In the Northern Tablelands of New South Wales, outside a town named Armidale, is a secret installation for growing medicinal cannabis. And not just any medicinal cannabis. While the entire Australian industry is centred around tinctures and pills, this is the country’s first marijuana “flower” farm, which is industry speak for bud. Here they grow a product that’s basically the same as what your dealer sells, except that it’s cultivated to exacting specifications and shipped in packaging that wouldn’t look out of place at your local pharmacy.
Ostensibly these “flowers” fill a hole in Australia’s medicinal market, but as the company’s owners freely admit, black market users also make welcome customers.
The company behind all this is The Australian Natural Therapeutics Group (ANTG). Eighteen months ago they bought a herb nursery outside Armidale, installed an enormous razor-wire fence with round-the-clock CCTV and retrofitted it to grow weed. The security might seem a little over the top, but this vigilance is a necessary caution to obtain the necessary licenses— particularly in an industry set to bring $150 million into the economy this year alone. By 2025, medicinal weed in Australia could be worth as much as $1.5 billion.
Site manager Jim Cameron meets me at the gate, and hands out several changes of protective gear to be worn in each warehouse-sized grow room. He's the former farmer whose nursery was purchased in 2019. Now, instead of growing lettuce and herbs, he grows weed.
By way of introduction he hands over a bottle of “Rocky,” which he explains is a high THC strain and one of the four they specialise in. There is currently no PBS subsidy for medicinal cannabis, but with their cheapest products coming in at $13 a gram, they are virtually the same price as the black market while giving consumers confidence in the quality and ingredients.
Next I’m met by founders Matt Cantelo and James Gaskell, who look like your typical Byron Bay startup dads in pastel shorts and sun tans. I’d previously googled both men to learn they were former tourism executives. Gaskell had moved through such travel firms as Hello World, Travelocity, and Flight Network, before getting a seat on the board of the Australian Medicinal Cannabis Association. Cantelo’s background was in streamlining business trips at Corporate Travel Management.
(I also couldn’t help but notice that Cantelo recently listed his Vaucluse mansion for nearly $20 million, which apparently highlights the kind of money you can make when your company signs a $92 million deal to export cannabis to Europe.)
The two men are slick operators, no doubt, but they also seem sincere when they claim their guiding ambition is to make sick people well. And judging by the dedication to security and bio-hygiene, their company seems unusually devoted to regulation compliance.
The two men spent the 2010s living in Canada and the US as the cannabis industry boomed, and they cut their teeth on a cannabis startup called Eve Farms, based in California. Then, when medicinal cannabis was legalised in Australia at the tail end of 2016, they moved home, bringing their expertise and many of their employees with them.
In the year-and-a-half since they opened, ANTG has already begun to have an impact on the domestic industry. Australia currently has about 30,000 people with approved cannabis prescriptions, but hardly any of those people are buying flower. But Cantelo and Gaskell believe that Australia’s much larger black market could be enticed to go legal with the right product and marketing.
Initially their business was geared for export, as they didn’t think they could turn a profit from domestic demand. But with the impact of COVID, they discovered that no matter how much flower they grew, Australian patients wanted more. Previously they’d only been able to access oils and pills, but the self-medicating population apparently wanted something more familiar.
Like all other pharmaceutical manufacturers in Australia, ANTG can’t advertise their products. But news spread quickly via word-of-mouth and online forums about the new organic buds.
“Our budget was 600 units of flower between July and December of 2020,” Gaskell explains proudly. “We sold all of that in our second week of our sales.”
“I mean, we were getting thousands of orders. We’re not idiots, we did our research and everyone told us there’s no demand for flower. Health care professionals told us it’s 50 only prescriptions a month. We said ‘well, we’ve only got flower, so we’ll just try and sell that.’ We ran out. People got angry. We were like, ‘well we didn’t know you all wanted it’.”
There’s an estimated 3 million black market weed users in Australia. Collectively they consume around 2.6 tonnes of cannabis every day, which has a market value of $14.8 billion per year. If Cantelo and Gaskell can sway even a quarter of those to start using their legally-available products, they could become even wealthier men.
Currently, the Therapeutic Goods Administration (Australia’s version of the FDA) don't limit the ailments that can be treated with medicinal cannabis. In theory, anyone with a history of mental illness, chronic pain, or endometriosis—all of which are incredibly common—can apply for a prescription, meaning that regular black market cannabis users could switch as the barriers of price and access come down.
“There are black market users who are treating themselves with cannabis, even if they don't see it that way,” Cantelo explains.
“And those people have the opportunity to no longer be criminals,” Gaskell adds. “Most of those people don't want to be criminals, they just are”.
As we’re led toward the heart of the operation, Jim Cameron talks us through the amount of paperwork required to run such a facility. Research licenses; manufacturing licences; cultivation licences; permits to export; a licence from the TGA and the Office of Drug Control, as well as the Federal Department of Health and the NSW Department of Health.
“If you think every time you turn around somebody's looking at you, they basically are,” Jim jokes. “There's nothing we can do that would go without scrutiny; or, quite frankly, that we would want to do without scrutiny”.
After donning overalls, shoe covers, hair nets, beard nets and facemasks, then sanitising everything we’re holding with alcohol spray and walking over a sponge mat of disinfectant, we enter the propagation room.
It’s amazing. The smell is less potent than you might expect, but it’s definitely floral. The room is a vast, cavernous space, not unlike a warehouse storage room, with shelves holding rows and rows of maturing cannabis plants. The psychedelic refrains of Dope Lemon’s “How Many Times” reverberate from a sound system overhead, and Jim tells me it’s what the workers like playing. They’re not trying to sonically infuse the plants.
As we wander the rows, I hear about how closely monitored everything is. The operation is licenced to hold 17,000 plants, made up of a certain number of mother plants, a certain number of clones, and a certain number of plants in cultivation.
“Everything's numbered,” Jim says, pointing to the tags at the base of each plant. “Every plant has an individual barcode. We have planning and product-tracking software so that we know where every single plant is at all times”.
If even a single gram of cannabis goes missing from the facility, ANTG are legally obligated to report it to the police. Even the waste from pruning has to be bagged, weighed, and signed off before it’s incinerated.
Because of the barcodes and the software, every bottle of dried flower can be traced back to its original plant. It’s kind of like the gourmet farm-to-table philosophy, but much more scientific.
Cameron points out the strains of the mother plants from which every other plant is cloned; “We’ve got Tangie Chem, Eve, El Jefe. That one’s OG Kush”.
The names sound comically out of place in such a sterile setting. All the strains have to be legally sourced from Canada and the US to prove they’re not derived from the black market.
We move out of the propagation room and into the flowering room, donning new protective gear as we go. The plants are much larger here, standing almost at head height. It takes just nine weeks for them to go from planting to harvest—and in the flowering room, where the temperatures are higher and the light is regulated to mimic the approaching end of summer, the plants triple in size in less than 21 days.
“We get about 1,200 kilos from 3,000 plants,” Cameron explains. “That’s about 400 grams per plant”. At $9 a gram, that makes each plant worth some $3,600, and puts the proceeds from an entire harvest at a cool $10.8 million.
The changing weather patterns outside the glass-covered greenhouse are stringently monitored. A shift from full cloud cover to full sun will increase the temperature inside by 10 degrees in three minutes, potentially ruining the crop. To mitigate that, automatic systems work constantly to maintain optimum temperatures and humidity. Fresh air is pulled in from outside through a HEPA filter, with a complete air change happening every three minutes.
“We've got light sensors; we’ve got a weather station outside which gives us radiation, wind velocity, wind speed, and outside humidity. In here we measure Co2; we measure temperature; relative humidity; light levels,” Cameron says. The amount of variables being controlled is dizzying—though that may just be the potent waft from the plants.
From the flowering room, we’re allowed a quick peek into the drying room where plants are stressed to encourage extreme flower growth. The cannabis we see is just hours away from being harvested and the small buds in the previous room have swelled to fat, monstrous columns that swamp the protruding fan leaves. The smell is overpoweringly aromatic, but we aren’t allowed to wallow in it for long for risk of contamination.
As we walk back to the main office I ask Cameron if he feels a bit like Willy Wonka working here. “A little bit,” he smiles. “It's really satisfying. I'm a technologist and this is the intersection of technology and horticulture”.
“Quite honestly one of the reasons that I'm so in favour of medicinal cannabis is that it's a natural product. If you can substitute an artificial medicine with a natural one, I’m all for it.”
“So this is your dream job, then?” I ask.
“Oh, yes,” he says, smiling.
While the facility is dazzling, it’s not an operation that can be created on a typical startup budget. Millions of dollars have been invested into the site to get it up to Good Agricultural and Collection Practice and Good Manufacturing Practice standards, which are much higher for products intended to be inhaled.
These barriers to entry have resulted in much of the market being run by either “cowboys” or “pharmas,” as Gaskell puts it.
“The pharmas are just gonna rape and pillage”, Cantelo explains. “The cowboys are the loud ones that want everything done yesterday and don't want to have to go through any rigour or pay for any of it. We want to be right in the middle and build a sustainable long term business that’s very patient-centric.”
“We can't just say ‘oh, we’re cannabis, we're different,’” Gaskell says, “and bulldoze through all the requirements for pharmaceuticals. It’s a process that takes 12 to 24 months—to compile all the safety data and do all the things you’re supposed to do—and I think that’s probably correct.”
“Even though we'd be highly profitable if it didn’t,” Cantelo adds with a grin.
The three men agree that cannabis looks set to be one of Australia’s more profitable industries in the coming years, and that the government is handling the roll out of this industry in the right way. They cite Health Minister Greg Hunt’s repeated statement that he wants Australia to be the largest exporter of medicinal cannabis in the world. Although Gaskell says there’s a long way to go.
“At the moment in its lifecycle, cannabis is not even walking yet,” he says. “It’s not even crawling.”
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