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Sydney startup Greenfield MC will launch a joint-venture business with US-listed company EPHS to cultivate medicinal cannabis in Australia, with Queensland’s Sunshine Coast a frontrunner for the operation.

EPHS has tipped the Australian cannabis industry to become the “envy of the global market” and gateway to the burgeoning Asian market due to high agricultural industry standards. A study bankrolled by cannabis companies estimates the Asian market to be worth as much as US$5.8 billion by 2024.

Greenfield’s recently-recruited Chief Medical Officer Sree Appu, one of Australia’s top cancer doctors, told Business Insider Australia the medicinal cannabis market is at a tipping point, with mounting evidence of the plant’s therapeutic benefits helping to smash the stigma surrounding the drug.

The Asia-Pacific medicinal cannabis market has been tipped to heat-up by the two companies involved in the launch of a new Australia-based marijuana cultivation business.

Aussie startup Greenfield MC — which was launched in 2018 as an importer and distributor of medicinal cannabis — will now become a grower, under the terms of a new deal with US-Canadian company Emerald Plants Health Source (EPHS).

The two companies will create a joint venture business, Greenfield MC Cultivation, which will develop a cannabis growing operation in Australia for export across the Asia-Pacific market, Business Insider Australia can reveal. There are 20 organisations listed on the Australian Office of Drug Control’s website as having secured a licence to cultivate medicinal cannabis, though it is unclear how many have actually started producing.

EPHS — which is licensed to grow and distribute cannabis in Canada and listed on the New York-based OTC stock exchange — is anticipating the Asia-Pacific medicinal cannabis market will become the world’s largest as demand for cannabis-based treatment grows.

“Australia’s reputation for best agricultural practices, crop safety management systems and robust quality control will make Australian-grown cannabis the envy of the global market and provide patients with confidence in this new form of medical treatment,” said Kevin Smith, vice president for strategy and business development at EPHS.

“For those very reasons, we see Australia as the gateway to Asia, which it already is in various agricultural and pharmaceutical product categories.”

A study conducted by London-based cannabis industry lobbyist Prohibition Partners, and funded by cannabis growers and distributors, estimates the Asian market to be worth as as much as US$5.8 billion by 2024.

Locations are currently being scouted for the Greenfield-EPHS grow operation, with the Queensland Sunshine Coast a current frontrunner, the two companies said, thanks to its “favourable climate and natural light-cycle”. The business is due to be operational by late 2020 and will employ around 200 people across farming, lab work and security, a Greenfield spokesperson confirmed.

The Greenfield-EPHS deal comes as Australian actor Olivia Newton-John has thrown a spotlight on the therapeutic benefits of cannabis. The Grease star told Nine’s 60 Minutes program that the plant has greatly relieved her pain symptoms related to breast and bone cancer, increasing her energy levels and mobility.

Olivia Newton-John is maintaining her health with a combination of conventional & alternative medicines. But her husband John Easterling says he's confident medicinal cannabis is contributing significantly to her health and wellbeing. #60Mins https://t.co/5btZ3kuvR7 — 60 Minutes Australia (@60Mins) August 4, 2019

Putting the medicine in ‘medicinal cannabis’

But while celebrity product endorsements are always helpful, Greenfield is betting that serious medical industry clout is worth more when it comes to the medicinal marijuana market.

The company recently recruited Sree Appu, a former oncologists at the Monash Cancer Centre in Melbourne, as its chief medical officer and chairman of its medical board.

Speaking to Business Insider Australia, Appu said any business trying to take advantage of the huge Asia-Pacific medicinal cannabis opportunity will need to prove its medical credentials.

“There’s a lot of buzz around the enormous potential of the medicinal cannabis market and people from all walks of life are jumping on board,” Appu said.

“However, we’re talking about medicine here. We’re talking about a product that needs to be prescribed by doctors and dispensed by pharmacists. And while there’s already promising evidence for the use of medicinal cannabis for a range of health conditions, further product development needs to be underscored by clinical trials and real-world clinical knowledge.”

Appu said there is a growing body of evidence from clinical trials suggesting cannabis has had a positive impact on patients suffering from conditions including epilepsy, chronic pain and chemotherapy-induced nausea, backing up the comments made by Newton-John to 60 Minutes.

With Greenfield headed to a private capital raise later in 2019, the Aussie startup will be hoping its high-profile medical recruit — and new global-backed push into cultivation — will have investors feeling mellow and euphoric.

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