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This article was published 12/4/2017 (1254 days ago), so information in it may no longer be current.

WAYNE GLOWACKI / WINNIPEG FREE PRESS Jeff Peitsch, CEO of Bonify, in the production hall by the nutrient tanks for the grow rooms.

On the eve of historic legislation paving the way for the legalization of marijuana in Canada, Manitoba’s second licensed producer finally got the green light from Health Canada.

It’s been a three-year journey for Bonify. CEO Jeff Peitsch said that time allowed the company to increase its scale and scope of operations, which may make the company more valuable in the long run.

The first batch of seeds will arrive next week at the undisclosed inner-city location. Bonify has built 100,000 square feet of production space that’s ready to go, and it has an additional 220,000 square feet of capacity under the same roof.

In addition, the locally owned company — it’s closely held and well-funded by a handful of Manitoba residents — has bought several acres of surrounding land that will give it one million square feet of production capacity.

"Our vision at the outset was not just to be a producer of cannabis for the local market but, in fact, a global leader of cannabis and cannabis-derived products," Peitsch said.

When it filed its application with Health Canada in 2014, it contemplated 30,000 square feet of production.

"The actual licence processing took quite a bit longer than we had initially anticipated," said Peitsch, who was the chief operating officer of CancerCare Manitoba for 10 years before getting into the pot business.

"We figured if this was going to take additional time, let’s build additional capacity and additional value in other aspects of our operations to maximize efficiency when the time comes," he said.

Bonify is approaching $10 million of capital investment before a single plant has grown. It has been operating a mail-order hydroponics equipment business for the past two years.

It’s likely not made a dent in the massive investment required, which includes more than $2 million in security infrastructure that features 200 closed-circuit cameras throughout the space; and a reverse-osmosis water-distribution system with a tank farm and mechanical setup that would put many local craft breweries to shame.

In addition to Peitsch’s experience in the business — he’s worked at Novopharm Biotech (now Viventia) — the facility general manager, Mark Smolenski, worked at Biomira Inc. and Abbott Laboratories.

Peitsch said Health Canada inspectors suggested its facility design exceeds most standards and could define best practice in a few areas.

"We are building a very credible organization with very credible people," he said. There are 15 people on staff and it will likely add 40 or 50 positions by the end of the year.

Bonify still has to prove itself, but it seems to have ticked all the boxes before starting production, including extensive engagement with physicians and medical-marijuana patients and having a modern automated growing facility that will drip in precise amounts of moisture and nutrients depending on the strain of marijuana being grown and the growing technique being deployed.

Delta-9 Bio Tech, the other licensed producer in Manitoba, is switching its production to hydroponics. Bonify will use a variety of growing techniques.

Bonify has started reaching out overseas. While there are no agreements in place, Peitsch said the company is engaged in discussions with third-party entities globally.

The annual global marijuana market is estimated at about $340 billion, so it’s natural that a new Canadian company would scope out international opportunities. Canada will be the first G7 nation to legalize marijuana.

Capital is pouring into the market. Canopy Growth Corp., one of the largest in the country, is worth $1.7 billion. Earlier this year, Alberta-based Aurora Cannabis Inc., acquired a 20 per cent stake in the first Australian company licensed for research and cultivation of medical cannabis for human use.

Aurora recently raised $75 million in convertible debt, its third debt offering in about six months. Last week, it announced the $7-million acquisition of a Montreal company that has a 40,000-square-foot cannabis-production facility but has yet to be licensed by Health Canada.

Peitsch said Bonify has received a serious proposal from U.S. investors to acquire 100 per cent of its operations even before it’s had the chance to begin production.

"We held off because we think we can add a great deal more value and build something that is special here," he said.

martin.cash@freepress.mb.ca