical to arrange shipping and release in Germany
• TheAgreementisafixedpricedcontractwithLGP entitled to refuse purchase orders for breach of payment terms or where otherwise reasonable
• LGP’s sole liability for failure to achieve microbiological levels, late delivery, or failure to deliver is re-delivery of the relevant shipment2

About Little Green Pharma

Little Green Pharma is a global, vertically integrated, geographically diverse medicinal cannabis business with operations from cultivation and production to manufacturing and distribution.

The Company has two global production sites for the manufacture of its own-branded and white-label ranges of GMP-grade medicinal cannabis products, being a 21,500m2 cultivation and 4,000m2 GMP manufacturing facility capable of producing over 30 tonnes of medicinal cannabis biomass per annum located in Denmark (EU) and an indoor cultivation and manufacturing facility located in Western Australia capable of producing ~3 tonnes of medicinal cannabis biomass per annum.

Little Green Pharma products comply with all required Danish Medicines Agency and Therapeutic Goods Administration regulations and testing requirements. With a growing range of products containing different ratios of active ingredients, Little Green Pharma supplies medical-grade cannabis products to Australian, European and overseas markets.

The Company strongly focuses on patient access in the emerging global medicinal cannabis market. It is actively promoting education and outreach programs and participating in clinical investigations and research projects to develop innovative new delivery systems.

Please note the following valuable information before using this website. 

Independent Research 

Market Open Australia is intended to be used only for educational and informative purposes, and any information on this website should not be taken as investment advice or guidance. It is important to conduct your own research before making any investment decisions, which should be based on your own investment needs and personal circumstances. Any investment decisions based on information contained on this website should be taken in line with independent financial advice from a qualified professional or should be independently researched and verified.