An Adelaide company is to become the first in South Australia to begin cannabis extractions and create market-ready products from a secret laboratory in the city.
GD Pharma has been importing cannabis components from overseas but under its new manufacturing licence it will be able to import the plants, extract the chemicals, and produce a range of experimental prescription products.
Chief executive Antony Condina said it meant they could control the concentration of cannabis to create tailor-made products for a wide range of clients.
Some 266 patients are approved to use medicinal cannabis Australia-wide.
He said the main hurdle to achieve the manufacturing license was the risk of cannabis being shifted into the black market, including risks of theft and being "held up".
GD Pharma's secret new factory will operate by the end of year and would take about one week to produce a batch of diluted resin that costs about $500 for a bottle.
Mr Condina said they were unlikely to draw a profit because red tape restricted doctors' ability to prescribe cannabis.
"Last year it was estimated about 100,000 Australians would benefit from medicinal cannabis but, in reality, there's only been around 100 patients in 11 months who have been approved for products."
Proponents say there is evidence to suggest cannabis products can help with conditions like multiple sclerosis, severe intractable epilepsy in children, intractable nausea and vomiting due to chemotherapy.
Those opposing it, however, along with the Federal Department of Health, have cited a lack of quality research along with ongoing investigations and trials as the reason for restrictions.