The Hydroponics Company Ltd (ASX:THC) has reached a licensing agreement with National Access Cannabis (NAC) of Canada.
The agreement gives THC immediate access to NAC’s intellectual property that will assist in the development of a professional clinic model, offering THC a unique path to market in Australia.
NAC is Canada’s best practices leader in delivering secure, safe, and responsible access to legal medicinal cannabis.
It provides high-quality physician and patient support and training in professional patient-friendly clinics environments.
THC will use the Canadian clinical model to create a solution in Australia
David Radford, chief executive, said: “Having visited their medical clinic in Ottawa, I believe that the quality processes and care that they have developed for their patients has a real and exciting place in the Australian marketplace.
“We will be working with the State Governments and Physicians to rapidly integrate this unique, quality assured program for the betterment of the Australian patients.
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“We look forward to working with the NAC team and leveraging their clinical model to provide a local healthcare solution which will facilitate patient access to a broad range of high, quality, legal medicinal cannabis products in Australia and New Zealand.
“Our expansion into the development of medicinal cannabis clinics will allow THC to work with local cannabis companies as they seek to develop a path to market.”
10-year licence in Australia and New Zealand with Asia option
The agreement provides for a transfer of technology, knowledge and intellectual property for 10 years in Australia and New Zealand, with a further option to extend by 10 years.
It also provides for a first right of refusal option to develop into Asia as the market matures.
THC is able to leverage NAC’s extensive relationships with Canadian licenced producers and access to new medicinal products.
THC will pay NAC a licensing fee of $500,000 upon or before the second anniversary of the agreement or successfully achieving an initial gross revenue milestone of $1 million, whichever occurs first.
Thereafter, THC will pay NAC ongoing quarterly royalties equivalent to 7.5% of gross revenue.