Little Green Pharma (ASX:LGP) share price leaps 10% on this ASX announcement

Medicinal cannabis company Little Green Pharma Ltd‘s (ASX: LGP) share price is up 10.34% in late afternoon trading.

This comes following the company’s announcement it has been granted a Good Manufacturing Practices (GMP) licence by the Therapeutic Goods Administration (TGA) for its recently commissioned manufacturing facility in Western Australia.

Today’s gains put the Little Green Pharma share price up 68% from its 24 March lows. Since listing on 20 February, the share price is down 8.57%. By comparison the All Ordinaries Index (ASX: XAO) is down 11.8% over that same time.

What does Little Green Pharma do?

Little Green Pharma is a medicinal cannabis business. Its operations span from cultivation and production through to manufacturing and distribution. The company produces its own range of GMP-grade medicinal cannabis products at its indoor facility in Western Australia.

Little Green Pharma supplies medical-grade cannabis products domestically in Australia and to international markets.

What does the licence mean for the Little Green Pharma share price?

With the new grant, Little Green Pharma now holds more than 20 state and federal operating authorisations.

According to the announcement, the company is now the only ASX medicinal cannabis share able to manufacture TGA GMP-grade medicinal cannabis flower and oil products in-house for delivery into Australian and European markets.

Commenting on the grant, Little Green Pharma Managing Director, Fleta Solomon said:

The grant represents the culmination of LGP’s long-term regulatory strategy and is a clear watershed moment for the Company. The grant of this GMP licence differentiates the company as the only fully TGA and ODC licensed and permitted medicinal cannabis company listed on the ASX with local Australian cultivation, manufacturing and wholesaling capacity, as well as brands in market.

This end-to-end capability allows us to more effectively manage costs, focus on higher-margin aspects of the supply chain, and supply LGP-branded GMP-grade medicinal cannabis products into the highly regulated markets of the European Union.

The company is particularly keen on the lucrative German market. Although it has the third largest medicinal cannabis market in the world, Germany remains entirely dependent on imports.

Little Green Pharma stated that it plans to develop its capability to manufacture additional GMP-licenced cannabis products and other pharmaceutical formulations.

With the new grant in place, the Little Green Pharma share price may be one to keep an eye on.

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Motley Fool contributor Bernd Struben has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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