As evidence to the shift in public perception of marijuana use, the Province of Ontario has announced plans to legalize Cannabis lounges once the country's Cannabis Act is passed.
Leading cannabis companies are already preparing for the increased demand including Canopy Growth Inc. (TSX: WEED) (OTC: TWMJF), MedReleaf Corp. (OTC: MEDFF), GW Pharmaceuticals (NASDAQ: GWPH), and MYM Nutraceuticals Inc. (CSE: MYM) (OTC: MYMMF).
For the past decade or so, Canada has had an extremely positive approach towards medical and recreational marijuana, and has been at the forefront of the push for legalization of the drug.
Having legalized medical marijuana in 2001 and currently in the process of doing the same with recreational marijuana, further news is emerging from its Provinces that are preparing for the significant changes in the post-legalization era.
Of course, markets are quick to reward companies that could benefit from the move to legal cannabis. Early participants have already taken initiative and are adding massive capacity like Canopy Growth Inc. (TSX: WEED) (OTC: TWMJF), and others focusing on medicinal applications and therapies using cannabis, such as MedReleaf Corp. (OTC: MEDFF), and GW Pharmaceuticals (NASDAQ: GWPH).
Alongside production, companies are looking to increase their opportunities by expanding to global markets and developing formulations, extracts and supplying product as Licensed Producers. MYM Nutraceuticals Inc. (CSE: MYM) (OTC: MYMMF) is a leader in this group. The company has announced it is developing some of the world's largest cannabis greenhouses, and diversifying interests into cannabis derivatives, formulations and most recently, producing cannabis in Australia and Colombia under co-ventures.
ONTARIO READY TO EMBRACE CHANGE
Initially, the province of Ontario – Canada's most populated area - planned to institute a categorical ban on public smoking which would have restricted consumption to homes. However, that proposal harbored various shortcomings, including exposing children to second-hand smoke.
Additionally, people living in buildings that ban smoking would have no place to smoke.
Trina Fraser, an Ottawa Lawyer who specializes in cannabis trade laws believes that such restrictive regulations would force people to smoke in undesirable places like their cars.
The proposed cannabis lounges could lag behind legalization legislation, which is expected by July.
The Ontario regulations would have provisions for both public lounges and smoking spaces in apartment and some business buildings. Additionally, pot smokers would be allowed to smoke in cigarette smoking zones, and other forms of marijuana, including edible varieties would be allowed in all hotel rooms.
If passed, marijuana producers, as well as sellers of smoking devices stand to benefit significantly, with more people finding it comfortable to smoke marijuana in an acceptable setting.
Tourist populations would also find it easier to sample Canadian pot.
ALREADY A VIBRANT MARKET
As it stands today, Canada has one of the most vibrant medical marijuana markets in the world.
This is in contrast to the US, where strict federal laws as well as prohibition in many states has kept marijuana as somewhat of a pariah drug.
The medicinal benefits of marijuana have been suspected for millennia, but modern scientific research has been largely restricted due to widespread prohibition of the drug. With regulations steadily easing, proof of these beneficial effects is coming thick and fast.
Cannabis is showing promise, particularly in pain management and promotion of tissue healing. These qualities are believed to play important roles in the management of symptoms of chronic illnesses like cancer, heart disease and skeletal diseases.
And while the leading cannabis companies are expanding capacity, there remains fear that there will not be enough cannabis to fill the void.
This has fuelled a race to up the production, including junior companies who see the opportunity.
A fast mover in the field is MYM Nutraceuticals. Their aggressive strategy is based on a commitment to superior growing technology, global expansion, product branding and innovative distribution strategies.
Through its majority-owned subsidiary CannCanada, MYM signed an exclusive deal with the Quebec municipality of Weedon to build a 1.5 million square foot facility. Weedon will be one of the largest greenhouse facilities dedicated to marijuana growth in the world, expected to produce over 150,000 kg of cannabis per year.
MYM has also has two more production facilities; a smaller facility in Laval, Quebec that just came online, and the other in Australia that's a co-venture with local government. That facility in New South Wales will house a 1 million square foot growing space slated to start in 2018.
Also on the global front, MYM recently signed a MOU with NEWCANNA S.A.S., a leading Colombian medical cannabis company to form a new joint-venture company.
All in all, MYM Nutraceuticals is pretty diversified developing and selling a variety of cannabis based natural products including custom-made cannabis products with tailored CBD chemistries along with tinctures, concentrates and oils, edibles, vape products and pet care products.
MYM does not currently have any operations in the United States and says it will not engage in that country unless significant changes to the federal laws regarding cannabis are made.
OTHERS LIKELY TO FOLLOW SUIT
The Provinces appear to be ready to take initiatives to assimilate the new cannabis culture, with actions like those of Ontario and New Brunswick well in hand.
The Canadian marijuana market will continue to take an oligopoly structure as a few firms that dominate the industry today enjoy a "first-mover advantage" once the Cannabis Bill passes.
Collectively, it is estimated that the stock value of Canadian marijuana companies will grow more than 1000 percent in the next ten years.
With the experience that they have already gained, Canadian companies have a head start that positions them well to benefit from the global market.
POTENTIAL COMPARABLES
Canopy Growth Inc. (TSX: WEED) (OTC: TWMJF)
The granddaddy of the corporate cannabis sector, Canopy Growth is the world's largest diversified cannabis company. Canopy boasts a wide offering of distinct brands and curated cannabis varieties in dried, oil and capsule forms. Most widely recognized is Canopy's subsidiary Tweed which is the world's most recognized marijuana production brand, as well as an industry educator. Accompanying Tweed in Canopy's portfolio is medical-grade cannabis producers Bedrocan Canada. In total, Canopy Growth's numerous state-of-the-art production facilities total over half a million square feet of GMP-certified indoor and greenhouse production capacity.
MedReleaf Corp. (OTC: MEDFF)
MedReleaf sets The Medical Grade Standard for cannabis in Canada and around the world. The first and only ISO 9001 certified cannabis producer in North America, MedReleaf is a R&D-driven company dedicated to patient care, scientific innovation, research and advancing the understanding of the therapeutic benefits of cannabis. Sourced from around the world and perfected in one of two state of the art facilities in Ontario, MedReleaf delivers a variety of premium products to patients seeking safe, consistent and effective medical cannabis.
GW Pharmaceuticals (NASDAQ: GWPH)
GW has established a world leading position in the development of plant-derived cannabinoid therapeutics through its proven drug discovery and development processes, intellectual property portfolio and regulatory and manufacturing expertise. Their lead product candidate is Epidiolex® (cannabidiol) for certain rare and severe early-onset, drug-resistant epilepsy syndromes. GW successfully developed the world's first prescription medicine derived from the cannabis plant, Sativex®, now approved in over 29 countries outside of the United States for the treatment of spasticity due to Multiple Sclerosis. The company has a deep pipeline of additional clinical stage cannabinoid product candidates for both orphan and non-orphan indications with a particular focus on neurological conditions.
For a more in-depth look into MYM you can view the in-depth report at USA News Group: http://usanewsgroup.com/2017/12/04/like-it-or-not-the-cannabis-sector-is-unstoppable-and-its-just-getting-bigger/
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