Canntab and FSD - delivered manufacturing equipment Near-term Revenue Potential
Canntab submitted an application to become a licensed producer under the ACMPR back in October. Once the license is granted, the company will be able to process cannabis products at its current production facility in Markham, Ontario with minimal additional capital expenditures compared to a new purpose-built facility. The application is a step in the right direction, but could take months for Health Canada to review and approve the application.
In the meantime, the company partnered with FSD Pharma Inc. (CSE:HUGE) (FSDDF) (0K9.F) in September to begin manufacturing its tablets. The agreement calls for FSD Pharma to assist Canntab in obtaining a license to sell cannabis and provide space at its Cobourg facility near Toronto. Canntab will in turn provide all of the necessary equipment and provide a royalty on products that are manufactured within the facility.
The company delivered manufacturing equipment to FSD Pharma’s Cobourg plant in September that will enable the production of more than 1.5 million tablets per day. Under the terms of the deal, these products will be sold by both FSD Pharma—where it receives half of all profit from sales through its channels—or through Canntab’s channels—where FSD Pharma will receive 3.5 percent of the selling price.