Cannabis giant Nuuvera plans Malta lab as relaxation of rules woos industry

One of the world’s largest cannabis companies is eyeing Malta’s prospective rules on the cultivation of medical marijuana to set a foothold on the island.

Nuuvera, a Canadian cannabis company, earlier this week secured a €538 million deal to sell to medical cannabis company Aphria.

But Nuuvera has also already explored plans to set up a presence in Malta, specifically to upgrade a laboratory facility on the island as part of a $5 million business expansion plan in Europe – and has disclosed the existence of a letter of intent in Malta for a joint venture.

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“Nuuvera has developed strategies to expand in several foreign cannabis markets, including Germany, Israel, Italy and Malta. It intends to focus on low-cost, high-quality inputs and build GMP-certified labs to create products and formulations for distribution to local and global markets,” the company said in its most recent company filing.

The news was broken by MaltaToday in its Sunday print edition, and later confirmed by Prime Minister Joseph Muscat in a party activity who said there were at least three names interested in gaining a foothold in the Maltese pharmaceutical industry to produce medical cannabis.

Nuuvera described Malta as a target market now that medicinal cannabis is legal and plans are underway for Malta to license cannabis producers.

“The government has also begun the process of updating the laws relating to medical cannabis, which may include enacting legislation to permit the granting of cultivation, production and import/export licences,” Nuuvera said.

he company also disclosed that it had signed a non-binding letter of intent on 25 September, 2017 “with three individuals, one of whom has an interest in a GMP-certified laboratory for analytical testing and release including in respect of narcotics. Through this arrangement, if it comes to fruition, Nuuvera and the prospective local partners will establish a joint venture which Nuuvera will control, which will in turn seek to acquire this GMP certified laboratory.”

Nuuvera said that once the applicable legislation is enacted, the joint venture will apply for one of the first licences for import/export, production and cultivation of cannabis in Malta. “This would assist in obtaining GMP certification of the local production facility according to European Union standards, establishing a certified laboratory to export cannabis products to other EU markets,” Nuuvera said.

Nuuvera acquisition

The Aphria deal is part of a growing wave of consolidation in Canada’s marijuana industry as companies seek to gain market share before sales become legal at some point this year.

Bloomberg reports that the combined Canadian market for medical and recreational market is expected to reach about €5.2 billion in sales by 2021, with companies such as Aphria and Nuuvera looking to grow in markets where there’s even bigger potential.

“This positions us to grow internationally and realigns the potential of these emerging cannabis markets,” Aphria CEO Vic Neufeld said earlier on Monday.

Lorne Abony, CEO of Nuuvera, said: “The transaction provides our shareholders with significant value for their investment in Nuuvera and the opportunity to participate in the significant upside of the combined company. As part of Aphria, we will have access to every tool we need to open key international markets and execute on our growth plan as part of a stronger, well-resourced global cannabis leader.”

Nuuvera is also one of the finalists in a tender to supply Germany’s market and the company already has an agreement to export marijuana to a German pharmaceutical distributor. Italy’s medical cannabis market is expected to be worth more than $9 billion and Nuuvera is currently one of only seven producers that have secured a licence to import into the country, he said.