Aphria to supply medical marijuana to Shoppers Drug Mart Shoppers was reportedly searching for someone to serve as the pharmacy chain's medical marijuana brand manager
Medical marijuana production at the Aphria greenhouses in Leamington.Postmedia News Leamington, Ont.-based Aphria Inc. said Monday that it had struck a deal to provide medical marijuana to Loblaw-owned Shoppers Drug Mart, Canada’s largest pharmacy chain.
“Subject to Health Canada’s approval of Shoppers Drug Mart’s application to be a licensed producer, under the terms of the agreement the Company will supply Shoppers Drug Mart with Aphria-branded medical cannabis products,” a release from Aphria said. “It is expected the products will be sold online, as Canadian regulations currently restrict the sale of medical cannabis in retail pharmacies.”
Shoppers, or its parent company, Loblaw Companies Ltd., have not been issued a licence to dispense cannabis yet, according to Health Canada’s list of companies registered to grow and sell medical marijuana.
It was also reported in November that Shoppers was searching for someone to serve as the pharmacy chain’s medical marijuana brand manager.
The supply agreement between Aphria and Shoppers has been reached approximately seven months out from Canada’s July 2018 target date for the legalization of recreational cannabis. It also follows Saskatchewan-based medical marijuana company CanniMed Therapeutics Inc. becoming the first licensed producer to sign a deal with a national pharmacy chain when it signed a letter of intent with PharmaChoice in March of this year.
Under Canada’s current rules, medical marijuana can only be distributed through the mail. Loblaw has said it aims to change that.
“We are engaging with the federal government and engaging with the provincial government around dispensing medical marijuana directly from our pharmacies,” said Galen Weston, executive chairman of Loblaw, on a Nov. 2016 earnings call. “We think that the pharmacy business is extremely well-suited for processing controlled substances.”
Meanwhile, trading of Aphria shares was halted Monday afternoon, with the company’s stock price up 1.93 per cent, to $11.62. Shares of the greenhouse grower were to resume trading at 4:30 p.m. ET. They are up nearly 86 per cent for the year.
According to Aphria’s most recent results, for the quarter ended Aug. 31, the company reported net income of $15 million and a 15 per cent increase in sales, to 852 kilograms or kilograms equivalent of cannabis.
“We have an impeccable record cultivating and producing high-quality, medical-grade cannabis,” said Vic Neufeld, chief executive of of Aphria, in a release. “These traits make us a strong partner for an organization looking to serve and support Canadian patients.”
gzochodne@nationalpost.com
Twitter: @geoffzochodne
SOURCE Financial Post