SOMAÍ CEO Says Europe’s Cannabis MCO Wave Is Accelerating — And U.S. Operators May Be Running Out Of Time

Europe’s cannabis industry is entering a new phase of consolidation, and according to SOMAÍ Pharmaceuticals founder and interim CEO Michael Sassano, the window for operators to establish meaningful positions in the region may be closing faster than many U.S. cannabis executives realize.

In an exclusive interview with IgniteIt following the publication of his paper, European Cannabis Merger Mania: The Global Conversation Has Begun, Sassano outlined why Canadian cannabis companies are already aggressively expanding across Europe, why American multi-state operators still struggle to adapt to the region’s pharmaceutical framework, and why the future winners of the international cannabis market may look less like U.S. MSOs and more like “multi-country operators.”

Sassano also believes the U.S. move toward Schedule III rescheduling accelerated global investor attention toward Europe by reinforcing cannabis as what he described in the paper as an “internationally recognized medical standard.”

According to Sassano, many of the largest U.S. operators may be underestimating how quickly the global cannabis market is evolving outside North America.

“One thing is certain: this is only the beginning, and there will be a very limited number of seats at the table,” Sassano wrote in the paper.

Europe Is Becoming Cannabis’ New Growth Engine

Sassano believes the global cannabis industry is entering a structural shift as European medical markets rapidly scale while many U.S. operators continue facing margin compression, debt burdens, and flat revenue growth.

“Pretty much all the revenues have been flatlining or going down for the big companies,” Sassano told IgniteIt.

At the same time, international medical markets continue expanding aggressively.

According to Sassano’s paper:

• Germany’s medical cannabis market grew roughly 155% to nearly €1 billion in 2025, with projections surpassing €2 billion in 2026.
• The United Kingdom expanded approximately 104% to nearly €300 million.
• Australia reached roughly $656 million in sales despite absorbing approximately 40% pricing compression.
• Israel reached approximately $372 million in annual sales.
• Poland expanded into a roughly $68 million medical market.

Beyond those core markets, Sassano pointed to additional growth emerging across France, Brazil, Switzerland, Italy, Spain, Ireland, the Czech Republic, Thailand, and other international jurisdictions adopting medical cannabis frameworks.

“These common-sense medical policies aren’t just providing critical access to patients in need,” Sassano wrote. “They are actively creating jobs, building a strong taxable base, and crushing the grey markets by providing safe, regulated alternative products.”

Why Canadian Cannabis Companies Moved First

According to Sassano, Canadian operators entered Europe with a major strategic advantage: export-ready infrastructure built around federally regulated medical cannabis production.

“The Canadians can make all their flower in their country and sell them to Europe, and all they need is distribution,” Sassano said.

That framework allowed Canadian companies to aggressively pursue international distribution acquisitions while many American operators remained constrained by state-by-state cannabis regulations.

In his paper, Sassano highlighted several recent international transactions:

• Organigram acquired German distributor Sanity in a deal valued at approximately €113.4 million plus a substantial earnout structure.
• High Tide acquired 51% of German distributor Remixian for approximately €26.4 million.
• Cronos acquired CanAdelaar in the Netherlands as part of its European expansion strategy.

“Buyout talks are continually occurring with all the largest groups right now,” Sassano wrote. “Though there are only a few Canadian companies left with the actual capital to make these purchases.”

Why U.S. MSOs Are Structurally Behind In Europe

Sassano argued that many American cannabis operators still underestimate the complexity of Europe’s pharmaceutical-grade regulatory environment.

Part of that disconnect, according to Sassano, is that Europe’s medical cannabis framework is beginning to offer something the U.S. industry still lacks: regulatory stability. Sassano argued that countries like Germany have entered “a phase of stability and moderate regulatory certainty,” allowing operators and investors to make longer-term infrastructure and distribution bets.

In that case, “a U.S. producer would have to turn their grow GACP,” Sassano explained, referring to Good Agricultural and Collection Practices standards required for medical cannabis production in Europe.

Even after achieving GACP certification, operators would still need to convert post-harvest and manufacturing operations to European Union Good Manufacturing Practice standards, or EU-GMP.

“They would have to transform their grows into EU-GMP, which would take years,” Sassano said.

That distinction is central to Europe’s cannabis framework, where cannabis products are regulated similarly to pharmaceutical products rather than consumer packaged goods.

“The product is stamped and regulated under EU-GMP pharmaceutical rules,” Sassano said. “It can go to any country that accepts an EU-GMP product.”

The executive also emphasized the tax advantages associated with Europe’s federally regulated pharmaceutical model.

“There’s no special tax treatment. There’s no penalty. There’s no 280E,” Sassano said.

Curaleaf May Be The Blueprint U.S. Operators Eventually Follow

Although many U.S. operators remain focused on improving margins, reducing debt, or consolidating domestic operations, Sassano believes some companies are already laying the groundwork for international expansion.

“Curaleaf is the only U.S. company that has gone heavily into Europe,” Sassano wrote in the paper.

According to Sassano, Curaleaf now generates roughly 12% to 15% of total revenue from international markets.

In the paper, he described Curaleaf’s strategy as a globally integrated vertical model combining cultivation, manufacturing, clinics, distribution infrastructure, and country-specific sales operations across multiple European markets.

“Curaleaf has built a true, fully vertically integrated platform,” Sassano wrote.

He believes other major U.S. operators, including Verano, Green Thumb Industries, Trulieve, and Cresco, may eventually pursue similar international expansion strategies as domestic growth slows and international medical markets continue scaling.

Why Flower Still Dominates Europe’s Medical Cannabis Market

Despite growing investor attention around pharmaceutical extracts and manufactured cannabinoid products, Sassano said flower remains the dominant product category across most major European medical markets.

“Flower is the biggest category in all the biggest markets,” he said.

According to Sassano:

• The UK market remains approximately 90% flower.
• Germany remains approximately 80% flower.
• Australia remains approximately 70% flower.
• Poland remains approximately 90% flower.

SOMAÍ itself currently distributes multiple international cannabis brands, including Cookies and Jack Herer products, through EU-GMP compliant production and distribution systems serving Germany, the UK, Australia, Poland, and other international medical markets.

“We grow the flower over here, and then we distribute to multiple countries,” Sassano said while discussing the Cookies brand partnership.

Insurance Reimbursement Could Become A Major Competitive Advantage

One of the biggest structural differences between Europe and the United States may be reimbursement.

Sassano noted that portions of Europe’s medical cannabis market are already covered through public healthcare systems.

“In Germany, 200 million of their 1 billion is covered by insurance,” he said.

France, which is expected to fully launch its national medical cannabis program soon after years of pilot testing, could become even more significant.

“That one will open shortly to extract products, and that’s 100% covered by the national system,” Sassano said.

The pharmaceutical structure also creates a different commercial environment than the fragmented U.S. state market.

“It’s prescribed by a doctor, and then it’s dispensed from a pharmacy,” Sassano explained.

From MSOs To MCOs: The Rise Of The Multi-Country Operator

Throughout the interview, Sassano repeatedly returned to one central thesis: Europe’s cannabis industry requires a fundamentally different operational model than the United States.

“In Europe, you have to be a fully integrated MCO — a multi-country operator,” Sassano said.

Unlike the U.S. MSO structure, where companies build cultivation, manufacturing, and retail infrastructure independently in each state, Sassano believes Europe rewards centralized production combined with international distribution.

“You only need one central area to grow as much as you can that’s scalable,” he explained. “Then you want to invest in sales and distribution and acquiring the patient, or the clinic, or the pharmacy.”

According to Sassano, companies that fail to control manufacturing, distribution, and patient acquisition simultaneously may struggle to compete internationally.

“If not, you have no control over your quality standard,” he said. “If you don’t have control of the distribution and patients in each country, you have no control of your sales.”

Cannabis, M&A, Valuations: Why Spend €500 When You Can Build One For $30 Million?

Despite the ongoing acquisition wave, Sassano suggested parts of the cannabis M&A market may already be entering irrational territory.

“I met a company today — I won’t say who — but they said their valuation is $500 million,” Sassano said during the interview. “I said, ‘Who’s going to buy you?’”

He argued that some operators are demanding valuations disconnected from broader cannabis public market realities.

“How can you claim $70 million trades at $500 million?” Sassano asked.

According to Sassano, larger operators may increasingly choose to replicate infrastructure internally rather than acquire inflated targets.

“If somebody had $20 million or $30 million, they could recreate your model,” he said. “It would just take an extra year or two.”

Why Standardized GMP Cannabis Products Could Become The Next Battleground

Sassano also believes the long-term future of global cannabis may ultimately favor pharmaceutical-grade standardized products.

“If a company like Walgreens or CVS says, ‘I need a standardized GMP product like all my products are,’” Sassano said, “the European products have a head start.”

While he believes flowers will remain dominant in many medical markets, Sassano expects standardized extracts to become increasingly important if major healthcare systems, pharmacies, or institutional distributors require repeatable pharmaceutical manufacturing standards and long-term shelf stability.

“I believe the flower market is different,” he said. “But I do believe in extracts, the Europeans will have a head start if the rules say it must be a standardized GMP product.”

For now, Sassano believes Europe’s role in the global cannabis industry is only becoming more central.

“The spotlight is shifting incredibly fast,” he wrote in the paper. “All avenues lead to Europe and the global medical markets as the next great growth sector.”