Australian medicinal cannabis producers are on a high after government across the Tasman gave them approval to begin exports.
By the early afternoon on Thursday, shares in Cann Group were up 27.8 per cent at $3.68, The Hydroponics Company had gained 22.4 per cent to 87.5 cents, and AusCann had soared passed a dollar for the first time, up 31.1 per cent to $1.075.
Distributor Bod Australia also hit record highs in early trading — and was still up 24.4 per cent to 53.5 cents — after inking a manufacturing and commercialisation agreement with pharmaceutical company iX Biopharma Limited to develop a cannabis wafer product.
Federal Health Minister Greg Hunt on Thursday said granting the export of medicinal cannabis products was "an important step" for the development of the sector and to secure long-term supplies for Australian patients.
"This decision will help both the domestic supply and Australian producers by strengthening the opportunities for domestic manufacturers," Hunt said in a statement.
He said allowing the export of medicinal cannabis product will also help the developing domestic market to grow further, amid increasing competition from imports.
Cann chief executive Peter Crock welcomed the news, which will allow the company to set up at a global scale. "I think we are seeing there is a global shortage so there is going to be room for multiple players," Crock said.
He said Cann is well placed to remain at the forefront of the industry, thanks to a $78 million capital raising that will support expansion and ensure it has capacity to meet local and export needs.
"We have got an expansion plan that we went to market and raised capital specifically for that and it really allows confidence to move forward," he said.
The federal Australian government in 2016 legalised patient access to Australian-grown and manufactured medicinal cannabis, subject to state and territory regulations. Victoria in 2016 became Australia's first state to legalise cannabis for medical use, quickly followed by NSW.
AusCann managing director Elaine Darby described the decision as a win for Australian companies and patients. "This will really strengthen the industry, enabling it to supply Australian patients — in addition to international patients — with high quality, cost-effective cannabinoid medicines," Darby said on Thursday.
"It will allow the Australian medical cannabis industry to scale up to a certain size and stability, making it easier to produce more cost effective products in a shorter amount of time."