Sativa Investments Plc (NEX: SATI), the UK’s first quoted medicinal cannabis investment vehicle and now an operating Company with two fully trading UK businesses, announced today that it has entered into a commercial offtake agreement with a Portuguese supplier for cannabis oil for the UK manufacture of cannabidiol products.
The offtake agreement is with MeridianTulip – Empresa Medicinal, Lda which is based in RioMajor, 60 km North of Lisbon, and is subject to MeridianTulip receiving authority from the Portuguese regulatory entity INFARMED for the cultivation and export of medicinal cannabis. INFARMED has granted two such licences to date, and the Directors believe that Meridian’s discussions are progressing well.
Sativa will acquire low THC cannabis oil for the UK manufacture of cannabidiol (CBD) products at the Company’s Somerset headquarters. It is intended that the end-product will supply subsidiary George Botanicals, a manufacturer, wholesaler and retailer of CBD wellness products, and other white label customers, including the Company’s Goodbody & Blunt subsidiary, which is to open its first store, in Bath, shortly.
Smart-sourcing is an integral part of Sativa’s business model and this offtake agreement can provide the Company with an identifiable supply chain from seed to product once MeridianTulip is successful in receiving authority from INFARMED. Sativa will be able to define the crucial factors of seed strain, growing techniques and environment, and extraction methods, all of which are imperative to the quality of the end-product. Sativa subsidiary Phytovista Laboratories will confirm the cannabinoid profile and quality of each batch on delivery.
The Directors believe that this commercial offtake agreement will contribute to quality assurance, forecasted forward quantities of supply, consistency, and pre-determined pricing, rather than the current spot pricing procurement procedure.
Sativa subsidiary George Botanicals already uses considerable quantities of cannabis oil in the manufacture of its products and its in-house chemists and product developers will access the new pre-defined material as new products are added to the range.
Geremy Thomas, founder and Chief Executive Officer of Sativa Investments plc, said:
“Sativa promises smart sourcing, innovation, technology, manufacturing and distribution. The offtake agreement with Meridian, once it receives its INFARMED licence, will provide clarity to a major part of the supply chain and give consistency across quality and pricing, as well as allowing the Company to determine exact seed strains and growing conditions.
“Yet again Sativa is at the forefront of this industry by identifying smart-sourcing as preferable to growing, as the Company concentrates on the value-add elements of the industry, including research & development, manufacturing, brands, and distribution.”