“I’d sooner have the capacity to look around with a toe hold in many things and jump to those little ones than be stuck in this stage and age in one single thing,” said Creso Pharma Ltd’s Investment Advisor, Bruce Linton when TDR caught up with him this week.
We touched upon Creso (ASX:CPH, FRA:1X8) being criticized for focusing on too many things at once, to which Linton replied, “Here’s a company that has headquarters and activities in Switzerland, key listings in Australia, a capacity in Canada, and now just entered the synthetic clinical trial capabilities in Canada and exports to a variety of other countries. It really is an open-minded company.”
Anyone who has been following Creso’s news over the last few months will notice that the company has been announcing some pretty big moves lately, indicating the company has strong global permeation and is poised for rapid expansion.
Mernova Moves into Canadian Cannabis Market
The company’s wholly-owned Canadian subsidy Mernova recently received purchase orders from the Ontario Cannabis Retail Corporation (OCRC), which operates the Ontario Cannabis Store (OCS) for its leading Ritual Green product range, with a total value of C$494,131.
This is the first move of the company’s foray into the Canadian cannabis space, with more purchase orders from other provinces and more products to become available, such as the Black Mamba strain and pre-rolls. This move into Canadian markets is set to be a strong revenue generator for Mernova with repeat customers and a recurring revenue model.
Creso Natural Remedies to Distribute in U.S.
Linton told us again this week as well as back in January that he was interested in Creso to begin with because of the strides they were making in animal care products that contain CBD.
Early this month, Creso announced that it had signed a letter of intent with Ceres Natural Remedies to distribute and sell their CBD and hemp animal products within the country.
Creso’s Anibidiol will be among the products distributed, which is a hemp-based animal health product that will be soon to be found in 50,000 outlets across the United States, with a projection of U.S. $5 million in sales over two years.
We recently covered the influx of celebrity-sponsored animal care products that contain CBD, including Martha Stewart’s foray through Canopy. Back in January, Linton was adamant that Creso took a very different approach to CBD for animal care, saying that Creso’s focus on research and development is what sets their pet products apart, with other companies, notably in North America, putting “the marketing brochure before the effort of doing the work.”
This week, he reaffirmed that it was Creso’s approach to pet care that got Linton interested in the company, not only interested in the application of CBD, but how Creso is using other cannabinoids to address anxiety or mobility issues in animals.
Further North American Permeation through CBD
Earlier this month, Creso also announced that they’d signed a Letter of Intent to distribute hemp-based products CannaDOL and cannaQIX in both Canada and the United States. The products will be distributed by ImpActive, a Canadian firm focus on reducing muscle and joint inflammation as they relate to sports injuries.
The sports industry is estimated to rise to $22 billion by next year, with $200 million of that being in Canada alone.
“CBD is not performance enhancing, it’s recovery enhancing,” said Linton of the new products. He says that it’s the scientific rigour that Creso takes in creating its topical products, noting that transdermal technology is essential for the efficacy of topicals. He notes that “CBD in the right dose, and the right delivery in the right time of consumption is a game changer.”
Foray into Psychedelics
This week, the Company made one of its biggest announcements when it became the first Australian Stock Exchange (ASX) psychedelics stock as it acquired psychedelic medicine company Halucenex Ltd.
Halucenex is focused on delivering and developing evidence-based products for the treatment of treatment-resistant depression and other detrimental mental illnesses, with a current focus on PTSD.
The Nova Scotia company operates at a 6,000 square foot medical treatment facility in next to the Hants Emergency Hospital, with a controlled substances laboratory and 18 treatment rooms for psychedelic-assisted psychotherapy. Once the company receives its pending Controlled Drugs and Substances Dealer’s License, it will apply to commence a Phase 2 clinical trial. Further research and clinical studies will be permitted under this license to examine other substances like LSD, psilocybin, and MDMA.
“We want to be a part of the front edge of what’s changing in treatment, and we’re not bound just by CBD coming out of Europe, not THC,” says Linton, “They’re aggressive!” he says of Creso’s recent business moves.
Why Invest in Creso?
While the company may have its focus in many areas, the strength of the acquisitions and the rapid speed to which Creso is permeating more continents in the world is what makes this company investment worthy. It’s all about optionality for investors, according to Linton.
The company “uses equity as a trades up to create a creative acquisition so you have more optionality as a business,” says Linton, “It actually has revenue from products that have been created in Switzerland, revenue in Canada, and the ability to grow those revenues. We have the strong beginnings of a business that is trying to create optionality for expansion.”