New Brunswick developed a new Crown corporation for the supervision of cannabis sales for the government’s anticipated legalization of recreational cannabis July 2018.
Provincial Finance Minister Cathy Rogers and Health Minister Benoît Bourque announced the news Friday. “In addition, the creation of this new provincial Crown corporation provides the flexibility and lays the groundwork for the eventual retail model once final decisions around that have been made,” Rogers said in a release.
New Brunswick’s statement was preceded by news that they have made a deal with licensed medical marijuana producers, Organigram Holdings Inc. and Canopy Growth Corp to ensure supply. As part of the agreements, Canopy and Organigram stated they would assist with funding public education or social programs also.
Organigram stated the agreement supply New Brunswick with at least five million grams of recreational marijuana annually, or about a quarter of their projected production. This arrangement has an estimated annual retail value of $40 to $60 million.
Canopy stated they had a two-year supply agreement, which included four million grams of cannabis and cannabis derivate for the first year, valued at $40 million.
In a phone interview, Greg Engel Chief Executive of Organigram stated, “These are the first agreements that any province has signed for supply from licensed producers in Canada,” Engel said. “Part of the initiative to get this supply agreement in place was they understand that there will be a supply deficiency for the first couple years of the adult recreational market, and they wanted to make sure that they were in a position to get a significant supply going forward and be the first to do so.”
Shares of both Canopy and Organigram jumped Friday, closing up by 2.09 percent and 16.74 percent, respectively.
MAPH Enterprises, LLC | (305) 414-0128 | 1501 Venera Ave, Coral Gables, FL 33146 | new@marijuanastocks.com
