Australian health and wellness product distributor Wellnex Life Limited (ASX: WNX) has entered into a joint venture with local medical cannabis firm OneLife Botanicals.
The 50/50 JV has been formed for the purpose of bringing registered medicinal cannabis and hemp-based products to Australian and international markets.
It’s envisioned the arrangement will see production of registered products for the Australian market under the Therapeutic Goods Administration’s (TGA) Special Access Scheme (SAS) by the end of this year – the channel used for legal access to medicinal cannabis currently. Looking further ahead, Wellnex says it has commenced the process to register cannabis products under the S3 classification, which is Pharmacist-Only medication not requiring a prescription.
The JV will also develop and sell hemp and cannabis products under a brand to be jointly developed.
The S3 market is expected to be quite lucrative. While Schedule 3 cannabidiol (CBD) products have been legally accessible since last year after the TGA gave the green light to down-scheduling low-dose CBD in late 2020, given the regulatory hurdles involved none have appeared on the market yet.
“With the Joint Venture, Wellnex is aiming to be one of the first companies to have a registered product in the S3 market by the end of CY23,” says the firm. “On obtaining the registration of an S3 product, Wellnex will earn a 4% stake in OneLife that will give the Company ownership across the whole value chain.”
There is plenty of competition to be among the first and Wellnex’s interest in medicinal cannabis appears to be fairly recent. OneLife Botanicals’ isn’t – it already has a cultivation site including glasshouses for growing medicinal cannabis in a controlled environment.
Melbourne-based OneLife was in the news last week after it inked an agreement with Canada-headquartered cannabinoid company MediPharm Labs Corp. for the sale of MediPharm Labs Australia. Part of the sale is a cannabis oil extraction facility in South Gippsland, Victoria that commenced operations in 2018.
OneLife Botanicals CEO Andrew Grant said the acquisition would establish his firm as a significant supplier in the Australian medicinal cannabis industry.