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European Cannabis Stocks Review: Akanda Announces ‘First Significant Revenue Above Initial Projections’


Akanda has enjoyed a sharp recovery in its share price this week, seeing its value return to levels not seen since October. 

The NASDAQ-listed medical cannabis operator has seen its stock jump nearly 80% since last Thursday, despite not releasing any significant market announcements until the following Thursday. 

Though its stock price has risen from $0.19 to $0.34 at the time of writing, this is still significantly below its listing price of $4, and still some way off the $1 price needed to avoid delisting from the NASDAQ in late March 2023. 

Some have suggested that this sharp increase has been due to wider market movement in the US, following news that the Food and Drug Administration (FDA) has made the decision not to regulate CBD, leaving regulation in the hands of Congress. 

This is supported by a rise in US cannabis operators since January 27 when the news was announced, which according to New Cannabis Ventures’ American Cannabis Stocks Index rose a more modest 6%. 

Others have suggested the stock has risen in anticipation of Akanda’s preliminary Q4 results, which were published yesterday (February 2). 

Akanda says it has achieved its ‘first significant revenue that is above our initial projections’ after successfully launching its initial supply to German customers. 

In its ‘first material revenues since its inception’, Akanda has recognised approximately €1.8m in sales of EU-GMP medical cannabis, resulting in an EBITDA of €472k, representing a margin of 16.5%. 

According to the company, these figures represent just two months of sales and three months of fixed costs. 

It added that due to initial sales exceeding original internal projections, 800 kg of freshly cultivated cannabis ready for pending medical sales expected in Q2 and Q3, and a planned increase in cultivation, it is confident of further sales growth ‘throughout 2023’. 

Notably, Akanda’s chairman Harvinder Singh mentions that the company is ‘assessing strategic alternatives’, including ‘selling our Portuguese business’, a move which would mark the latest major divestment from the region after Clever Leaves and Tilray announced similar moves last month. 

Despite the positive financial figures from Akanda, its stock could yet be dragged down again when the results of an ‘investigation being conducted by (Akanda’s subsidiary) Canmart directors and council’ into its CEO Tej Virk are disclosed.

Jazz Pharmaceuticals 

Earlier this week, Jazz Pharmaceuticals, which acquired Epidyolex developer GW Pharmaceuticals for $7.3bn in 2021, announced that the drug has now been ‘recommended for reimbursement’ in the UK for a new condition. 

The National Institute for Health and Care Excellence (NICE) has recommended the big-pharma company’s CBD-based drug for reimbursement to treat tuberous sclerosis complex (TSC) for patients two years of age and older.

Epidyolex, one of just three cannabis-based medicines approved in the UK, was approved by the MHRA for use ‘as an adjunctive treatment of seizures associated with TSC’ in August 2021. 

The recommendation means that eligible patients will now be able to have their treatment reimbursed on the NHS from March 1, 2023. 

Epidyolex has also been approved for treatment and reimbursement for Lennox-Gastaut syndrome and Dravet syndrome, both rare forms of epilepsy. 

Jazz Pharma’s General Manager Simon Newton said: “We welcome NICE’s recommendation which provides appropriate patients across the UK, who are living with TSC, a difficult-to-treat condition, access to a new treatment option. This is an important milestone not only for those living with TSC but also for their families, carers and clinicians. 

“This demonstrates the importance of randomised clinical trials and regulatory approval in providing reimbursed access to cannabinoid-based medicines to patients who may benefit.”

Kanabo Group

Another big winner this week was Kanabo, which has seen its share price jump nearly 60% since last week, reaching highs not seen since May 2022. 

Like Akanda, this spike in trading volume and share price has come without any significant news being released by the company. 

The positive sentiment seems to have built since the launch of two new high-THC vape formulas in mid-January, with investors believing its shift towards the UK’s medical cannabis market and away from the struggling lifestyle and CBD market could prove to be a key pivot.

Some investors believe the share price is set to continue its upward trend with the anticipation of imminent announcements from Kanabo. 

As BusinessCann reported last month, a string of new developments from the company are expected to be published over the coming weeks and months. 

Others have raised concerns about the company’s ties to the recently listed cultivator Hellenic Dynamics, which, like all of its LSE-listed cannabis predecessors, has seen its stock price fall significantly since listing, though this time over a shorter period. 

Since listing in early December for 3p, the pre-revenue company has seen its share price drop below 1p, wiping nearly two thirds off its market cap.

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