Why this ASX cannabis share is charging higher on Tuesday

The MGC Pharmaceuticals Ltd (ASX:MXC) share price is charging higher after announcing strong prescription growth in November…

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The MGC Pharmaceuticals Ltd (ASX: MXC) share price has been a positive performer on Tuesday.

In morning trade the cannabis company's shares are up 3% to 3.5 cents.

Why is the MGC Pharma share price charging higher?

Investors have been buying MGC Pharma's shares after it provided an update on its prescription growth.

According to the release, the company has seen the number of prescribed standardised, affordable cannabinoid medicines pass the 1,400 mark in Australia, the United Kingdom and Brazil. This represents 40% growth since the end of October 2019.

This has been driven by strong growth in unique patient numbers and returning patients. Over the period the company reported a 28% increase in unique patient numbers.

Management believes this further demonstrates the near-term revenue generating potential of its phytocannabinoid derived medicines.

MCG Pharma's co-founder and managing director, Roby Zomer, was very pleased with the company's performance in November.

He said: "We are delighted with continued momentum behind the business which is demonstrated by the ongoing growth in the number of prescriptions, increasing by 40% since the end of October, with an increasing number of return patients."

"This shows the near-term revenue generating potential of the Company based on its phytocannabinoid derived medicines which are now available to patients in Australia, the U.K and Brazil under early access schemes. We look forward to updating the market on our further progress as we approach the New Year," he concluded.

Cann Group rebounds.

Also on the rise in the cannabis industry on Tuesday is the Cann Group Ltd (ASX: CAN) share price. Its shares are up 11% this morning to 49.5 cents.

However, it is worth noting that its shares fell a whopping 40% on Monday. Investors have been selling its shares amid concerns over the weaker than expected demand for cannabis products in North America and the oversupply of cannabis dry flower.

Cann Group is currently constructing a massive growing facility in Victoria at significant cost. But it remains unclear whether it will be able to offload its supply given current market conditions.

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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