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Shifting Legal Views Signal New Potential for the Cannabis Marketplace
NEW YORK, March 26, 2019 /PRNewswire/ -- Dozens of countries across the world have moved to legalize cannabis in some form, even though the majority of these countries are only allowing cannabis for medical applications. The two main components of cannabis, tetrahydrocannabinol (THC) and cannabidiol (CBD) have been linked to providing consumers with various therapeutic effects. And research and studies have shown that these cannabinoids can help medical symptoms associated with conditions such as cancer, chronic pain, blood pressure, appetite, muscular problems, and epilepsy. However, despite the beneficial uses of medical cannabis, the plant remains internationally listed as a Schedule 4 Drug under the Single Convention on Narcotic Drugs. As a result of legal concern surrounding cannabis and the psychoactive effects of its marijuana derivative, many countries have been hesitant about entering the industry. In the near future, further extensive research is required to evaluate the plant and understand its biological makeup. As this research continues to expand, positive results will in turn cause more countries to legalize cannabis for either medical or recreational applications. Additionally, according to data compiled by Coherent Market Insights, global medical cannabis was valued at USD 3.52 Billion in 2017 and is expected to exhibit a CAGR of 24.4% from 2017 to 2025. Pressure BioSciences, Inc. (OTC: PBIO), Pyxus International Inc. (NYSE: PYX), Organigram Holdings Inc. (OTC: OGRMF) (TSX-V: OGI), iAnthus Capital Holdings, Inc. (OTC: ITHUF), MariMed Inc. (OTC: MRMD)
Only a handful of countries have moved to establish cannabis legalization, however, many of those countries account for the largest populations around the globe. For instance, in 2017, Germany's parliament signed a bill to allow doctors to prescribe those patients suffering from chronic pain, vomiting, and nausea, some cannabis for relief. Meanwhile, in early 2018, Australia allowed cannabis producers in the region to export medicinal cannabis and cannabis products globally. Among other large marketplaces includes the U.S., Canada, Israel, and Spain. Even still, however, cannabis remains in limbo in many regions, mainly due to its psychoactive effects. The effects heavily limit the growth of the marketplace, but many countries are looking to use hemp-derived CBD as an alternative. CBD, or cannabidiol, is derived from the Sativa-family hemp plant, underlying the general cannabis plant. So far, research has proven that CBD can relieve consumers of the same medical conditions as THC. And recently, the World Health Organization (WHO) highlighted that "in humans, CBD exhibits no effects indicative of any abuse or dependence potential." Additionally, WHO also noted that to date, there is no evidence of public health-related problems associated with the use of pure CBD. "The stigma of cannabis only stems from the THC component, which has mind-altering effects. If we focus on the medicinal benefits of the plant, we can see more of the physical benefits. I do see people being more open-minded about it," said Ildi Pekar, a beauty therapist who has launched a range of products containing CBD.
Pressure BioSciences, Inc. (OTCQB: PBIO) announced earlier last month that, "analytical testing on hemp-derived CBD oil processed via PBI's Ultra Shear Technology™ (UST™) platform has confirmed that UST processing uniquely achieves the challenging criteria for creating highly-effective "nanoemulsions" of CBD oil in water, without loss or modification of CBD throughout the entire UST process (> 99% recovery).
The ultimate goal in mixing oil-based nutritional and therapeutic products like CBD oil into water, for effective oral or topical delivery and absorption, is to reduce the size of the oil drops to such a level that they seemingly 'vanish' into the water (become "water soluble"). These exceedingly small, nanometer-scale droplets are so tiny that it becomes very easy for the human (or other animal) body to absorb the oil-based nutrients or drugs (like CBD) directly from the inner surface of the oil droplet. Traditional processing methods struggle mightily with this challenge, but PBI's proprietary UST platform uses ultra-high pressure to create extreme shearing forces to make nanometer-scale droplets of fluids that become highly-stable, homogenized "nanoemulsions" of materials that normally do not mix (e.g., CBD oil and water).
Dr. Vera Gross, Director of Applications Development at PBI, explained: 'We asked an independent, university-affiliated laboratory to determine the size of oil droplets achieved in UST-processed CBD oil, using a universally-accepted sizing method called DLS. Their analytical results revealed that the UST- processed oil drops were reduced to approximately 65 nm in size, well into the 20-200 nm range targeted for truly effective nanoemulsion delivery and absorption of nutrients and therapeutics, such as CBD (Nano- and Microscale Drug Delivery Systems, 2017).'
Dr. Gross continued: 'It was critically important to also demonstrate that CBD from hemp-derived CBD oil was not lost or modified during UST processing. For this we enlisted the help of scientists at NutraFuels, Inc. (OTCQB: NTFU), which has an FDA-inspected, highly-qualified analytical testing laboratory with state-of-the-art equipment and well-trained chemists with years of experience in laboratory testing.'
Mr. Cooper Dodd, R&D Scientist at NTFU, said: "Using a powerful laboratory method called HPLC to measure the concentrations of CBD and potential impurities, we determined that no appreciable amount of CBD was lost during the UST process. These results compare well to our standard processing method of ultrasonication, which can carry a risk of measurable loss of CBD, and sometimes creates the appearance of impurities if not performed properly. While there is more work to be done, as a nutraceutical manufacturer with products already on the market, we see these results as a robust leap towards better optimization of our CBD-enhanced products."
Dr. Keith Warriner, Professor of Food Science at the University of Guelph (Toronto), and a recognized expert in the cannabis industry, commented: 'The data released today on UST-generated nanoemulsions of CBD oil are very impressive. Creating nanoemulsions of CBD oil with full preservation of CBD throughout the process, while not generating impurities, remains a significant challenge in the industry. These data indicate that UST can achieve that goal, thereby offering great promise to the future.'
Professor Warriner continued: 'Not only does the UST process appear capable of achieving stability of emulsions, but the controlled heating that also occurs may offer a valid alternative to thermal and non-thermal pasteurization methods to reduce the risk of harmful microbes in products such as edibles and topicals. I believe that CBD-infused topicals and similar products will prove more popular with users than edibles. However, to be successful, it is imperative that topicals be highly stable, safe, bioavailable, and readily absorbent nanoemulsions. After consideration of the data released today, the UST process appears to be a leading candidate to fill that important need.'
Dr. Bradford A. Young, Chief Commercial Officer of PBI, summarized: 'We were delighted to release a short video last week showing the ability of our new UST platform to make visually clear and stable mixtures of CBD oil and water. The scientific data released today have further validated the achievement of creating high quality, nanoemulsion mixtures of oil and water using our UST platform. In particular, these data specifically show that CBD levels are preserved all the way through UST processing to the finished product. We are very excited by these results and believe our proprietary Ultra Shear Technology can help a diverse variety of customers to develop a vast array of new and beneficial products spanning multiple large markets, including CBD and nutraceuticals, cosmetics and topicals, food and beverages, drug delivery and more.'"
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Pyxus International Inc. (NYSE: PYX) is a global agricultural company with 145 years' experience delivering value-added products and services to businesses and customers. Pyxus International, Inc. recently announced the opening of its affiliate, Criticality, LLC's, industrial hemp extraction and purification facility located in Wilson, North Carolina. The 55,000 sq. ft. cstate-of-the-art facility was unveiled during a ribbon cutting ceremony and grand opening event on March 12th. Criticality is an integrated North Carolina-based agricultural hemp company that takes a science-based approach to the extraction, refinement and formulation of high-quality, transparent industrial hemp derived products. The facility is designed to follow good manufacturing practices and operate in compliance with dietary supplement standards. The hemp processed at the facility will be used to expertly craft and responsibly produce "Korent," Criticality's line of cannabidiol oil (CBD) products, as well as develop new products in its innovation pipeline. "Through our investment in Criticality—a North Carolina-based hemp processor—our goal is to become a leader in the production of CBD and related consumer products," said Pyxus President, Chief Executive Officer and Chairman Pieter Sikkel. "The opening of the facility is a critical step in achieving that goal and is a glimpse of what's to come in the future."
Organigram Holdings Inc. (OTCQX: OGRMF) (TSX-V: OGI) is a TSX Venture Exchange listed company whose wholly owned subsidiary, Organigram Inc., is a licensed producer of cannabis and cannabis-derived products in Canada. Organigram Holdings Inc. recently announced that the Company had entered into an agreement with 1812 Hemp, a New Brunswick based industrial hemp research company to secure supply and support research and development on the genetic improvement of hemp through traditional plant breeding methods. 1812 Hemp is focused on further developing a line of Canadian cultivars (specific varieties of plants cultivated to enhance desirable qualities) of high cannabidiol (CBD) yielding hemp for the Canadian climate. Under the terms of the agreement, Organigram will have access to a secure supply of hemp flower which contains significant levels of cannabidiol (CBD cultivars ranging from 4% to 8%). CBD is a naturally occurring active ingredient in hemp and cannabis that is currently being studied for various therapeutic uses. "Maximizing the CBD yield of hemp and cannabis means being able to meet increasing consumer demand for CBD while reducing overall production costs," explains Greg Engel, Chief Executive Officer Organigram. "We are proud to work with other industry-leading companies and researchers to continue to explore the potential of hemp and cannabis plants and the efficiency with which we can deliver CBD to our customers."
iAnthus Capital Holdings, Inc. (OTCQX: ITHUF) owns and operates best-in-class licensed cannabis cultivation, processing and dispensary facilities throughout the United States, providing investors diversified exposure to the U.S. regulated cannabis industry. iAnthus Capital Holdings, Inc. recently announced the grand opening of its third Florida dispensary, located in the City of Lake Worth. The dispensary will operate as "GrowHealthy Lake Worth" under iAnthus' "GrowHealthy" Florida dispensary brand. At the new Lake Worth location, GrowHealthy's range of vaporizer cartridges, oral cannabis tinctures, oil syringes, and topical salves will be available for purchase. All GrowHealthy products are quality controlled to the highest degree, tested for heavy metals, solvents, and microbiological contaminants. "A dispensary shouldn't just be a store where you walk in, buy cannabis, and walk out," said Don Moxley, Director of Applied Science and Brand Development at GrowHealthy. "Our patient care representatives provide the information customers need to have a healthy relationship with cannabis. They're highly trained in customer service and exceptionally knowledgeable when it comes to cannabis varietals. At GrowHealthy, we're always happy to listen, share what we know, and help anyone find a cannabis treatment that's exactly right for anyone's needs."
MariMed Inc. (OTCQB: MRMD) is a multi-state cannabis company that develops, owns and operates licensed cannabis facilities and develops and distributes branded cannabis and hemp product lines. MariMed Inc. recently announced the formation of MariMed Hemp, Inc., a wholly-owned subsidiary to be entirely focused on hemp-derived CBD products. MariMed Hemp will have a dedicated executive team, proprietary brand and product lines, and distribution and marketing relationships, all separate from MariMed's core cannabis business. The subsidiary builds on MariMed's recent investment in GenCanna Global, a leader in high-quality, fully compliant hemp cultivation and processing which is acclaimed for its genetics, proprietary cultivation practices and best in class processing procedures that produce world-class, GMP, quality CBD isolates and oils. GenCanna anticipates planting and processing over 10,000 acres of hemp in 2019, making it one of the nation's largest hemp producers and the key supplier of hemp CBD oil to MariMed Hemp. "With the recent signing of the U.S. Farm Bill that declared hemp fully legal at the federal level, we believe the hemp CBD industry may grow even faster than the cannabis industry," said Robert Fireman, Chief Executive Officer of MariMed. "Consumers and retailers alike seek the highest quality, trustworthy products. While many niche players may try to compete, the reality is that only a handful of suppliers can reliably deliver top-quality CBD products at scale that can serve the needs of major retailers."
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