Day: June 25, 2024

Since its founding in 2018, Sanity Group has quickly established itself in the European cannabis market and today maintains one of the strongest pharmacy distribution networks in the German medical cannabis market, with more than 2,000 pharmacies. Currently, the company holds an estimated market share of around ten percent with its medical brands Vayamed and avaay Medical. Notably, the avaay Medical brand has become one of the leading cannabis flower brands and has seen significant sales increases since the reclassification of cannabis in Germany in April this year. Sanity will use the additional capital to improve education and simplify access to medical cannabis therapy. Moreover, Sanity is currently the only German company participating in a scientifically supervised Swiss pilot project for the distribution of recreational cannabis through licensed specialty shops in the Canton of Basel-Landschaft. The project called Grashaus Projects could serve as a blueprint for further steps in cannabis legalization also in Germany.

Expanded Import Volumes Following EU-GMP Certification

The current investment extends the previously announced supply agreement between Organigram and Sanity Group. Once Organigram obtains EU-GMP certification for its indoor cultivation and production facility in Moncton, New Brunswick, Sanity will introduce more flowers and innovative dosage forms from Canada to Germany. Organigram expects to complete its final EU-GMP inspection by the end of the calendar year. “With a commitment to responsible research, innovation, and product development, we are confident that we have chosen a partner in Organigram who will support us in taking a leading position in rapidly developing legal European markets,” says Dr. Konstantin Rutz, COO and Managing Director of Sanity Group.

“We are very pleased to complete this financing with our partners at Organigram, who have consistently proven themselves as leaders in the competitive and highly regulated Canadian cannabis market,” adds Finn Haensel, co-founder and CEO of Sanity Group. With its entry, Organigram expands Sanity Group’s investor community, which includes venture capital funds such as Redalpine, HV Capital, Cherry Ventures, Atlantic Foodlabs, Casa Verde Capital, and Navy Capital as well as well-known personalities like Will.i.am (Black Eyed Peas), Scooter Braun, German TV presenter Klaas Heufer-Umlauf, model Stefanie Giesinger, soccer professionals Mario Goetze, André Schuerrle, and Dennis Aogo, and actress Alyssa Milano.

Strong Signal for the German and European Cannabis Market

“We believe that after Canada, Germany will emerge as one of the more promising markets under a nationally legal model,” says Paolo De Luca, Chief Strategy Officer at Organigram. “With its evolving program for medical cannabis and recent limited legalization for recreational consumption, Germany may eventually adopt a full adult-use cannabis framework. This growth opportunity is magnified by positive regulatory developments in several neighbouring European jurisdictions where Sanity Group is expanding its presence.” 

Beena Goldenberg, CEO of Organigram: “Our investment in Sanity Group establishes a significant European footprint for us. Organigram benefits from Sanity’s expertise and insights in the German and (in the future) other European cannabis markets. This has the potential to provide a pathway for us to launch our own brands and industry-leading IP through Sanity’s extensive distribution network. This relationship also bolsters our European revenue generation through a significantly expanded commercial agreement.”

Developments in Germany Potentially Shaping Europe

Following the legal reforms for recreational cannabis that came into effect on April 1, 2024, the German cannabis industry is experiencing an expansion: Recently estimated at an annual rate of 500 million euros, the German market is expected to grow to two billion euros by 2027. This remarkable growth is initially reflected in a 30 to 50 percent increase in medical cannabis prescriptions since the reclassification and removal of cannabis from the Narcotics Act. Similarly, the number of imports has increased significantly, reaching over 30,000 kilograms in 2023 – an increase of more than 26 percent compared to the previous year. The progress of the German cannabis industry could thus serve as a catalyst for a more unified and progressive approach to cannabis legalization and regulation across the continent.