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by Stockwatch Business Reporter
The Canadian Securities Exchange Composite Index gained 8.95 points to 848.19 Tuesday. Cronos Group Inc. (CRON) rose $1.20 to $20.54 on 2.1 million shares while Medipharm Labs Corp. (LABS) rose 41 cents to $6.84. The companies have entered an agreement in which Medipharm subsidiary Medipharm Labs Inc. will supply Cronos subsidiary Peace Naturals Project Inc. with $30-million worth of cannabis concentrate on a private label basis (in which Medipharm produces, packages and labels the product, but it is sold under the Cronos brand) over a period of 18 months. Peace Naturals will have a right to purchase an additional $18-million worth over the same period, subject to Medipharm having available supply. After that, the companies have a mutual option to extend the deal for another $12-million of concentrate, bringing total cannabis concentrate supplied in this case to $60-million.
As part of the deal, Cronos will supply bulk dried cannabis on a two-year term to Medipharm's Barrie, Ont., facility. Medipharm will process the dried cannabis into oil derivative products. The companies did not provide details on how much dried cannabis the supply agreement is for.
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