Sativa Investments PLC (NEX:SATI) has inked a commercial offtake agreement with Portuguese cannabis oil supplier, MeridianTulip – Empresa Medicinal Lda, for the UK manufacture of cannabidiol (CBD) products.
Under the deal, the UK medicinal cannabis company will acquire low tetrahydrocannabinol (THC) cannabis oil for the UK manufacturer of CBD products at its Somerset headquarters.
THC is a compound in the cannabis plant that gives the “high” associated with recreational use while CBD is non-psychoactive. Medicinal cannabis, which was legalised in the UK late last year, contains CBD and low levels of THC.
Sativa plans to supply the cannabis products to its subsidiary George Botanicals, a manufacturer, wholesaler and retailer of CBD wellness products. It will also supply to Sativa’s Goodbody & Blunt wellness centres, which is to open its first store, in Bath, soon.
The offtake agreement is subject to MeridianTulip receiving authority from Portuguese regulatory authority, Infarmed, for the cultivation and export of medicinal cannabis.
Sativa said Infarmed has granted two such licences to date and the company is confident Meridian’s discussions are “progressing well”.
“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,” said Sativa founder and chief executive, Geremy Thomas.
“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."