Aphria, Tilray Deal Is Bet on Euro Pot: Cannabis Weekly

Photographer: Patricia de Melo Moreira / AFP / Getty Images

At first glance, Tilray’s dealing with Aphria may sound like a bid to create Canadian heavyweight, or a move to get a better leg in the U.S.

But as the Italians say, “dietrologia” – the surface definition is never true. Much of the logic seems to be rooted in Europe.

Tilray has an agricultural facility in Portugal, and Aphria has another in Germany – as well as a pharmaceutical business linked to 13,000 German and other pharmacies across Europe. This will allow cannabis to be tax-free for the European Union, a market that companies are promising to liberate quickly.

“By bringing our companies together to create Europe’s largest medical cannabis industry, and preparing us in the event of a one-day legal strike in the EU,” Aphria Chief Executive Irwin Simon told me in a discussion on the deal last week.

His representative Tilray agrees.

“There is a good chance that so far, two to six European countries will be legislating cannabis for adult use,” said Tilray Chief Executive Brendan Kennedy. France is likely to launch a pilot program in the next 60 days, and Tilray has a bid to provide marijuana for him, Kennedy said.

From there, as the U.S. has seen, it’s only a matter of time. When medical cannabis is approved, it will be much harder to argue against legalizing what is left of the illegal market. Simon, who is poised to become CEO of the company together, said he expects Germany to be the first to legalize recreational cannabis. And a legal one in one place could trigger a chain reaction among others.

“The question is – if they decriminalize, why don’t we make a law?” Simon said. “People will look at the amount of tax dollars they are losing. ”

The European Union currently monitors local regulations, from total bans in countries like Sweden to lax rules in others. Some major economies, such as Spain and the Netherlands, largely allow property for recreational use.

In the short term, the U.S. is expected to account for about 70% of the world’s $ 93.8 billion cannabis market by 2025, according to Euromonitor International – but that outlook could quickly change.

Recent developments in Europe show that the ball is already going, albeit slowly. Swiss National Council vote to make access to medical cannabis easier. North Macedoniathere is a Medical Cannabis Growers Association appealing to the country’s parliament for permission to issue cannabis flour. And there is a reform group in Malta seeking decriminalization.