Source: cannabisfn.com
The Hemp Business Journal estimates that hemp industry sales reached $688 million in 2016, representing a 22% compound annual growth rate. By 2020, the same researchers believe that the hemp industry will expand to more than $1.8 billion, driven primarily by the rise of hemp-based cannabidiol (CBD) products. These products could make a dent in the $17.7 billion opioid market, especially given emerging research and renewed political pressure.
Investors may want to take note of these trends and consider companies like Corix Bioscience Inc. (OTCQX: CXBS) that are building strong businesses targeting this space.
Cannabidiol as an Opioid Alternative
Cannabidiol, or CBD, is one of over 100 cannabinoid compounds in the cannabis plant. Unlike tetrahydrocannabinol (THC), CBD does not produce a euphoric high or psychoactive effect. The effects of CBD are very complex and not completely understood, but researchers believe that it helps the body use its own endocannabinoids more effectively. These endocannabinoids control many different functions, ranging from mood to pain sensation.
In pain management, researchers believe that CBD may stop the body from absorbing anandamide – a compound associated with regulating pain. Increased levels of anandamide in the blood stream is associated with a reduction in the amount of pain that a person feels. The compound may also limit inflammation in the brain and nervous system, which could help people experiencing pain, insomnia, and certain immune-system responses.
Studies have shown that people don’t build up a tolerance to the effects of CBD, which means that they don’t have to continuously increase their dose. Tolerance build-up is a common problem with opioids that often leads to addiction and long-term dependence. CBD also has fewer side-effects than most opioids, with the most commonly reported being tiredness, diarrhea, changes in appetite, and changes in weight.
WADA Opens the Door for Athletes
The World Doping Agency (WADA) recently removed cannabidiol (CBD) from its list of banned substances in 2018. WADA governs drug testing in the Olympics and it sets standards for many sports leagues, including the Ultimate Fighting Championship (UFC). The move could open the door for CBD oil and related supplements to be used by athletes to manage their pain and inflammation as an alternative to prescription pharmaceuticals like opioids.
“Annually, the Prohibited List review involves a very extensive stakeholder consultation process over the course of nine months,” said Director General Olivier Niggli in his official statement. “In reviewing the List, experts examine such sources as: scientific and medical research; trends; and, intelligence gathered from law enforcement and pharmaceutical companies in order to stay ahead of those that endeavor to cheat the system.”
The specific language reads: “Cannabidiol is no longer prohibited. Synthetic cannabidiol is not a cannabimimetic; however, cannabidiol extracted from cannabis plants may also contain varying concentrations of THC, which remains a prohibited substance.” This means that athletes must be extremely careful when selecting cannabidiol oils, since any trace amounts of THC could still lead to penalties, and hemp plants still contain very trace amounts of THC.
Corix’s Innovative Approach to CBD
Corix Bioscience Inc. (OTCQX: CXBS) aims to become the largest tissue culture propagator of cannabidiol and cannabis genetics in the U.S. and Canada. Its primary focus is on creating and patenting genetic strains of true medical marijuana and hemp CBDs. Using tissue culture, the company can create identical, pathogen-free plantlets every time that can be used to create highly-standardized hemp-based CBDs that are free from THC content.
Corix currently grows industrial hemp on a 160-acre hemp farm in Genoa, Nevada that is expected to harvest 250,000 pounds of dry flower for extraction into oil, complemented by an 11,000 sq. ft. laboratory in Carson City, NV for genetic research and tissue culture. It’s also under contract for a 46,000 sq. ft. building in Carson City that will be used for R&D and cultivation of hemp year round, and leases a 21,500 sq. ft. cannabis research grow facility in Adelanto, CA on nine acres.
In terms of licensed production, the company has a Nevada Industrial Hemp license that enables it to cultivate, handle, transport, process, and distribute unlimited quantities of hemp. Corix also has DEA approved, state issued export licenses for hemp that enable it to sell product throughout the U.S. The company’s California cannabis cultivation, process, transportation, and distribution license also covers the actual cannabis plant, which it intends to use to produce strain specific plants to target cannabinoids. THCV for obesity/diabetes and CBG as an over the counter sleep aid are just a couple of examples, in addition to the more widely known CBD.
Looking Ahead
Corix Bioscience Inc. (OTCQX: CXBS) represents a compelling investment opportunity in the hemp-based cannabidiol industry. With the World Doping Agency’s new regulations, athletes may be free to embrace the benefits of CBD without fear of penalties. This could open the door to a significant new end market, as well as encourage researchers to continue exploring the benefits of CBD and ultimately pave the way for pharmaceutical products.
The company’s focus on tissue culture propagation and existing licenses and properties make it a unique opportunity in the space. In addition to near-term revenue, the company’s scientific focus could make it a major player in the pharmaceutical side of the business as it opens up.
For more information, visit the company’s website or download their investor presentation.
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