Fast-moving CresoPharma has expanded into Latin America with the purchase of Kunna Canada Ltd. and its Colombian subsidiary Kunna S.A.S., a medicinal cannabis group, the company said in a release this week. Under terms of the deal, Creso, which is traded on the Australian Stock Exchange (ASX), is to pay up to $7.15 million for Kunna, primarily in CresoPharma shares.
Kunna S.A.S., one of Latin America’s first medical cannabis companies, is to develop and produce 100% natural plant-based medicinal, therapeutic and cosmetic products. Its planned range of “phytotherapeutic” products are applicable to patients who suffer seizures, chronic pain, cancer, epilepsy and multiple sclerosis, among other maladies.
Latin America adjusting laws
As Latin American countries continue to adjust their laws to take advantage of a growing cannabis legalization movement around the world, Colombia has spent the last two years setting a framework for the industry. The government legalized low- and high-THC-based extracts in 2016, and in 2017 set rules for the cultivation, production, and domestic and international distribution of such derivatives; application fees, security requirements, quality controls and responsibilities of licensees and government administrators were also clearly defined by Colombian authorities this year. The legal framework adopted in Colombia sets clear export rules based on international laws, Creso said.
Kunna this past March received a license to produce and export cannabis derivatives and extract-based products in Colombia by the Ministry of Health, making it one of a small number of companies to have secured such permission. Creso said Kunna expects to get a further license to grow cannabis in Colombia early in 2018. Toward that end, the company recently entered a research partnership with ‘GIEM’ – affiliated with Medellin’s Universidad de Antioquia – to study plant genetics, disease and optimizing cultivation. Kunna says it aims eventually to plant cannabis on as much as 600 hectares, subject to Colombian ministry quota grants.
Creso said the purchase of Kunna will help it to integrate its supply chain as it begins to produce its own medicinal cannabis as well as supply its existing products to the Colombian cannabis market, estimated at $86.3 million and expected to grow rapidly.
Tech entrepreneur at helm
Kunna is led by entrepreneur Pedro Tosin, CEO and Director, who has more than 15 years’ experience in the technology sector and has a background in digital marketing and advertising. He has been CEO at Kunna since 2016.
Creso’s acquisition in Latin America comes on the heels of the company’s purchase of Halifax-based Mernova Medicinal Inc. in Canada where plans to cultivate plants for its MMJ products.