Perth, Australia-based Little Green Pharma has signed a binding three-year supply deal with German medicinal cannabis company Demecan.
The purchase agreement with Demecan is for any combination of 1,000 kilograms (2,200 pounds) of dried flower or 48,000 units of medical cannabis oil per year.
The agreement kicks in with the first commercial shipment, which is expected to take place in the second half of this year.
Financial terms were not disclosed.
Germany is home to the largest medical cannabis market in the European Union, with more than 100 million euros ($110 million) of medical cannabis reimbursements in 2019, according to Marijuana Business Daily’s estimate.
Germany’s medical market, while growing fast, is about a quarter of the size of Canada’s.
“Patient access to medicinal cannabis in Germany has been limited to date, with inadequate domestic production that is unlikely to produce sufficient product to satisfy the German market in the near term,” Little Green Pharma Managing Director Fleta Solomon said in a statement.
The Australian company also has a deal in place with CC Pharma, a subsidiary of Canada’s Aphria and distributor of pharmaceutical products in Germany.
Australian health regulators expect the number of prescriptions for medical cannabis to climb to at least 70,000 in 2020, more than double 2019’s 30,000 approvals.
Shares of Little Green Pharma trade on the Australian Stock Exchange as LGP.