The Federal Government is preparing to give a $6 million grant to support US-based medical cannabis companies as it tries to boost the sector in Australia.
The announcement was made in a Federal Budget announcement on Tuesday, as part of the $6 billion Australia-US investment package.
The funding would be used to boost US companies with cannabis-based products, such as hydroponic growers, and expand their market presence in Australia, as well as help to diversify the industry.
The Department of Finance’s National Cannabis Industry Strategy is the first in the world to consider a US investment in cannabis technology, following a review in the US.
The strategy states that there is an urgent need for a national cannabis industry.
“The Australian Government is committed to providing the support required to create the best possible environment for medical cannabis businesses to flourish, grow and innovate,” Treasurer Scott Morrison said.
The Government has also announced a $1 million grant from the National Health and Medical Research Council to support research into the development of cannabis products for medicinal purposes.
The initiative is designed to “demonstrate that a robust, internationally supported medical cannabis market is feasible and sustainable, and that the science behind cannabis-derived medicine is well established and ready to support its commercialisation in Australia,” the strategy said.
“Further support for US-related cannabis companies is also being considered.”
A US company called Kaleidoscope is the latest to enter the Australian medical cannabis scene.
The company has already launched an online business and has been growing a market of more than 50,000 square metres in the state of Queensland.
The cannabis company’s CEO, Aaron Smith, said the grant was crucial.
“Kaleidoscopes mission is to create a cannabis-centric, state-of-the-art facility to supply the medical cannabis markets in Australia with quality cannabis products and services that meet our patient needs,” he said.
“As the first US-backed company in the industry, we are thrilled to have the support of the Government to accelerate the development and launch of Kaleis CBD, the first Australian-developed cannabis-infused capsule.”
We’re confident that the US support will drive the success of our CBD business, and support other Australian cannabis companies in the long-term,” he added.
The US is the only country in the developed world that currently has a medical cannabis law that allows for a patient to use cannabis to treat a medical condition.
The federal government has promised to allow the sale of medical marijuana in the country, but that will only be possible if the US allows the importation of marijuana from other countries.