Oettinger Brauerei, one of the leading German breweries and XPhyto Therapeutics Corp., a Vancouver, Canada based biotechnology and next-generation cannabis company, announced today to having signed a standstill agreement and letter of intent for cooperation in the field of development, production, and distribution of new cannabis-infused beverages. The companies have agreed to sign a definitive agreement in due course for creating new cannabis-related beverages and products, XPhyto said.
The German-based family owned Oettinger brewery does not only produce one of the best-selling beers in Germany, it is also internationally recognized as one of the largest exporters of German beer worldwide (inside.beer, 17.5.2019).
Despite being a Canadian company, XPhyto Therapeutics Corp has put a focus on the emerging European and especially the German market, where the company sees a huge potential for cannabis based products. Europe’s biggest economy, is projected to have one of the highest growth rates in the world for a cannabis market, with a 76.8% compound annual growth rate to reach USD 1.6 billion by 2022, according to research by Arcview.
In addition to its subsidiary Vektor Pharma TF GmbH, a German narcotics manufacturer, importer and researcher, XPhyto owns also 100% of German cannabis company Bunker Pflanzenextrakte GmbH. The company operates from a decommissioned German Air Force command center and nuclear bunker in Memmingen near Munich, hence its name, which is the largest cannabis laboratory in Germany. Bunker has been granted a unique German cannabis cultivation and extraction licence for scientific purposes by the German Federal Institute for Drugs and Medical Devices (BfArM).
Bunker has two exclusive R&D collaboration agreements with the Technical University of Munich, one with and the Faculty of Chemistry and the other one with the Chair of Beverage and Brewing Technology, School of Life Sciences Weihenstephan. The exclusive cannabis research and development agreement with Weihenstephan was first announced September 9, 2019.
Weihenstephan is home to the International Beverage Research Center Weihenstephan (iGZW), a best-in-class interdisciplinary research and development center, capable of handling the entire drink design process chain - from basic molecular biology research through biotechnology processes to the final product.
With a start-up cost of EUR 22 million (USD 24m), the iGZW includes a state-of-the-art pilot brewing plant which makes it possible to run a variety of trials to manufacture a broad range of beers in accordance with the German Purity Law and other fermented beverages using
un-malted cereals and alternative starch carriers, as well as non-fermented beverages.
The chair of brewing and beverage technology has a well-earned reputation for expertise in the field of food and beverage science with an emphasis on commercial applicability. The institution has a specific focus on flavor-process-engineering, raw material and product design, food safety, and relevant legislative issues, such as EU designated "novel foods".
"In partnership with Oettinger and supported by Weihenstephan, we plan to establish ourselves as first-movers in Europe in this important and fast growing market," said Hugh Rogers, CEO and Director of XPhyto.
While beverage companies in Canada and the US have already started to align with leading cannabis companies, the market in Europe is still in its infancy. Therefore, Oettinger’s move seems to be a step into the right direction.
Just two weeks ago, Constellation Brands one of the biggest beverage companies in the United States has boosted its equity holding in Canopy Growth to 38.6% (inside.beer, 1.5.2020). Constellation Brands was the first large beverage group that entered the cannabis market when it bought a 9.9% minority share in the Canadian medical marijuana company in October 2017 (inside.beer, 30.10.2017).
Canopy Growth itself bought just last year C3 Cannabinoid Compound Company, a German company based in Neumarkt/Oberpfalz and a leading manufacturer and distributor of dronabinol, a registered pharmaceutical drug in Germany, Austria, Switzerland, and Denmark (inside.beer, 7.5.2020).
Last month, Molson Coors Beverage Company, another North American beverage giant has extended its existing Canadian joint venture with HEXO Corp for the development of non-alcoholic, cannabis-infused beverages to the USA (inside.beer, 15.4.2020).
In December 2018, AB InBev announced through its subsidiary Labatt Breweries of Canada a partnership with Tilray, “a global pioneer in cannabis production and distribution, … to research non-alcohol beverages containing tetrahydrocannabinol (THC) and cannabidiol (CBD)” (inside.beer, 21.12.2018).