Who is Compass Cannabis Clinics?

Chiropractors, Naturopaths, and health professionals all converge under the Compass Cannabis Clinics roof. But what exactly is Compass Cannabis?

Founded in 2017 in the Okanagan Valley in British Columbia, Compass Cannabis Clinics set out to simplify access to medicinal cannabis for those seeking it in Canada.

The company takes a holistic approach to medicine, including nutrition, exercise, relaxation, and therapy, using a unique treatment that is tailored to each individual. Part of this treatment includes the medicinal use of cannabis in a clinical setting, and within a few years, the company had opened 8 clinics throughout Western Canada and had helped over 13,000 patients gain access to medicinal marijuana products when they needed it.

Our Story - About Compass | Compass Lifestyle Clinics
Co-founder of Compass Clinics, Dave Martyn

Occurring alongside the rapid growth of Compass Clinics, Compass's co-founder, Dave Martyn created StarBuds Canada, the retail chain of Compass, which won the 2019 Cannabis Startup of the Year award at the O'Cannabiz Awards, prior to selling StarBuds in April 2020. Having worked in Business Development, Franchise Sales, and Restaurant development for over a decade, Dave is no stranger to executing a business plan, and that's precisely what he's been doing with Compass Clinics. Now, Mr. Martyn is taking his business acumen abroad, as he extends the reach of Compass Clinics to the APAC region, beginning with Australia and New Zealand.

Compass Clinics Heads to Australia

While the U.S's cannabis market was worth over $11 billion in 2018, and Australia's is set to reach just a tenth of that figure by 2025, it doesn't mean Australia is a write-off. In fact, Mr. Martyn has identified Australia as one of the key growth markets when it comes to cannabis, set to grow even bigger than Canada.

The country has been showing strong patient growth, with a record-high 4,133 SAS-B approvals in May thanks to a sensible regulatory framework. Australia also has a sunny climate for growing cannabis, and the potential for over-the-counter CBD on the horizon means that patient access could skyrocket in the near future.

This is why Dave brought Compass Clinics down under in 2019 when he opened the first two Australian Compass Clinics in Sydney.

We've really looked hard at different regions, but Australia was the one we really found had the potential.Dave Martyn, Co-Founder of Compass Cannabis Clinics

The strength in Australia's medicinal cannabis industry, according to FreshLeaf Analytics' Consultant Rhys Cohen, is due to "a combination of patient access reforms, product pricing reductions, and doctor education" which has "facilitated industry growth despite economic and social hurdles."

In order to establish itself in Australia, Compass has entered into a 2-year white-label agreement with MediPharm Labs Australia Pty Ltd, in which MediPharm will supply Compass with finished pharmaceutical-quality cannabis oil products in Australia under Compass Clinics' brand. MediPharm Labs Australia will import the formulated cannabis oil products from MediPharm Labs Inc.'s Canadian TGA GMP certified facility.

Within just 100 days of opening their Sydney clinic, Compass Cannabis had helped over 500 patients gain access to medicinal cannabis under guidance from the Therapeutic Goods Administration (TGA), and the company's Chief Medical Officer, Dr. Teresa Towpik, was crowned Doctor of the Year in the 2019 Cannabis Industry Awards for Australia.

"Australia has welcomed us with open arms", said Dave Martyn, when talking about Compass's early success in the country. "When we did our research, we could see Australians were underserved when it came to safe access to medicinal cannabis. At the same time, from an economic standpoint, we've seen what an incredible job creator the cannabis sector has been in Canada. We've been fortunate to partner with some of the top cannabis leaders in Australia to play a part in ensuring safe patient access while also helping to grow the industry at large."

The Broader Oceania Region

Despite being somewhat of a newcomer, Compass Cannabis's revenue for 2019 was $2,180,402 across it's Canadian and Australian operations, exceeding many of its ASX-listed cannabis-related peers. Now, with a proven track record and a working business model in both Australia and Canada, Compass intends to not only continue expanding its operations in both those countries but to also make a play for the New Zealand cannabis market.

As many will know, New Zealand has it's upcoming cannabis referendum next month, with polling suggesting that the majority of New Zealanders will vote "yes" to cannabis legalization.

Additionally, Compass has the option to execute a 10% share exchange with Medigrowth Australia upon receipt of their cannabis cultivation and manufacturing licenses. Medigrowth is also a late-stage cultivation applicant in New Zealand, which means that should New Zealand vote "yes" in September, Compass will be well-positioned to capitalize on its recreational market.

I believe Australia and New Zealand are the best international markets outside North America in terms of growth. Both have flown under the radar because of COVID-19 and because they're still early stage, but the near-term catalysts are here. Dave Martyn, Co-Founder of Compass Clinics

Much like Australia, New Zealand's Ministry of Health recently launched its new Medical Cannabis Scheme, which will allow for the domestic commercial cultivation, manufacture, and distribution of medical cannabis throughout the country and abroad. This will help to lower costs for New Zealand patients, thus increasing patient access in addition to establishing New Zealand as a global cultivator and exporter of cannabis products.

Dr. David Clark, the Minister of Health in New Zealand said that "over time this Government's medicinal cannabis scheme will help people ease their suffering by making a wider range of quality medicinal cannabis products available. There is huge international interest in the potential of medicinal cannabis. These regulations mean New Zealand companies will be well placed to manufacture for both the local and international markets.

"There is already considerable expertise in this area with 20 companies currently licensed to grow cannabis for research purposes and another 238 growing industrial hemp. It's expected that at least some of these companies will apply for licences for medicinal cannabis," Dr. Clark concluded.

Compass Clinics' Capital Raise

In 2019, Australia's medicinal cannabis market expanded by over 650% in the number of active patients using cannabis products. This year, the Australian medicinal cannabis industry is estimated to reach $150,000,000 in value as a result of the projected 70,000 prescriptions set to occur in 2020.

In response to this predicted growth of Australia's cannabis industry, Compass is similarly looking to expand its Australian operations, as well as to build a telehealth system that can allow the company to continue thriving amid COVID-19. As such, the company has launched a crowdfunded cap-raise on Birchal, an equity crowdfunding platform, with expectations to raise up to $2 million. The cap-raise was launched today and has seen over $153,000 invested by over 100 investors. The campaign will run for a further 21 days, but Mr. Martyn fully expects the $2m goal to be hit.

"We've far exceeded the top end of what we expected to raise, based on the 800 or so expressions of interest we received," Mr. Martyn stated to Stockhead.

The company currently has a valuation of $13.5 million, and investors can pick up shares in Compass at $0.30 per share. Compass Cannabis is expecting to publicly list on the ASX in early 2021.

Keen investors can check out Compass Cannabis's investment offer here, as well as visit Compass's website here.

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Louis O'Neill
Louis O'Neill

Louis is a writer based in Sydney with a focus on social and political issues. Having interviewed local politicians and entrepreneurs, Louis now focuses on cannabis culture, legislation & reform.

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