German medical cannabis company Demecan has secured 7 million euros ($7.6 million) in financing to expand production in Europe’s largest medical market.
The fresh capital – from btov Partners, a European venture capital firm, and a German single family office – comes as international companies establish footholds in the important European Union market.
“The funds will allow us to expand the cultivation operations, which we are considering given the exponential growth of the German medical cannabis market,” he wrote in an email to Marijuana Business Daily.
He did not say how much more capital, if any, would be needed to scale up to reach the company’s government-sanctioned production quota.
Demecan is one of only three companies authorized to grow medical cannabis in Germany after a lengthy application process that finished earlier this year. The others are Aurora Cannabis and Aphria, both of Canada.
Demecan was contracted to grow 600 kilograms (1,320 pounds) a year for a period of four years, and subsidiaries of Aurora and Aphria are contracted to grow 1,000 kilograms each annually.
The quantities to be grown domestically are not expected to meet demand by the time the first harvests are available at the end of 2020.
In recent months, the first shipments of medical marijuana from Australia, Colombia, Portugal and Uruguay reached Germany, although product from Latin America was for testing purposes only.
Canada’s Wayland Group owns 50% of Demecan, according to previous disclosures.