Tilray reached a deal with Luxembourg’s Ministry of Health to supply the small European country with medical cannabis, the company announced Tuesday, becoming the third Canadian cannabis producer since 2019 to supply the burgeoning market.
Tilray, which has offices in Leamington, Ontario, and New York, will provide a variety of pharmaceutical-grade medical marijuana products such as extracts and dried flower, according to the announcement.
“We believe that Tilray’s growth potential in the European Union represents a $1 billion opportunity, and today’s announcement affirms that we are turning potential into performance,” CEO Irwin Simon said in a statement.
Previous deals to supply Luxembourg included:
- Aurora Cannabis, in May 2019, said it had become the “exclusive supplier” of medical cannabis to Luxembourg.
- Rival producer Canopy Growth, in October 2019, announced its own “exclusive” deal to supply the country.
Few details of Tilray’s arrangement were disclosed, including financial terms, and the company didn’t say whether the deal was exclusive.
Some details were released in August via a parliamentary query.
The Ministry of Health said it had requested 3 million euros ($3.5 million) from the Ministry of Finance to buy 30 kilograms (66 pounds) of medical cannabis this year.
That included:
- 28.5 kilograms of product containing 18% THC and less than 1% CBD.
- 2.25 kilograms of product containing 10% THC and 10% CBD.
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Luxembourg will need more if it hopes to match supply with demand.
The country suffered a supply shortage in 2021, the Luxembourg Times reported, after doctors prescribed 140 kilograms in 2020.
Luxembourg recently backpedaled on its plan to establish Europe’s first fully regulated recreational marijuana market.
An early plan called for the country to establish an adult-use market “inspired by the Canadian model.”
Instead, Luxembourg plans to allow home cultivation of up to four plants for personal use.
Retail will not be permitted.
The move is still a milestone for Europe, as Luxembourg would be the first country in mainland Europe to permit and regulate adult-use marijuana home cultivation.
But it’s short of original expectations.
Legalizing recreational marijuana was part of the coalition agreement of the current government, which called for the production, purchase, possession and consumption to be regulated within Luxembourg’s borders.
Shares of Tilray trade on the Nasdaq as TLRY.
Matt Lamers can be reached at matt.lamers@mjbizdaily.com.
