Kanabo Group (KNB) said its recently acquired telemedicine company The GP Service has extended an agreement between itself and one of the UK’s largest retail groups.
Earlier this year, the Israeli-based medicinal cannabis firm acquired The GP Service, a private primary care telemedicine provider, in an all-share deal for a total consideration of £13.5m.
GP Service, which operates an internet-based consultation platform, originally partnered with the UK retailer in 2019 for the provision of general medical assistance for its members. Its retail businesses include food retail, wholesale, e-pharmacy, insurance, and legal services.
The original agreement was limited to the submission of the patient’s medical history online, where the GP Service doctors would review information provided by the patient and complete the prescription for the retailer to arrange fulfilment and delivery of any approved medication.
The GP Service will now be able to provide live video consultation services with prescriptions available for collection through its partner network of over 4,000 pharmacies across the UK.
Users will normally see a doctor and may receive a prescription for collection on the same video call. In addition to prescription services, GPs will also provide fit notes and referrals.
The Company said that consultations will be available between 8am and 8pm, Monday to Sunday, 365 days a year.
Consultations are usually available within 30 minutes, with approximately 95% of all prescriptions available within 60 minutes of the consultation.
Commenting on the contract extension, Atul Devani, CEO of The GP Service told investors this morning: “The extension of this agreement reflects the successful relationship we have had since we began working together in 2019. Our integration with the NHS summary care records ensures our services are both safe & secure and we now look forward to extending our services to include virtual GP consultations with automated digital prescriptions.”
Kanabo CEO, Avihu Tamir, said today’s extension “goes a long way” to validating Kanabo’s rationale for the acquisition earlier this year. “The GP Service is an innovative Telemedicine Provider, that forms an integral part of the overall strategy at Kanabo, and I look forward to extending our services in the UK further over the coming months and years,” he said.
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Earlier this week, Kanabo hailed the progress made throughout the year ended 31 December 2021 and said it expects 2022 to be “another year of transformation growth” for the business.
Recent data from Morningstar has shown that assets managed by cannabis funds had fallen by 45% to $2.6 billion in the 12 months to March, down from $4.6 billion in the year prior. Despite this, Kanabo Group still remains one of the best performing shares on a relative basis, with cannabis stocks on London’s main market falling between 60% and 80% over the past year.
In recent weeks, Kanabo has offered a proposed alternative growth strategy to replace its proposed acquisition of Materia. The alternative strategy - which won’t expose its shareholders to further dilution - received support from the market and provided some reassurance for Kanabo investors, with the shares climbing to 4.21p on the day of the announcement.
The new partnership is expected to support Kanabo’s commercialisation of medical cannabis products in the UK and Germany with direct access to Materia’s EU-GMP production facility.
Alongside its focus on product commercialisation, Kanabo is also focused on expanding its patient access to medicinal cannabis in the UK - these plans have already come into fruition with its recent £13.5m acquisition of the primary care telemedicine provider The GP Service.
In addition, following the period-end, Kanabo signed a Memorandum of Understanding with Forbe, thereby taking the Company into the emerging CBD markets in the Israeli market.
Kanabo expects this to position it as a CBD market leader in this high growth market where the regulatory landscape for the sale of CBD products is on an increasingly positive trajectory; at the current rate of growth, Israel’s deregulated market is estimated to be worth up to US$475 million by 2025.
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