Canopy Growth expansion continues in Europe

Canopy Growth has positioned itself with acquisitions in Germany. Canada’s largest cannabis company also aims to offer cannabis-based medicines in the future as a part of Canopy Growth expansion plans.

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Germany to be included in Canopy Growth expansion

The cannabis business is not developing as expected. Consumption for recreational purposes has been permitted in Canada since last year. However, the industry’s sales have recently fallen off market expectations.

This also applies to the most valuable cannabis group, Canopy Growth, which is currently valued at $6.5 billion (€5.9 billion) and has lost more than 40% of its stock market value within one year.

And so, Canadian cannabis companies have looked beyond their borders and set their sights on Europe. Canopy Growth expansion plans specifically highlight Germany.

“Germany and Europe are very important for Canopy Growth and will continue to grow in importance. The European market is larger than that of Canada and the U.S.,” said Paul Steckler, co-head of Canopy’s European business, in an interview.

The cannabis market in Germany is booming

In Germany alone,the number of patients receiving cannabis as medicine expects to increase from the current 40,000 to 60,000 to an additional 800,000 in the coming years.

“If one takes the development in Canada as a benchmark, where 1% of the population is receiving medical cannabis, there could be more than 7.6 million patients in Europe,” said Steckler.

The 46-year-old Englishman with more than two decades of experience in the pharmaceutical industry has been leading Canopy Growth expansions in Europe for a few months together with Steve Wooding, who has been Jannsen’s pharmaceutical manager for many years.

Cannabis flowers and extracts have been allowed in Germany since March 2017 for therapeutic use in certain serious diseases. There were already authorized for medical products before that date.

Strategy for Canopy Growth expansion

Canopy Growth has already positioned itself in the European market with several strategic acquisitions. At the end of 2016, for example, the company acquired the wholesaler Spektrum Cannabis from St. Leon Rot.

At the end of 2018, the Tuttlingen-based company Storz & Bickel was also acquired by the Canopy Growth expansion for $160.8 million (€145 million). The German medium-sized company produces vaporizers for cannabis flowers, which is the only device to have been approved as a medical product.

In May of this year, the company also acquired the C3 cannabis division of the natural drug manufacturer Bionorica in further Canopy Growth expansion plans.

With the purchase of approximately $250.6 million (€226 million), Canopy secured its business with the prescription drug dronabinol, containing the cannabis ingredient THC.

The drug, with which Bionorica generated a turnover of around $29.9 million (€27 million) last year, accounts for around one-third of cannabis prescriptions in Germany.

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(Featured image by  Ansgar Scheffold via Unsplash)

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