In this new Trade To Black Podcast, TDR Founder Shadd Dales spoke with Xebra Brands Ltd. (CNSX: XBRA) CEO Jay Garnett, fresh off a transformative ruling by the Mexican Health Regulatory Agency (COFEPRIS)—the domestic equivalent to the U.S. FDA—to grant Xebra’s wholly owned Mexican subsidiary Desart MX, SA de CV (Xebra Mexico) a full-spectrum approval to commercialize low-THC cannabis in Mexico. Mr. Garnett gets granular on the 4-plus year process to obtain approval, what it means for his company, and more.
The March 9 announcement brings finality to a December 2, 2021, decision which saw all five Supreme Court justices vote unanimously in favor of granting Xebra Mexico an irrevocable injunction to commercialize cannabis. The COFEPRIS authorization also brings full circle the final leg of the journey, which began on November 29, 2018 when it first applied for licensing.
Xebra Brands took a risk and pursued the licensing process to the end, and ultimately was rewarded for its efforts. The approval grants the company the ability, among other things, to import and acquire cannabis seeds, cultivate and harvest cannabis, process and produce cannabis, and sell cannabis products. It is a privilege that is without legal precedent in Mexico on the recreational side of the ledger.
While Xebra Brands digests the magnitude of the approvals, the company is currently sorting through the various opportunities now afforded to it. As Mr. Garnett explains:
We’re having a lot of ongoing conversations now, as I referenced earlier, it was: ‘Call us when you actually get it (licensing approval). We announced on Thursday morning, as you know, it’s been a relentless stream of phone calls to be able to, you know, kind of get back to everybody, which is very exciting for us… I don’t think we’re going to rush into anything. But I do think that over the next 60 to 90 days, we’ll identify the right partnerships.
Most likely, those partnership will be centered around edibles, drinks and wellness products as the licensing is valid for cannabis products with low-levels of THC (under 1%).
Currently, only medical cannabis in permitted for sale at a retail level in Mexico. Under the law, medical cannabis can be prescribed by authorized healthcare professionals, and patients can access it through licensed pharmacies. To be eligible for medical cannabis, patients must have a medical diagnosis and prescription from a healthcare professional authorized by the Mexican Ministry of Health.
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