Canadian producer Aphria has just bought a sizable chunk of Florida’s upcoming medical marijuana industry. Chestnut Hill Tree Farm was one of only seven licensees in the state who were granted a permit to grow medical cannabis. Aphria invested $25 million of their own capital along with another $35 million from investors to purchase and run the Florida company. A sound investment indeed, as the going rate for a Florida medical marijuana growers license is estimated to be valued at around $200 million**.
Aphria is one of Canada’s top producing medical marijuana companies, whose stock valuation is currently just under $750 million. This move makes them the first Canadian company to actively pursue a piece of this new American market. The venture, of which Aphria will control a 37.6% stake, will operate under the name Liberty Health Sciences and be branded as Aphria USA. Florida’s medical marijuana market is expected to be worth approximately $85 million by the end of 2018.
There has been some controversy surrounding Florida’s final cannabis bill. The voters will was heard, and last November, medical marijuana became law in the overly conservative state. Months go by and state officials announce that they plan to gut the proposed amendment and what they came up with was a medical marijuana patient’s worst nightmare. Before the Florida House of Representatives was done, they did their best to make sure that nobody was going to get high. The initial bill implemented a 90 day wait for cannabis patients to receive their first prescription. It also limited the amount of THC in the plant, and prohibited smoking. The senate is about to give the bill look over, hopefully they will make some changes to help increase patient’s access to effective medicine.
Moving into an American market is a risky proposition for a company, whose success is all but guaranteed in Canada once legalization hits next year. When it comes to cannabis, America still doesn’t even really know if it’s coming or going. A patchwork of states have rebelled against federal marijuana law which was tolerated under past administrations. The new president is seemingly neutral on the issue, however, the top law enforcement official is a staunch prohibitionist. There has been some pressure on the administration to keep their drug dogs on a leash, but how long that will hold is anybody’s guess.
Aphria’s stock peaked at around 8.40 on April 10th, when news of legalization hit. It is currently hovering around March prices of six dollars per share. With Aphria’s move into the Florida market a go, buying into the company at six dollars is a steal. The cannabis industry has not even left the launch pad and yet billions of dollars are already flowing into the market. Aphria’s move into the Florida market is yet another example of how Canada is slowly but surely taking over the cannabis world.
Cory Hughes is a former police officer turned cannabis cultivator and writer. After years of being on the wrong side of the law, Cory decided to hang up his badge and gun and move into an industry that truly has the potential of bringing people together. He has been an active part of the Colorado cannabis culture and has worked as a horticulturist in dozens of licensed grow operations. Cory now looks to share his knowledge of cultivation and horticulture with the world.