Why did you decide to get started in this industry?
CARLOS VELÁSQUEZ Colombia has one of the most sophisticated medical cannabis frameworks in the world, which came into effect in April 2017. We put together a team to present all the research and analysis to the government to cultivate, manufacture, and export cannabis products—essentially cannabis extract—for medical purposes. In September 2017, we obtained our full government license for non-psychoactive cannabis and set up our infrastructure and operations. We then studied the market and found a large demand for custom medical cannabis, especially in Canada, Germany, Switzerland, and the US.
GUSTAVO ESCOBAR It was a combination of a number of different things at the right moment. I was personally in a position to start working on the entrepreneurship side with different ideas with a company mainly focused on opportunities to create awareness among the population with one of our business partners. At the same time, we made excellent connections and gathered information that the medical cannabis opportunity would grow significantly by the end of 2015. We knew that medical cannabis had been licensed in different countries and geographies, so the sector made sense and identified Colombia as having relevant competitive advantages with a combination of low cost production and the possibility to produce high-quality medical solutions to bring benefits to patients all around the world.
What have been your major challenges and accomplishments?
CV The first challenge is the taboo about cannabis, which relates to a lack of education about the product. Cannabis has been used in the human body for 4,000 years. It has been used for textiles and medication for a long time, and education is the key here. The other main challenge is the association of Colombia with people that have not done the right thing in the past; however, that is not Colombia. This country is full of talent, resources, and excellent entrepreneurs. That said, currently there is also a large shortage of cannabidiol (CBD). In addition, the cannabis framework is being approved in 80 countries around the world, and pharmaceutical companies are now marketing CBD and creating new products around it. The market will, therefore, only continue to grow, and there will be enough room for several players globally. We are particularly excited in Colombia because we have comparative advantages both in terms of quantity and quality for off-takers. Demand is increasing every day. We are just missing the formal participation of the financial sector because the Colombian government was thoughtful about how it developed this overall framework. The rest of the structure and processes are going well. It is a learning process for everyone, though legally we are on the right path.
GE There have been many achievements. Being one of the pioneering companies is a huge advantage and gives us significant advantages: we have 5ha of GACP under cultivation in our facility and are in the process of establishing up to 100ha, thus implementing one of the largest GMP cannabis extraction and formulation facilities in LATAM. What's more, we have already signed supply agreements in different regions and joined with other companies to create an association called Asocolcanna, which we have led from the beginning. It was a personal effort, and we work together with other players in the country. It gave us a great advantage, especially in terms of exposure to regulators and creating different benefits for companies and patients. There has also been a great deal of development regarding cannabis and offering access to patients, though not on developing the right prescriptions and items that people can access. It is a huge challenge since a close cooperation with medical associations is required. We have been doing tests and evaluations with the medical community in Colombia, and no more than 65% of the physician community is ready to accept this as a legitimate treatment. Indeed, it is a major challenge to get them into this new system. This government has been trying to understand the different background and track records that other regulators have been dealing with in the past 10 years, and Colombia has done a great job creating a framework that helps to develop the medical cannabis industry.