Legal Cannabis Market to Continue Rising in 2022 and Beyond
NEW YORK – The global cannabis market is continuing to grow rapidly thanks to increasing legalization and social adoption across the globe. According to a report by Vantage Market Research, revenue came in at US$12.8 billion in 2021 and is estimated to hit US$48.3 billion by 2028 at a CAGR of 24.80%. Factors influencing the growth of the market include the rising acceptance of cannabis for the treatment of chronic pain, increasing government support and more research and development and technological innovations. North America is dominating the market for a number of reasons, including the presence of major players in the legal cannabis market such as Flora Growth Corp. (NASDAQ:FLGC), Aurora Cannabis Inc. (TSX:ACB) (NASDAQ:ACB), Curaleaf Holdings, Inc. (CSE:CURA) (OTCQX:CURLF), Sundial Growers Inc. (NASDAQ:SNDL) and Tilray Brands, Inc (TSX:TLRY) (NASDAQ:TLRY).
Flora Growth Corp. (NASDAQ:FLGC) is a leading all-outdoor cultivator, manufacturer and distributor of global cannabis products and brands that operates one of the largest outdoor cannabis cultivation facilities.
Flora Growth just announced that its subsidiary JustCBD will launch its line of Novel Foods-approved CBD products on Amazon.co.uk. This decision comes shortly after JustCBD obtained UK Novel Food clearance. Flora and JustCBD intend to continue working with Amazon to expand into other countries and markets over time.
“The demand for hemp-derived CBD continues to draw attention in the United Kingdom. JustCBD’s existing presence in the UK alongside the new partnership with Amazon UK has truly solidified our presence in this growing market,” said Flora Growth CEO Luis Merchan.”We are excited to continue expanding our operations and clinical research programs in the United Kingdom and deliver top-quality CBD products to customers aiming to improve their health and quality of life.”
Flora Growth also recently announced JustCBD has signed an agreement with airport distribution juggernaut OTG Management to sell its CBD products at airports. As part of the agreement, JustCBD will begin selling its premium CBD products at US airports through distribution company OTG Management, which is a leading operator of airport restaurants and retail storefronts. According to Grand View Research, the CBD gummy market is the fastest-growing segment of the CBD industry, with a projected CAGR of 30.7% from 2021 to 2028, representing a $13.28 billion market opportunity.
JustCBD now has offices in the UK as well as 78 products which have cleared the UK Novel Foods authorization.
Earlier this month, Flora Growth announced the launch of Vessel brand, a leader in premium cannabis accessories, in Canada following an approved listing in the Ontario Cannabis Store (OCS). The company also announced the launch of its Canadian direct-to-consumer online store, www.vesselbrand.ca to service customers directly across the country.
“We’re elated about our partnership with the OCS and are looking forward to bringing the full Vessel experience to our loyal customers across Canada,” says James Choe, Flora Growth’s Chief Strategy Officer. “Our internal estimates show the Canadian cannabis market will be around CAD 5.9 billion this year, with the ancillary category making up about $350 – $475 million. That market potential, coupled with our expectations around meaningful retail door penetration across the country, signals promising growth in this market.”
Flora Growth is also advancing its Flora Pharma division. On May 23, the company announced that it has signed a deal with leading cell biologist, Dr. Annabelle Manalo-Morgan, Ph.D., to acquire her Masaya brand, as well as her patent-pending CBD formulations. Flora intends to distribute the brand and its formulations worldwide.
Masaya will become a Flora-owned brand sold in the US and will be Flora Life Sciences’ first offering. In addition, the original patent-pending formulation, Masaya Pure, is expected to be used in Flora’s current clinical trials with the University of Manchester in the UK. The formulation is also being registered with the Colombian regulatory agency, INVIMA, as one of the first steps for distribution beyond the US.
Cannabis Companies Are Expanding And Making Acquisitions
On May 5, Aurora Cannabis Inc. (TSX:ACB) (NASDAQ:ACB) announced that it has completed the acquisition of TerraFarma Inc., the parent company of Thrive Cannabis for $38 million paid in cash and shares, and up to $30 million in potential earnout amounts, provided that Thrive achieves certain revenue targets within two years of closing the transaction. The transaction is expected to strategically strengthen Aurora’s position in the Canadian market by placing the Thrive team in charge of Aurora’s Canadian recreational portfolio and advancing the shift to innovative premium products including dried flowers, pre-rolls, vaping products and concentrates.
On May 6, Curaleaf Holdings, Inc. (CSE:CURA) (OTCQX:CURLF) announced plans to open three new dispensaries in Florida in the coming weeks. Curaleaf’s latest expansion will increase the company’s business footprint to 50 dispensaries in Florida and 133 locations nationwide. With a population of 21 and older expected to exceed 16 million by 2025 and the potential for an expansive adult market, Florida presents continued growth opportunities for Curaleaf. The company’s growth strategy in Florida has seen its statewide market share increase to 15% and laid the foundation for future developments..
Sundial Growers Inc. (NASDAQ:SNDL) announced it has completed the acquisition of all of the issued and outstanding common shares of Alcanna Inc for approximately $320 million consisting of cash and common shares of Sundial. With locations in Alberta and British Columbia, Alcanna is one of the largest private sector alcohol retailers in North America and the largest in Canada by number of stores. Alcanna’s majority-owned subsidiary, Nova Cannabis Inc., also owns or operates a total of 78 cannabis retail stores in Alberta, Saskatchewan and Ontario.
On April 12, Tilray Brands, Inc (TSX:TLRY) (NASDAQ:TLRY) announced that it has signed a definitive commercial and financial partnership agreement with HEXO Corp. As originally announced on March 3, 2022, the partnership will bring together Canada’s two major cannabis market leaders, strengthening their respective operations and paving the way for production efficiencies that are expected to drive increased productivity and other efficiencies in a dynamic, highly competitive marketplace.
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