Israel is set to establish an incubator for the development of cutting-edge medical cannabis technologies in the southern Israeli town of Yeruham in the Negev desert.
Jerusalem-based equity crowdfunding platform OurCrowd announced this week that a consortium it established in partnership with Perrigo, a private label over-the-counter pharmaceuticals manufacturer and BoL Pharma, one of the first licensed cannabis cultivators in Israel, has won a tender by the Israel Innovation Authority to operate the government-backed incubator, dubbed CanNegev.
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The consortium will operate the incubator for five years and will have the option to extend for another three years, according to the terms of the tender.
The Israel Innovation Authority and member companies of the consortium will invest an estimated NIS 150 million (about $43 million) to operate the incubator, support startups, who become part of it and follow up on investments, according to a joint announcement.
The consortium will aim to choose six startups with breakthrough technology in the medical cannabis sector per year to be part of the incubator, for a total of 30 companies over the course of the first five years.
“The government and the consortium intend to transform the town of Yeruham into the cutting-edge of the global medical cannabis market, which is projected to expand to $59 billion in 2025,” said Jon Medved, CEO and founder of OurCrowd.
“We will find startups with breakthrough technologies, make seed and follow on investments and equip them with all the necessary tools for success in the international market,” Medved promised.
“The member firms of the consortium have a wealth of knowledge and experience in the medical field and in medical cannabis, and this will be placed fully at the disposal of the innovators. It should be noted that Perrigo already operates a highly sophisticated manufacturing plant in Yeruham and its familiarity with the city and the region will also contribute to the success of the project,” he added.
Yeruham Mayor Tal Ohana who has been working to make the city Israel’s “cannabis capital,” said she “the vision of turning Yeruham into a research, technology and production capital for medical cannabis” is now being realized.
“The incubator will serve as an anchor for innovators from around the world and will upgrade the activities of entrepreneurs, who are already in the process of allocation of land for the establishment of cannabis extraction plants in Yeruham,” said the mayor, who leads a city of fewer than 10,000 people.
“This is a true defining moment for the Ministry of Economy and the Innovation Authority in their recognition of the medical cannabis industry as a future growth engine for the Israeli economy,” said Tamir Gedo, CEO of BoL Pharma.
“The Ministry of Health and the Medical Cannabis Unit at the ministry have wisely established the regulatory and research ecosystem that gives Israel’s medical cannabis industry a competitive advantage, and the incubator in Yeruham is an additional important layer to this ecosystem. This layer will enable initial funding for startups in the sector in order to utilize this advantage and establish in Israel a medical cannabis industry with tremendous know-how and skilled manpower for years to come. We’re proud to establish the world’s first government-supported medical cannabis incubator,” added Gedo.