The U.S. cannabis industry grew 64% in 2013 and is expected to reach $2.34 billion by the end of 2014, according to ArcView Market Research. At the same time, the U.S. nutraceutical industry is projected to grow at a 5% CAGR to reach $75.9 billion by 2018, according to RNCOS. Cannabis Therapy (OTC: CTCO) is executing its product development strategy to benefit from both of these trends, bringing biomedical methods and processes, as well as a seasoned management team, to the cannabis space.

In an exclusive interview, the company’s President and CEO Soren Mogelsvang sat down with CannabisFN’s Mike Elliott to discuss the company’s distinctive business model and how it plans to capitalize on the rapidly growing industries.

Qualified to Lead

Cannabis Therapy’s skilled team consists of entrepreneurs and business veterans with experience across both the nutraceutical and biomedical industries. President and CEO Soren Mogelsvang is a biotech executive with over 15 years of experience in translational research, antibody development, and ISO compliant manufacturing with proven development and operational skills.

On the Board of Directors, Guy Yachin, Cohava Gelber, and Vered Caplan bring an accomplished track record from the biomedical industry. Mr. Yachin is a serial biotech entrepreneur with a highly successful track record; Dr. Gelber is a PhD with over 25 years of work in developing immune-based therapeutics and diagnostics targeting cancer. Ms. Caplan brings to the table a diverse background in the biotech industry, having worked at several companies over the course of her career.

The team’s extensive background within the biotechnology and pharmaceutical industries could prove invaluable in guiding the company through the challenging early-stage cannabis industry. While pursuing a strategy with minimal regulatory hurdles, the team’s experience should ensure that its products are supported by science as well as being safe and efficacious for consumers.

Innovative Strategy

Cannabis Therapy differs from many other publicly traded medical cannabis companies, such as GW Pharmaceuticals plc (NASDAQ: GWPH) or Cannabis Science Inc. (OTC: CBIS), in that it’s focus is to target the nutraceutical industry. By taking this approach, management aims to minimize many of the regulatory hurdles associated with pushing a pharmaceutical drug through the FDA approval process.

The company aims to identify existing hemp-based cannabis strains and develop new proprietary cultivars with elevated cannabinoid content and little or no THC. With an ISO-compliant cannabinoid extraction and characterization process, the firm will adhere to strict biotechnology and pharmaceutical standards in its development and manufacturing of new products for the nutraceutical market.

In addition to developing nutraceuticals, management indicated that it may also offer laboratory purification and testing services, along with third party product development, to a select group of industry partners in the future. The combination of developing proprietary products and potentially joint venturing to develop additional products could create a comprehensive portfolio with less risk.

Clinically Significant

The hemp plant contains over 450 different substances and is practically devoid of the psychoactive THC (which creates the “high” feeling associated with marijuana). Researchers have been drawn to the human cannabinoid receptors and their potential to modulate the immune system, and positively influence human health.

Cannabis Therapy plans to focus its initial efforts on developing products for inflammatory diseases, where hemp has already been shown to have medicinal potential. Future products could target indications such as nausea, loss of appetite, insulin resistance, sleep disorders, anxiety, and chronic pain, leveraging the vast medicinal potential of the cannabis plant.

Looking Ahead

Cannabis Therapy has assembled a talented team and formulated a unique strategy to capitalize on the growing cannabis and nutraceutical industries. Since hemp is widely available and legal to grow in many states (due to its low THC content) the company’s products will likely face little regulatory scrutiny, while scientific studies have suggested that its products could be highly efficacious.

Investors may want to take a closer look at the company as an alternative to companies like Vape Holdings Inc. (OTC: VAPE) or Hemp Inc. (OTC: HEMP).

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