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Mining

Copper Miners on Deep Discount

Commodities are the cheapest they’ve ever been relative to stocks in nearly 50 years; and we believe copper is one of the most attractive areas of the commodity complex.

Copper is a critical element for the future green economy; it is a key input for electric vehicles, wind, solar and infrastructure. In the near term there is a very tight supply/demand dynamic for copper, with global inventories sitting at decade lows.

Additionally, base metal miners are trading at trough valuations relative to history, the group of North American miners currently trade at 4.5x EV/EBITDA versus their historical average of 6.0x EV/EBITDA.

The small and mid cap copper mining universe offers the best value in the sector, as they trade at a substantial discount to their large cap copper peers. Sierra Metals (NYSE:SMTS, TSX:SMT) and Hudbay Minerals (TSX:HBM) are two copper miners that screen deep value in the sector.

Psychedelics

HAVN’s Transformational Acquisition of Spore Life Sciences

HAVN Life Sciences (CSE: HAVN) (OTC: HAVLF) announced the acquisition of Spore Life Sciences.  HAVN acquired a substantial business in Spore with many opportunities for synergies between their operations (e.g., manufacturing, distribution, product line expansion).

“With this Definitive Agreement, HAVN Life is looking to strengthen its position as a leader in brain health focused nutritional supplements,” says HAVN Life CEO Tim Moore.  “Upon completion of the Acquisition, we will add these high-quality formulations to the HAVN Life natural health product portfolio,” he adds.

Highlights of the Deal

Spore joins HAVN as a profitable company: a gross profit margin of 70% compared with HAVN Life at 43%

Spore management and other insiders have locked up shares from the deal for as long as 2 years

If revenue milestones are hit, HAVN’s revenue would grow from $20 million post deal to more than $100 million in 2.5 years, a 90% annual growth rate.

Read our full report on the acquisition here.

Mindset’s Lead Candidate MSP-1014 Comparable to Psilocybin in Assay Analysis

Mindset Pharma (CSE: MSET) (OTCQB: MSSTF) announced that its lead candidate, MSP-1014, was comparable to psilocybin assessed using a drug discrimination assay.  The results suggest that MSP-1014 induces a similar perceptual state to psilocybin, further confirming the viability of MSP-1014 as a therapeutic analog of first-generation psilocybin as they advance MSP-1014 into the clinic.

“In the drug discrimination assay, MSP-1014 demonstrated a dose dependent and full generalization to a psilocybin discriminative cue in rats,” stated Joseph Araujo, CSO of Mindset.

“Furthermore, we identified an effective dosage of 0.6 mg/kg for subcutaneous administration of MSP-1014 with no detrimental effect on the response rate up to doses of 2 mg/kg.  MSP-1014 also showed a dose dependent generalization to a psilocybin cue following the oral route of administration.  These results further validate MSP-1014 as an effective second-generation psilocybin-like drug candidate.”

Cybin Awarded Patent for Compound to Treat Anxiety

CYBIN (NEO: CYBIN) (NYSE: CYBN) announced that it has been awarded a Notice of Allowance from the U.S. Patent and Trademark Office (USPTO) for patent application No. 17/394,038 related to CYB004, their investigational deuterated psychedelic tryptamine compound for the potential treatment of anxiety disorders.  The patent, which is expected to expire in 2041 before consideration of any patent term extension, covers composition of matter for the CYC004 drug substance as a putative new chemical entity.

“The receipt of this Notice of Allowance from the USPTO represents an important milestone in expanding our intellectual property portfolio progressing psychedelics to therapeutics for the countless patients in need, and strongly demonstrates the Company’s dedication to the discovery and development of differentiated psychedelic-based compounds for addressing mental health,” said Doug Drysdale, CEO of Cybin.

“Once issued, this patent may have the opportunity to cover a broad range of claims supporting our IP in psychedelic medicine and further strengthen our emerging best-in-class position in this evolving industry.”

FDA Places Clinical Hold on MindMed’s Phase 2b LSD Trial

Mind Medicine (MindMed) Inc. (NASDAQ: MNMD) (NEO: MMED) announced that the U.S. Food and Drug Administration (FDA) has placed a clinical hold on its IND submission intended to support the initiation of a Phase 2b trial of lysergic acid diethylamide (LSD) for the treatment of generalized anxiety disorder (GAD).  Additional detail regarding the FDA’s decision is expected within 30 days.

“Our team has a tremendous sense of urgency to bring new treatments, such as LSD, to the many patients in need, particularly given to the growing mental health epidemic,” said Robert Barrow, CEO and Director of MindMed.  “We remain highly confident in the therapeutic potential of LSD to usher in a new treatment paradigm for these disorders and we look forward to working closely with FDA to satisfy all outstanding concerns as rapidly as possible.”

Cannabis

The Drug Enforcement Administration (DEA) and National Institute on Drug Abuse (NIDA) say they are in favor of a White House proposal to streamline the process of researching Schedule I drugs like marijuana and certain psychedelics.  The agencies testified at a House Energy and Commerce subcommittee hearing, expressing support for the Office of National Drug Control Policy (ONDCP) research plan.  The focus of the meeting was mostly regarding a move to strictly classify fentanyl-related substances, the parts of the White House’s proposal regarding research would help address concerns within the scientific community about the problems with studying other Schedule I drugs.

“It is critical that the scientific and medical community study Schedule I substances, as some may turn out to have therapeutic value,” said, DEA Principal Deputy Administrator Louis Milione. “DEA supports the administration’s legislative proposal’s expansion of access to Schedule I research.  DEA looks forward to continuing to work with the research community and our interagency partners to facilitate Schedule 1 research.”

Organigram Holdings Inc. (NASDAQ: OGI) (TSX: OGI)  announced that they have acquired an additional $2.5 million of secured convertible debentures in Hyasynth.  Proceeds of the investment are designated to advance Hyasynth’s production scalability as well as investment into new cannabinoid technologies, business development efforts and company growth.

“Organigram continues to be extremely focused on delivering meaningful innovation to cannabis consumers, which is why we are so excited about deepening our relationship with Hyasynth.  They have achieved tremendous scientific advancement in the cannabinoid biosynthesis space with technology expected to be protected by intellectual property.”, said Beena Goldenberg, CEO of Organigram.

Sierra Metals is a market awareness client of Capital 10X.