Sales of Cannabis Products are on the Rise Both for Medical and Recreational Purposes
SOURCE FinancialBuzz.com
NEW YORK, January 23, 2018
According to a report by New Frontier Data, the legal cannabis market was worth $6.6 billion in 2016 and is forecast to grow to $24.1 billion by 2025, registering a compound annual growth rate of 16 percent. By segment, the medical cannabis market was worth $4.7 billion in 2016 and is expected to grow to $13.3 billion by 2025. Recreational cannabis sales throughout the same period are expected to grow at a 21 percent CAGR, from $1.9 billion to $10.9 billion.
The continuous validation of cannabis products for both medical and recreational use is a key factor contributing to the progress made in this industry. On November 8th, 2016, California has passed California Proposition 64 by a vote of 57.13% for and 42.87% against, allowing individuals in California to use and grow cannabis for personal use. iAnthus Capital Holdings Inc (OTC: ITHUF), Terra Tech Corp. (OTC: TRTC), Liberty Health Sciences Inc. (OTC: LHSIF), Aphria Inc. (OTC: APHQF), MPX Bioceutical Corporation (OTC: MPXEF)
California's new recreational cannabis laws were officially implemented on January 1st, 2018. New Frontier Data CEO, Giadha Aguirre De Carcer, commented on California's potential market growth, "California offers the perfect example of why it is so important to understand trends in consumer behavior. The state's legal (cannabis) industry is forecast to grow from $2.8 billion in 2017 to $5.6 billion in 2020. That spending will be increasingly directed at products and retailers who understand and serve the market's evolving tastes and preferences. The market is changing, and the most successful operators will be those who adapt most quickly to the change."
iAnthus Capital Holdings Inc (OTCQB: ITHUF) also listed on the Canadian Securities Exchange under the trading symbol "IAN". Last week the company announced breaking news, "that it has acquired through merger and acquisition transactions substantially all of the assets of GrowHealthy Holdings, LLC ("GrowHealthy") and certain related subsidiaries (all transactions together, the "Acquisition", and all assets of GrowHealthy and its subsidiaries collectively, the "Business").
The Acquisition completes iAnthus' full-scale entry into the rapidly expanding Florida medical cannabis market, which is projected by Arcview Market Research to grow into a US$1 billion market by 2020 and which has seen a 300% increase in the number of registered patients over the past six (6) months. iAnthus previously acquired approximately six percent (6%) of GrowHealthy in a preferred share purchase in October, 2017.
GrowHealthy and its affiliate, McCrory's Sunny Hill Nursery, LLC ("McCrory's") comprise one of just thirteen (13) current Florida Medical Marijuana Treatment Centers ("MMTCs") licensed to provide medical cannabis under Florida's medical marijuana law. The Acquisition includes GHIAA Management, Inc., a wholly-owned subsidiary of GrowHealthy that holds an exclusive 40-year management contract to operate the medical cannabis business associated with the MMTC license issued to McCrory's (the "License"), together with an option to acquire 100% of McCrory's for a nominal consideration, pending approval of the Florida Department of Health…
"As one of the largest states in the U.S. with a population of nearly 21 million people and favorable demographics, Florida and its medical cannabis market provide a tremendous opportunity for iAnthus and its shareholders. The state's population includes a large percentage of older adults who can derive significant benefits from medical cannabis, and the Florida program has witnessed a rapid rise in its registered patient base since passage of the law," said Randy Maslow, President of iAnthus.
"GrowHealthy in particular boasts a state-of-the-art 200,000 square foot cultivation and processing facility in Lake Wales, a flagship dispensary location in a densely populated area of Palm Beach County, and the opportunity to open up to 25 dispensaries in Florida currently and more in the future," Mr. Maslow continued. "The GrowHealthy cultivation and operations team has already established itself as a leader in Florida's medical cannabis market, and we look forward to contributing iAnthus' capital and operational resources to fully build out GrowHealthy's infrastructure and capitalize on the enormous opportunity provided by Florida's medical cannabis market."
Pursuant to the Florida medical marijuana statute and regulations, GrowHealthy is permitted to immediately begin delivery of finished products and to open and operate up to twenty-five (25) dispensaries, a number which will be increased with every 100,000 patients that are added to the state medical marijuana registry. Construction on GrowHealthy's flagship Palm Beach County dispensary is expected to be completed during Q2 2018 and the 4,500 square foot facility is expected to open in July 2018.
Additional dispensary locations in Palm Beach County and elsewhere around the state have been identified and are the subject of lease negotiations, and dispensary openings in the Tampa and Orlando areas are planned for Q3 2018 and Q4 2018, respectively. GrowHealthy has already commenced sales through product delivery, and will continue to expand its delivery capabilities throughout the year."
