It’s no secret that the world is growing accustomed to the business of cannabis, but for $9.6 billion Canadian medical marijuana producer Canopy Growth, the future is approaching faster than many expect.
On Tuesday, Canopy — which has gained traction on news of several-billion-dollar investments from Corona parent Constellation Brands — announced that it had shipped cannabis to the United States from Canada for medical research, a milestone in the U.S. government’s acceptance of what it considers to be a Schedule 1 drug.
“Under [Drug Enforcement Administration] approval, we shipped, for the first time, legally — and I highlight ‘legally’ — cannabis from Canada to the U.S,” Bruce Linton, the co-founder, Chairman and CEO of Canopy Growth, told CNBC’s Jim Cramer.
“The DEA-approved partner, which we haven’t announced yet, can actually begin to do medical research, clinical trials if necessary, [and] create the data set that enables people to know when, what, where, and maybe it can become federally regulated in the U.S. with some input that way,” Linton said in an interview on “Mad Money.”
Canopy’s news comes less than one month after competing Canadian marijuana producer Tilray announced DEA approval to import cannabis to the United States for medical research at the University of California San Diego Center for Medicinal Cannabis Research.
California is one of eight states, excluding the District of Columbia, to fully legalize medical and recreational marijuana use. Thirty U.S. states currently have laws legalizing medical marijuana use in some form.
Today, the world has its eyes on Canada, where full legalization of adult marijuana use is set to take effect on Oct. 17. While the windfall will likely be massive for producers like Canopy, Linton is focused on the longer-term global opportunity.
The CEO said Thursday that cannabis could disrupt some $500 billion worth of global markets, calling that a more “accurate” estimate than “conservative, cautious” predictions of a $200 billion disruption.
“We disrupt alcohol potentially, cigarettes potentially, in terms of smoking cessation,” he told Cramer. “We really disrupt pharmaceutical, because whether or not you’re geriatric care, you’re dealing with arthritic conditions, you’re someone who can’t sleep, you’re going through an oncology treatment, I think you’re going to find cannabinoid therapies really hit there.”
“And so you add all that together, plus the existing $200 billion illicit market, that pretty quickly gets you up around $500 billion,” Linton continued. “It sounds like a ‘How could it be?’ but just do a bit of the back-of-the-envelope math. It’s not crazy.”
Canada’s legalization could be Canopy’s key to seizing on that opportunity more than it already has, Linton added.
“Last week I was in the EU, the U.K. They know about Oct. 17 intimately and they’re trying to figure out, ‘Hm, if we’re a government or businesses, how do we quit ignoring cannabis and govern it, regulate it, tax it and turn it into something that might be medicinal and for sure a much better formatted product for a party?’” he said.
“And so what’s going to be the big bump isn’t just Canada,” he said. “If we do it right, Canopy leads. That gives us the position globally that then, all of a sudden, you add a zero or two to the number of people we’re trying to serve.”
U.S. shares of Canopy, the first cannabis company to be listed on the New York Stock Exchange, gained 5.64 percent Friday trading as the rest of the stock market recovered from its multi-day losing streak.