Cannabis Sales Surge During Lock Down

CannabisNewsWire Editorial Coverage: COVID-19 devastated the economy but created a surge in cannabis sales, bolstering long-term trends.

As the pandemic wreaked havoc on the U.S. and global economies, cannabis sales rocketed higher across multiple markets in North America. California cannabis sales soared nearly 160% compared to the same day in March 2019, while sales in Washington climbed 100% and Colorado saw a 46% increase on the same day. This surge gives no indications as a one off and is strong reinforcement of long-term trends in the industry. After a lot of early hype, the cannabis sector is on firm ground and is posting impressive numbers. A strong performer in the sector, Cannabis Strategic Ventures (OTCQB: NUGS) (NUGS Profile), is now on pace for over $2.7 million in quarterly sales and approximately $11 million in annualized sales, based on its strong performance in April and May. Simultaneously, the company increased its harvest size by as much as 2.5x and is now selling product at an 11% premium to industry standard. Powerful new deals confirm sector viability and vitality. Village Farms International Inc. (NASDAQ: VFF), one of North America’s largest vertically integrated greenhouse growers, recently launched a majority-owned joint venture for a large-scale, low-cost, high-quality cannabis production. HEXO Corp. (NYSE: HEXO), an established consumer packaged goods cannabis company, just closed a public offering for total gross proceeds of C$57,546,000. Amyris Inc. (NASDAQ: AMRS), a global science and technology leader of pure, sustainable ingredients for consumer products, just announced a major breakthrough in CBD delivery, improving efficacy of CBD by 10-40X as the carrier oil chassis for the skin care market. Tilray Inc. (NASDAQ: TLRY) a global leader in cannabis research, cultivation, processing, and distribution announced a C$90.4 million registered offering. The surge in cannabis sales during lockdown only adds to a sector that is thriving.

Click here to view the custom infographic of the Cannabis Strategic Ventures (OTCQB: NUGS) editorial.

Pandemic’s Unexpected Windfalls

COVID-19 has had a crippling effect on many industries. Shops and restaurants forced to close, manufacturers unable to operate their plants, companies across the manufacturing and service sectors seeing demand plummet. The layoffs and losses are very real, and no one knows yet what the long-term economic impact will be.

But some businesses actually benefited from the economic disruption the pandemic has wrought. There are obvious ones like pharmaceutical companies and those producing protective equipment for medical staff. There are the tech businesses that facilitate working from home, providing software for virtual workspaces and online meetings. And there has been a huge increased demand for home entertainment, which has spilled over into a less obvious sector – cannabis producers such as Cannabis Strategic Ventures (OTCQB: NUGS) (NUGS Profile).

COVID Lends Cannabis a Lift

Cannabis was already a boom industry in North America. This has been driven by a range of recent changes, such as recreational legalization in Canada, federal legalization of hemp in the US, and the repeal of prohibition across a growing number of states. This has allowed the growth of companies such as Cannabis Strategic Ventures, which cater to a growing market as customers move from criminal supply channels to legal ones.

Demand exploded during the early stages of COVID-19’s spread through North America. According to the Bank of America Securities, there were record sales of cannabis as consumers stockpiled, preparing for a lockdown. While some people bought mountains of toilet paper or tinned food, both medical and recreational cannabis users were making sure they had enough to see them through a crisis.

The result was a spike in sales in April and May, to the benefit of companies with recognizable quality brands such as Cannabis Strategic Ventures. Sales could have been stymied as states locked down and restricted business to control the spread of COVID-19. But most states classified cannabis as an essential product, allowing sales to continue even as other parts of the economy were shutting down.

Together, these factors led to record sales for some cannabis companies, with Cannabis Strategic Ventures celebrating increased sales of cannabis product from its core cultivation facility and adding staff to address the rising demand.

Strong Contender Seizes Market Opportunity

These sales marked an extraordinary month for NUGS. Despite restrictions on business due to COVID-19, the company had record-breaking sales in the final week of April, putting monthly sales 800% higher than the monthly average for Q1.

Any fears that this might be a blip caused by panic buying at the start of the pandemic vanished the following month, when the company announced sales from its most recent harvest. With cannabis sales in the US average roughly $1,525 per pound, the company sold its product at around $1,700 per pound, 11% above benchmark levels. This was a particularly impressive price given that it had been selling at a discount relative to the benchmark only six months before.

Of course, not all cannabis companies will benefit from the crisis. Their ability to profit depends in large part on the strength of their existing business. NUGS had been building up its business prior to the crisis, with the addition of a six-acre cultivation site in 2019, capable of four or five harvests per year.

Seizing the market opportunity brought by COVID-19, the company has announced further improvements in the first half of 2020. Work on both the quantity and the quality of output has more than doubled the output of cultivation facilities while supporting rising prices for its products.

Cannabis Industry Evolves

The long-term expansion of legal markets has led to dramatic growth for cannabis companies over the past decade, and the COVID-19-related influx of revenues provides well-run businesses the resources they need for further expansion. Late April and early May saw Cannabis Strategic Ventures sell out its entire stock every week for a month.

“We have never seen anything like this,” said Cannabis Strategic Ventures CEO Simon Yu. “We booked $100,000 in one day to clear out all of our remaining inventory. We anticipated this dynamic but still underestimated the force of the trend. Too much demand is always the problem you want to have.”

NUGS sold $929,000 of cannabis products in May and expects to see even greater sales in June. Expanded inventory and product range have supported this growth even in a time of crisis, while reinvestment from that growth will let the company further expand its capacity.

Part of the sector’s success comes from producing a varied range of brands and products. Rather than just selling weed, the more successful companies have been developing a variety of cannabis derivatives for different markets. While the recent boom in sales has come from demand for cannabis itself, related brands have diverse interests in supporting long-term growth of the market, normalizing cannabis and its derivatives as consumer products, and protecting companies against a disruption in any individual part of the market.

Cannabis Players Execute on Varied Strategies

The boom in sales brought about by the COVID-19 crisis has created an opportunity for a range of growing companies.

Village Farms International Inc. (NASDAQ: VFF) is one of the largest and longest-operating vertically integrated greenhouse growers in North America. The company announced that its majority-owned joint venture for large-scale, low-cost, high-quality cannabis production, Pure Sunfarms, has received from Health Canada its cannabis cultivation sales license based on an initial production area within its second 1.1 million square foot greenhouse facility in Delta, British Columbia.

HEXO Corp. (NYSE: HEXO) is an award-winning consumer packaged goods cannabis company that creates and distributes innovative products to serve the global cannabis market. The company serves the Canadian adult-use markets under its HEXO Cannabis and Up Cannabis brands, and the medical market under HEXO medical cannabis. The company recently closed a public offering for total gross proceeds to the company of C$57,546,000.

Amyris Inc. (NASDAQ: AMRS) is a global science and technology leader of pure, sustainable ingredients for the Health & Wellness, Clean Beauty and Flavors & Fragrances markets. The company recently presented clinical data showcasing the superiority of its natural sugarcane squalane (marketed and sold as Neossance Squalane) as a carrier of CBD versus other oils. In order for CBD to be effective in topical applications, skin penetration is a key factor. Amyris sugarcane squalane improves the efficacy of CBD by 10-40X as the carrier oil chassis for the skin care market based on new data.

Tilray Inc. (NASDAQ: TLRY) is a global leader in cannabis research, cultivation, processing and distribution. An industry pioneer, Tilray was the first GMP-certified medical cannabis producer to supply cannabis flower and extract products to tens of thousands of patients, physicians, pharmacies, hospitals, governments, and researchers on five continents.

COVID-19 devastated the global economy but spurred a revenue spike in the cannabis industry, substantiating the opportunity in an already rapidly expanding sector.

For more information on Cannabis Strategic Ventures, please visit Cannabis Strategic Ventures (OTCQB: NUGS)

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CannabisNewsBreaks – technical420 Highlights Five Emerging Must-Watch Cannabis Markets

A recent editorial by Anthony Varrell of technical420 reviews five emerging cannabis markets suggested as “need-to-watch” for investors in 2020. These include Colombia, Uruguay, Australia, Israel and China. The publication also highlights companies that are laser-focused and positioning for opportunity within these markets, including Chemesis International Inc. (CSE: CSI) (OTCQB: CADMF) (FRA: CWAA) and its wholly owned subsidiary La Finca, Aurora Cannabis (TSX: ACB) (NYSE: ACB) and its ICC Labs, Aleafia Health (TSX: ALEF) (OTCQX: ALEAF) and CannaPacific, Tilray, Inc. (NASDAQ: TLRY) and Canndoc Ltd., a wholly owned subsidiary of InterCure Ltd. (OTC: IRCLF) (TASE: INCR), as well as Canrim Growth Group, CGA and NSG. “From Australia to South America, from Europe to Africa, countries all over the world are enacting pro-cannabis legislation and this is a trend that is expected to become more significant in 2020,” Varrell writes. “Today, we want to highlight 5 emerging international markets as well as companies that are focused on these burgeoning opportunities.”

To view the full article, visit http://cnw.fm/uxGg6

About technical420

Technical420 is dedicated to educating investors about the risk and rewards of investing in the cannabis industry. It highlights companies that have the most growth potential by utilizing its proprietary analytics platform. For more information, visit www.technical420.com.

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CannabisNewsBreaks – Tilray, Inc. (NASDAQ: TLRY) Receives Second GMP Certification for Cantanhede, Portugal Facility Allowing International Export of Finished Medical Cannabis Products

Tilray (NASDAQ: TLRY), a global pioneer in cannabis research, cultivation, production and distribution, on Wednesday announced its wholly-owned subsidiary Tilray Portugal, Unipessoal Lda. (“Tilray Portugal”) has received its Good Manufacturing Practice (“GMP”) certification in accordance with European Union standards, for its manufacturing facility in Cantanhede, Portugal. According to the update, Infarmed, the Portuguese National Authority of Medicines and Health Products, issued the GMP certification. This is Tilray Portugal’s second GMP certification, which allows the facility to manufacture and export GMP-certified finished medical cannabis products, including dried flower and oils, from Portugal to international markets with legal medical cannabis regulations. “We are pleased with the continued momentum of our growth strategy across Europe with this additional GMP certification for Tilray’s EU campus in Portugal,” Tilray CEO Brendan Kennedy said in the news release. “This will enable us to export a greater range of medical products to international patients, partners and markets. Our international strategy is an important component in driving profitability and long-term shareholder value.”

To view the full press release, visit http://cnw.fm/Fk7pC

About Tilray(R)

Tilray is a global pioneer in the research, cultivation, production and distribution of cannabis and cannabinoids currently serving tens of thousands of patients and consumers in 13 countries spanning five continents. For more information, visit the company’s website at www.Tilray.com.

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CannabisNewsAudio – Sugarmade, Inc. (SGMD) Contributes to the Thriving Kentucky Hemp Market

Related Editorial
Hemp may be taking the first steps to overtake tobacco as a leading industry in Kentucky.

Sugarmade Inc. (OTCQB: SGMD) (SGMD Profile) is among the companies moving into Kentucky, with a million-dollar investment in hemp growth. Hemp’s national prominence is growing through deals such as Aurora Cannabis Inc.’s (TSX: ACB) (NYSE: ACB) collaboration with United Fighting Championship (UFC). Research work by Tilray Inc. (NASDAQ: TLRY) may involve using hemp to treat a growing range of physical and mental ailments. Curaleaf Holdings Inc. (OTCQX: CURLF) (CSE: CURA) is serving states without a strong, homegrown hemp industry, such as Florida. In addition, companies across the cannabis sector, such as Cronos Group Inc. (TSX: CRON) (NASDAQ: CRON), are diversifying their product ranges as more hemp crops come online.

To hear the CannabisNewsAudio version, visit http://cnw.fm/FPq1f

To view the full editorial, visit http://cnw.fm/us4V5

About Sugarmade Inc.

Sugarmade Inc. is a product and brand marketing company investing in products and brands with disruptive potential. For more information, visit the company’s website at www.Sugarmade.com.

NOTE TO INVESTORS: The latest news and updates relating to SGMD are available in the company’s newsroom at http://cnw.fm/SUGAR

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Hemp Set to Overtake Tobacco in Kentucky Amid Boom for Growers, Suppliers

CannabisNewsWire Editorial Coverage: Hemp may be taking the first steps to overtake tobacco as a leading industry in Kentucky.

Once the hemp heartland of the United States, Kentucky is rebuilding this lost industry following recent legislative changes.
Both tobacco farmers and specialist hemp companies are contributing to the boom.
The trend appears to also be profitable for companies providing support services, such as CBD extraction and hydroponic supplies.

To view an infographic of this editorial, click here.

A Surprising State

In some ways, Kentucky is a surprising place to see a hemp boom. Conservative lobbyists in the state have consistently resisted legalization measures for related plants, despite the wider growth of the industry. Given the “thin end of the wedge” arguments wielded against drug reform, the hemp industry might have expected to face a cold response in the state.

Yet the state’s hemp sector has deep roots. During the 19th century, Kentucky was the largest producer of hemp in the United States, producing three-quarters of the nation’s hemp fiber. As hemp production went into decline following the First World War, tobacco took its place as a major cash crop for the state. However, tobacco now faces challenges of its own. With hemp production made legal on a federal level for the first time in nearly half a century, Kentucky has once again emerged as the country’s leading manufacturer.

Overtaking Tobacco

Kentucky has become a go-to state for companies with an interest in hemp, such as Sugarmade Inc. (OTCQB: SGMD).

Since federal legislation allowed the production of hemp at test sites in 2014, Kentucky has taken a leading role in the industry. The Bluegrass state was one of only three states to exceed 100 acres by 2016, and research permits were issued for more than 12,000 acres in 2017. By the time the 2018 farm bill proposed the legalization of hemp across the United States, Kentucky hemp growers were becoming a powerful lobby. They won the support of the state’s politicians, helping to push national legislation through in December.

Sugarmade’s involvement in Kentucky comes through, at least in part, a million-dollar investment in Nevada-based Hempistry Inc. Hempistry has begun growing high-grade hemp on a 23,000-acre land option it holds in Kentucky. High in cannabidiol (CBD), an active ingredient in high demand for wellness products, this hemp offers a chance to maximize earnings from the land and set down roots for larger operations in the state.

Commentators watching the development of hemp in Kentucky have speculated that plant could overtake tobacco, once the state’s leading cash crop. A growing number of savvy tobacco farmers have started growing hemp on part of their land, hedging their bets against the decline in tobacco sales. Hemp certainly appears to be a natural alternative to tobacco for these farmers, as it can be grown in similar conditions and sold into related markets.

Consequently, the Kentucky hemp industry is already turning into a large and diverse one, driven by two separate trends. One is the need of farmers for new crops, as declining tobacco sales and the pressure of trade wars impact their profits. The other is the emergence of companies with a focus on hemp and related crops, such as Sugarmade. These companies provide specialist tools and invaluable knowledge, while the farmers bring decades of experience growing crops in the region. Old and new knowledge combine to build a booming industry.

Looking to buoy up the economic health of their state, Representative James Comer and Senator Mitch McConnell have pushed the hemp agenda at a national level, creating the space for Kentucky’s hemp industry to thrive. McConnell has been particularly crucial, using his position as majority leader to advocate for hemp reform, including publicly reinforcing his support for the industry through a tour of the state with Sonny Perdue, head of the U.S. Department of Agriculture (USDA). With this growing federal support, Kentucky hemp growers appear to be making long-term investments, confident that politicians will ensure a friendly business climate.

Providing the Fundamentals

Of course, it takes more than political goodwill to make an industry grow. Suppliers providing tools and materials to support the fundamental activities involved in the industry are crucial. This need is what attracted Sugarmade to the industry and is still the bedrock of the company’s hemp strategy.

Sugarmade entered the hemp space as a supplier of hydroponic equipment. Hydroponics are essential to the hemp market. While some hemp is grown outdoors, much is grown indoors, where greater control can be asserted over growing conditions. Hydroponic systems are used for this indoor agriculture, and Sugarmade supplies some of the best available systems available. In addition, the company is looking forward, exploring the use of artificial intelligence to monitor crops and ensure the best growth.

Agricultural supplies are one of the bottlenecks in the hemp industry. The sector has grown so quickly that suppliers have struggled to keep up. These circumstances have created what appear to be ideal conditions for Sugarmade, as demand for its core products seem to be all but ensured, allowing the company to expand by acquiring other firms. This savvy pick-and-shovel strategy has taken Sugarmade beyond its original strategy and into the Kentucky cultivation sector through the investment in Hempistry.

Supplying producers has given Sugarmade space to diversify. In addition to hydroponics, SGMD now sells extraction equipment. This is used by hemp growers or specialist processing companies to extract the CBD from hemp, so that it can then be sold to manufacturers as a raw ingredient. Sugarmade’s future plans include the introduction of new types of processing machines, aimed to keep the sector innovating and moving forward and also strengthen the company’s position as a leader in the space.

Subsidiary services such as extraction are one more reason why hemp may grow in importance to surpass tobacco. These services provide extra forms of employment and an extra boost for a state such as Kentucky. The state’s workers and tax base benefit not just from hemp farming but also from agricultural supplies, processing businesses and the entire supply chain of hemp and CBD products, a chain that looks set to only expand as the industry continues to see extraordinary growth.

The Hemp Boom

Big players from related industries are also making use of hemp to broaden what they offer as well.

Aurora Cannabis Inc. (TSX: ACB) (NYSE: ACB) recently acquired Hempco Food and Fiber Inc., a company it has been investing in since 2017. This provides Aurora with a high-volume supply of raw hemp from which it can extract cannabidiol for use in a wide range of products. The company is also working to raise the profile of hemp and find new ways to use the it. At least part of these efforts are being accomplished through a partnership with mixed martial arts company UFC. Aurora’s products and discoveries are designed to be used to help UFC athletes manage pain relief, tackle muscle strains, and enjoy the rest and relaxation they need between fights. As well as drawing attention to Aurora and hemp, the collaboration may prove invaluable insight into what CBD can do for professional athletes.

A pioneer in the use of cannabinoids, Tilray Inc. (NASDAQ: TLRY) is a company with a heavy focus on research, contributing to studies around the world. The company has recently gained permission from the U.S. government to import CBD to the states for clinical trials at the NYU School of Medicine. These studies will explore the effectiveness of CBD in treating patients suffering from Alcohol Use Disorder (AUD) and AUD with Post-Traumatic Stress Disorder (PTSD).

While regions such as Kentucky are seeing a hemp boom, others have yet to see such growth and remain underserved for CBD products. Curaleaf Holdings Inc. (OTCQX: CURLF) (CSE: CURA) is focused on these areas, taking the opportunity provided by unmet demand. States such as Florida, Massachusetts, New Jersey and New York have limited licensing and large populations, making them ideal settings for this strategy. Curaleaf is about to open its 26th dispensary in Florida.

Cronos Group Inc. (TSX: CRON) (NASDAQ: CRON) is working to strengthen its position in the hemp market through the recently completed acquisition of four subsidiaries of the Redwood Holding Group. This adds a range of hemp-derived consumer products to Cronos’s lines, giving it more prominence in the market.

The hemp boom isn’t limited to Kentucky, but with growing political and corporate support, the state appears set to return to its former place as the U.S. hemp leader.

For more information on Sugarmade, visit Sugarmade Inc. (OTCQB: SGMD)

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Political Backing, Investor Interest Fuel Kentucky Hemp Boom

CannabisNewsWire Editorial Coverage: The surging hemp industry means exciting benefits for Kentucky.

Hemp is big business in Kentucky. Among the companies working in the state is Sugarmade Inc. (OTCQB: SGMD) (SGMD Profile), a supplier of hydroponic equipment that is now moving into hemp through an investment in Hempistry. In New York, a leading politician has been in contact with Canopy Growth Corporation (TSX: WEED) (NYSE: CGC) to ensure the survival of a hemp project threatened by executive upheaval. Tilray Inc. (NASDAQ: TLRY) is looking even further than North America for growth. Cronos Group Inc. (TSX: CRON) (NASDAQ: CRON) is focusing on innovation in the sector. New Age Beverages Corporation (NASDAQ: NBEV) has been expanding its distribution and marketing power to reach into an ever-growing hemp market.

Kentucky is now the largest producer of hemp by state in the United States, fueled by local and national political support.
The hemp boom promises an alternative crop to struggling farmers.
The burgeoning industry is drawing investment into the state from hemp companies.

To view an infographic of this editorial, click here.

Hemp Achieves Great Growth in Kentucky

This year has seen a serious ratcheting up of hemp production across the United States. After the 2018 Farm Bill passed late last year legalizing national widespread hemp production, companies have been rushing to establish a foothold in the industry. Some are expanding test cultivation sites established under the 2014 bill, while others are setting up new operations.

This boon is proving particularly profitable for Kentucky. Having wholeheartedly embraced hemp cultivation under the previous regulations, the state is benefiting from a relatively well-developed industry that has existing strong political support. These favorable circumstances are attracting hemp companies and hemp investment into the state, helping to balance declines seen elsewhere in the state’s agriculture space.

Heading for Kentucky

A wide range of businesses, including brand-development company Sugarmade Inc. (OTCQB: SGMD), are investing in Kentucky’s hemp sector, funding the cultivation, processing and sale of the plant. Whether it’s being used for grain, fiber or CBD production, hemp crops are booming.

Hemp production in Kentucky began in 2014, when 20 approved growers planted 33 acres of the crop under legislation that supported trials of hemp farming. By 2018, the industry had grown 200 times in size to 6,700 acres cultivated by 210 growers. On top of this, 14 university projects and 72 processors were invested in the crop. Only Colorado exceeded Kentucky for hemp production within the United States.

Since the passage of the 2018 Farm Bill, the state has seen a further staggering surge in production. Kentucky now has 60,000 acres devoted to hemp production, making it the biggest hemp-producing state in the country. The industry has produced nearly a thousand jobs, 250 of them in the first half of this year. And as companies such as Sugarmade increase their investments in the state, that growth looks set to continue.

Sugarmade entered the hemp sector through hydroponics. A significant portion of hemp is grown indoors to provide greater control over how the crop is grown. Growth and acquisitions have made Sugarmade one of the hemp sector’s leading providers of hydroponic equipment and supplies, which are vital for this indoor growth.

Now the company is taking a more direct interest in hemp by exercising its option to invest in Hempistry Inc. Founded by Sugarmade’s own CEO Jimmy Chan, Hempistry is growing hemp in Madison County, Kentucky. Sugarmade is making a series of investments in the project that are expected to total an estimated $1 million.

“These investments into Hempistry make sense for Sugarmade, not only from a financial standpoint relative to probable rate of return, but also from a business development standpoint,” said Chan. “As Hempistry and other local cultivators grow, we believe Sugarmade’s status as a potential supplier to cultivators will also continue to rise. We look forward to a successful growing season with Hempistry.”

Kentucky Politicians Back Hemp Farmers

One of the reasons for Kentucky’s hemp boom is the strong support provided by politicians across the state. Representative James Comer and Senator Mitch McConnell have actively backed the industry at a national level, while Kentucky Agriculture Commissioner Ryan Quarles has been an advocate within the state. Under Quarles’s leadership, the Kentucky Agricultural Department has encouraged the development of the hemp industry, putting policies in place to support it.

This political support is at the heart of what makes Kentucky so appealing to companies such as Sugarmade as they seek opportunities for hemp investment. Though hemp is once again legal on a federal level, the road to this point has been rocky, and the industry is likely to face further political hurdles. Knowing that Kentucky will provide political support makes the state an appealing place to invest.

McConnell has been particularly essential in establishing this support. The senior Kentucky senator used his position as majority leader to push hemp reform through the federal legislative process. This summer, he publicly reinforced his support for hemp through a tour of the industry in Kentucky with Sonny Perdue, head of the U.S. Department of Agriculture (USDA). The tour marked an important moment for Kentucky as a leader in that industry, as well as the hemp industry as a whole, acknowledging its newfound legitimacy.

Among the issues the two men talked about on the tour was improving access to finance for hemp growers. Though December’s farm bill legislation theoretically should have removed financial barriers, in practice, banks need encouragement to change their approach. With high-profile advocates such as McConnell and Perdue taking a firm stance, this is likely to change rapidly, making life easier for companies such as Hempistry and Sugarmade.

Hemp Provides Something We Need

In strained political times, hemp has provided something we all need — an issue on which politicians from both major parties can agree. The hemp provisions of the farm bill passed thanks to cross-party support, and politicians from both sides of the aisle have been keen to encourage the industry.

Nothing makes this clearer than the involvement of both Democrat and Republican senate leaders in supporting and encouraging the industry. Earlier this month, Senate Minority Leader Chuck Schumer spoke directly to the leadership of Canopy Growth Corp. to ensure that recent changes at the company wouldn’t stand in the way of a building a cutting-edge hemp facility in New York. When companies such as Sugarmade see this type of support, they feel confident investing heavily in hemp, knowing that both parties support industry expansion.

The reason behind this widespread support is that hemp caters to another need — new avenues for farmers to make a living. Farm production in the United States is at a six-year low, with many farmers struggling to get by. Economic disruption and trade wars threaten to further undermine their financial well-being. As a high-value cash crop, hemp offers a lifeline to farmers, making support of the industry more important than ever.

The money poured into the industry by Sugarmade and other savvy companies may be the difference between success and failure for rural communities. And it doesn’t hurt that, along the way, these investments appear likely to be highly profitable for these companies and their investors.

Hemp Producers Rise to Prominence

The growth of the industry has brought hemp-growing companies to greater prominence than ever.

Schumer’s call to Canopy Growth Corporation (TSX: WEED) (NYSE: CGC) highlights just how much influence these companies now have, as they nurture the first shoots of what promises to become a fruitful industry. Canopy Growth Corporation is one of the largest Canadian companies operating in the hemp space, a leader in the field with significant resources and influence. The surprise removal of CEO Bruce Linton caused alarm in some quarters as well as uncertainty about the company’s future direction. But Schumer’s direct intervention has brought reassurance that the company will move ahead with its New York hemp plans.

While Canopy Growth has shed its most prominent executive, competitor Cronos Group Inc. (TSX: CRON) (NASDAQ: CRON) has added a new one to its team. Dr. Todd Abraham is joining the company as chief innovation officer. A thought leader in the field of consumer packaged goods, Abraham has shown faith in the staying power of the hemp industry through his move to Cronos. He’ll have plenty of tools to innovate with, as the company recently announced that it is establishing a brand new R&D facility, as well as acquiring a state-of-the-art fermentation and manufacturing facility. These deliberate moves put Cronos Group in a strong position to create new products using cultured cannabinoids.

The industry expansion isn’t limited to just the United States and Canada. Tilray Inc. (NASDAQ: TLRY) has recently arranged the export of CBD-rich oils to Ireland and is expanding its European leadership team. Hemp and CBD markets operate under different rules in Europe, so local knowledge is essential for expansion there, and Tilray is investing in that knowledge.

New Age Beverages Corporation (NASDAQ: NBEV) has also been pushing to become a global brand, following an announcement to this effect in April. But the company isn’t neglecting its American markets. It recently acquired marketing, sales and distribution company Brands within Reach to strengthen its marketing and distribution position in North America, working to take its relaxing drinks to an ever-wider market.

With the support of politicians and business leaders, hemp is clearly growing in popularity. Nowhere is the economic impact of that felt more strongly than in Kentucky.

For more information on Sugarmade, visit Sugarmade Inc. (OTCQB: SGMD)

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Cannabis Companies Seek Strong Strategies to Meet Growing Demand

CannabisNewsWire Editorial Coverage: With demand outstripping supply, successful cannabis companies are following smart core strategies and reporting strong revenues.

Golden Developing Solutions Inc. (OTC: DVLP) (DVLP Profile) has used a mix of acquisitions, diverse brands and products, and increased production footprint to meet customer demand and report significant revenue increases, including its strongest second-quarter numbers ever. Industry giant Canopy Growth Corporation (TSX: WEED) (NYSE: CGC) has followed a similar path, though some change may follow the recent departure of its co-CEO. Tilray Inc. (NASDAQ: TLRY) has invested heavily in increasing production while reaching into new markets such as the United Kingdom. Medmen Enterprises Inc. (CSE: MMEN) (OTCQX: MMNFF) and Curaleaf Holdings Inc. (CSE: CURA) (OTCQX: CURLF) have both shown the potential for growing multistate businesses in the United States, despite the challenges created by federal legislation.

Increasingly liberal laws have allowed demand to show in the legal market, but supply has not yet caught up.
To meet this demand, the industry needs to increase production.
Individual companies are using acquisitions and diversification to improve their revenues.

To view an infographic of this editorial, click here.

Expanding Business

The cannabis, hemp and CBD sector is experiencing a period of huge expansion. With medical cannabis now legal in 60% of U.S. states, recreational cannabis legal in many states as well as Canada, and hemp production legalized on a federal level, North America has become home to a thriving industry. What was relegated to illegal markets and fringe cases only 20 years ago is now the source of an economic boom.

In this brave new world of legal business, cannabis companies are looking for ways to maximize their profitability and ensure a strong position as the market keeps expanding. So what are the strategies bringing success for the growing cannabis companies, both big and small? And how are those strategies contributing to the development of the sector?

Expanding Production

For the companies working in this sector, such as Golden Developing Solutions Inc. (OTC: DVLP), their work in the space is producing strong growth and sales numbers. From March 2018 to March 2019, Golden Developing Solutions saw an 800% jump in performance. Further growth was announced in May, as the company went from strength to strength.

“As we projected, top-line performance is accelerating across all metrics following our recent investments,” said Triant. “Everything is clicking right now.”

For Golden Developing Solutions, some of its growth is coming by expanding production. With the cannabis industry being so new and tightly regulated, production is relatively limited. And with demand rising rapidly, especially for hemp-derived CBD, the industry is currently struggling to meet customers’ needs. This demand supports high prices but still means that producers are missing out on opportunities, as there is untapped potential in the market.

Golden Developing Solutions is just one of the companies expanding its production capacity in response to this trend. The expansion is a complex undertaking, as a hemp or cannabis production facility requires a specially adapted building, hydroponic equipment to grow the plants, security and other support facilities, and an appropriate license from the relevant local authority. When a new growing space is established, such as Golden Developing Solutions’ recently announced 25,000-square-foot facility in Denver, Colorado, it’s big news for both the company and the industry.

This move in Colorado by Golden Developing Solutions was a direct response to that gap between supply and demand. Already equipped with much of the equipment it needs, and with licensing in place to produce marijuana infused products, DVLP has identified an ideal space with promising potential.

“Our CBD Infusionz segment is bursting at the seams right now,” said CEO Stavros Triant. “Demand already vastly outstrips supply capacity. This new facility directly addresses that issue, and should provide the necessary room for the explosive growth that we anticipated when we made that acquisition in March.”

Acquisitions and Subsidiaries

Increasing production space is the only way for the industry as a whole to address supply shortages. But for individual companies, other options to increase their presence in the sector are available.

The past two years have seen a huge surge in acquisitions in the cannabis sector. These acquisitions have allowed companies to grow in size, resulting in increased supplies and sales. Though it doesn’t directly lead to an increase in overall supply, the benefits in scale and efficiency mean that, in the long term, this coming together of companies could lead to better supplies.

For Golden Developing Solutions, its most important recent acquisition has been Infusionz LLC, a manufacturer of CBD products. Completed in March, the acquisition gave Golden Developing Solutions control not just of Infusionz’s production base but also of its established brands and retail links. Building relationships with customers is a tricky business in an industry where licensing limits marketing options and where brand allegiances are just starting to form. Acquiring a brand for which demand already outstrips supply is invaluable.

This is a common pattern for mergers and acquisitions in the cannabis and CBD space. Though brands may be relatively small scale compared with other industries, they are often not folded into existing lines on acquisition. The benefits of experimenting with new brands and tapping into their customer base outweigh what might be gained by merging output to supply a smaller number of brands.

A More Diverse Approach

Infusionz isn’t the only subsidiary in Golden Developing Solutions’ armory. In addition to Where’s Weed, a core pillar of the company since 2011 connecting medical and recreational cannabis consumers with local dispensaries, delivery services, strains and more, the company is also focusing its attention on Where’s CBD.

Similar in nature, Where’s CBD is a new technology resource and future online marketplace connecting CBD consumers with local businesses, brands and educational content across the United States, helping people quickly find the right products for themselves or their loved ones.

Providing a powerful opportunity to capture both customers and purchasing data while providing distribution channels for brands, Where’s CBD is a diverse addition to the company that inherently adds more value to the overall ecosystem and foundation that has been built thus far.

By increasing production, acquiring smaller competitors, and diversifying their products and services, cannabis companies are becoming stronger than ever.

Among these strengthening companies is Canopy Growth Corporation (TSX: WEED) (NYSE: CGC). If any company can be considered an established giant in such a young industry, it’s Canopy Growth. Emerging from the Canadian market in 2013, Canopy Growth quickly rose in power off the back of the Canadian medical cannabis sector. As of April 2019, Canopy Growth was the largest cannabis company in the world as measured by market capitalization and showed no sign of faltering. Like Golden Developing solutions, it has followed the three main paths to growth in the sector, including diversifying its product line to suit a market that now includes recreational cannabis and CBD derivatives as well as medical cannabis. The recent departure of co-CEO Bruce Linton has caught observers by surprise but is unlikely to disrupt Canopy Growth’s ongoing rise.

Another of the big Canadian companies, Tilray Inc. (NASDAQ: TLRY) recently announced the investment of $32.6 million in expanding its cultivation and manufacturing facilities. The expansion work, taking place over three sites, will increase the company’s production and manufacturing footprint to 1.3 million square feet. The company’s growth includes reaching into new markets, with the recent announcement that it has exported bulk amounts of cannabis oil into the United Kingdom. The United Kingdom only allowed the use of cannabis oils recently — with stringent restrictions. Some expect this to become the thin end of the wedge, as many in the country would like to see cannabis rules liberalized, especially where the drug can meet medical needs. By being one of the first bulk providers in the country, Tilray could establish itself as an important name before the British market is even fully formed.

Of course, there’s still room for improvement in the legal situation in the United States, and Medmen Enterprises Inc. (OTCQX: MMNFF) (CSE: MMEN) has established itself as one of the largest financial supporters of progressive marijuana laws. The gap between federal laws and those in individual states is an ongoing problem for companies working in North America, making it hard to carry out cross-state operations. Despite this, Medmen has managed to establish a multistate business working across 19 facilities that, through a move into Arizona, bring business to five states.

Another U.S. company, Curaleaf Holdings Inc. (CSE: CURA) (OTCQX: CURLF) is a vertically integrated medical and wellness cannabis company whose strategic focus is specifically on areas where demand is most likely to go unmet. Working in states such as Florida, Massachusetts, New Jersey and New York, which are highly populated but have limited licensing, the company is bringing its products to customers who may struggle to get the cannabis and CBD derivatives they are looking for. Curaleaf has used acquisitions to help with this strategy, with the recent acquisitions of Emerald Dispensary.

By diversifying, increasing production and acquiring other companies, cannabis businesses are expanding to meet previously unmet demand.

For more information on Golden Developing Solutions, visit Golden Developing Solutions Inc. (OTC: DVLP)

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Acquisitions, Licenses, Research Key in Consistent Cannabis Market Growth

CannabisNewsWire Editorial Coverage: The cannabis sector continues its steady shift toward big business and big money, with much of growth based on acquisitions, agreements and consistent research.

TransCanna Holdings Inc. (CSE: TCAN) (FRA: TH8) (TCAN Profile) is focused on creating a large operation with various licenses and recognized brands, with several key acquisitions, being part of that strategy. Medmen Enterprises Inc. (CSE: MMEN) (OTCQX: MMNFF) is in the process of acquiring PharmaCann, which recently received an extension to complete the development of its cultivation facility in Ohio. Cronos Group Inc. (TSX: CRON) (NASDAQ: CRON) just entered into a multiyear supply agreement that will help the company provide high-quality products to consumers in anticipation of the derivative market launching in Canada this fall. Tilray Inc. (NASDAQ: TLRY) recently completed its acquisition of Manitoba Harvest, the largest hemp food company. GW Pharmaceuticals Plc (NASDAQ: GWPH) continues its march forward as a leader in cannabinoid prescription medicines sector with its recent announcement of positive, top-line results of a Phase 3 clinical trial of Epidiolex® in the treatment of seizures associated with a rare and severe form of childhood-onset epilepsy.

Cannabis companies are engaging in multimillion-dollar acquisitions in growing numbers.
This strategy supports a consolidation of the industry as it moves from scattered creativity to efficient large businesses.
The trend is built in part on intangible assets, including brands, licenses and research.

To view an infographic of this editorial, click here.

A Very Different Business

The image of the cannabis industry varies significantly depending upon an individual’s point of view. To supporters, the market is a transformative sector aimed at bringing the world together. Detractors call the industry one more vice threatening public morals. For many standing in the middle ground, the sector is a space where hippies and stoners can thrive but not necessarily one that encourages the buzz and dynamism of mainstream business.

In reality, the cannabis sector fits none of these images. The industry is emerging from its early nascent steps into legality to become a significant business sector much like any other, with all the elements of modern capitalism. This growth appears to be reflected in the sector’s recent burst of mergers and acquisitions.

Big-Money Deals

Certainly one of the most eye-catching aspect of mergers and acquisitions in the cannabis sector is the significant amount money involved. Take just two recent examples from a single company: TransCanna Holdings Inc. (CSE: TCAN) (FRA: TH8).

In the past few months, the Vancouver-based cannabis company has made announcements on two major deals. First came the acquisition of a 196,000-square-foot vertically integrated cannabis facility for a total purchase price of $15 million. Then came a letter of intent relating to Californian company Lyfted Farms outlining TransCanna’s plans to acquire Lyfted’s business and assets for $5.5 million.

By some standards, these might not seem like significant deals. But when a company is investing $20 million on expansion in the space of a couple of months, stability seems evident. That TransCanna can make these deals is a show not only of the strength of the company but also the strength of the industry.

The financial growth of the legal cannabis industry has been a positive move for everyone from company leaders to their lowest-paid employees. The legalized trade is pulling money out of the black-market economy and allowing those at the top to earn big bucks while also providing employees with a decent wage. Far from weakening the power of legal providers, paying employees properly is leaving them with enough money to go around buying up competitors, as TransCanna is doing.

Success has also brought funds from outside. From private individuals to big alcohol and tobacco companies, investors are pouring money into pot, allowing businesses to expand while keeping their employees happy. There are living wages at the bottom and big money at the top.

Tidying Up the Market

The progression of the legal cannabis industry started with a scattered approach. TransCanna is one of many companies that started in the market with a relatively small presence. Some began as entrepreneurs seeing a new industry within which to operate. Others were experienced cannabis cultivators moving from the illegal to the legal market. Still others were pharmaceutical companies dipping their toes into a new medicine and, from there, into the recreational industry.

As a result, the cannabis industry was initially made up of diverse and disconnected businesses. Now, however, the sector is moving toward a space of consolidation.

This doesn’t mean that the variety created in that early surge is being lost. When larger companies buy up smaller ones, the aim is often to continue supporting and growing the individual brands and styles the smaller companies have created. For example, TransCanna has announced the acquisition of GoodFellas, allowing TransCanna to take control of the Daily Cannabis Goods brand. TransCanna CEO Jim Pakulis has talked not in terms of absorbing the Daily brand into TransCanna’s existing identity but in terms of maintaining Daily and expanding its sales.

The consolidation of multiple brands and businesses into a smaller number reflects a dialectic process that’s common in new business areas. First comes a burst of creativity. With few precedents and no big players dominating the market, entrepreneurs and creatives have free rein. Some of their experiments fail, but the ones that succeed get consumers interested and fill the market with ideas.

While this creates plenty of exciting idea and products, it’s also inefficient. In the phase that follows, bigger companies step in or emerge from among the smaller ones. Consolidation creates efficiency, providing more reliable products for consumers and better value for companies.

The Power of the Immaterial

In the illegal market, product was the main focus for cannabis sellers. In the legal market, the focus is different. When a company relies on the full complement of marketing, intangible assets become important. That’s why GoodFellas is valuable to TransCanna — not just for its cannabis but for the Daily brand attached to it.

And while intangible assets are normally talked about in terms of brand and IP, there’s another sort of asset that gets much less publicity and that the cannabis industry is bringing to investors’ attention: legal licenses.

Licenses of various sorts are important for a wide range of industries, from food production to mining. But they have a particular prominence in the cannabis industry because tight regulation has created a scarcity of licenses. When TransCanna subsidiary TCM Distribution Inc. gained cannabis manufacturing and distribution permits from the City of Adelanto, California, it was an important step in the company’s growth within the state. And when a deal like TransCanna’s acquisition of Lyfted is announced, the target’s cannabis licenses are often mentioned. These licenses are a crucial asset and one that investors are concerned about. Without the licenses, the business can’t function.

The prominence of licenses is a new feature of investment for those going into cannabis. But it could be a feature that helps investors recognize these assets in other companies. Cannabis companies are increasingly about immaterial assets, and immaterial assets are increasingly about licenses as well as IP.

Keeping Profiles High

In such an atmosphere, cannabis companies are working hard on keeping their profiles high while building up their portfolios of products.

Last year Medmen Enterprises Inc. (CSE: MMEN) (OTCQX: MMNFF) soared 60% in one week when the company announced the deal to buy PharmaCann. PharmaCann is working to complete its $20-million cultivation center, which must be operational before the acquisition can be completed to comply with Ohio law, which requires a licensee to have operating certification before transferring a license to another owner. The deal will double the number of states where Los Angeles-based MedMen has licenses to operate – expanding the firm’s reach to 12 states with 66 retails stores and 13 cultivation facilities.

The agreement between Cronos Group Inc. (TSX: CRON) (NASDAQ: CRON) and MediPharm Labs Corp. will supply Cronos Group with approximately $30 million of high-quality, private-label cannabis concentrate over 18 months and, subject to certain renewal and purchase options, potentially up to $60 million concentrate over 24 months. In addition, Cronos Group and MediPharm Labs have entered into a multiyear tolling agreement, where Cronos Group will supply bulk cannabis to MediPharm Labs’ state-of-the-art extraction facility in Ontario.

With the completion of the acquisition, Manitoba Harvest will operate as a wholly owned subsidiary of Tilray Inc. (NASDAQ: TLRY), leveraging the expertise of Tilray’s global cannabis industry expertise. “Tilray’s acquisition of Manitoba Harvest is a milestone for the cannabis industry,” said Tilray president and CEO Brendan Kennedy. “It builds on the strategic partnerships we have formed with consumer brand industry leaders and demonstrates our track record of disrupting the global pharmaceutical, alcohol, CPG, and functional food and beverage categories. We’re excited to work with Manitoba Harvest to develop and distribute a diverse portfolio of branded hemp-derived CBD food and wellness products in the U.S. and Canada.”

The newest test results from GW Pharmaceuticals Plc (NASDAQ: GWPH), the world leader in the science, development, and commercialization of cannabinoid prescription medicines, expands the company’s knowledge of Epidiolex and its potential use beyond the current indications. “Data from previous controlled clinical trials of EPIDIOLEX have shown clinically meaningful seizure reductions and consistent safety and tolerability in children and adults with Lennox-Gastaut syndrome and Dravet syndrome,” said Dr. Elizabeth Thiele, the lead investigator of the trial, director of the Herscot Center for Tuberous Sclerosis Complex at Massachusetts General Hospital, and a professor of neurology at Harvard Medical School. “Based on the positive results of this trial in TSC patients, Epidiolex, if approved for this additional indication, may become an important treatment option also in this disease state with significant unmet medical need.”

The cannabis industry is clearly evolving with big money, consolidation and growing intangible assets playing pivotal roles in the growing strength and consistency of the sector.

For more information on TransCanna Holdings, visit TransCanna Holdings Inc. (CSE: TCAN) (FRA: TH8)

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Searching for the Next Super Nova

CannabisNewsWire Editorial Coverage: Skepticism has been squashed and all apprehension eliminated. There’s no longer any question about either the viability or the profitability of the newly respected cannabis sector. Huge money has already been made in the nascent industry, and the only real question left is: where’s the next super nova?

Quarter-over-quarter sales growth is one of the indicators used to target explosive upside potential. Similar growth patterns were exhibited by many of the cannabis behemoths prior to parabolic price increases. In what may be an equally telling indicator, Wildflower Brands Inc. (CSE: SUN) (OTCQB: WLDFF) (WLDFF Profile) revenues have now increased 11 consecutive quarters, quarter on quarter, ever since the company started selling its hemp-based CBD products. Similar quarterly sales spikes and strategic acquisitions foreshadowed dramatic price increases in some of the largest names in the cannabis universe. Last October Medmen Enterprises Inc. (CSE: MMEN) (OTCQX: MMNFF) soared 60% in one week when the company announced a deal to buy PharmCann. Florida-based Trulieve Cannabis Corp. (OTC: TCNNF) (CSE: TRUL) went public last September through a reverse merger in Canada and soared 200% after a strong 2018 Q2. Already up big on Canadian exchanges, Cronos Group Inc. (NASDAQ: CRON) (TSX: CRON) became the first pure-play marijuana stock to list on NASDAQ around $7 and just bounced off $23 a share. Last year, Tilray Inc. (NASDAQ: TLRY) became the first cannabis company to IPO on the NASDAQ at $17 per share and by September skyrocketed to $300. Despite price surges and fluctuations in the big cannabis names, there’s bound to be more money made in the sector; the run is far from over.

Cannabis run is far from over, new winners emerging
Branding, marketing and retail reach signals of success
Quarter-over-quarter revenue increase helps identify future potential

To view an infographic of this editorial, click here.

Good Times Have Just Begun

Legal cannabis is a recent global phenomenon, and the emergent market appears to be nowhere near reaching its potential. The worldwide legal marijuana market, valued at just $9.3 billion in 2016, is expected to blow past $146 billion within the next six years.

According to a United Nations report, cannabis is the most widely consumed drug on the planet. Approximately 270 million global consumers use cannabis, equivalent to about 4% of the world’s population and a mere pittance in market penetration. As marijuana muscles into the mainstream, usage among all age groups is on the upswing. However, among the most coveted 18-to-34-year-old demographic, there’s an explosion of acceptance as they mature in a world where cannabis is common.

Millennials are about three times and Gen Z about four times more likely to use cannabis than aging Boomers. Forward-leaning cannabis companies are full throttle in product and brand development to corral this coveted demographic and capture market share, now and for decades to come. As public perceptions change and legalization expands, the number of users is certain to skyrocket in an essentially untapped market. A global transition is underway, and the good times for cannabis have just begun. Growth trajectory is virtually vertical, presenting a once-in-a-generation investment opportunity.

Retail Reach

Founded in 2012 as a private company, Wildflower Brands Inc. (CSE: SUN) (OTCQB: WLDFF) went public in 2014 and has been on a tear ever since. Wildflower is an integrated health-and-wellness company creating distinct brands that incorporate the synergistic effects of plants and their extracts. The company’s latest quarterly sales set records, up 78% over the previous quarter, validating corporate strategy, the popularity of its products, and the continued expansion of market share. Intent on supercharging revenue and earnings even further, Wildflower is about to finalize the acquisition of a preeminent cannabis retailer in Vancouver that also owns multiple cannabis licenses.

Wildflower’s latest press release is further evidence of the company’s rapid growth and global reach. The company reported third-quarter sales were up by 78% over the second quarter, the 11th consecutive quarter of revenue growth, since Wildflower Brands began selling products. On top of these stellar results the company is further expanding its retail footprint and product distribution with the accretive acquisition of Vancouver-based City Cannabis Corp.

City Cannabis is a premier cannabis retailer holding two of the three City of Vancouver licenses to sell cannabis and os the only company with multiple licenses in British Columbia. With margins of 50%, City Cannabis had revenues of $1.8 million for the reporting period that began with the opening of its two stores in early January. The combined quarterly revenues of Wildflower Brands and City Cannabis equates to an impressive $4.3 million. Wildflower expects to close on the City Cannabis deal before the end of June, and the acquisition will immediately be accretive to Wildflower’s earnings upon closing.

Bringing City Cannabis and Wildflower together will result in revenue operations in three U.S. states and two Canadian provinces with a combined North American target market of more than 75 million people. The positive net income generated by City Cannabis comes from just two operating properties, even though the company holds an additional seven leases at various stages of permitting approvals.

Commenting on the financials, Wildflower CEO William MacLean stated, “We are pleased with the financial results of both Wildflower and City Cannabis. Sales through every Wildflower distribution channel are up, and sales at City’s licensed retail outlets continue to grow month over month. The positive net income is particularly impressive with City Cannabis carrying a total of nine leases, which are at various stages of the permitting process.”

Grow, Grow, Grow

Already an established presence in California, Wildflower owns 14 cannabis licenses for recreational and medical cannabis cultivation, manufacturing, retail distribution and delivery. The company’s expansion into Canada with the acquisition of City Cannabis bolsters Wildflower’s global growth strategy, which is includes strategic distribution deals already in place in the European Union and South Africa. In addition to capturing revenues from retail operations, the City acquisition gives Wildflower another channel to market its enormously popular products and launch into the over-the-counter market with its CBD formulations and accessories.

Wildflower continues to capture ever-greater market share with innovation, retail expansion and a growing family of popular brands. The company’s strategic partnerships, acquisitions and organic growth are all bolstered by its marketing genius to lock in more loyal consumers. Grabbing national and celebrity attention, Wildflower used ingenious product placement during the 2019 Oscars by including its CBD+ Healing Stick in each of the gift bags of the stars.

The company has also employed an innovative pop-up store approach in SoHo, New York, to introduce Wildflower Wellness products. Wildflower identified a compatible high-profile retail venue and struck a deal with the outlet, then marketed its products in the upscale establishment for a limited time period, raising market uptake and visibility.

Big Names

Medmen Enterprises Inc. (CSE: MMEN) (OTCQX: MMNFF) is a cannabis retailer with operations across the United States and flagship stores in Los Angeles, Las Vegas and New York. Company objectives are to capitalize on first-mover advantage by opening stores in top markets and building brand awareness and customer acquisition. The company is also intent on expanding retail footprint and creating an omnichannel consumer experience.

Trulieve Cannabis Corp (OTC: TCNNF) (CSE: TRUL) is a vertically integrated, seed-to-sale company and is the first and largest fully licensed medical-cannabis company in Florida. Trulieve cultivates and produces all of its products in-house and distributes those products to Trulieve-branded stores (dispensaries) throughout the state, as well as directly to patients via home delivery. Trulieve also operates in California, Massachusetts and Connecticut.

Cronos Group Inc. (NASDAQ: CRON) (TSX: CRON) is a global cannabinoid company with international production and distribution across five continents. Cronos Group is committed to building disruptive intellectual property by advancing cannabis research, technology and product development. The company is committed to responsibly elevate the consumer experience and is building an iconic brand portfolio.

Tilray Inc. (NASDAQ: TLRY) is a global pioneer in the research, cultivation, production and distribution of cannabis and cannabinoids. The company currently serves tens of thousands of patients and consumers in 12 countries spanning 5 continents. Tilray was the first licensed producer of medical cannabis in the world to have its facility Good Manufacturing Practices (GMP) certified in accordance with European Medicine Agency (EMA) standards.

The cannabis markets have already produced some amazing profits, but all indications are the industry is only at the beginning of an amazing ascent. There’s little doubt that a plethora of new winners will be created in the burgeoning sector. When searching for the next super nova, Wildflower Brands is certainly one to watch.

For more information on Wildflower Brands, visit Wildflower Brands Inc. (CSE: SUN) (OTCQB: WLDFF)

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Dramatically Improved Delivery Systems Promise More Effective Cannabis Treatments

CannabisNewsWire Editorial Coverage: Experiments with next-generation delivery systems appear certain to lead to better cannabis-based products.

Lexaria Bioscience Corp. (CSE: LXX) (OTCQX: LXRP) (LXRP Profile) has recently seen spectacular improvements in the effectiveness of cannabinoids thanks to its proprietary chemical delivery treatment. GW Pharmaceuticals Plc (NASDAQ: GWPH) (OTC: GWPRF), which has won widespread praise for its innovative medical work, has seen good trial results for a new treatment for seizures. Tilray Inc. (NASDAQ: TLRY) is supporting studies into the uses of cannabinoids to treat behavioral problems and HIV. MariMed Inc. (OTCQB: MRMD) has set up a subsidiary focused on CBD, currently the highest-profile cannabinoid product. Cronos Group Inc. (NASDAQ: CRON) (TSX: CRON) has established a new research lab to develop devices for CBD consumption.

Currently, cannabis medicines are poorly absorbed by the body.
Delivery challenges increase costs and reduce effectiveness.
Select companies are working on better delivery systems.
Others are working on new medicines so that cannabinoids can improve more lives.

To view an infographic of this editorial, click here.

The Cannabinoid Waste Conundrum

The popularity of cannabinoid products — those containing active ingredients from cannabis — has created a challenge for producers. While these producers are extracting larger volumes of CBD from cannabis and hemp, much of the precious ingredient goes to waste: the human body only absorbs a small fraction of these molecules because of delivery system limitations and human physiology.

This delivery challenge causes several problems. Manufacturers must comply with regulations limiting the amount of active cannabinoid ingredients, but consumers may not be able to obtain the effect or benefit they are seeking, even when needed to overcome serious medical conditions. People could end up consuming more cannabis than they would otherwise, which is both expensive and ill-advised. And in an age when the waste of human society is ravaging the environment, it means that the cannabis industry may also be doing unneeded damage to the environment.

But thanks to the fast pace of cannabis research, a solution may be on the horizon.

Improving the Delivery of Cannabinoids

Across the industry, researchers are looking for ways to more effectively deliver CBD into the human body. Thanks to their latest breakthroughs, the scientists at Lexaria Bioscience Corp. (CSE: LXX) (OTCQX: LXRP) appear to be leading the way.

A biotech company based in British Columbia, Lexaria is currently focusing on its proprietary DehydraTECH(TM) technology. This unique technology has been developed to make medicinal compounds more suitable for human consumption in a number of ways. By combining molecules such as CBD with fatty acids at a molecular level, DehydraTECH makes it easier for the CBD to cross the body’s internal barriers. Higher levels of CBD are absorbed, and they are absorbed more quickly.

Consumers need to know this: the quantity of CBD, or any other drug, in the bottle is unimportant. What matters is how much of that CBD actually reaches the bloodstream — and even more importantly — how much reaches the brain.

Most CBD sold in CBD-infused products in America today does not reach the bloodstream. CBD mixed in water and fed to animals demonstrated the incredible power of DehydraTECH. Results announced in May showed that DehydraTECH, in combination with generic nanotech techniques, delivered CBD to the brain 1,137% more efficiently than existing industry formulations. In addition, Lexaria’s patented DehydraTECH delivered CBD into the bloodstream in just two minutes and delivered as much CBD in 15 minutes as generic doses did in 60 minutes.

Not content with these sorts of results, the company has been working on improving the power of DehydraTECH through a new second-generation version called Enhanced DehydraTECH. Lexaria’s Enhanced DehydraTECH showed remarkable properties in crossing the blood-brain-barrier, delivering 1,937% more CBD into the brain than a generic industry formulation. It also delivered between 717% and 1,098% more CBD into the bloodstream than generic CBD formulations.

Lexaria’s technological advances make it possible to manufacture capsules and edible products that deliver CBD and THC more effectively than ever before.

Satisfying Customers and Regulators

This vastly superior delivery performance holds promise to radically change the CBD industry, at a time when the sector is already going through huge change and growth.

On one level, the benefits of technology such as that being developed by Lexaria are obvious. A more efficient delivery system can do one of two things: it can make the same dose of a drug or vitamin more effective, or it can allow the same consumer effect to be achieved with a smaller dose.

The latter approach may have the widest impact and certainly has potential to shift prices. Recent legal changes in Canada and the United States have led to a surge in demand for CBD, a demand that suppliers have been unable to meet. With demand for CBD outstripping supply and a production process that involves complex technical steps, the price of CBD is relatively high. But if companies can make products that are just as effective but use smaller amounts of CBD, they can reduce their production costs and provide more products with the same raw resources. This change would allow companies to meet currently unmet demand and reduce prices, thus benefitting both the customers and the industry.

There’s also a less-obvious factor, one that industry outsiders might not consider but that companies such as Lexaria are acutely aware of. With the legalization of cannabis across Canada and hemp in the United States, regulators are stepping in to control the production, sale and dosage amounts of CBD or THC products. Limits are being set on how much CBD or THC a product can contain.

Improved delivery systems such as DehydraTECH allow companies to produce more effective products within the same legal limits. Customers can experience the highest benefit from their products while everyone stays inside the law.

Beyond CBD?

But while CBD is proving a profitable testing ground for DehydraTECH, the impact of this first-of-its-kind delivery system could potentially go far beyond this, extending into the wider medical sector.

Recent research results have shown that DehydraTECH is effective in delivering both cannabinoids and nicotine into brain tissue, thus improving the speed and effectiveness of these ingredients. The delivery system also comes with a fast-on/fast-off element, in which the effect of the drug both starts and ends quickly and clearly, providing better control over the use of the products in which drugs are used. DehydraTECH is being evaluated by the largest nicotine company in America for products utilizing oral delivery, bypassing the known disease conditions associated with current pulmonary delivery.

As a result, Lexaria’s technology already has potential medical benefits because it can be used to deliver CBD- and THC-based medicines, in addition to its applications as a solution to cigarette use. But what if it could do more?

Since DehydraTECH has been shown to work with multiple molecules, people are asking if it could be used with central nervous system drugs. By delivering drugs quickly and efficiently across the blood-brain-barrier, this innovative delivery system could enhance the speed and effectiveness of a wide range of drugs and potentially usher in a new era of treatment for a wide range of debilitating diseases. Lexaria has quietly filed patent applications for innovation in treatment options related to central nervous system diseases such as Parkinson’s and Alzheimers.

Experimenting with Cannabis

Given the importance of cannabinoids in treating some of these debilitating diseases, improved delivery systems already have clear medical advantages. Among the companies applying cannabinoids to life-changing medicines is GW Pharmaceuticals Plc (NASDAQ: GWPH) (OTC: GWPRF). With more than 20 years of research in the cannabis sector, GW is a global leader in developing cannabinoid medicines and was named one of Time Magazine’s 50 genius companies for this work. The company recently announced successful clinical trials of EPIDIOLEX, in which this CBD drug was used to reduce the frequency of seizures associated with tubular sclerosis complex.

Tilray Inc. (NASDAQ: TLRY), a world-leading cannabis company based in Canada, has been working to address the shortage of cannabis and CBD, investing $32.6 million in an expansion of its cultivation and manufacturing facilities. But the company isn’t just working on meeting current needs. Tilray is providing support to two clinical studies that could lead cannabinoids to transform more lives for the better. Through studies like these, the use of cannabinoids is spreading beyond its traditional territory of pain and nausea management.

MariMed Inc. (OTCQB: MRMD), a multistate cannabis company, has been improving the efficiency of its operations through vertical integration and the addition of new product lines, allowing it to more effectively deliver cannabis products to a wide range of customers. At the start of this year, the company established a subsidiary focused on CBD in response to rising sales and the changed legal status of hemp manufacturing in the US.

Lexaria’s work on DehyrdaTECH isn’t the only area where the interests of cannabis and tobacco are merging. Cronos Group Inc. (NASDAQ: CRON) (TSX: CRON), a global cannabinoid company, has had its fortunes and its profile improved by an investment of C$2.4 billion from tobacco giant Altria. The company’s growth has also allowed it to establish a new global research and design center, Cronos Device Labs, in Israel. There, the company will work on devices specifically designed for the consumption of CBD.

As the technology around cannabis improves, so will the efficiency and effectiveness of cannabinoid products, lowering prices and improving outcomes for patients around the world.

For more information on Lexaria Bioscience Corp., visit Lexaria Bioscience Corp. (CSE: LXX) (OTCQX: LXRP)

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