$12m factory renovation underway for medical marijuana enterprise
STELLARTON — Fourteen months ago, Greg Wilson happened upon a CNN documentary about medical marijuana.
On Wednesday, the Ontario businessman was about $3.5 million into a $12-million renovation of an abandoned Stellarton stereo factory to grow medical marijuana.
It happened that fast.
“No, not once,” Wilson said when asked if he’d ever smoked weed.
“I was an athlete and not many people were into it where I grew up in Ottawa.”
Medical marijuana is big business — Health Canada estimates it’s worth about $100 million.
It’s getting bigger, fast.
Health Canada estimates more than 400,000 Canadians will have prescriptions for medical marijuana in a decade, up from the current 37,000.
In April, it changed the rules that had previously allowed those holding medical marijuana licences to grow their own and began issuing licences for the commercial production.
So far, 13 companies have been issued licences but about 25 new applications are being submitted weekly, driven by a modern-day gold rush of investment capital toward dope cultivation.
“Health Canada predicts it to grow to a $1.4-billion annual market in a decade, but if it is legalized for recreational use, the prediction is for a $6.7-billion market,” said Wilson.
After seeing that documentary, the gears started turning in his head and within a few months he was chief executive officer of the newly formed Vida Cannabis Corp.
He went looking for a building and found the abandoned Clairtone factory the Town of Stellarton was selling for $500,000. As the ball rolled forward and capital came his way, Wilson assembled a management team of people with experience in security, research, quality control and cultivation. On May 5, Vida Cannabis submitted its 657-page application to Health Canada for a licence.
“Right now, we have the best management team in the country,” he said.
Around him, the huge former factory was being completely redone.
Phase 1, for which nearly all the $12 million in private capital required has been raised, is expected to be complete this winter. Final Health Canada approvals are expected by early 2015.
With that, the five-member cultivation team will be able to begin growing on an eight- to 16-week harvest schedule.
“This is just a larger scale,” said Steve Hyde, a member of the cultivation team who grew medical marijuana in Kelowna, B.C.
With 600, 1,000-watt lights, a soilless hydroponic system that delivers nutrients straight to the roots and a carbon dioxide-enriched atmosphere, Vida Cannabis expects Phase 1 to allow it to produce 2,700 kilograms a year.
The plant will employ 40 people, but as demand grows, production could ramp up to 30,000 kilograms annually grown by 240 workers.
Those are important jobs for Stellarton, which has seen businesses closing up downtown and a long decline since its glory days as a coal mining town.
But not everybody is happy with the growth of commercial marijuana cultivation.
“They can kiss my ass,” Tony Beare said Wednesday.
The Sambro resident and former nurse received a medical marijuana prescription eight years ago. He has a rare condition that causes him to urinate more than 120 times a day.
He uses a vaporizer to smoke an average of five grams a day that he says has resulted in him urinating only about 60 times daily.
“That’s allowed me to enjoy my life to a limited extent — I was able to drive to Moncton to visit my grandkids for the first time in four years,” said Beare.
It costs him about $2.75 per gram to grow his own.
He said buying it from a Health Canada-approved supplier costs about $13 a gram.
That’s more than he can afford on the $2,000 he receives monthly for his disability.
“So you think about it — drug dealers who grow it illegally on a small scale and have to hide from the police can sell it for about $9 a gram,” he said.
“And these big companies growing it in factories are selling it for $13. That’s robbery. They’re a bunch of drug dealers.”
Those entering the production business, like Wilson, counter that competition will bring down prices.