APHRIA INC COM NPV (OTCMKTS:APHQF) shares have been up over 20% recently, and it could continue to rise after it announced its plans for a joint distribution venture with Tera Bio-Pharma, as well as the ongoing changes in the Canadian cannabis industry. First, let’s take a look at the company profile.
Aphria Inc is one of Canada’s lowest cost producers, produces, supplies and sells medical cannabis. Aphria is truly powered by sunlight, which allows for the most natural growing conditions out there. The company is committed to providing pharma-grade medical cannabis, superior patient care, all while while balancing patient economics and returns to shareholders. Aphria is the first public licenced producer to report positive cash flow from operations and the first to report positive earnings in consecutive quarters.
Let’s move onto its recent news. Aphria and Tera Bio-Pharma recently announced plans for the joint distribution of dried medical cannabis in the maritime provinces and Quebec. When speaking on this plans, APHRIA INC COM NPV (OTCMKTS:APHQF) CEO Vic Neufeld stated, “The commercial venture between Tetra and Aphria will enhance Aphria’s brand visibility and distribution of our high-quality medical grade cannabis into the maritime provinces and Quebec, as we look to meet the commercial demand for PPP001.”
Neufeld added, “As a leading Canadian licensed producer, it was important for us to work with an organization that shares our focus on pharmaceutical-grade quality assurance and control. Tetra’s emphasis on developing products driven by patient needs and scientific research and development makes them the perfect partner in this important next step for Aphria.”
Now, Tetra and Aphria have invested in the development of its PPP001 drug, and they will continue investing in the drug in an attempt to bring PPP001 to market in both Canada and the U.S., as the first prescription drug using dried cannabis. The companies have developed a high quality dried cannabis product. Now, they would like to make it available to physicians under the current ACMPR program. With the ongoing changes in the cannabis industry, and states in the U.S. legalizing the medicinal and adult recreational use of marijuana in 2016, as well as the potential legalization of adult recreational and medicinal use of cannabis in Canada, Aphria is well positioned to grow its earnings.
According to Andre Rancourt, CEO of Tetra Bio-Pharma Inc., “This commercial venture is an important decision for Tetra shareholders as it will start generating revenues this summer which will be invested back into developing PPP001 as a prescription pharmaceutical…Tetra will be accelerating its manufacturing and quality studies as required by the U.S. and Canadian prescription drug and controlled substance regulations. The investment in this research will be offset by sales revenues generated under the ACMPR.”
As we’ve already stated, Canada could potentially legalize the adult recreational and medicinal use of cannabis throughout the country. When speaking on the potential legalization, Neufeld stated, “Aphria has a proven track record of supplying Canadian patients with high-quality, medical grade cannabis. We welcome the federal government’s introduction of a regulatory framework legalizing cannabis for Canadians to keep profits out of the hands of the black market, restrict access to youth, and ensure clean and safe product.”
Neufeld added, “Aphria is very well positioned to supply a significant amount of cannabis to the recreational market, estimated to be at least 600,000 kg annually. Recently, inspectors from Health Canada completed their onsite field inspection of our Part II expansion, which, upon finalized approval, will add an incremental 57,000 square feet of greenhouse capacity, increasing our annualized harvest to 8,000 kg. Upon completion of our vision to build 1,000,000 square feet of greenhouse footprint (inclusive of our Part III and IV expansion presently underway), we will have the capacity to supply more than 75,000 kg of high-quality cannabis at one of the lowest costs in the industry, making for an attractive value proposition in this new market.”
With this large potential production and the demand for cannabis for medicinal purposes, Aphria could increase its earnings and take some market share in the space due to its cost efficiency. If you missed these updates on APHQF, you might want to consider subscribing to our free newsletter. All you have to do is enter your email address in the box below, and you’re on your way to receive updates, if any, on APHQF.
Disclosure: No one at Street Register has been compensated in any way for the publishing of this article, nor do we hold any position in APHQF stock, short or long.