MediPharm Secures “Game-Changing” Human Trial Licence

Extraction specialist MediPharm Labs Corp. [stock_market_widget type="inline" template="generic" color="default" assets="LABS.TO" markup="(TSX: {symbol} {currency_symbol}{price} ({change_pct}))" api="yf"] has received a research licence to conduct human trials featuring dried cannabis, extracts, topicals, edibles, distillates, oil, and terpenes.

Chief executive Pat McCutcheon called it a “game-changer” for his firm’s research and development department. It allows MedPharm Labs to conduct sensory experiments with taste, allowing it to gain a stronger understanding of the taste profile that consumers will find appealing.

It coincides with the Canadian market opening up for edibles, beverages, and other concentrates, dubbed Cannabis 2.0. “Scientific study and testing of sensory properties in our process gives us a competitive edge, one that we know consumer-packaged goods companies and licence holders selling to retail will value and employ,” said McCutcheon.

MediPharm offers extraction services and white-label services to licensed producers across Canada. It believes the receipt of the research licence makes it a more appealing partner for the industry, giving it an advantage over competitors.

The firm is bidding to fulfill its large annual throughput capacity, which has increased to 275,000 kg this year and could rise to 500,000 kg in future. It has tied up supply deals with large producers like Canopy Growth Corp. and TerrAscend, along with export deals covering Europe and Australia, but it is not yet operating at full capacity.

Ontario-based MediPharm Labs generated pre-tax net income of $4.1 million in Q2 2019 after enjoying a sharp sequential increase in revenue. It brought in revenue of $22 million in Q1 and that rose to $31.5 million in Q2, allowing the company to swing from a pre-tax loss of $325,000 in Q1 to $4.1 million net income, while adjusted EBITDA increased to $7.7 million.

It should release its Q3 financials next month, and it will be keenly analyzed by investors, as very few cannabis companies are profitable right now. LABS began the year at $1.80, peaked at $7.39 and decreased to $3.44 on Oct. 1. It has been steadily increasing this month and it opened at $4.67 today.

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Martin Green
Martin Green is an experienced journalist with a strong focus on the cannabis, alcohol, and gambling industries. He is particularly interested in the political issues affecting the global marijuana trade, and he has a keen focus on regulation changes and legal topics. He holds a BA English Literature, MA Creative Writing and a National Qualification in Journalism diploma. He has worked in journalism since 2009 and written for a broad range of newspapers, business titles and magazines, including The Sun, The Metro, The Journal, Livestrong, Drinks Retailing News, Harpers, Sportsbook Review, Vital Football, Essex Live and Surrey Live. Address: 682 Indian Road, Toronto, Ontario, M6P 2C9. Phone: 416-721-8257.
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