New Zealand sees first casualty as MediCann NZ goes into Liquidation
Less than one month following legislation for Medicinal Cannabis, New Zealand has claimed its first casualty – MediCann NZ.
Founded in March 2018, MediCann was placed into liquidation by its shareholders late last year.
The company has planned on building an agricultural industry similar to the kiwifruit sector, where growers would apply to become a MediCann NZ Licensed Producer, and the company would handle expertise and hardware, consumables and agronomists.
It’s understood that two of the company’s founders, Ross Smith and Brendan Ogilvy, were at loggerheads about how the business should be run.
Australia and New Zealand are likely to see more companies fall over in 2019.
The Australian Office of Drug Control has stated they have received over 180 license applications since legislation changes in 2016, with 37 commercial cultivation and manufacturing licenses being granted.
|License Type||Number Granted|
|Medicinal Cannabis License||21|
|Cannabis Research License||12|
Considering only a small handful of these are actively supplying products to the Australian market, it is expected that some, if not most, will not survive as operational issues, funding issues, competition and price wars drive them out of the market.
Mark Dye, CEO of Nubu Pharmaceuticals, one of New Zealand’s leading medicinal cannabis companies, said “Things in the cannabis space internationally are moving incredibly quickly, and New Zealand is no different. There are a multitude of companies talking very big games at the moment, some of which will work, but a number of which won’t. MediCann being the first of the latter.
There is more than enough room in this market, but given the number of interested parties at the moment there will likely be more MediCann’s to come.”
Investment into cannabis companies has been high, with many calling it the new dot-com boom. Much of this investment has gone to companies with Directors holding little, or no, experience in key sectors of the industry such as greenhouse cultivation, medicine, or pharmaceutical manufacturing.
At the end of the day, it’s going to be the mum and pop investors who were sold on an easy financial win who will suffer.