NEW YORK, May 24, 2018 /PRNewswire/ --
CannabisNewsWire Editorial Coverage
With the announcementin April of the Industrial Hemp Farming Act of 2018, the industry could be looking at a federal redefinition of hemp. Industrial hemp is a great source for CBD (cannabidiol), a non-psychoactive cannabinoid with numerous medical applications (http://cnw.fm/7tqIy).
If passed alongside companion House Bill 5485, the Hemp Farming Act would effectively remove hemp from regulation as a controlled Schedule 1 substance, restoring the plant's historic status as an important U.S. agricultural commodity. With Senate Minority Leader Chuck Schumer and fellow Democrat Senator Michael Bennet from Colorado signing on to the Hemp Farming Act with Republican Senator Cory Gardner from Colorado, the bill now looks to have strong bipartisan support. A recent report from Brightfield Group issued prior to the announcement of the Hemp Farming Act estimated that the hemp-derived CBD products component of the hemp market alone could hit $1 billion by 2020 (http://cnw.fm/Z9l9K). Industrial hemp has a storied history in America, having been cultivated from Colonial times through World War II and being essential to war efforts throughout that period. Given that the plant is a robust source for strong natural fiber and oils used to make everything from canvas and rope to building materials and fuel, it seems likely that the nation will indeed see the plant returned to its historical status as a core agricultural commodity.
Cultivation and Legal CBD Enable Agile Positioning
In an industry run by pioneering industry veterans who have lived through the legislative ups and downs that have ebbed and flowed since the earliest days of the cannabis market, the looming passage of the Cannabis Act in Canada and the potential of legislation such as the Marijuana Justice Act in the United States are encouraging signs that the industry has rounded the corner into the home stretch on legalization. CEO of Marijuana Company of America (MCOA Profile) Don Steinberg actually founded the first publicly traded U.S. marijuana company, Medical Marijuana Incorporated. MCOA already has a strong hand in the rapidly emerging market for industrial hemp-based CBD products, as well as its strategic cultivation-focused JV with B.C.-based Global Hemp Group that began in New Brunswick Canada last year and which has now expanded to 125 acres of commercial production.
The tip of the spear for MCOA in CBD is wholly owned subsidiary hempSMART™, whose affiliate marketing program and shrewdly engineered networking architecture, as well as upcoming major marketing campaigns that include a sixty second are designed to not only capture maximum market share but bolster customer retention as well. An offering such as hempSMART's patent-pending "hempSMART Brain" product, which is designed to support healthy brain function, is an arguably compelling exploitation of CBD's increasingly apparent antioxidant and neuroprotective functions (http://cnw.fm/Vh8bo).
Capacity Is Key Moving Forward
The recent JV agreement between MCOA and Global Hemp Group (which also has base operations in Montreal and Los Angeles) focused on cultivation of legal, high-yielding CBD from industrial hemp at a newly acquired 109-acre farm in Scio, Oregon. This move should significantly enhance the company's market presence (http://cnw.fm/Owe9r). With the purchase of 20,000 high-yield CBD clones along with onsite clone production to meet an early June planting schedule target, assessment of key greenhouse technologies needed to maximize floor space and enable the JV's perpetual harvest model, as well as the purchase of an additional 12,096 square feet of greenhouses for an initial total of nearly 20,000 square feet of production space, the JV is well on its way to having a superb high-yield CBD project in one of the country's most cannabis-friendly states.
Additionally, the company recently announced completion of an initial10,000 square foot greenhouse just south of the Canadian border in Washington State, developed via JV with agricultural services company Bougainville Ventures (http://cnw.fm/m8GaT). This first leg of a planned 30,000-square-foot facility is a major step towards realizing a sizeable production facility in a key jurisdiction that will become the home of several licensed tenants that will be looking for just such an ideal turnkey solution to satisfy their growing needs.
Sector Outlook Grounded in CBD and Biopharma
A strong footing in the already legal CBD market with the infrastructure to also potentially supply the growing medical and recreational markets throughout North America has put MCOA on the radar of many sector analysts. Savvy investors will want to compare the company's rapidly expanding footprint with that of other sector players that also stand to benefit from pending legislative reform.
Aurora Cannabis, Inc. (TSX:ACB.TO) (OTCQX: ACBFF), a licensed Canadian producer of medical cannabis, recently estimated that it will surpass 90,000 kg of output by the end of this year and see revenues of around $70 million. With an 800,000-square-foot flagship facility at the Edmonton International Airport (estimated to be able to produce 100,000 kg of cannabis a year at full capacity), a 55,200-square-foot facility in Alberta, and another 40,000-square foot facility in Quebec, Aurora is uniquely positioned to become a major supplier that may even surpass rival Canopy Growth (WEED.TO) (OTC: TWMJF), which recently moved to list its shares on the NYSE. Moreover, Aurora's plan to buy all common shares of MedReleaf (LEAF.TO) (OTC: MEDEFF), if approved, would create a true industry juggernaut, one estimated by financial services firm Canaccord Genuity to have the potential to eventually produce a whopping 570,000 kg of cannabis per year.
GW Pharmaceuticals Plc (NASDAQ: GWPH) is one of the most well-established cannabis biopharmaceutical companies in the space today, boasting a proprietary cannabinoid product platform that has given rise to such highly publicized indications as the anti-seizure CBD-based drug Epidiolex®. Along with its U.S. subsidiary Greenwich Biosciences, the company recently announced publication in The New England Journal of Medicine of Phase 3 study results of its oral CBD drug in a form of rare childhood-onset epilepsy known as Lennox-Gastaut syndrome. Many sector analysts argue that the NDA for GWPH's oral CBD solution in Lennox-Gastaut and (similar) Dravet syndromes is likely to be approved by the FDA. Such an approval would mean the drug could become available by prescription in the the United States in the second half of 2018.
Medical Marijuana, Inc. (OTC: MJNA) portfolio companies Hempmeds®, Kannaway and Kannalife™ Sciences have been receiving more and more coverage of its internationalized distribution of products such as Real Scientific Hemp Oil™. The company's CEO, Dr. Stuart Titus, was recently featured as part of a Buzzfeed article on CBD that reached a massive audience, even as the company's portfolio company, HempMeds Brasil, was in the news for sponsoring the upcoming medical marijuana-focused "A Look into the Future" International Medicinal Seminar. That announcement came just days after the news that HempMeds has partnered with Northshore Pharmacy in Bermuda to sell the company's flagship CBD oil products.
Rocky Mountain High Brands, Inc. (OTCQB: RMHB) recently announced that hemp products in its new and cutting-edge CBD-infused product line, known as HEMPd, are available for purchase on both Amazon and eBay. The company's popular and naturally flavored energy drinks, Rocky Mountain High Hemp Infused Beverages, have been doing solid business in Canada since the initial one million can order shipped back in 2016. Rocky Mountain High is looking forward to potentially enjoying some serious momentum as Canada moves towards legalization, with one of the most widely recognized brands today in functional hemp food and drink. A roughly $3.6 million deal executed late last year with a major food and beverage distributor in Mexico, where marijuana is soon to be legalized, means RMHB looks to be well on its way to becoming one of the leading hemp-infused food and beverage purveyors on earth.
Sector Sentiment Appears Positive to Many Analysts
While there were major concerns for the cannabis sector last year and earlier this year, companies poised to exploit CBD and broader cannabis demand are eyeing the softening tone in the United States, as well as forthcoming Canadian legalization of all cannabis, as major boons to the industry. For a company such as MCOA, which has good access to the North American market and an established presence in CBD, the best may be yet to come.
For more information about Marijuana Company of America, please visit Marijuana Company of America (MCOA).
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