Canadian cannabis producer Organigram is set to bring its products to the UK’s medical cannabis market for the first time amid a new tie-up with 4C Labs.
The new supply agreement, announced this morning (August 16), will see Organigram grant the UK-based healthcare provider ‘strain exclusivity’ of its products in the UK, which will be sold under the 4C Labs’ brand.
It comes just two months after 4C Labs signed a similar agreement with another Canadian cultivator BZAM, which it said would help it establish a ‘dominant foothold’ in the UK market, while opening the door for a ‘new wave’ of high quality Canadian imports to the country.
4C Labs CEO Greg Dobbin tells Business of Cannabis this deal marks the latest step forward in that strategy.
New supply deal
Under the terms of the new deal, NASDAQ and TSX-listed Organigram will provide 4C Labs with ‘approximately 600kg of high-quality, indoor-grown dried flower product’ within the first year, with expectations to increase this amount over the following two years.
Mr Dobbin says this ‘high-quality’ product, which Organigram is able to produce in its 14-acre campus in Moncton, New Brunswick, is a natural fit for his company’s current offering.
“Organigram fit really well into our model because they have all indoor growing, they have 122,000sq ft rooms in their facility, and they make a premium product which is something at the moment we don’t carry substantially in our line,” he explained.
Alongside this, Organigram will grant 4C Labs ‘strain exclusivity within the geographical boundaries of the UK and Channel Islands’, meaning the only way UK medical cannabis patients can access its products will be through 4C Labs.
According to Mr Dobbin, 4C Labs is currently working to help Organigram achieve the certification needed to import to the UK, but once this achieved ‘this deal is an exclusive for us in the UK’.
“We’re going to sell their products under our own brand name. We can select genetics, we can pick the packaging, it’s all kind of an open slate for us, which is quite exciting,” he added.
‘New wave’ of Canadian supply to the UK
In June, Business of Cannabis reported that 4C Labs had suggested a raft of Canadian cannabis producers ‘that were not as early to the party and were undercapitalised’ have been quietly building their genetic profile and developing a range of products that ‘resonate with people’.
As the dominant players like Aurora and Canopy Growth continue to haemorrhage money, this new wave of companies are now looking towards the European medical market to subsidise their incomes as the Canadian market remains hostile.
In its latest financial results, Organigram’s CEO Beena Goldenberg highlighted the growing ‘exaggeration’ of THC levels within the Canadian market, which was forcing the company to drive down its prices even further to compete.
Once its products make it onto the UK’s shelves, expected to happen around Autumn this year, Organigram will have secured a foothold in the UK, Germany, Israel and Australia.
“It’s just a great opportunity for them to use their head start in expertise, and their head start in an amazing facility and genetics development to get into a new market when it’s on the cusp of taking off,” Mr Dobbin commented.
Ms Goldenberg added: “Medical Cannabis has been legal in the UK since 2018. However, due to significant energy cost premiums compared to Canada, access to consistent, high-quality products in this market is limited, making importing Medical Cannabis an attractive option for this growing market.
“We are excited to partner with 4C LABS to increase access to Medical Cannabis for UK Medical Cannabis patients.”