$1.1 Billion Play on New York Cannabis Ready to Go Public?

Cannabis Background

A new cannabis IPO is coming down the pike. This company is about to go public and it presents a big opportunity for investors.

Not only is this company one of the largest in the U.S., but the company also managed to land a $110 million investment from a Canadian cannabis powerhouse.

This company filed paperwork to go public this fall, and if all goes well, it could be one of the most exciting cannabis industry events of the year.

Pharmacann was founded in 2014 and headquartered in Chicago, Illinois. The company currently operates in six states, with 23 dispensaries and four cultivation facilities.

  • Illinois: 8 dispensaries, 1 cultivation facility
  • New York: 4 dispensaries, 1 cultivation facility
  • Massachusetts: 3 dispensaries, 1 cultivation facility
  • Ohio: 3 dispensaries, 1 cultivation facility
  • Maryland: 4 dispensaries
  • Pennsylvania: 4 dispensaries

Pharmacann is a broad play on the high-growth U.S. cannabis industry. But when you look under the hood, this is also a play on one of the most promising new cannabis markets in the industry.

New York just became the 16th U.S. state to legalize recreational cannabis. As one of the largest states in the U.S., analysts expect New York to quickly grow into one of the largest cannabis markets in the world.

According to cannabis market research firm, New Frontier Data, New York should generate $3.7 billion in annual cannabis sales by 2025. This would make New York the second-largest cannabis market in the U.S. behind California. Pharmacann is in position to capitalize on New York going legal.

Despite New York’s massive population, there are only 36 medical cannabis dispensaries in the state. This exclusive group of medical permit holders, which includes Pharmacann, will be first in line to receive permits to sell recreational cannabis.

Pharmacann currently owns four medical cannabis dispensaries in New York and one cultivation facility. These existing permits and facilities make it likely that Pharmacann will be one of the first companies to land a permit to sell recreational cannabis in 2022.

Cronos Group Just Invested $110 Million in Pharmacann

The company caught the eye of massive Canadian cannabis leader Cronos Group (NASDAQ: CRON).

Cronos bought a 10.5% stake in Pharmacann for $110 million in June of 2021. In the short run, the deal gives Pharmacann $110 million to invest in more growth. In the long run, it gives Pharmacann a powerful ally that can potentially help the company tap into new markets in Canada, Europe, and South America.

Pharmacann Just Filed Paperwork to Go Public this Fall

While Cornos may have gotten the first chance, investors like you and me will have an opportunity to own shares soon. Pharmacann recently filed to go public. Here are some more details from Reuters.

PharmaCann, one of the 10 original cannabis licensees in New York, has confidentially filed for an initial public offering that could value it at well over $1 billion, sources familiar with the matter told Reuters.

The planned IPO would help PharmaCann raise funds before New York state begins recreational weed sales, expected sometime next year. The IPO could take place this fall, one of the sources said.

PharmaCann, which operates in five other U.S. states, is likely to seek to dual-list its shares on the Canadian Securities Exchange and for over-the-counter trading in the United States, one of the sources said.

The Big Picture

Pharmacann is one of the largest cannabis companies in the U.S. and a play on New York going legal in 2022.

The company recently landed a $110 million investment from Cronos Group and will be getting another large injection of cash if it goes public this fall. This is a company to keep an eye on in the next few months and I will also be sharing updates on the status of the potential IPO.


About the Author & Cannabis Stock Trades

Michael Vodicka is an equity analyst with more than 20 years of experience trading and investing. His research has been featured in some of the industry’s most respected publications. He has been investing and leading investors in the cannabis sector since 2013.

Mr. Vodicka brings his expertise and guidance to the members of Cannabis Stock Trades.

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