Evogene Ltd., a plant genomics firm whose shares are traded on the Nasdaq and on the Tel Aviv Stock Exchange, said Wednesday it has set up a subsidiary that will focus on developing medical cannabis products made from better and higher quality leaf yields.
In a statement, Evogene said it has been evaluating the medical cannabis field for more than a year and has obtained governmental approval for its research program and the establishment of a research facility.
Its subsidiary, Canonic Ltd., will initially focus on creating improved cannabis varieties, Evogene said in the statement. The unit will use Evogene’s plant genomics and computational know-how for its work, the statement said.
Evogene applies mathematical algorithms to plant biology to seek out genes that make seeds more resistant, enabling farmers to produce higher-yielding crops for a world that is being forced to produce more with fewer resources, as populations grow and the quantity of arable land declines.
The cannabis market is estimated at around $13 billion and is expected to grow to some $24 billion by 2025, according to the cannabis annual report issued by the Frontier financial group cited in the statement.
Although the cannabis market is growing rapidly, the next generation products will need to address a number of limitations, including low yield of the plants, which causes high costs for patients, and low variety stability, which leads to products that are unreliable for medical treatment, Evogene said.
Evogene’s software can help overcome these roadblocks, the statement said, and provide the firm with a “significant competitive advantage.”
The idea is to create high metabolite yield cannabis varieties without the use of genetic engineering; stable varieties of cannabis products with consistent performance; and specific varieties of cannabis to suit specific medical indications, the statement said.
The indications that the company plans to address at this stage are post-traumatic stress disorder (PTSD), severe chronic pain, and cancer.
“The field of medical cannabis fits perfectly within both our plant genomics activities and our human therapeutics activities,” said Ofer Haviv, the president and CEO of Evogene. “We expect the new company to advance rapidly in executing its mission of developing next generation medical cannabis products and to create substantial value in a relatively short time.”
Israel is known as a pioneer in cannabis research. Hebrew University’s Prof. Raphael Mechoulam kick-started the field in 1964, when he discovered tetrahydrocannabinol, or THC, the main psychoactive constituent of cannabis. The field has attracted a number of high profile personalities, including former prime minister Ehud Barak, who last year was appointed chairman of one of Israel’s biggest medical cannabis firms to lead its global growth strategy, and former Israel Police commissioner Yohanan Danino. On Wednesday Israeli cannabis firm Univo said that former prime minister Ehud Olmert will join the firm as an investor and adviser.
Last year, NRGene, an Israeli startup that uses algorithms to map out the genetic makeup of plants, said it will partner with a Swiss cannabis breeding company to decipher the genetic profile of weed in a bid to create more resilient plants that are better tailored to the needs of users.