Cannabis company MGC Pharmaceuticals on watch after "transformational event"

The MGC Pharmaceuticals Ltd (ASX:MXC) share price could be on the rise on Friday after a late announcement by the cannabis company…

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The MGC Pharmaceuticals Ltd (ASX: MXC) share price could be on the move today after the cannabis company released a late announcement on Thursday.

What did MGC Pharmaceuticals announce?

On Thursday MGC Pharmaceuticals provided an update on the planned construction of its Malta-based state-of-the-art Good Manufacturing Practice (GMP) production and research facility.

According to the release, the company has signed a long-term lease agreement on a 6,000m2 site in Malta, which was previously identified and designated to MGC Pharma by Malta Industrial Parks.

The lease agreement was signed following formal approval from Malta Enterprise as part of a government signing ceremony held in Malta on Thursday.

What now?

Management believes this represents a major event for the Maltese medical cannabis industry, as the company's facility will be one of the first commercial EU-GMP grade production and research facilities in the country within the medical cannabis sector.

It will also facilitate development of expertise for cannabinoid derived medicines and research in Malta with subsequent products to be delivered into the European Union and global markets.

MGC Pharma's co-founder and managing director, Roby Zomer, described this as a transformational event and one which provides a gateway to key European and global markets.

He said: "The Maltese facility, when constructed, will be our centralised European production and distribution hub. This will be integral as we advance our strategy of becoming a leading European focused producer of cannabinoid derived medicinal products. The Maltese facility will significantly scale up our existing operations and commercial activities currently based in Slovenia and the Czech Republic."

He added: "The lease agreement is a key step forward, and with planning approvals also in place we will now look to swiftly move into the construction phase. The state-of-the-art Maltese facility is to be a key asset for MGC Pharma to provide a platform for future product development and commercial growth, with large-scale production driving strong future revenues upon completion. I look forward to updating shareholders with details of our progress in the upcoming months."

It has been another busy week for the cannabis industry. This week Elixinol Global Ltd (ASX: EXL) announced a supply agreement with Pet Releaf, Creso Pharma Ltd (ASX: CPH) revealed an exclusive distribution agreement with Medleaf Therapeutics, and Althea Group Holdings Ltd (ASX: AGH) provided a positive update on the number of patients being prescribed its medicinal cannabis in Australia.

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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