MGC Pharmaceuticals says delivery of its Californian distribution deal for its cannabis-based skincare products is imminent. In an operations update, the medical cannabis hopeful says it is ramping up cosmetics production at its Slovenian facility and is in advanced discussions on additional distribution agreements as it ramps up its international presence.
ASX listed MGC Pharmaceuticals says it is set for its first major product delivery under its Californian distribution deal for its line of cannabis-based skincare products as it ramps up its international presence and sales network.
In an operations update issued recently, the Perth-headquartered company said it was set for its first major product delivery and for revenues from the Californian deal, which relates to its “anti-aging” cosmetic line based on Cannabidiol, a product derived from Cannabis.
It is the company’s first material commercial contract and management expects it to be worth about ‘€1.2m, or AUD$1.75m, over the first year, with MGC aiming to sign numerous similar distribution deals as part of a bold international expansion plan.
The company said it was in advanced talks regarding further distribution deals across North America and Europe and was increasing cosmetics production at its production facility in Slovenia in anticipation of further orders.
MGC are breaking into the lucrative multi-billion dollar global cosmetic industry with their Cannabis based skin care line. The company said it is currently finalising a full range of up to 50 cosmetic products slated for release in Q1 2017.
In the update, MGC also said it had made positive progress on completing its API grade GMP cannabidiol extraction facility in Slovenia and was on schedule to finalise its acquisition of Czech-based medical cannabis company, Panax Pharma.
In an interesting move MGC Pharma will also take advantage of recent Australian law changes by applying for an Australian Medical Cannabis licence during the fourth quarter of 2016.
MGC Pharmaceuticals managing director Nativ Segev said “With our commercialisation initiatives progressing well, we are expecting to generate a material revenue uplift in the short and medium term. In addition, with our API extraction facility nearing completion, we look forward to the production of our first API CBD product.
“With our Panax acquisition making solid progress and an Australia medical cannabis growing license on the horizon, this is an exciting time in our commercial development as a leading medical cannabis company.”
MGC, which has been working with the University of Sydney Business School community engagement program on a medical cannabis white paper, has two distinct business streams -- a medical research operation and a cosmetics arm.
The company has a distinct advantage over the plethora of other medical marijuana companies in so much as it has a revenue stream from the skin care business which will assist it to fund the medical research arm.