The Fly conducted an exclusive interview with Pat McCutcheon, chief executive officer of MediPharm Labs (MEDIF), on the company’s supply agreement with Cann Farm and its Latin America strategy. Here are the highlights:
CANN FARM SUPPLY DEAL: MediPharm Labs announced earlier in the month that it would supply premium formulated cannabis oil to Cann Farm Peru, a Lima-based producer and distributor serving Peruvian and other markets in Latin America. The agreement marks the company’s first such deal in Latin America. “We’re very excited for our first deal into Latin America with Cann Farm,” McCutcheon said.
Under the one-year renewable agreement, MediPharm Labs will provide a variety of cannabis concentrate formats, with optionality for patient ready formulated products. The products will be distributed to patients through pharmacies in Peru. Cann Farm will in turn obtain all Peruvian registrations, authorizations and approvals required for importation. In the future, Cann Farm may look to MediPharm Labs for further support in commercialization activities. MediPharm Labs anticipates delivery to begin in Q4, pending regulatory approval by applicable health authorities.
The CEO added that there are many benefits to expansion into Peru. “Peru is the fifth largest addressable market in terms of opportunity for cannabis medical consumption in Latin America and actually it’s about the same size of Canada,” he said. “It’s a fantastic kind of first step for us into Latin America.” The country has created a legal framework for producing, importing and selling cannabis for medical use and the market thus far is 100% dependent on imports, the CEO added. “Not only do we expect to be sending formulated oil in different forms, but also whatever new novel formulations for distribution in Peru and we’re also excited for the Cann Farm business model to evolve into other jurisdictions in Latin America,” McCutcheon said. “It’s a fantastic new opportunity with a leading-edge company in Cann Farm in Latin America.”
LATIN AMERICA STRATEGY: MediPharm Labs has expanded its addressable medical, wellness and adult-use markets to parts of Asia Pacific, Europe and now Latin America, which has a combined population of approximately 580M. The CEO said “MediPharm is uniquely positioned with our Australian health authority GMP Certification. Our platform in Canada was initially certified by the Therapeutic Goods Administration and subsequently our platform in Australia so this gives a very unique opportunity with these certifications to actually be directly exporting products into different Latin American countries.” McCutcheon said Peru is a great start as MediPharm Labs views the country’s cannabis industry as quickly evolving relative to the other Latin American countries. “We’re also very excited to look at Uruguay, Argentina and especially Brazil,” he said. “There are a number of slightly unique nuanced evolutions between the different countries, but they are very quickly evolving in terms of patient count and the comfort of physicians to look at new cannabis-based products.” The CEO added that there is a lot of research being conducted on a number of different formulations and MediPharm Labs is excited to support that research and be part of it slightly down the path. “Latin America is going to be a great opportunity for patient numbers even relative to a number of different European jurisdictions,” he said. “It’s a great opportunity for us to move into this with Peru as being our first step.”
WHITE-LABEL SUPPLY CUSTOMERS: MediPharm Labs also announced earlier in the month that it will supply cannabis concentrate products in Denmark to two new medical cannabis customers under two separate white-label agreements. “Denmark is another very quickly evolving medical cannabis jurisdiction with a great quickly accelerating patient base,” the CEO said. “The two companies that we signed deals with, although slightly different, are both looking at novel or new formulations that will be white-labeled in fact and then distributed in the Danish medical segment.”
Under the agreements, one which has an initial two-year term and the second a one-year term, both subject to renewal, MediPharm Labs will supply a full range of specially formulated CBD and THC cannabis oil products that will be white-labeled for distribution. MediPharm Labs anticipates delivery to its customers to begin in October, pending regulatory approval by applicable health authorities.
“Denmark is actually taking quite a first-mover stance on a number of different approved formulations,” he said. “The partners that we’re working with are actually very unique in the way they’re looking at their patient base and they’re really ahead of the curve relative to a number of other areas in Europe.” Denmark launched its four-year medical cannabis pilot program in 2018 and post-harvest GMP is required for distribution of medical cannabis products. According to information complied by New Frontier Data and the Danish Ministry of Health, over 2,100 patients received cannabis-based medicinal products from 429 prescribing doctors under this program in 2019. “Even though it’s on the other side of the world from that Peruvian deal, we felt Denmark is a key piece to distribute products across the European regulatory whole,” McCutcheon said.
CORONAVIRUS IMPACT: When asked about the impact the coronavirus has had on MediPharm Labs, the CEO said the company really got ahead of ensuring it kept employees and consumers safe due to its medical focus and support from its scientific advisory team, board and health and safety team. “We have a number of people and policies and procedures that are very strict at MediPharm,” he said. “Even before coronavirus, we actually had very strict PPE and helpful safety rules to not only keep our people safe, but to keep our products clean in terms of our manufacturing process.”
McCutcheon said the pandemic has had certain effects on the distribution and regulatory timelines, however the company has still seen continued distribution of cannabis products in Canada and is moving forward with approvals. “We have seen challenges but they have not impacted our business too heavily at this point,” he said.
CHALLENGES: Looking at the current hurdles facing the cannabis industry, McCutcheon said he sees the biggest challenge as a lack of standardization of high quality of manufacturing processes. “We are a fully GMP-certified platform and now a manufacturer of products at the highest pharmaceutical standard,” he said. “One of the things we see is challenges not only in the Canadian marketplace, but a number of new jurisdictions popping up around the world, is the lack of standardization of GMP quality or certification of those manufacturing processes.” The CEO said in certain areas of the world, and definitely in Canada and the U.S., consumers can purchase a product that is not necessarily what is advertised on the label or can repurchase a product which offers a different experience than the previous purchase. “Replicability of effect for consumer experience with GMP and standardization of pharmaceutical products is important,” he said. “You can have the same expectation of a very high-quality product every time you consume it and so we feel like that lack of standardization sometimes creates challenges for either physician comfort or the actual the movement forward of these new evolving jurisdictions to approve cannabis-based medicines.”
OPPORTUNITIES: When asked about the opportunities in the space moving forward, the CEO said MediPharm Labs is excited about exploring relationship with large pharmaceuticals companies. “Well obviously these things can cap on to the previous answer in terms of GMP and a pharmaceutical standard of the manufacture of our cannabis-based end products or our active pharmaceutical ingredient that we also sell in bulk,” he said. “We’ve been at this level of certification and registrations, we are actually able to now access and explore relationships with big pharmaceutical companies.” McCutcheon noted that a number of other industries now take part in the cannabis industry globally, like big alcohol, big tobacco. “One of the things we have not seen yet, but we’re very excited to be one of the leaders in is actually working with large pharmaceutical companies either in supporting them in new formulation development opportunities for different distributions across the world and or trials actually to support and evolve data that comes from these new novel formulations,” he said. “We think by far the largest opportunity is the evolution of relationships with big pharma and the whole medical space in cannabis.”
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