Cannabis Industry: Focus on Israel
It is well known that the U.S. is witnessing tremendous momentum toward the legalization of medical and recreational cannabis. There has been less coverage of the dramatic developments across the globe. Thirty countries (and 33 U.S. states) ─ including Australia, Germany and Israel ─ have legalized some type of cannabis use.
This blog will focus on the developments in the cannabis industry in various countries, beginning here with Israel.
Similar to the U.S., Israel is witnessing dramatic shifts in public opinion about cannabis. Just as in the U.S., former Speaker of the House John Boehner shocked observers when he joined the board of a cannabis company, the same phenomenon is occurring in Israel. In fact, two former prime ministers, Ehud Barak and Ehud Olmert, each have accepted leadership positions at Israeli cannabis companies, illustrating the extent to which the stigma which surrounded the plant is rapidly vanishing in Israel. Mr. Barak even recently headlined the Cannatech conference in Tel Aviv, where he addressed an audience of cannabis entrepreneurs, activists and scientists from all over the world.
As Mr. Barak explained, Israel’s deep rooted agricultural traditions make it ideally suited to thrive in the cannabis industry. The country’s farming chops were honed on kibbutzes (collective farms) which played a significant role in the country’s early development. Its earliest pioneers prided themselves on the fact that they made the desert bloom using innovative irrigation techniques. So, cannabis cultivation is a natural fit for a country that has already conquered significant agricultural challenges.
Another competitive advantage is the country’s top notch research universities. Research at the Technion, Israel’s leading research university, has uncovered promising evidence that certain strains of cannabis can actually kill certain types of cancer cells. Further, Israel is home to Raphael Mechoulam Ph.D., a cannabis scientist who was nominated for various awards including the Nobel prize. Dr. Mechoulam’s work includes Isolating Δ9-tetrahydrocannabinol, known as THC, the most abundant cannabinoid and the one with the most psychoactive effects. He also established the structure of Cannabidiol (CBD), the second most abundant compound, which had been previously isolated, yet unknown structurally. His work helped form the foundation for which much of today’s medical research on cannabis is based.
Given the above developments, we believe that Israel will be an exciting and dynamic country for cannabis industry observers to follow.
Noam Hirschberger, CFA, CVA
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