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The Guardian - UK
The Guardian - UK
Business
Jasper Jolly

A new leaf? The Cornish company trying to unlock secrets of cannabis

A man and a woman in lab clothes and sunglasses taking measurements of cannabis plants being grown in a room lit with lavender light
Phytome grows cannabis under carefully tuned shades of light. Photograph: Phytome Life Sciences

Elegantly refurbished farm buildings hardly merit a second look near the Cornish coast, but the CCTV cameras on stalks around the Trelonk estate hint at something unusual. This is not a second home, or Airbnb fodder: it’s a cannabis business.

The buildings, overlooking a bend in the River Fal amid the peaceful Roseland peninsula, are home to Phytome Life Sciences, and one of the few legal marijuana crops in the UK.

Cannabis legalisation is gaining momentum around the world, with some US states, Canada, Portugal and Uruguay among the places that have decriminalised recreational use to varying extents. Mexico, Germany and Switzerland are among those who could follow soon. But even in stricter countries such as the UK, the door has been open since 2018 for prescribing cannabis-derived medical products.

Walk along the street in any large enough town in Britain and you can usually smell how successful, or otherwise, the UK’s ban on cannabis is. However, medicinal cannabis companies still have to follow extremely strict licensing requirements. Phytome’s laboratories may be in one of the most picturesque settings in Britain, but they have hefty security. There are 200kg bombproof doors, ram-raid-resistant wire mesh walls, and no recording devices.

Inside the building, racks of cannabis plants appear nearly black under rows of bright lights carefully tuned to different shades of purple, blue and pink and beyond; ultraviolet and far red light, invisible to the human eye, have the potential to stimulate the growth of useful compounds in the plants. Water, fertiliser and even humidity and carbon dioxide levels are controlled in order to find conditions that will stimulate the plant to produce chemicals that may have promising applications.

Phytome wants to “make the plant programmable” and “take the next step in indoor agriculture”, says Sebastian Vaughan, Phytome’s chief executive, on a tour of the site on a sunny February morning.

Cannabis-derived medicines are already used for pain relief, to treat some rare forms of epilepsy, and to help people undergoing chemotherapy. Phytome will research new ways of growing the plants, but it will also look beyond the best known substances they produce – THC (tetrahydrocannabinol, the controlled component that causes the cannabis high) and CBD (cannabidiol, which is increasingly available in high street products).

“Cannabis is a major area of opportunity,” says Vaughan, suggesting there are as many as 500 chemicals in cannabis plants, compared with about 30 in a herb such as basil. “Most people are focused on THC and CBD. Cannabis produces a heck of a lot of chemicals.”

But plants can be unpredictable – particularly if left exposed to the vagaries of Cornish weather. Vaughan hopes that by controlling every possible variable, the company can turn a “herbal product into something that can be produced to high grade, high specification”.

For cannabis, the combination of legal recreational use and medicines is creating a large new market. Global sales of CBD, medical and adult-use cannabis reached $44.2bn (£36.6bn) in 2022, and could expand to $100.4bn by 2026, according to Prohibition Partners, a cannabis industry consultancy.

Other companies in the British Isles are also pursuing the medical marijuana market. GW Pharmaceuticals had been going for 20 years when it was bought by US pharma company Jazz in a $7.2bn deal in 2021. It sells a multiple sclerosis drug called Sativex, and another drug called Epidiolex to treat childhood epilepsy. Northern Leaf is growing medicinal cannabis in Jersey. Celadon Pharmaceuticals is aiming to grow as much as 15 tonnes of cannabis a year for pain relief at a plant in the West Midlands.

Phytome is looking at a different niche. Instead of providing plants or developing its own products, it does research and so does not produce cannabis products in big volumes or sell medicines itself. It will test combinations of light and nutrient mix (with an ambition to use artificial intelligence to predict the best recipes) before extracting the chemicals and analysing them the same day, and then feeding the data to partners.

Research contracts alone should allow it to break even within two years, says chairman David Richards, an automotive entrepreneur who was chair of Aston Martin until 2013. However, Phytome will also retain a stake in any intellectual property produced, meaning it could enjoy the benefits if any cannabis-derived medicine takes off.

Richards started building the business in 2019 after discussing business partner Mark Parnall’s attempts to grow hemp and other plants with possible health benefits. (Parnall also has a project building an imitation second world war Spitfire fighter plane at the Trelonk estate.) It took two years and £4m in equity investment in the secure facilities to achieve a Home Office licence.

That ended up being a point in favour of the venture. “There were very high barriers to entry and the UK had not got any facilities like Phytome that were available on a commercial basis,” says Richards. It also offered the chance to create some high-value jobs in an area dominated by tourism and far from the Oxbridge-London pharma triangle. “Lots of people said Cornwall was too remote and you wouldn’t attract the talent,” says Richards. “That didn’t deter us.” Twenty employees will expand to 50 if all goes to plan.

For Vaughan, joining the company was a promising opportunity after a career that has taken him through the City and software startups (as well as a stint in the Leicester Tigers rugby squad), but now his ambition is nothing less than “expanding the medicinal pharmacopoeia”.

“These plants have been known for thousands of years for their properties,” Vaughan says. “Over time, the opportunity is to gain access to plants that are demonstrated in the ethnobotanical history of peoples. That opportunity is still, in my opinion, in the foothills.”

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