Tilray CEO encourages pharma and booze companies to enter the cannabis space; shares soar
Cannabis companies have been in the spotlight ahead of the pending legalization in Canada.
Tilray Inc (NASDAQ:TLRY) CEO Brendan Kennedy sat down with CNBC’s Jim Cramer Tuesday night to frame the big picture beyond Canada and discuss which companies need to carve out a piece of the space.
READ: Tilray receives approval from US to import a medical cannabis study drug, shares soar almost 30%
Shares of Tilray surged more than 50% to US$234 in Wednesday pre-market trading following the interview.
Kennedy said pharmaceutical companies especially need to consider partnering with cannabis companies.
”They have to hedge this,” said Kennedy in his “Mad Money” interview.
“Cannabis is a substitute for prescription painkillers, prescription opioids, and so if you’re an investor in a pharmaceutical company or you’re a pharmaceutical company, you have to hedge the offset from cannabis substitution.”
READ: Constellation Brands ups stake in Canopy Growth, invests an additional US$4bn
Tilray teamed up with Sandoz Canada Inc, a division of Swiss drug manufacturer Novartis AG (NYSE:NVS), giving the cannabis company a helping hand developing products and getting them into Canadian pharmacies and hospitals.
Constellation Brands Inc (NYSE:STZ), the maker of Corona beer, recently invested an additional US$4bn in another Canadian cannabis company, Canopy Growth Corp (NYSE:CGC, TSX:WEED).
Kennedy encouraged other alcohol manufacturers to follow suit, calling it a “great hedge” and a “global opportunity.” He valued the cannabis industry at around US$150bn.
Legalization is headed to Canada in October, but Kennedy is more interested in what comes next.
“With Canada, we’re about to see 100 percent growth: one country, Uruguay, to two countries, Canada. What intrigues me is country three, four, five and six,” said Kennedy.
“It’s not about Canada, it’s about all the countries that follow,” he added.
Kennedy predicted that a third country will arise within 12 months of October.
Story by ProactiveInvestors
Source: http://www.proactiveinvestors.com/companies/news/205233/tilray-ceo-encourages-pharma-and-booze-companies-to-enter-the-cannabis-space-shares-soar-205233.html
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