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Canada-based cannabis company High Tide has entered the German medical cannabis market by purchasing a 51% stake in Frankfurt-based pharmaceutical company Purecan.
The announcement of the acquisition, made on Monday, comes after Germany legalized recreational cannabis for personal use, effective last April that took the ban off the controlled substances list, and eased medical access for patients.
High Tide has acquired a majority stake of 51% in Purecan GmbH for €4.8 million to enter the German medical cannabis market.
This acquisition immediately positions High Tide for Purecan’s established operations, including its German import license, warehousing and logistics infrastructure, and a soon-to-be-launched telemedicine platform.
With more than $1.5 billion in cumulative sales generated from its Canadian cannabis operations, High Tide intends to use this expertise to secure a strong position in Germany’s blossoming market.
This acquisition supports High Tide’s strategy to expand into high-margin markets, capitalizing on Purecan’s financial results, which include €15 million in annual revenue and a 29% EBITDA margin.
The transaction positions the company well for future growth in European cannabis markets.
Investments In Germany’s Medical Cannabis Market
High Tide is not the first North American cannabis company to invest in Germany’s medical cannabis market.
In 2022, Curaleaf Holdings took a 55% stake in Four 20 Pharma, while Organigram Holdings entered into a supply agreement with Sanity Group last year.
In 2023, Frankfurt-based Bloomwell Group raised a multi-million euro funding round from U.S.-based Artemis Growth Partners, with participation from Measure 8 Venture Partners and actor Moritz Bleibtreu.
Previously, Canopy Growth Corporation was one of the first cannabis companies to enter the German market by acquiring the German distributor MedCann in 2016, now operating under the name Spectrum Therapeutics. Similarly, another Canadian company, Aurora Cannabis, started investments in the medical cannabis market in Germany since 2017.
These investments underpin the increasing attention toward this country, where demand for medical cannabis has been growing, presenting a goldmine opportunity for North American companies.
Medical Cannabis Market In Germany
Medical cannabis in Germany is on a high-growth curve. According to a report by Prohibition Partners, medical cannabis sales in Germany would top more than €420 million in 2024.
The market is growing rapidly, although the investment levels have been inconsistent. After back-to-back approximately €55-million investments in 2021 and 2022, 2023 saw less than €20 million across seven deals.
The reason for the surge in medical cannabis prescriptions has to do with the reclassification under the Cannabis Act, also known as CanG, which has made access easier for patients.
This is a growing market with significant further growth potential as import volumes increase and regulatory barriers are relaxed, according to the report.
Reimbursement policies are improving, too, with more and more public insurance plans covering the costs of cannabis and further boosting demand.
Starting on October 17, the majority of doctors in Germany can prescribe medical cannabis for reimbursement, with no need for prior approval by health insurance providers.
The Federal Institute for Drugs and Medical Devices, BfArM, released data regarding medical cannabis imports.
This corresponds to an increase of almost 40% over the first quarter’s 8.1 tons, in which 11.7 tons of dried cannabis flowers for medical use were imported in the second quarter.
From 24 countries, about 32.5 tons of cannabis flowers were imported during 2023.
By the first half of 2024, this number reached 19.8 tons, coming from 15 countries. The biggest lots of medical cannabis came from Canada with 11.1 tons, Portugal with 3.5 tons, and Denmark with 1.6 tons.
“}]] Canada-based cannabis company High Tide has entered the German medical cannabis market by purchasing a 51% stake in Frankfurt-based pharmaceutical company Purecan. Read More
