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Neptune Wellness poised to expand hemp extraction capacity

Neptune Wellness Solutions is expanding its North American extraction capacity with the acquisition of SugarLeaf Labs LLC and Forest Remedies LLC.

The US$36-million deal, which was announced July 24, gives Neptune Wellness access to SugarLeaf’s hemp processing facilities and its Forest Remedies farms in North Carolina.

“The acquisition of SugarLeaf, combined with Neptune allows us to create a leading North American extraction platform with significant capacity available to serve our customers on both sides of the border,” said Neptune president and CEO Michael Cammarata in a statement.

Neptune Wellness Solutions is a Quebec-based company that specializes in extracted products for the health and wellness market, including cannabis. It has a licenced processing facility in Sherbrooke, Que., and a head office in Laval, Que.

“We are extremely proud to be a part of the Neptune family,” said Sugarleaf president Peter Galloway in a statement. “The hemp extract opportunity is significant and our sales pipeline is healthy, giving us comfort that we are well positioned to execute our business plan.”

The U.S. market for hemp-derived CBD-based products is said to reach US$16 billion by 2025, according to a research study by Cowen Equity Research. Neptune Wellness said in a statement that the company’s new acquisitions will expand its extraction capacity to an estimated 1.5 million kilograms of biomass by the end of the year, with plans to expand further.