Xebra Brands Ltd. cannabis company announced this week that the Mexican Health Regulatory Agency (COFEPRIS), the Mexican FDA equivalent, has granted Xebra’s wholly owned Mexican subsidiary Desart MX an outright first-mover-advantage in the country, according to a press release shared by the company.
The agency is officially issuing corporate cannabis authorization for the import and acquisition of cannabis seeds, cultivation and cannabis harvesting, processing and production of cannabis and sale of cannabis products, both domestically and through export.
It’s a long time coming, as Xebra’s application process began in 2018. On Dec. 2, 2021, five Supreme Court justices voted unanimously in favor of granting the company an irrevocable injunction to commercialize cannabis. Xebra is now the only company authorized to commercialize cannabis outside of strict medical parameters.
Xebra Brands CEO Jay Garnett said that the completion of the process is historic for the company and cannabis as a whole.
“This represents an important moment for cannabis globally with the first ever grant for full cultivation, harvesting, processing and commercial activities to a corporate entity in Mexico,” Garnett said. “This grant follows years of hard work and focus by a devoted team and is only the beginning of what Xebra has laid as the foundation for growth. The path is now clear for Xebra to continue forward to unlock the commercial opportunities that exist.”
Now that Xebra has received all operations, including standard conditions around safety protocols, security measures, customary inspection and reporting provisions, the company is able to move forward so long as all industry standards are met.
There are no restrictions on where in Mexico Xebra can cultivate cannabis, the size of cultivation facilities or the processing and manufacturing operation volume. The initial authorizations will apply specifically to the commercialization of cannabis products containing less than 1% of THC.
In the press release, the company states that it will take a “methodical approach” in assessing opportunities for partnership and growth that have been presented since the beginning of the process that began in 2018, nodding to the historical importance and commercial opportunity of being granted these authorizations by the Mexican government.
“We look forward to delivering to our shareholders, a plan in which we recognize the full potential of these authorizations on a similar scale to those corporations that were granted licenses through Health Canada upon legalization in Canada,” Garnett added.
Medical and recreational cannabis is legal in Mexico, though it’s a complicated conversation. The Supreme Court made the decision to legalize cannabis in June 2021 in a 8-3 vote, though similar to some U.S. markets, implementation has been slow. Namely, there is still no specific legal framework in place to obtain a medical prescription or prove one’s legal medical status.
Cannabis possession of up to five grams of cannabis for any purpose has been decriminalized across the nation, though local and federal police don’t always honor this new reality. The country is still struggling to pass a full legalization law that would establish the legal means to grow, sell and possess cannabis for all adults.
Authorities in Mexico are in the process of regulating medical cannabis with less than 1% THC after it was legalized by a 2017 decree by former President Enrique Nieto. Regulations were published in January 2021, though no legal framework has emerged, so medical cannabis remains essentially impossible to access in a legal way.
In August 2022, Senate President Olga Sánchez Cordero said leaders of other Latin American countries have consistently asked about the status of Mexico’s efforts to set up a regulated cannabis market, admitting, “We are falling behind in the world if we do not advance on this issue,” translated from a Proceso report.
Zebra said it will provide an update on its plans in the Mexican cannabis market in the coming weeks.
