Flora Growth to distribute Storz & Bickel medical vaporizers in Australia

Oct 15, 2024

Flora Growth Corp. (NASDAQ: FLGC) entered into a distribution agreement with Canopy Growth Corp. (TSX: WEED) (Nasdaq: CGC) to bring medical cannabis vaporizers to the Australian market, the company announced Monday.

The agreement allows Flora’s subsidiary, Australian Vaporizers, to distribute Canopy’s Storz & Bickel medical vaporizers throughout Australia. Storz & Bickel makes high-end vapes, including the popular Volcano Vaporizer, known for its unique balloon-style vapor delivery and precision German engineering. The brand has focused on providing more handheld offerings in recent years.

Flora has looking to expand its presence in Australia’s growing medical cannabis sector, following its acquisition of Australian Vaporizers in June. That deal was valued at approximately $700,000, paid in Flora shares, according to the June share purchase agreement.

“We are very much interested in partnering with Canopy Growth to bring their highly regarded Storz vaporizers to the Australian market,” Flora Growth CEO Clifford Starke said in a statement Monday.

Starke previously noted that the acquisition of Australian Vaporizers was expected to quickly improve the company’s bottom line and drive synergies with Flora’s existing brands.

The Australian medical cannabis market was estimated at $94 million and is projected to grow at a compound annual rate of 33.6% from 2024 to 2030, according to Grand View Research.

Australian Vaporizers, which sold more than 92,000 units to more than 30,000 active customers in 2023, will lead the distribution efforts to health care professionals and clinics across the country, Flora said.

Flora itself has faced recent challenges, posting a net loss of $2.7 million for the second quarter of 2024 and ongoing liquidity issues, according to its latest financial report.

The global handheld marijuana vaporizer market, valued at approximately $5 billion, is anticipated to grow at a 13.4% compound annual growth rate by 2031, based on data from Transparency Market Research.