Veteran medicinal marijuana producers in Israel are gearing up to launch on the Tel Aviv Stock Exchange (TASE), according to local reports.
Israel has always been known as a pioneer in the medical cannabis trade, but the country’s industry is now set for huge growth after the government legalized exports. Since then the share prices of speculative cannabis firms that already listed on the TASE have soared. Now, established companies want a piece of the action.
Seàch Medical Cannabis Group, which has produced medical cannabis strains for domestic consumption since 2008, is said to be exploring an IPO. A well-established agricultural family that has been in business for more than 60 years owns Seàch. Its strains include Jerusalem Express, Havarra Wedding, and Super Silver Bullet.
Ilan Bio, an agro-biotechnical company with interests in the cannabis trade, is also working on a TASE listing.
Ilan Gerzi, a senior partner at law firm Pearl Cohen, which represents most cannabis companies in Israel, said older cannabis companies are displaying resentment towards the newcomers that are currently enjoying all the limelight. They feel that they have nurtured a strong industry, only for opportunists to seize the momentum from them at this crucial juncture, and they now plan to fight back.
Companies need to show they have invested at least 3 million shekels ($830,000) in research and development over a three-year period before listing on the TASE. If they cannot prove that, they have the option of merging into publicly traded shell companies.
Seàch has captured a 15% share of the domestic medical marijuana market and co-founder and chief executive Yogev Sarid said he expects to see plenty of growth going forward. He expects investors in the U.S. and Canada to take a healthy interest in the Israeli cannabis industry.
Everyone in the trade is buoyed by a new World Health Organization report calling for cannabis and its properties to be formally reclassified under international drug treaties. The WHO wants to see it removed from Schedule IV of the 1961 Single Convention on Narcotic Drugs, while arguing that THC should be struck from the 1971 Convention on Psychotropic Substances and moved to Section I of the 1961 convention. It represents a massive shot in the arm for the legitimacy of the burgeoning global cannabis industry and, along with Canada, Israel is well placed to become one of the leading lights in the next few years.