Israel Desks - February 2020 Edition

10 Shmueli at Lipa Meir & Co. agrees. “The number of transactions and the value of total funding are rapidly increasing annually.” The Israeli law firm has been involved for a number of clients in fundraising. Public company Cannbit raised about NIS 135 million in 2019 through various fundraisings, while Together Pharma raised about NIS 31 million in 2018-9, through various fundraisings. Israel’s cannabis industry can be divided into several segments: Propagation; Growing; Processing/Manufacturing, and; Selling and Marketing. While most companies are active only in one segment, few have activity more wide-ranging activities,withBOLPharmaoneof thefewin Israelwithafullyavertically integrated model. InPropagation andGrowing,BOLPharma is joinedby TikunOlam,Canndoc Pharma, Israel Medical Cannabis (IMC), Seach, Cann Pharmaceutical (Better Cannabis), Teva Adir, Cannabliss (bought by Together Pharma) and Pharmocann and others, while the Processing/ Manufacturing segment includes companies such as Panaxia Pharmaceutical and Bazelet Pharma. Following the change in law and a new government on the way, the number of companies is expected to grow. The Israeli Innovation Authority (IAA), which grants funds to start-ups, as well as VC and private equity funds looking to invest in the cannabis industry, recently announced the founding of three new incubators. The third incubator, CanNegev , will operate from Yeruham and specifically focus onmedical cannabis and is based on a consortiumconsisting of the OurCrowd crowdfunding platform, pharmaceutical company Perrigo, and BOL Pharma. The consortium will operate the first-of-its-kind incubator for five years, with an option to extend its license for an additional three years. Six start-up companies operating in the field of medical cannabis will join the incubator annually,with the facility supporting a total of 30 companies over the initial tender period. The IAA and the consortium plan to invest approximately NIS 150 Million (US$ 43 Million) in CanNegev start-ups. It is in the field of R&D where Israel is expected to shine. “Our prediction is that Israel’s future in the field lies in R&D and producing medical cannabis products at the highest level and to medical standards,” says Berkovits. While it may be “a matter of time before all production shifts to less-costly production sites, thanks to technology,when it comes to R&D, the story is very different.Medical cannabis R&D companies can be found worldwide, and provide great results, regardless of the country they are located in.” Number of companies is expected to grow