THC Global in trading halt as it strikes deal with MGC Pharma
20 January 2020, Written by David Simmons
Medicinal cannabis companies THC Global (ASX: THC) and Europe-based, Australian-listed MGC Pharma (ASX: MXC) have signed a new supply deal this morning.
The agreement will see MGC Pharma provide THC Global with an "immediate" source of medicinal cannabis products to be packaged and made available to Australian patients under THC's Canndeo brand.
Initially, THC Global will launch three oral liquid formulations in partnership with MGC Pharma, which are expected to be available for patients in Australia and New Zealand in Q1 2020.
The deal also provides for the two companies to collaborate on the future supply of Active Pharmaceutical Ingredients extracts as well as other finished product, including from THC's recently established Southport facility.
THC was placed into a trading halt immediately after announcing the collaborative agreement.
The Sydney-based company anticipates the trading halt will be lifted on or before this Wednesday, at which time the company will announce the receipt of a licence for manufacturing "therapeutic goods" from the Australian Therapeutic Goods Administration (TGA).
THC Global CEO Ken Charteris says the partnership with MGC Pharma will grow the company's Canndeo brand.
"Our agreement with MGC Pharma provides THC Global with an immediate extension of our Canndeo branded medicinal cannabis product range, as well as a pathway for further collaboration with MGC Pharma taking advantage of THC Global's Southport Facilityand MGC Pharma's Maltese facility," says Charteris.
The agreement with MGC Pharma also provides THC Global with access to Tetrahydrocannabinol (the cannabinoid dubbed 'THC', the principal psychoactive component of the cannabis plant) containing formulations complementing the company's current focus on producing Cannabidiol (CBD) extracts.
MGC Pharma and THC Global will leverage the latter's Southport Facility for future collaboration, with THC Global intending to transition its Canndeo formulations to using its own Australian produced cannabis.
Managing director and CEO of MGC Pharma Roby Zomer says the company is pleased to partner with THC Global to produce and supply white label Canndeo branded products.
"With the ever-growing use of phytocannabinoids for medicinal purposes, MGC Pharma is well placed to work with companies such as THC Global to manufacture quality and cost effective phytocannabinoid products," says Zomer.
"We expect that further discussions between MGC Pharma and THC Global on mutual exports of product to respective international markets will be beneficial to all going forward, particularly as we develop our ~15,000m2 GMP compliant pharma production and research facility in Malta."
The agreement between the two listed cannabis companies has a minimum term of 18 months, including a bi-annual review towards the expansion of the agreement to encompass further collaboration.
Business News Australia
Author: David Simmons