Germany's fledgling medicinal cannabis industry is ripe for the picking, and Australia's leading player in the sector is making moves to dominate.
Elixinol Global (ASX: AXL), recently highlighted by Business News Australia as the top cannabis company in the country, has signed an exclusive agreement to distribute its products into over 15,000 German pharmacies.
Under the terms of the agreement MedVec International GmbH will sell Elixinol branded products and white label products via its existing sales network in the pharmacy sector.
The exclusivity of the agreement is based on the condition that minimum annual sales targets are hit.
The global chief executive officer of Elixinol Paul Benhaim says the deal is a boon for the company, considering the size and the growing potential of Germany in the EU.
"The distribution agreement with MedVec allows Elixinol to significantly expand its presence in Germany, the largest pharmacy market in Europe, as well as Austria and Switzerland," says Benhaim.
Medicinal cannabis was legalised on March 10, 2017 in Germany. The drug has experienced a boom in popularity since then, but the local development of the drug has been slow to build.
Companies like Elixinol are tapping into what is a relatively untapped market by local German companies.
Companies like Canada's Tilray and Dutch supplier Nuuvera recently announced their own initiatives to capture the German market. Israel also recently greenlit the export of medicinal cannabis to Germany.
The domestic market and local health professionals have been criticised by organisations like Health Europa for their "conservatism"; doctors are reluctant to prescribe the drug, and the lack of domestic producers of cannabis means those buying it are being slugged with large import costs.
Shares in Elixinol are up 6.45 per cent to $3.91 per share at 11.45am AEST.
Business News Australia
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