Aug 29, 2017
According to Arcview Market Research, the legal Cannabis market in North America was $6.7 billion in 2016 and is expected to grow to $22.6 billion by 2021. Edibles in the form of chocolates, candies, baked goods, beverages and pills make up about 20% of total revenue currently. The edibles market is one of the fastest growing sectors in the cannabis industry and this is expected to continue as several states and Canada roll out their adult use/recreational markets and new medical use legislation containing smoking prohibitions is put in place in states like Pennsylvania and Florida.
While growing rapidly, the edible cannabinoid market faces some challenges. Currently, edibles can be difficult to dose accurately as the effects can take up to 2 hours to be felt by the consumer. Additionally, edibles are poorly absorbed in the body and the strong taste of the cannabis used in production needs to be covered by lots of sweeteners and additional flavorings. Lexaria’s technology solves all of these problems with effects commonly felt within 20 minutes of ingestion, absorption rates 5-10X that of traditional edibles and flavor masking that eliminates the need for excessive sweeteners.
Lexaria currently has 2 products on the market; Vipova Tea and Turbo CBD Capsules.
ViPovaTM Tea is made with a rich, smooth organic black tea from China’s famed Yunnan Province and the finest rich hemp oil derived from the highest quality agricultural hemp cultivars. We use our own patented process to infuse the valuable hemp oil ingredients inside lipids, allowing for a more efficient and comforting delivery to your body. Only ViPovaTM takes this vital step for your benefit.
TurboCBD™ is our brand of technologically enhanced, high absorption full spectrum hemp oil capsules. Lexaria’s TurboCBD™ capsules are specially formulated with the finest American Ginseng and Ginkgo Biloba for support of enhanced focus and memory, and reduced stress and fatigue.
Lexaria is currently working with several companies in the USA and Canada within the edible cannabinoid space to jointly develop a new class of fast acting – high absorption edibles using Lexaria’s technology. We are currently working with chocolate, candy and beverage companies that are already enjoying great growth in their edible lines and are looking to add the enormous benefits of Lexaria’s proprietary technology to their product lines.
Lexaria’s lipophilic enhancement technology is designed to increase the bioavailability of orally- ingested cannabinoids in the bloodstream. There are three main paths for cannabinoids to enter the bloodstream:
With Lexaria’s patented technology, orally-ingested cannabinoids will quickly become a viable alternative to harmful inhalation while also offering better-tasting edibles for health conscience consumers. By nature, cannabinoids are poorly absorbed by the human body’s gastrointestinal (GI) tract, which explains the low bioavailability of cannabis edibles. Research testing has proven that Lexaria’s lipid-based delivery system solves that problem by protecting the cannabinoid molecule from the acidic environment of the GI tract. Broken down into more easily absorbed particles in the small intestine, these long chain fatty acids are able to bypass the portal vein that travels to the liver where additional filtration occurs, and instead enter the bloodstream via the lymphatic and circulatory systems.
Four benefits of Lexaria’s disruptive technology
Lexaria’s technology provides four critical benefits for cannabinoid edibles:
Lexaria is currently focussed on licensing the company’s technology to companies that are currently manufacturing cannabinoid edibles. Lexaria has several letters of intent signed with interested parties and we are in advanced discussions with several other potential partners. Lexaria is focussing on large US markets like California and Nevada, where recreational use legislation was recently adopted and Pennsylvania and Florida where medical use laws were recent put in place. As other jurisdictions, like Canada, finalize their rules we will be actively pursuing partners in those markets.
We are currently working with the National Research Council of Canada research our technology to expand its delivery and use in the areas of nicotine, Non-steroidal anti-inflammatory drugs and fat-soluble vitamins.
The more efficient delivery of cannabinoid molecules to the bloodstream, the lower the overall dosage required to achieve the desired outcome for consumers. At a bioavailability rate of only 5 percent, a medical marijuana patient requiring 10 mg would have to consume 200 mg of THC within edibles. Raising the bioavailability rate to 30 percent lowers the required dosage to just 33 mg. The ability to use a lot less of the active molecule to achieve the same effect represents a 10 to 15 percent cost savings for cannabis edibles manufacturers.
The latest trends in cannabis edibles in California and Colorado are to “micro-dosing” of just 5mg per edible serving. In fact, regulators are beginning to force manufacturers to individual doses of just 5mg to 20mg per serving, making Lexaria’s technology vital and competitively invaluable. Regulator-required smaller edible doses could enhance demand for Lexaria’s technology among licensed cannabis companies seeking to deliver the most positive customer experiences within dose limitations.
On top of that, the capital costs for implementation of Lexaria’s technology are significantly lower compared with competing pharma-based technologies, including micro-homogenization machines. Such equipment also has limited throughput capacity, whereas Lexaria’s technology is highly scalable for the food and consumer goods marketplace.
What makes Lexaria unique in the field of functional foods is that we are the first company to provide pharma-grade solutions at mass market costs. While existing pharmaceutical technology may offer one benefit such as improved taste or enhance bio-absorption, Lexaria’s technology can do more at a fraction of the price. “Even after paying a royalty, costs will be revenue neutral for the licensee of our technology and potentially even revenue positive. None of our competitors in North America or Europe can offer higher profitably.”
You can expect Lexaria to make significant progress over the next several months with respect to its intellectual property, research and development and new business development. We expect to be awarded our THC patent by the end of 2017soon by the USPTO and several of the international patents that are currently pending.
Lexaria’s ongoing research collaboration with the National Research Council Canada will expand on our current technology and advance the application to Nicotine, NSAIDs and Fat-soluble vitamins. Significant breakthroughs can be expected here. Investors should expect to see important new applied R&D launched in the near future.
Finally, investors can expect several new royalty agreements with existing LOI partners and new potential partners in Canada and the USA.
Disclaimer: NAI is being compensated for this article. Materials contained in this article is for information purposes only and is not intended to constitute an offering of securities in any jurisdiction. Nothing on this article should be construed as an offer, solicitation or recommendation to buy or sell products or securities.
