NEW YORK (MainStreet) In Canada, regulation changes on April 1 will allow licensed producers to grow medical marijuana on a commercial scale. That's a radical shift, moving from a sole provider system to one with multiple providers. As a result, patients will no longer be able to grow their own medicine, but the Health Canada-run program will have eight to ten approved providers to cultivate the goods.
"The story is big, because the patient population is likely to explode," said Alan Brochstein, founder of marijuana stock subscription service 420 Investor. "There have been impediments for patients to becoming eligible, primarily a ten-week wait-list under the old regime."
Health Canada conservatively estimates the Canadian market could be worth $1.3 billion by the end of 2014. Industry analysts see that number doubling by 2016 to $2.6 billion. Added with the growth of the U.S. market, forecasts suggest the North American cannabis market should top $5 billion-plus by 2016.
The authorized Canadian licensed producers under the "Marihuana for Medical Purposes Regulations" are as follows:
- Bedrocan Canada Inc.
- Canna Farms Ltd.
- CanniMed Ltd.
- Mettrum Ltd.
- MedReleaf Corp.
- The Peace Naturals Project Inc.
- ThunderBird Biomedical Inc.
- Tweed Inc.
- Whistler Medical Marijuana Corp.
Reaping the Benefits of Fertile Ground
The public company play is Creative Edge Nutrition (FITX), which controls subsidiary CEN Biotech, equipped with a super grow cannabis facility in Lakeshore Ontario (still seeking approval from Health Canada to grow and sell cannabis). CEN Biotech will have a funding and supplier agreement with GrowLife (PHOT), a company that supplies specialized equipment to cannabis growers and marijuana dispensaries. In January, GrowLife through its joint venture partner OGI invested in CEN Biotech's ten-acre cultivation plant, expected to produce up to 1.3 million pounds of medical marijuana annually, with $40 million in restricted stock.