Mr Gunning admitted it was not easy to tap investors for early stage companies in the COVID-19 environment.
„All these potential investors have other business interests, and maybe they have been really hammered in other industries,” he said.
„If the three big (families) get involved, others will follow, but we are certainly casting the net wider because we don’t want to leave this to chance.
„There is a lot of money sitting on the sidelines still. There is so much uncertainty right now.”
These medicines have a useful and definite role but we want them used properly.
— Michael Fey, CannaPacific chief medical officer
Cornerstone investor Aleafia Health of Canada was also an early backer and controls 10 per cent of CannaPacific. Mr Gunning is expecting that Aleafia will follow its money by providing medical cannabis product such as oils and sprays to CannaPacific, which it then sells to patients through general practitioners.
The Melbourne-based Liberman family has been a key supporter through its privately controlled firm, JLIB Investments. Dean Kavanagh, JLIB’s portfolio manager, is also a CannaPacific non-executive director.
CannaPacific chief executive and founder Joshua Dennis said the Libermans were attracted to the company given its point of difference.
„We have a path to revenue through off-take agreements with our extraction partners. We are one of the few Australian companies to have such off-takes,” he said.
„Our first stream is to cultivate and provide product to others, whilst developing our unique varieties (of plants) with our partnerships with Tasmanian Alkaloids, the University of Newcastle and Xing Technology.
„That is underpinning our pharmaceutical strategy. We are developing plant varieties that we want to feed back into our pharmaceutical strategy.”
The bulk of the funds raised so far has gone to paying licence fees, building blackout curtains, lighting and security for its new one hectare greenhouse located outside Byron Bay, NSW, which is part of its 18 hectare site.
CannaPacific is close to receiving its permit from the Office of Drug Control, which sits within the Department of Health.
Once the permit is granted, CannaPacific plans to hire 30 to 40 people, and 4000 cannabis plants will go into the greenhouse for the harvest slated in April.
Mr Dennis, who founded the company in 2016 and is a civil and structural engineer, has a lofty goal of becoming the next GW Pharmaceuticals – a British group listed in the US with a $US3 billion market capitalisation. It is a global leader in developing cannabinoid-based registered medicines.
Michael Fey, chief medical officer and an oncologist who works part-time for GenesisCare, admitted the medical cannabis space was crowded, but CannaPacific was unlike other companies in the sector seeking to breed novel cannabis species.
„We are going from plant development biogenetics and plant propagation, to growing and extracting, right through to our clinical model,” he said.
CannaPacific is following a traditional model of drug development with pre-clinical trials. The two main areas of focus for pharmaceutical development are in palliative care and post-traumatic stress disorder.
Dr Fey said CannaPacific was also in tandem supporting GPs to use these medicines.
„These medicines have a useful and definite role but we want them used properly,” he said.
„We have written a bunch of software to enable that process and we are going out to GPs and getting them on board.”
The proprietary software helps streamline the application process for the patient to gain access to the medicine. The application must receive the tick of approval from the Therapeutic Goods Administration.
Dr Fey and Mr Gunning control about 15 per cent of the company, while Mr Dennis still holds a 34 per cent stake.