Patent pending cannabinoid compounds bring new treatments to market
Cannabinoids, the diverse compounds which bind to the homonymous receptors in the human body, are only recently being properly explored, largely due to long standing prohibitive policies that have blanket-banned legitimate study of cannabis-type plants (cannabis and hemp are considered distinct since one contains psychoactive compounds, but they are anatomically identical). Since cultivating hemp for research purposes was legalised in the USA in 2014, however, an increasing body of research is building as a result of what appears to be a global attitude shift, and as with any budding market, a range of pre-boom-time investment opportunities have emerged.
Perhaps the largest pressure to allow the study of such plants and their associated compounds has been provided by the decades upon decades of anecdotes relating to their health benefits. Empirical evidence in support of some of these claims is now commonplace, such as for the treatment of a wide variety of inflammatory conditions. Statistics have shown that marijuana smokers suffer considerably less chronic inflammation than non-smokers, and researchers have since wanted to prove whether non-psychoactive components such as cannabidiol (CBD) could be used to treat autoimmune diseases such as arthritis, lupus, colitis or multiple sclerosis, of which inflammation is symptomatic.
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On the cutting edge of such discoveries are companies seeking to patent combinations of cannabinoid compounds in order to bring commercialised treatments to market. Scythian Biosciences Corp. (TSXV: SCYB) (“Scythian”) have two such patents currently pending that could bring affordable and invaluable relief from minor concussions and inflammatory bowel diseases. Scythian’s first patent application covers a two-drug combination therapy for concussion treatment, since CB2 agonists modulate the inflammatory response itself, easing the initial swelling and the resulting pressure of injured brain tissue against the skull, potentially substantially reducing subsequent trauma.
The second patent filing covers methods and compositions for treating gastrointestinal inflammation, the source of severe discomfort for sufferers of conditions such as irritable bowel syndrome and Crohn’s disease. These diseases are characterized by chronic and sometimes severe inflammation in the gastrointestinal tract caused by an overactive immune system and inflammatory response, due either to autoimmunity or hypersensitivity. Personally, I can think of a large number of people who would pay good money for decent relief from these conditions and the market research completely agrees.
Indeed CBD is present in all cannabis plants, but Hemp-derived CBD enjoys a marginally better public perception, and as such is projected to be a billion-dollar market in just a few years. Several data analysts estimated that hemp CBD sales already hit $170 million in 2016 and a 55% compound annual growth rate over the next five years will cause the market to break through the billion-dollar ceiling. There is phenomenal growth potential in all hemp and cannabis markets currently, though it seems to us as if hemp-derived CBD will take the lead.
While the world continues to argue about recreational applications of these plants, the medicinal cannabinoid markets are having a much easier time of progressing with the science. An investor looking for a lower risk entry into such markets would do well to consider Scythian, as very few people object to helping people to seek comfort and longevity, and many will fork out small fortunes for the same. Scythian stocks are currently trading at CAD$4.85 and have gained over 15% in the trailing quarter; I expect the company’s value to continue to climb as new applications are proven throughout the next few years.