Israel, the country that has been dubbed the “Start-up Nation” by many, is on track to become the global leader in medical cannabis. Currently, Israel’s medical cannabis industry is steadily developing and with promising results.

Canada has greatly contributed to Israel’s success in the medical cannabis sector, what with the Great White North securing millions of dollars’ worth of deals with the Middle Eastern country in recent times.

Mainly, Canada’s investments in Israel have been focused on the creation of cannabis products that can relieve a broad spectrum of health problems, including epilepsy, insomnia, cancer and chronic pain.  

Founder of CannaTech believes Israel is the perfect spot for pot-related research

Every year, the CannaTech conference takes place in Tel Aviv. Recognized worldwide as a premier cannabis event, CannaTech was founded by Australian expat Saul Kaye. Also the owner of a private equity cannabis company called iCAN, Kaye is acknowledged as a leader in the Israeli cannabis system.

“We have about 106 clinical trials running right now in cannabis and nowhere else in the world has been able to do that,” Kaye said to The Media Line. “We’ve got nearly 40,000 patients now and when I started there were 12,000 patients so that’s a huge amount of growth, and obviously with growth comes capital. Capital all over the world is looking at the cannabis (industry).”

In Kaye’s opinion, Israel is the ideal spot to play around with cannabis for medicinal purposes. Aside from the fact that the climate is perfect for yielding quality pot plants, Kaye says that researchers in Israel are more advanced in their skillset than any other place on the planet.

A prime example is CannRx Technology. The company, which produces “high-quality pharmaceutical and analytical products utilizing the cannabis plant,” is a subsidiary of Jerusalem-based Izun Pharmaceuticals. One of the company’s achievements involves a unique technology that can be used to develop pharmaceutical-grade cannabis extractions for the treatment of various medical conditions.

“We created VCT or Vapor Capture Technology,” said the Founder & Executive Chairman, Dr. William Z. Levine. “Basically, (the machine) vaporizes cannabis. A gas plume comes out from the material similar to what you would inhale into your lungs. We then capture that gas plume, solubilize it down through a series of solubilization chambers and transform it into a very clean, efficient, very controlled liquid. It can be water soluble or oil-based, (depending on how) we choose to deliver it to the system.”

Another cannabis that company is paving the way for Israel’s medical cannabis industry is Alvit Pharma. This budding business sets itself apart from competitors with its fascinating combination of cannabis and medicinal mushrooms. Incredible things can be expected from Alvit Pharma. After all, the company just signed several deals with Canadian Licensed Producers (LPs).

“It seems like almost every LP here has something to do with somebody in Canada right now,” said Alvit CEO, Yona Levy. “Canada is probably the most mature market now in terms of cannabis in the world. They’ve taken it very seriously and they’ve approached it the right way,” she added.

Future of Israel’s medical cannabis industry is not certain

Notwithstanding, the outlook for Israel’s medical cannabis industry is somewhat hazy. Uncertainty enshrouds the ever-changing cannabis market, due to the fact cannabis product exports are prohibited as a result of strict government regulations. Even after many years of campaigning to legalize overseas medical cannabis sales, it is still forbidden.

This past summer, a political debate erupted at a committee meeting at the Ministry of Finance and the Ministry of Public Security. Officials were at loggerheads during the heated meeting, where Public Security Minister Gilad Erdan dismissing the idea of export reform for myriad reasons.

Industry analysts are concerned about the risks associated with Canada and Israel’s cannabis industry. Industry insiders assert that, although countless overseas investors have shown interest in the Middle Eastern country’s product range, government restrictions could cost investors billions of dollars.

“It all got held up by Israeli Prime Minister Binyamin Netanyahu, who said ‘I want to do a final review before we allow exports,’” declared Kaye. “A third of my investors are Canadians, a third are Australians and a third are Americans so we need to be able to export to other countries.”

Nonetheless, Canada’s government has affirmed that it is prepared to cooperate with Israeli cannabis companies in the foreseeable future.

“Canadian and Israeli companies are exploring opportunities for trade and investment in the cannabis-for-medical-purposes industry, in addition to partnerships in research and development,” wrote a spokesperson at Tel Aviv’s Canadian Embassy in a statement issued to The Media Line. “Canada does not support any international trade in cannabis for non-medical or non-research purposes,” she added.

Cannabis business owners in Israel are moving their operations elsewhere

While there may still be obstacles to overcome, plenty of pot entrepreneurs are not letting their businesses suffer.

“We’re concerned about the regulations,” added Levy from Alvit Pharma. “That’s why with regards to research and development it’s very simple. Israel doesn’t give us permission? Well, I’ll take my recipe and I’ll (create my product) somewhere else.”

In an attempt to dodge legislative issues and the dreaded ban on medical cannabis exports, numerous companies have shifted their research and development (R&D) operations to different locations within Israel. Some have gone as far as to begin cultivating cannabis outside of the country.

Together Pharma is an example of a company that is adapting to change in Israel’s medical cannabis industry. Not so long ago, the specialist in cannabis cultivation, distribution and export came to a multi-million dollar agreement with an anonymous Canadian company to sell cannabis oil weighing five tons. 

“Due to the Israeli export regulations, we are opening a greenhouse in Uganda, where regulations to export cannabis are already in place,” said the founder of Together Pharma, Arik Filstein. “At the moment, Israel is losing money. Instead of taxable revenue being generated here, it’s going to other countries, which is unfortunate,” Filster finished.