These Three Kings of Cannabis are Going Into Business Together

It’s being called ‘the largest global cannabis partnership to date.’

Two of legal marijuana’s largest corporations are joining forces with a legendary cannabis genetics outfit, creating an unprecedented joint venture that will sell some of pot’s most recognizable brands throughout Canada, eventually selling in international markets.

The deal’s individual players, who are among the industry’s most noteworthy, are calling the partnership “the largest global cannabis partnership to date.”

The players are Ontario-based Canopy Growth, considered the world’s largest cannabis company, with a market cap of $3.8 billion; Colorado-based Organa Brands, the U.S.’s most ubiquitous marijuana brand, thanks to its flagship OpenVape products; and Netherlands-based Green House along with its sister brand Strain Hunters, known for their influential genetics, popular consumption clubs, and globetrotting documentaries.

The collaboration will operate through Canopy Growth’s federally licensed Agripharm facility in Creemore, Ontario, with Canopy Growth issuing shares to Green House and Organa Brands in exchange for exclusive licenses in Canada for proprietary technology, genetics and intellectual property.

“These individual businesses each bring an interesting combination of experience, brands and entry points into the sector,” Canopy Growth CEO Bruce Linton told Joint Ventures this week. “It’s almost as if we’re making a rope with these different threads, and it feels like another industry first when you look at what we’re trying to do with this collaboration—since we’re bringing this level of expertise and experience and wrapping it all into a fully compliant, Health Canada-certified building.”

The deal also includes the exclusive distribution of all Organa Brands and Green House products via Canopy Growth’s national channels—and the opportunity for international growth, since Canada’s federally legal market can export cannabis products to countries that allow the importing of marijuana.

“These groups, we’re are all entering into a partnership to explore the world,” Peter Miller, Agripharm’s CEO who comes to this position through his work with Green House and Strain Hunters, said. “There’s an ambition to work together globally, similar to how we’re working together in Canada.”

Added Organa Brands co-founder Jeremy Heidl: “This is a true collaboration, providing an international home base for all three of us. To have a foundation in Canada and collaborate around the world in other federally regulated markets—with these three companies working together worldwide—is very much what we’re going for. And to have created this kind of reach overnight is just amazing.”

Organa Brands already sells its OpenVape, Bakked, Magic Buzz, and District Edibles products in eleven U.S. states and Jamaica, and Heidel confirmed that his team has been actively looking to expand to Germany, Switzerland and other European countries. This deal may very well expedite that process for Organa Brands.

“Canada is the largest federally legal adult-use market at the moment with upwards of 36 million people, but when you think about how much headroom there is, we’ve barely scratched the surface,” Heidel added. “Especially since we’ll be working together with Canopy Growth and Green House, the rest of the world is our oyster.”

While Canopy Growth and Organa Brands are among North America’s largest marijuana businesses, Green House and its notable founder Arjan Roskam are the industry veterans of the group.

The first Green House Coffee Shop opened in Amsterdam in 1985, and three other 420-friendly locations followed in the Dutch cas did a consumption-friendly Strain Hunters Club in Barcelona. Green House genetics, including world-famous strains White Widow and Super Lemon Haze, have won more than 40 Cannabis Cups, and the group’s plant-centered Strain Hunters documentaries have more than 150 million views.

“Our brands have been in the market for 32 years,” Billy Levy, managing partner at Green House Brands North America, said. “We believe brands will be an important part of how this industry grows. And once this opportunity came up to bring the Green House brand to the North American market, we knew we had something special.”

For consumers, the three-way deal will introduce some of marijuana’s biggest brands to Canadian stores. As the country’s marijuana market transitions from medical to recreational in the coming year, Agripharm will sell Green House strains and seeds, Strain Hunters-branded products, and cannabis concentrates and edibles made by Organa Brands.

That said, one of the hurdles facing the new joint venture is Canada’s current ban on concentrates and edibles. But Canopy Growth’s Linton is confident the country will start allowing the production and sale of extracts and edibles by late-2018 or 2019.

“There will be a bunch of pressure to allow that to happen and a bunch of valid reasons that it will happen,” Linton said, pointing toward consumer demand for such products and the Canadian government’s desire to manage the country’s black market. “I think there is enough demand from enough sources that we’re going to see it happen.”

In many ways, these entrepreneurs feel as if they were destined to ink this partnership. For Heidel, his first legal cannabis purchase was in a Green House Coffee Shop in Amsterdam in 2003, and he later bought one of Roskam’s “King of Cannabis” DVDs—something that blew his mind as a kid growing up in prohibitionist Georgia.

Linton has admired both Green House and Organa Brands from afar for years. But perhaps the most striking alignment centers on the Agripharm facility itself—which was originally built by Miller and Levy, who sold it to Mettrum Health Corp. and later left Mettrum to explore other opportunities—which ultimately lead to a friendship and then partnership with Green House, just as their old Mettrum facility was acquired by Canopy Growth, which is now opening up the Agripharm facility to its new partners, including Miller and Levy.

“We put the first shovels in the ground to form Mettrum Health,” said Miller. “So this has really come full circle for us.”

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