Tilray Inc (TLRY) Q4 2018 Earnings Conference Call Transcript

Motley Fool Transcribers, The Motley Fool - finance.yahoo.com Posted 6 years ago
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." data-reactid="244">Okay, thank you. Last little question for me. When you look at sort of what Canada Health is given, as they're sort of initial view maybe around the regulatory framework around edibles, you're seeing sort of maybe limitations on per serving potency, or you're seeing maybe limitations on sweeteners and coloring and maybe that the necessity to have separate manufacturing facilities.

Just curious how you sort of fold all that up into making competitive edible products versus the illegal market, where they've already sort of achieved scale and sort of know what the consumer want, some of which seems like Canada Health want to limit particularly like gummies and other products that adult-use has shown a lot of demand for?

Brendan Kennedy -- President and Chief Executive Officer

Yeah, when we've looked at the opportunity in Canada over the past two years, it's always seemed a little incongruous that a public health organization was limiting the product form factor and essentially limiting consumer's options or choices and essentially forcing them to smoke a product. It didn't quite make sense to us. We are extremely interested in the opportunity that will be made available to us, when we can begin manufacturing and selling non-combustible form factors, such as edibles and beverage.

I think you touched on a really important point. Scale and marketing brands are what beat the black market. And if you look at individual US dates, the black market has been decimated in Washington state. It's been decimated in Colorado. And every restriction that Health Canada places on the edible market in Canada, all of those restrictions empower the black market, empower products and brands that are already in -- illicit products and brands that are already in consumer hands.

Having said all that, we are strong supporters of portion sizing and limiting the potency of edible products. And whether that is a 10 milligram portion cap or a 5 milligram of THC portion cap, we'll adjust our products accordingly.

Mike Hickey -- Benchmark Co. -- Analyst

Thanks guys. Best of luck.

Brendan Kennedy -- President and Chief Executive Officer

Thank you.

Mark Castaneda -- Chief Financial Officer, Secretary and Treasurer

Thanks Mike.

Operator

Thank you. And our last question is some Mike Grondahl with Northland Securities. Your line is open.

Mike Grondahl -- Northland Securities. -- Analyst

Yeah, thank you guys. Hey, Brendan, I know you kind of called out Germany, but what other countries do you think are most promising for medical use in the near term?

Brendan Kennedy -- President and Chief Executive Officer

Oh gosh! We're -- I'll sort of bifurcate that into existing and then future. So, the UK, Australia, New Zealand, we continue to see growth there. And really Chile, Argentina, Peru, Brazil are really early on in their growth curve. And then in Europe; Czech Republic, Croatia, Cyprus all countries that we already ship to. I think that we'll see progress and really interesting opportunities inside of the EU, really by the end of this year and so whether that's Ireland, Poland, France, et cetera. Those are the opportunities that we think are going to come online.

There's 19 countries in Europe that have legalized medical cannabis and so we expect -- we expect that a population of more than 500 million people will have access to medical cannabis in Europe over the next -- really over the next 12 to 24 months. And I think really an important distinction to make between Canada and Europe is that, in Canada, the Government of Canada's taxing medical cannabis, and in Germany, they're subsidizing medical cannabis.

In Germany and the Rest of Europe, you're going to see this product made available through government subsidized medical programs. And so it's a really different approach from Canada that's sometimes it's hard for people to grasp. In Germany, any doctor can write prescription, any patient for any illness distributed through a pharmacy with insurance company coverage and you just don't see that in North America today.

Mike Grondahl -- Northland Securities. -- Analyst

Sure. Sure. And then quick on CBD, is there any form factors that you think really stick out with hyper demand, or is it just anything with CBD can sell like crazy? How do you think about it?

Brendan Kennedy -- President and Chief Executive Officer

Yeah, that's what's interesting about what we saw a few weeks ago at Expo West. We might -- we had a pretty large team there from Tilray, our -- almost our entire US team was there, as well as the team from Manitoba Harvest, and everyone on the team was sending me, they're all sending me pictures of different CBD products produced by really mainstream manufacturers. And it was, -- I mean, it was a cross, it ran the gamut in terms of form factors. And I think I made a joke the final day, that the only thing I didn't see was the CDB toothpaste. And two people sent me a CBD toothpaste and so were -- send me a picture of a CBD toothpaste. And so we're seeing it in virtually every form imaginable form factor.

I think that -- I think what you're going to see are products, mainstream products that contain CBD. But then you're also going to see really pharmaceutical grade dietary supplement, nutritional supplement products that come from established brands and trusted -- trusted sources, and I think that's probably the -- I guess probably the biggest opportunity.

Mike Grondahl -- Northland Securities. -- Analyst

Okay. Thanks a lot.

Operator

Thank you. And I would like to turn the call back to management for any final remarks.

Brendan Kennedy -- President and Chief Executive Officer

Thanks, everyone, for joining our call. We are very pleased with our performance in Q4, and in 2018 overall. Thanks for listening.

Operator

Ladies and gentlemen, thank you for participating in today's conference. This concludes the program, and you may all disconnect. Have a wonderful day.

Duration: 71 minutes

Call participants:

Katie Turner -- Investor Relations

Brendan Kennedy -- President and Chief Executive Officer

Mark Castaneda -- Chief Financial Officer, Secretary and Treasurer

Steve Schneiderman -- Cowen and Company -- Analyst

Tamy Chen -- BMO Capitals -- Analyst

Rob Wertheimer -- Melius Research -- Analyst

Luke Perda -- Seaport Global -- Analyst

Graeme Kreindler -- Eight Capital -- Analyst

Michael Lavery -- Piper Jaffray -- Analyst

Mike Hickey -- Benchmark Co. -- Analyst

Mike Grondahl -- Northland Securities. -- Analyst

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