MELBOURNE: Australian medicinal cannabis company Althea Group Holdings Limited continues its expansion into Europe with its planned entry into the German market. Althea has signed a Memorandum of Understanding (‘MOU’) with Nimbus Health GmbH for the sale and distribution of Althea’s medicinal cannabis products in Germany through its pharmacy network.
Nimbus is an independent and global pharmaceutical wholesaler specialising in the distribution and import of medicinal cannabis products. Nimbus also holds a wholesale pharmaceutical licence and estimates that it has direct access to approximately 25% market share of the medicinal cannabis patients in Germany through its pharmacy network.
Under the MOU, Nimbus will sell and distribute Althea’s full suite of pharmaceutical grade medicinal cannabis products under the Althea brand name in Germany. Althea and Nimbus will jointly establish yearly sales targets, marketing and commercial strategies and develop real world anonymized patient data.
Based on expected timelines provided by Germany’s Federal Institute for Drugs and Medical Devices (BfArM) and Australia’s Office of Drug Control (ODC), the Company anticipates the first shipment of Althea’s medicinal cannabis products to arrive in Germany early in the first half of 2020.
To support the entry into the German market, Althea is following the same strategy that has been successfully implemented in Australia and the UK. Althea will develop a localised version of its Althea Concierge platform and its Medicinal Education in Cannabinoids (MEDIC) learning portal for the German market.
Althea Concierge and MEDIC will provide comprehensive medical education for healthcare professionals and streamline the process required to prescribe Althea products. These tools will help fill a gap in the German market which, despite being advanced in terms of patient numbers, lacks educational initiatives focused on clinical evidence and patient access to medicinal cannabis.
Through these initiatives, and with Nimbus’ substantial market position, Althea believes that it will be ideally positioned to compete in the German market and quickly build market share.
Althea CEO Josh Fegan will be relocating to London early in 2020 to drive the scaling up of Althea’s UK business along with coordinating the Company’s expansion into Germany. Althea’s global headquarters will remain in Melbourne and the Company has an exceptional Australian management team in place to ensure it maintains its market leading position, domestically.
With a population of 82.3 million and a favourable regulatory environment, Germany’s medicinal cannabis market is expected to become one of the largest in Europe. According to a report on the German cannabis market published by cannabis intelligence firm Prohibition Partners last month2, Germany has become a leading power in the European cannabis industry since legalising medical cannabis in 2017 and is poised to be a major player in the global market in the coming years.
The report found that 60,000 people were treated using medicinal cannabis in 2018 with an estimated value of €73.7 million. Based on current data, Prohibition Partners predicts that by 2024, over one million German patients will have access to medical cannabis and that by 2028 the medical cannabis market will be worth €7.7 billion.
In the shorter term, a separate study published this year by Arcview Market Research in partnership with BDS Analytics3 predicts that Germany will dominate Europe’s legal cannabis market, reaching a value of over $1 billion by 2022. The report noted that while legal cultivation began in Germany this year, imports will remain important due to the fact that domestic supply will be insufficient to meet rising demand.
The report highlighted that rapid patient growth is expected in the country due to health insurers typically covering the entire fee for medicinal cannabis, with current approval rates from health insurance providers upwards of 70%.
Althea CEO Josh Fegan said: “We are very pleased to have entered into this MOU with Nimbus. Working within an existing and successful distribution channel in Germany is a low risk and high reward strategy for us. The regulatory and social acceptance of medicinal cannabis use in Germany is favourable and we are expecting immediate patient growth in what is one of Europe’s largest and most affluent countries. I am looking forward to relocating to London so that I can oversee the next phase of growth in our UK operations and facilitate a timely entry into the German market, during what is an exciting period for Althea and its shareholders.”
Nimbus Founder and CEO Linus Maximilian Weber said: “Nimbus engages with partners following extensive and careful testing to deliver the highest quality products to our patients. We are excited to work with a highly reputable partner like Althea and deliver such high-quality products to the pharmacies in our network who are covering approximately 25% of the existing medical cannabis market in Germany.”