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In a regulatory first for Guernsey, a medicinal cannabis and psychedelics fund has launched.

Leafy Tunnel, an early-stage venture capital firm, has launched the first regulated medicinal cannabis and psychedelics fund in Guernsey.

The fund is set up as a route two 'qualifying private investor' private investment fund (PIF), with international law firm Carey Olsen as their advisor.

Leafy Tunnel Fund 1, L.P. will invest in companies and teams that seek to maximize the potential of alternative medicine, focusing on pain relief, physical and mental disabilities, and improving the quality of life for both patients and their families.

Leafy Tunnel, which is primarily focused on the European market, has begun to build a portfolio of companies that it hopes will lead, legitimise, and shape the future of cannabis and psychedelics in medicine.

The Carey Olsen team advising Leafy Tunnel on all Guernsey-related aspects of the fund's establishment and regulatory approval was led by corporate partner Tom Carey, assisted by senior associates Alex Mauger and Matt Brehaut, and associate Oliver Orton, and worked alongside onshore counsel DLA Piper UK LLP and Guernsey fund administrator Imperium. Additional specialized regulatory advice was provided by partners Mark Dunster and Simon Florance.

"The Carey Olsen team were instrumental in advising Leafy Tunnel throughout the fund formation process as a Guernsey-based legal counsel of the fund. From assisting the Leafy Tunnel team with regulatory queries to their help with the fund establishment, Tom, Alex and Matt along with the rest of the Carey Olsen team were very professional and timely with their advice," Bek Muslimov, co-founding partner of Leafy Tunnel stated.

"We are proud to be the first-ever fund of this nature in Guernsey and believe this jurisdiction will play a vital role in facilitating the growth of medical cannabis and psychedelic medicine soon."

"Mental health and pain disorders affect every fourth in the world. Left unaddressed, the toll on society will come at a huge cost and result not only in lost human capital wealth but a continuous spike of mental disorders, exacerbated by Covid-19. Medical cannabis and psychedelics are being increasingly recognised for their superior safety and efficacy compared to conventional pharmaceuticals. The Leafy Tunnel Fund has embarked on the mission to address these urgent healthcare challenges and rally investors looking to capitalise on financial opportunities these medicines hold," said Nikolay Tretiyakov, a co-founding partner of Leafy Tunnel.

"Huge congratulations to the Leafy Tunnel team," Tom Carey said. "It has been fascinating to work with them on the launch of the first ever medicinal cannabis and psychedelics fund to be regulated in Guernsey. There is increasing global interest in cannabis and psilocybin investments and this launch demonstrates that Guernsey is well equipped to service innovative asset classes, such as this rapidly growing sector."



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