Aphria Inc. (TSX: APHA) joined a small group of big players that can ship medical weed freely inside the world’s largest trading block.
The Ontario producer announced Tuesday it gained its European Union Good Manufacturing Practices certification, which gives it the ability to ship bulk dried flower and cannabis oil products within the E.U.
The Canadian pot firm said it chose the Malta Medicines Authority to conduct the EU GMP audit because the criteria established by the MMA is among the most stringent and demanding of the 28-member union. The certification was obtained through Aphria’s Ontario-based subsidiary Avanti Rx Analytics.
“We believe that this is a game changer for Aphria Inc. and will significantly advance our leadership in permissible medical cannabis markets across Europe,” Aphria CEO Irwin Simon said in a statement.
“With 2.4 million square feet of licensed production capacity of up to 255,000 kilograms, state-of-the-art greenhouses and labs, and our global infrastructure, we believe Aphria is well positioned to lead in the Canadian and international markets.”
The company expects medical cannabis shipments to its German subsidiary will begin in its fourth quarter of fiscal 2020.
Aphria Inc. Receives EU GMP Certification for Subsidiary ARA-Avanti Rx Analytics: https://t.co/yTnnUDDU94 $APHA pic.twitter.com/yoeVi4x2nj
— aphria inc. (@aphriainc) January 21, 2020
Aphria fighting for piece of Europe’s burgeoning medical pot market
Because Canada is the first G7 nation to legalize pot, companies north of the 49th parallel have been jockeying for first mover advantage to import legal cannabis into overseas markets.
But in order for a Canadian pot firm to ship its products to Europe’s growing medical cannabis markets, it needs to gain EU GMP certification. And EU GMP is considered by the industry as the highest level of quality certification for medical cannabis in the world.

Germany was the first E.U. nation to legalize medical cannabis in 2017. Research firm Prohibition Partners expects the country will play a central role in opening up the European cannabis market in the coming years. (Photo courtesy of Deposit Photos)
According to Laura Lepore, VP of Investor Relations & Communications at MediPharm Labs (TSX: LABS), there are many levels of GMP certification but the EU GMP level is by bar the highest and hardest to get for the cannabis industry. She said its even more difficult for a cannabis processor to achieve compared to a cultivator.
“You have to validate everything and every single step of the process,” she said in a previous interview. “Even every piece of equipment — even a little valve — you have to be able to trace it back to the manufacturer.”
MediPharm has been working on receiving its EU GMP certification for more than one year, as it tries to beat out other major cannabis extractors also vying to meet the high standard.
Aphria joins several weed producers that have achieved the EU GMP standard, directly or through a subsidiary. That list includes: Canopy Growth, Cronos Group, Aurora Cannabis and Tilray.
Each of those weed giants has at least one supply deal inside Germany or the E.U.
Cannabis research firm New Frontier Data says France leads leads all European nations with the largest demand for medical cannabis at US$10.5 billion. Next in line, Italian medical markets have a value of US$9.7 billion, and in Germany it reaches US$9.5 billion. The U.K. comes in fourth at US$4.6 billion.
Aphria’s share price initially rose three per cent on the news, but finished Tuesday’s trading session down one per cent.
The Ontario producer slumped on the Toronto Stock Exchange since it released its second quarter earnings Jan. 14. The company said it’s slashing its fiscal 2020 revenue forecast to $575 million to $625 million from $650 million to $700 million.
Read more: Canopy Growth widens its medical cannabis footprint to Luxembourg and the U.K.
jared@mugglehead.com
@JaredGnam
