Tetra Bio-Pharma Unveils Commercialization Strategy for Terpacan Products

Tetra Bio-Pharma Inc. has unveiled plans to bring two over-the-counter CBD-based health products to market in 2020.

The Ottawa-based firm secured Health Canada approval and Drug Identification Numbers for two CBD-based products under the TERPACAN banner last week. One is used to treat hemorrhoids and the other is used for back and muscle pain.

It has now revealed its commercialization plans for the products, which are expected to hit shelves by mid-2020. Tetra has chosen an unnamed producer to manufacture the products and it said that test batches will soon be ready.

Our Take

Maintaining lower operating costs will limit cash burn and reduce the amount that needs to be raised.

Tetra-Bio Pharma has announced they intend to use both contract manufacturers and sales organizations to expedite the launch of their two TERPACAN products.

While using contractors will decrease overall margins, it will expedite their go-to-market strategy and reduce operating expenses for TBP. This has a few benefits.

As a company in need of additional funding, developing its first revenue streams will significantly reduce their cost of capital. Further, maintaining lower operating costs will limit cash burn and reduce the amount that needs to be raised.

The net effect is lower dilutions for current shareholders.

Additionally, they are currently the only company with cannabinoid-based drugs that have received OTC approval. They should take advantage of their first-mover advantage and the hype that comes with it.

By moving quickly they can gain significant market share in the respective categories and obtain the best financing possible for shareholders. Overall, investors should be happy to see TBP’s prudent approach to launching their new TERPACAN products.

Details of Commercialization

It will reveal the identity of the manufacturer when a definitive agreement has been signed. Once the testing phase is complete, Tetra will begin marketing the products and set about tying up deals for listings in Canadian pharmacies by the summer.

They intend to use a Contract Sales Organization to expedite the rollout as well. These sales representatives will help launch the two products to market, and will likely help TBP expand to the U.S. once the National Drug Code (NDC) has been received.

In regards to entering the U.S., TBP is targeting a late 2020 U.S. launch. It is putting the finishing touches on a contract manufacturer agreement and obtaining a NCU number for each product.

TERPACAN is a topical pain relief product. The Canadian hemorrhoid treatment market grew 3% to reach $22 million in 2019, posting a steady 3% CAGR in 2019, according to Nielsen data.

The new products fall into the self-care pain treatment category, which reached $432 million last year (Nielsen). Terpacan Back & Muscle Pain can be used to treat backache, lumbago, strains, bruises, sprains, arthritic, or rheumatic pain and pain of tendons and ligaments, giving Tetra a large target market.

Tetra has another range called Awaye, which is also a topical product made from a terpene found in cannabis sativa. It is used to relieve local pain in patients with both acute and chronic pain.

The firm reported that commercial interest in Awaye has “grown steadily” over the past couple of months and that it is in advanced discussions with a Middle Eastern pharmaceutical distributor on a deal covering the region.

“The commercial and business development teams have worked hard to bring Awaye to other territories around the world and we are using this momentum to accelerate the launch of the Terpacan products globally,” said chief executive Dr. Guy Chamberland.

The opinions provided in this article are those of the author and do not constitute investment advice. Readers should assume that the author and/or employees of Capital 10X hold positions in the company or companies mentioned in the article. For more information, please see our Content Disclaimer.

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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