South Australia-based MedTEC Pharma is preparing to harvest its first commercial crop as it reaches a milestone that has been five years in the planning.

Located in the Riverland region of the state, 260km east of Adelaide, the company is growing approximately 12,000 plants on a 10-hectare cultivation site.

The first crops are expected to be harvested in the next two weeks with MedTEC planning to release its debut home-grown flower and oil medicine by mid-year. Health House International will distribute the products.

MedTEC has around 12,000 plants in the ground at its South Australia site

The crop, which is being grown under protective netting enclosures, is expected to yield approximately 8,000kg of dried flower. The majority will be THC strains for inhalation and extraction, with 1,000kg set for CBD-only oil.

Managing director and MedTEC’s largest shareholder, Brad Gallard, told Cannabiz the journey has been a long one.

“The company started in 2019 and, since I went to a cannabis conference early that year, it’s been a full-time gig to get to this point,” he said. “If anyone tells you they can do it quickly, don’t believe them. We knew it was going to be a long slog, although probably not quite as long as [this].”

He declined to disclose how much the venture has cost, but said its shareholder base – which numbers around 100 – has “great depth”.

“We have smart-money shareholders who were chosen to invest in the business,” Gallard said. “We have worked on a capital-light base for high-yielding production and have spent a lot less money than probably some of the listed companies.

“I’ve come from a horticultural background, from tomatoes to citrus, and if you don’t run a lean operation, you’re not going to make it. We’ve seen that already in the cannabis industry.”

Despite earlier flagging a possible public listing in 2023/24, Gallard ruled out such a move, saying the shareholder base has changed since an IPO was first mooted.

“When you start up and investors come on board, they want to know what the exit is, and directors at the time thought an IPO might be the way to go. But the shareholder base has changed since then and at this point in time, we have no intention of an IPO,” he said.

“We are comfortably self-funded and unfortunately, IPOs in Australia, whether it be cannabis or anything else, have struggled.”

Along with MedTEC’s existing outdoor site – which will produce one annual crop – construction will soon start on a near-3,000sqm indoor facility on the same 20-hectare site that will allow for year-round growing.

Indoor cultivation capacity is expected to come on line in the last quarter of 2024, with a GMP manufacturing facility also planned.

Chief commercial officer Dirk Beelen said the addition of locally grown product will be welcome in Australia, and embraced by patients.

MedTEC Pharma chief commercial officer Dirk Beelen

“We will produce medicinal cannabis with provenance, that is one of our points of difference,” he said. “I believe people want and like Australian products and there’s not that many in the market. How much medicinal cannabis in Australia is imported, 75%? 80%?

“We are making sure we have the right products for this market and will focus on that provenance, making sure people understand that, here in Australia, we have the capacity to grow quality flower that is competitive with what is being imported, whether that is the cannabinoid content, terpene content or the physical appearance of the product.”

He stressed the outdoor and organic nature of the cannabis plants, coupled with iCloud and AI-based cultivation software, will produce a quality product.

“Some people say [outdoor-grown plants] might not be stable or consistent, but given the environment where we are growing, we truly believe the benefits will be clear.

“Those who have come through the facility have been blown away by the plants. Of course we need to get the results and the Certificate of Analysis (CoA), but we believe we have the right cannabinoids and the terpene content to deliver quality products.”

Gallard said climate conditions in the Riverland region are ideal for outdoor-grown cannabis, with hot days, little rain – automated irrigation systems have been installed in the cropping enclosures – and a breeze that reduces the risk of mould.

MedTEC CEO Brad Gallard

“We are also growing in living soil so we’re fully organic,” Gallard added.

MedTEC has joined forces with a number of research bodies, including the South Australian Health and Medical Research Institute (SAHMRI), to adopt a clinical approach to cannabis medicine.

Beelen described the firm as a “truly medicinal cannabis-focused company” that will work with doctors and research bodies to identify strains that work for specific indications.

While high-THC product will feature in its product mix, the more immediate launch of MedTEC-branded medicine – from plants grown by an undisclosed third-party cultivator – will contain lower levels of THC.

“There is a strong indication that very high-THC flowers, the 35% flowers, are not what a typical patient is looking for,” Beelen said. “Our products that will come out very soon, which are also from an Australian producer, sit at 14% to 18% THC.

“The products from our crop will sit around at 18% to 25% THC, and maybe higher. We’ll have to see when the results come in.”

In addition to cultivating at the site, MedTEC’s facility features a drying room and has propagation and cloning capabilities in fully insulated temperature-controlled environments.

Steve has reported for a number of consumer and B2B titles over a journalism career spanning more than three decades. He is a regulator contributor to health journal, The Medical Republic, writing on...

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