Medicinal cannabis and pharmaceuticals company Rua Bioscience is planning an initial public offering to list the company on the NZX.
It also announced todayit has been granted a commercial licence by the Ministry of Health to grow and supply cannabis-derived medicines from its new specialist growing and production facilities on the East Coast.
After being given the green light for its facilities to begin commercial operations and a European Union export sales agreement with leading German medicinal cannabis distributor, Nimbus Health, Rua Bioscience (Rua) revealed its plans to raise capital and list on the NZX.
The company, founded in 2016 as a subsidiary of Hikurangi Enterprises Ltd, said an IPO is slated for the fourth quarter of this year.
"We believe an IPO will offer New Zealanders an opportunity to invest in a highly focused leader in the medicinal cannabis sector, with a clear path to revenue," Rua's board chair Trevor Burt said.
"At this stage we plan to go to IPO in the fourth quarter of this year, however, this is subject to ongoing market conditions, company developments and other factors."
Proceeds from an IPO will fund Rua's next stage of development, build long-term resilience and accelerate growth, the company said.
All funds raised will be for new capital, with no allowance for a sell down by existing shareholders. Any IPO is expected to also include a priority offer for Tairāwhiti residents.
"An IPO would be an important step for Rua, as a company founded and initially funded by a small Māori community on the East Coast," co-founder and Kaihautu Manu Caddie said.
Existing shareholders in Waiapu Investments, which invested in Rua through a local crowdfunding raise in 2018, will have their shares converted to Rua shares if an IPO occurs.
The number of shares and price range are yet to be determined but further details are expected in the coming weeks, the company said.
Rua was one of the first medicinal cannabis companies to be licensed for commercial production and plans to be exporting its first product, Ruatoria-grown pharmaceutical-grade dried cannabis flower, to Germany in the next year.
"Germany is one of the world's most advanced medicinal cannabis markets. Doctors there prescribe the dried cannabis flower to patients to use primarily for pain relief," Burt said.
Rua said it is focused on a "doable" export strategy to drive revenue over the next three years by making its first material sales through wholesale exports of dried cannabis flower to Germany.
Burt added the company was also creating sustainable economic opportunities for East Coast communities.
"New Zealand's medicinal cannabis scheme became operational in April, and we are now licensed by the Ministry of Health to commercially cultivate and supply cannabis-derived pharmaceuticals for sale," he said.
Rua's CEO Rob Mitchell said more than $6 million has been invested in two state-of-the-art facilities that are now licensed and operational, which include an 8000sq m cultivation centre in Ruatorea and a purpose-built extraction and manufacturing facility in Gisborne.
"Initially the medicinal products to be manufactured from Gisborne will be CBD oil and dried flower for export," he said.
"Like in Ruatorea, this facility is also designed to be easily extended as our production increases. Currently, our system can process 2200kg per annum, but with planned expansion modules this can easily be increased ... we aim to produce a few hundred kilograms of pharmaceutical-grade dried cannabis flower in our first full year of operation."
Yesterday, the Herald reported the Ministry of Health had also granted the country's largest company in the sector, Helius Therapeutics, a new commercial licence.
The company said the medicinal cannabis industry could play an important role in the nation's economic recovery from the Covid-19 pandemic.
The global market for medicinal cannabis is forecast to reach $55 billion by 2025.
Kiwis will also vote at the rescheduled October 17 election on a non-binding referendum over whether the recreational use of cannabis should become legal, based on the proposed Cannabis Legalisation and Control Bill.
Cannabis-based medicines can already be prescribed by a doctor in New Zealand.