COPENHAGEN (Reuters) – Danish cannabis firm StenoCare STENO.TE sparked a stock market stampede on Friday as investors rushed to buy into its shares on their debut, driven by enthusiasm for the therapeutic benefits of its products.
FILE PHOTO: North Grow Cannabis Expo, the first Nordic cannabis convention, takes place in Bella Center in Copenhagen, Denmark, September 7, 2018. Ritzau Scanpix/Andreas Beck via REUTERS/File Photo
The stock nearly quadrupled in price to hit a high of 33.50 Danish crowns in early trade, valuing the company at more than 200 million crowns ($30 million). They had been priced at 8.80 crowns in their initial public offering.
Interest from investors in the stock had been overwhelming, Chief Executive Thomas Skovlund Schnegelsberg said. “From our communication with investors, we get a sense that many might have followed their heart rather than their wallet.
“We’ve had people contact us who themselves are users of medicinal cannabis and said they want to support the case,” Schnegelsberg said.
Scientists say evidence is growing that cannabis can ease epilepsy and other conditions such as chronic pain, multiple sclerosis and chemotherapy-induced nausea, prompting renewed interest in a substance best known for its psychoactive properties.
Denmark is one of several European countries, including Germany, Britain, the Czech Republic and Italy, that have allowed prescriptions of medicinal cannabis oil. Denmark, which legalized the medicinal use of cannabis from Jan. 1, is also one of the few European nations to legalize local production.
Recreational use of cannabis is still prohibited in the country even though Copenhagen’s Christiania district is famous for cannabis-selling booths which are rarely targeted by the authorities.
StenoCare plans to use money raised in the IPO to launch its own production to serve local customers and export to other European markets. It plans a first sowing of cannabis plants in the first quarter of 2019.
“Our ambition is to have our own products on the shelves next year, but the exact timing depends on approval from the Danish Medicines Agency,” said Schnegelsberg.
StenoCare currently imports cannabis from Canada’s CannTrust, with first deliveries to Danish pharmacies and hospitals made last month.
Cannabis is also attracting the interest of consumer product companies after Canada last week became only the second country in the world after Uruguay to fully legalize cannabis.
Reporting by Jacob Gronholt-Pedersen; Editing by Robin Pomeroy and David Holmes