Just like every nascent sector, the cannabis industry is undergoing major changes almost on a daily basis. New opportunities come up constantly as ever different countries finish outlining the regulations on the matter. In such a fast-paced space, it can be quite tricky to make steps in the right directions. However, investment company Elixxer has a clear idea of where the industry is going, and how to benefit from the many possibilities it offers. “Cannabis is going to be a commodity in the future, and therefore it is of the utmost importance for us to position ourselves to the full extent of the potential of this sector,” John McMullen, Elixxer president, explains.
John McMullen, Elixxer President
“That is why we have made investments almost throughout the globe. We have operations in Canada, Australia, Italy, Switzerland, and Jamaica. Each of those aims to tackle specific portions of the market. For instance, in Canada and Australia, we focus on the medical, therefore we opted for indoor farms; while in Jamaica we make use of both indoor and outdoor, as we want to capitalize on the unique Jamaican conditions such as the sunlight and the Jamaican soil. With regards to Italy and Switzerland, on the other hand, we aim at tackling the CBD market, initially and aim for Medical in Italy
Growing medical indoor
According to John, indoor farms are the go-to approach for growing medicinal-grade cannabis as they allow to achieve the most important things for a medical cannabis grow operation: consistency, this is achieved through a Good Manufacturing Practice (GMP) facility. The GMP standard is the Pharmaceutical standard so it maintains standards of consistency, cleanliness and efficacy. “The pharmaceutical is a major influence for the cannabis industry,” says John. “This means that cannabis growers and companies really need to bring their A game, but most importantly they have to keep in mind that people are going to medicate themselves with those flowers. Thus, these need to have the same effect each and every time they get assumed. This type of high control is only possible in indoor farms, where automation plays a central role.”
The centrality of automation
According to John, automation is very important and ensures that all the processes are running fine and smoothly. “People in the facility are given the tools, and they need to be able to make use of them.” Indeed, John further explains that many growers had hard times getting used to the legal industry. “As cannabis became regulated, a ‘new actor’ for cannabis growers jumped onto the stage: horticulture.” John considers horticulture knowledge as paramount, and Elixxer investments have been deployed exactly with this in mind. “The people we have invested in are experts in what they do. This means that they can do things properly, especially when it comes to expanding – which is something quite common in such a burgeoning industry.” However, not every cannabis company can rely on a pool of talents like Elixxer, and therefore many challenges seem unsurmountable, or even worse, these challenges become serious issues. “The key aspect for any indoor farm is efficiency, and to maintain said efficiency all the time,” John points out. “This is of the utmost importance since the cannabis industry is particularly cash intensive, and thus, crop losses can have very ‘unamusing consequences’.”
John continues to explain the problem with a number of indoor cannabis operations. “It is crucial to keep constantly in mind the business side of it. From this perspective, we see some indoor farms that do not grow profitably. That’s because there is some misstep in the SOPs, or in other words, there is something that prevents plants from expressing their full genetic potential. This is a consequence of how some growers tend to think, that is: they think that capital is a viable business model. Truth is, it is not.” That is why Elixxer has been diversifying its business and it is constantly keeping an eye on the future. “You need innovation if you want to stay at the top of your game,” says John. “For instance, the science behind extraction is evolving at an incredible pace. Any facility that is doing processing should always be open to improvements and should follow the technology development with a careful look.”
The trust factor
John believes that cannabis will be a commodity in the future, and therefore it is necessary for businesses to maintain a low production cost, while at the same time to stay compliant with the different regulations. “The tobacco industry can work as an example,” he points out. “For instance, every province in Canada has different regulations with regards to the packaging, the length of the cigarette, and so on. The cannabis industry will follow the exact same guidelines, with a few differences, of course. One above all is that we are providing medicines to patients. Therefore, following the regulations is even more important for us, as the wellbeing of some is in our hands.”
“The cannabis industry in the future will be very diverse, and very complex. It will be compliant, safe, and generally more socially accepted. It will create a lot of opportunities for people who want to be part of this. That is why we have to ensure the success for everyone across the board, now. All the companies should not give anyone any reason to think that this plant shouldn’t be regulated. The trust factor is what needs to be there, and we as Elixxer are striving exactly for that.”
For more information:
Elixxer
800 Place Victoria, Suite 3700
Montreal, QC, Canada
info@elixxer.com
elixxer.com