3 Australian Cannabis Dispensaries to Watch in 2019

Although medicinal cannabis has been legal in Australia at the federal level since 2016, the overall patient uptake rate is still relatively small when compared to other countries that have legalised its' use.

By April 2018 only 525 people had been approved for medicinal cannabis, despite a growing body of scientific research showing that it may be used to treat everything from chronic pain, to anorexia and anxiety.

This number would eventually increase to approximately to 3,100 by February 2019, however experts estimate that up to 100,000 Australia are still self-medicating with illegally acquired cannabis.

Advocates for greater access say that cannabis can offer a safe and effective form of treatment to patients with long term medical conditions. Conversely, critics in the healthcare sector argue that there is still only limited evidence to support the use of cannabis in a clinical setting.

While this may seem discouraging, several local medicinal marijuana companies are looking to change this by opening their own cannabis clinics in Australia.

 

Cannabis Access Clinics

Cannabis Access Clinics—which is partly owned by MMJ Group Holdings (ASX: MMJ)—is the first network of healthcare clinics in Australia aimed exclusively at assisting patients to legally access medicinal cannabis products.

The company has clinics in Sydney, Melbourne, Brisbane, Perth and Gold Coast and also sees patients nationwide via the Telehealth online healthcare portal.

 

 

Speaking to The Green Fund, Cannabis Access Clinic's medical director, Dr Sanjay Nijhawan, explained that the company is "continuously expending our clinic network to ensure as many patients as possible can talk to a doctor who is open minded and knowledgeable about medicinal cannabis as a treatment option."

"Clinics provide faster, easier and often more cost effective access to medical cannabis as a treatment option. Our doctors are knowledgeable in the benefits of medicinal cannabis and the products available."

"Our pharmacists work closely with pharmacies and product suppliers who are able reduce their costs to patients based on higher volumes—we do not supply the product—and our regulatory team works closely with the federal and state regulators on patient applications and compliance matters to make application times shorter," Nijhawan said.

Cannabis Access Clinics currently charge $200 for an initial consolation, followed by an additional $120 for the post approval consultation. Although this may seem costly, Dr Nijhawan believes that a reluctant healthcare sector is to blame for Australia's low patient uptake, rather than the price point of medical marijuana.

"We recognised that patient access was the main issue in Australia. Doctors in general are unfamiliar with the therapeutic benefits of medicinal cannabis, the products that are available and, the additional regulatory requirements and prescribing procedures," Nijhawan said.

"We have built a clinic framework with in depth clinical expertise, patient centric governance model, technology platform to streamline the patient journey and, in conjunction with pharmacy dispense product at the lowest price in the market."

"As awareness of what our clinic does and how it can help patients increases we see more doctors—both specialists and GP's—referring patients. We don't disclose patient numbers but based on the approvals reported by the TGA we expect that our patient group would be the largest in the country by a substantial amount."

Cannabis Access Clinics' network of medical practices are staffed with GPs and medical specialists who are trained to assist patients suffering from conditions which may benefit from medicinal cannabis therapy.

Although it can still take up to a week for patients to receive approval from the Therapeutic Goods Association (TGA), the general manager of Cannabis Access Clinics, Belen Gomez, confirmed that approval times for patient applications have begun to "increasing drastically". The company even receives "same-day approvals, sometimes within minutes" on a frequent basis.

According to the company, patients can also expect to see a decline from the steep prices currently being charged for medicinal marijuana over the next 12-18 months, as competition between rival producers drives down prices.

"Prices paid by many patients fall within the limits of what is considered affordable. We expect product prices to continue to trend downwards, as more players enter the market and more streamlined, efficient supply chains are established," Cannabis Access' research team said.

 

Emerald Clinics

Although Cannabis Access Clinics have the first-mover advantage in Australia, they're still facing stiff competition from rival operator Emerald Clinics, which is run by AusCann (ASX:AC8) executive, Dr Stewart Washer.

The company has already established clinics in Sydney and Perth, and Washer claims that there are "big funds from America"—including a founder of dispensary juggernaut MedMen—that are interested in investing in Emerald clinics.

Similarly to Cannabis Access, patients who are referred to Emerald Clinics will undergo an initial medical examination to assess their suitability for medicinal cannabis therapy.

After developing a cannabinoid treatment plan, the clinic will continue to monitor progress to ensure that the desired outcome is delivered.

 

 

Dr Washer believes that the Australian medical sector is the reason that patient prescription rates have failed to keep pace when compared to our overseas counterparts.

"We've seen the TGA turn an application around in three hours," Washer said.

"We know the TGA approves with good evidence. We also know [doctors]… aren't paid to do three hours of application work after a consult."

According to Washer, the company was partly created address the Australian market's need for a cannabis clinic that isn't owned by a drug maker or cannabis cultivator, such as the online Medicinal Cannabis Medicines Portal created by Medlab (ASX:MDB) and the Cann Group (ASX:CAN).

Emerald Clinics is currently in the process of establishing a third clinical practice that will serve as the eventual launchpad for a planned IPO later this year. The company is also expected to raise $2 million as part of a pre-IPO round, and has confirmed that it intends to generate further revenue by selling de-identifiable data to drug manufacturers, insurers, and regulators.

 

Cannvalate

Cannvalate boasts the largest network of medicinal cannabis clinics in Australia, consisting of over 1000 referring doctors, 600 affiliated pharmacies, and 13 existing medical practices—with a further seven in development—spanning every state in the country. The company completed its' Series A $4 million fundraising round in October 2018, and has plans to launch a $65 million IPO later in 2019.

Despite only being around for a short time, Cannvalate prescriptions already account for more than 30 percent of the Australian market, which drew the attention of disruptive healthcare company, Impression Healthcare (ASX: IHL).

Earlier in March it was announced that the two companies will be entering into a partnership which will see Impression's licensed medicinal cannabis products distributed throughout Cannvalate's clinical network.

 

 

The joint venture will also see Cannvalate conduct four clinical research trials, including a "first of its kind" study on the efficacy of CBD oil as a treatment option for patients suffering from a traumatic brain injury. The CEO and co-founder of Cannvalate, Dr Sud Agarwal, described the trials as "game-changing" due to the lack of treatment options for the diseases being studied.

"We are delighted to be working with Impression Health to perform game-changing clinical research for significant medical diseases at our world class medicinal cannabis research unit." Agarwal said.

"Researching cannabinoid pharmacological solutions for obstructive sleep apnoea, periodontitis, traumatic brain injury and TMJ dysfunction is particularly exciting as all four of these diseases have no existing therapies available today."

Patient access is an important concern for Dr Agarwal, who says that he founded the company in response to the lacklustre uptake of medicinal marijuana by the healthcare community.

"Cannvalate has the primary goal of converting the estimated 100,000 patients who are currently accessing illegal black market cannabis for medical purposes on to legitimate medically prescribed cannabis so they can be guaranteed that what they are consuming is infection-free, dosed appropriately and has rigorous safety monitoring in place."

"The fact that our series A funding came predominantly from Doctors demonstrates that our business model resonates well with the medical profession and most of those involved have gone on to become active cannabis prescribers through our Cannvaclinics," Argarwal said.

Cannvalate are currently preparing for a Series B funding round that is scheduled to take place later this year, ahead of its eventual IPO some time in 2019. The company has confirmed that the funding raised will be used to underwrite a number of projects, including the creation and dissemination of training and education resource materials to further grow the network of Cannvaclinics operating in Australia.

 

Consumer Pipelines

Although it's still too early to gauge how successful any of the ventures will be, their increasing patient numbers demonstrates that there is an obvious space in the market for the specialist clinic model.

Research conducted by market intelligence firm Prohibition Partners has suggested that Australia's medicinal cannabis market could be worth $1.2 billion by 2024, yet patients are still being forced to jump through regulatory hoops to acquire it.

Many doctors are highly reluctant to prescribe cannabis, or are still sceptical about its ability to affect patient outcomes. And the comparably low number of people receiving TGA approval for medical marijuana suggests that consumers are still finding it difficult to access as a treatment option.

Only time will tell if medical cannabis clinics will be able to win back Australians who have given up on legally acquiring the drug due to excessive government regulation, however it seems like a one-stop prescription spot could be the answer.

Hugo Gray
Hugo Gray

Hugo Gray is a Melbourne-based journalist with a body of work that covers a diverse range of topics, including immigration law, sex technology, and now the rapidly expanding cannabis industry.

There is 1 Comment in this post

  1. ASX listed Impression Healthcare (ASX: IHL) is the Company to watch in 2019, trading on a ~$12 million valuation versus the industry sector average of ~$84 million.

    The partnership with Cannavate is a fantastic development and strongly supported by shareholders of IHL. Dr Sud Argarwal of Cannvalate is a leading expert in the sector and his Company will be funding four exciting clinical trials in concert with IHL.

    For more information search Cannvalate or refer to the ASX announcements released by IHL.

Leave a Reply

Your email address will not be published. Required fields are marked *