The East Coast settlement of Ruatoria could soon be transformed if a $160 million medical cannabis deal goes through.

A medical cannabis venture, Hikurangi Cannabis Company, has signed a Letter of Intent with Seattle-based Rhizo Sciences to produce 12,000kg of pharmaceutical grade cannabis products over the next four years.

The $160m offer is conditional on Labour's medical marijuana bill passing its second and third reading. It is currently at select committee stage.

Hikurangi Cannabis managing director Manu Caddie says the deal is a lifeline for the region that has few high-value products and unemployment levels well above the national average.

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"Thanks to the good work of other primary industries, New Zealand has a great reputation internationally for high-quality food and natural health products.

"We have leveraged this reputation with international customers in the EU, Canada and Australia who want to access the highest quality medical cannabis products in the world."

The company is still in its establishment phase with an initial public offer going up on crowdfunding platform PledgeMe next month, but Caddie says plans are well underway for the construction of a processing facility before the end of this year.

The company is preparing a submission to the Select Committee on the Medical Cannabis amendment bill to press home the importance of developing a scheme for its medical marijuana to be exported.

"There is huge scope for New Zealand to produce the highest quality medical product in a global sector expected to reach US$60 billion within five years."

A global cannabis consulting company, Rhizo Sciences vice-president Dallas McMillan says New Zealand is "ideally positioned to deliver a world-class clean, green product".

- NZ Newswire