The U.S. medical cannabis industry has grown at a 16.2% CAGR between 2009 and 2014 to reach $2 billion in annual revenue, according to IBISWorld. Driven by both favorable legalization and clinical studies, the analyst expects demand for the industry’s products to continue growing in the five years to 2019. Investors have been taking note of these growth rates and have many opportunities.
While GW Pharmaceuticals plc (NASDAQ: GWPH) is the most widely known medical cannabis company, there are many others focused on the therapeutic potential of cannabinoids. Early clinical trials have suggested that the compounds found in cannabis could be beneficial for pain management, treating metabolic diseases or addressing various orphan diseases.
In this article, we’ll take a look at a relatively unknown publicly traded company that aims to become a leader in identifying promising cannabis therapies.
Intelligent Drug Design
InMed Pharmaceuticals Inc. (OTC: IMLFF) (CSE: IN), formerly known as Cannabis Technologies Inc., is a clinical-stage drug discovery and development company uniquely focused on the therapeutic potential of cannabinoids. By leveraging its proprietary Intelligent Cannabinoid Drug Design Platform, management aims to identify promising new bioactive compounds in cannabis.
The company’s innovative platform provides numerous advantages over other companies using just cannabidiols (“CBDs”), including:
- Quickly and effectively generates new therapies based on scientifically proven genomics and metabolomics.
- Creates an accelerated pathway for drug development and commercialization of between 3 and 5 years versus 10 to 15 years.
- Network-based approach enables the company to reposition drugs based on common disease mechanisms and generate new intellectual property.
So far, the company has identified two compounds to treat glaucoma and arthritis known as CTI-085 and CTI-091, respectively. CTI-085 is a topical formulation containing a proprietary compound of cannabinoid and non-cannabis ingredients for the treatment of glaucoma, while CTI-091 is a mixture of cannabinoids and non-cannabis ingredients to relieve joint pain and swelling from arthritis.
Early preclinical data is suggestive of both safety and efficacy in both cases. While both drug candidates remain in preclinical trials, the rapid time-to-market enabled by its proprietary platform could mean accelerated data.
Proprietary Drug Delivery System
Cannabinoids offer problems related to drug delivery. They are lipophilic by nature, meaning that they easily combine with lipids or fats in the body, which can mean that they are not effectively delivered to the targeted area. In order to solve this dilemma, InMed is partnering with researchers at the University of British Columbia’s Department of Chemical and Biological Engineering. UBC is a leading research university, consistently ranked among the top 40 in the world.
The team aims to develop a drug delivery system that effectively transports InMed’s therapies to the intended tissue without significant dilution. The development of such a system would not only enhance the efficacy of the company’s drugs, it could lead to licensing and partnership opportunities throughout the pharmaceutical industry.
Botanical Research & Genetics
InMed Pharmaceuticals has already started developing the process for individual strains and clones that will produce the raw material bases for future pharmaceutical research, according to a recent investor presentation. By taking advantage of differences between cannabis strains, the company will utilize THCs and CBDs, as well as other pharmacologically active cannabinoids to treat various diseases.
These strains will be developed by studying plant development and secondary metabolite biosynthesis in both indoor and outdoor conditions, which could lead to the commercial production of an increasing range of phyto-pharmaceuticals. Of course, these compounds must also meet high expectations and regulations regarding minimum and maximum content of a range of compounds.
The company’s R&D efforts are similar to GW Pharmaceuticals’ Cannabinoid Research Institute, which has been tasked with undertaking the fundamental science and investigating cannabinoid medicines. For these reasons, some investors have already started referring to InMed as a “Junior GW” in terms of its approach and potential within the rapidly growing medical cannabis industry.
By taking a comprehensive approach to cannabinoid research and development, the company sets itself apart from many other medical cannabis-focused companies in the space and could be worth a second look for investors.
InMed Pharmaceuticals has an exceptional management team at the helm to guide the company’s development. President & CEO Craig Schneider has over 20 years of experience in the capital markets, while Chief Science Officer Dr. Sazzad Hossain, Ph.D., M.Sc., has more than 20 years of experience in new drug discovery and natural health product development, including work with the Biotechnology Research Institute of National Research Council Canada overseeing the safety and efficacy of new drugs under development.
In September, the company also announced the hiring of Peter Huang as the Senior Bioinformatician. With over 17 years of experience in bioinformatics, software development, and biological research, Mr. Huang will focus on leveraging the company’s proprietary platform technology to discover novel cannabis-based drug therapies to add to its growing product pipeline.
With the right team in place, the company is well positioned to move its existing product pipeline through clinical development, discover new novel compounds to add to the pipeline, and ultimately build long-term value for shareholders.
InMed Pharmaceuticals trades with a market capitalization of just $6.8 million, according to OTC Markets. Despite two preclinical drug candidates that have already shown early signs of promise, this valuation represents a fraction of competitors, including Cannabis Science Inc.’s (OTC: CBIS) $60 million valuation. The company’s proprietary platform could also help advance its valuable pipeline sooner than is typical.
Investors already involved with recreationally focused cannabis investments, such as Vape Holdings Inc. (OTC: VAPE), or growing-focused cannabis investments, such as Terra Tech Corp. (OTC: TRTC), may want to take a closer look, too. With medical cannabis already approved Canada and a growing number of U.S. states, the near-term revenue potential for therapeutics is increasing by the day.
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