An Israeli cannabis company is set to be listed on the London Stock Exchange (LSE) as part of a drive to raise £4m for clinical trials into medical marijuana.
Tel Aviv-based Kanabo Research is keen to fund detailed studies into the potential health benefits of medical cannabis ahead of launching over-the-counter products as it plans to become the first business of its kind to appear on the LSE.
The move comes as the UK is gripped in the final throes of negotiating its way out of the European Union (EU) – a prospect which, according to lawyers and Kanabo’s CEO, still has the potential to attract huge investment from a wide variety of sectors.
Avihu Tamir, who set up Kanabo after being treated with medical marijuana for crippling migraines he had suffered since childhood, says London still offers opportunities for pioneers – despite the current Brexit upheaval.
“I believe there is a benefit to being first, I believe there is a benefit of leading a change in a market,” he said.
“We have a route for generating cash and revenue almost immediately, but we have potential for much more than that.
“You’re growing fast or being bought and when you need to grow fast it’s much easier to do it as a public company – the London Stock Exchange gives you that added value.”
The surging medical cannabis market in Israel is one of the Tel Aviv stock exchange’s fastest-growing sectors, but Kanabo – with a promised investment of £1.5m from cash shell Spinnaker Opportunities – is keen to seize on the potential of the UK market.
Anticipated products from Kanabo are all largely medical cannabis administered through a vaping device – a delivery system which has the backing of Israel’s health ministers.
It is understood Kanabo is counting on the UK to relax its marijuana laws over the coming years. While a limited number of CBD products are available in many stores across the UK, uncertainty still surrounds future legislation.
That uncertainty has led several lawyers to urge caution. Including Claire O’Donnell – a partner with Norton Rose Fulbright who told Israeli business site Haaretz that investors needed to be wary.
“A lot of people are wanting to have a conversation about the sector,” she said.
“But investors need to tread carefully and take guidance to navigate what is a complex regulatory landscape.”