Kris Krane on Biden’s impact on the nationwide decriminalization of cannabis

In the latest InvestorIntel interview, Tracy Weslosky speaks with Kris Krane, President of 4Front Ventures Corp. (CSE: FFNT | OTCQX: FFNTF) about the company’s success in getting to a $1B market value in the cannabis business.

This InvestorIntel interview, which may also be viewed on YouTube (click here to subscribe to the InvestorIntel Channel), has Kris describing how advocacy, professionalism and low-cost production at scale are the keys to make 4Front a success as they compete with other multi-state operators. With the announcement that New York is joining the ranks of legal, adult-use cannabis states and the anticipation that there could be 2-4 more states legalizing before year-end, it is imperative that a successful enterprise be ready for the evolution of the competition which leads to downward price compression. With a strong advocacy background, Kris is on the leading edge of Government policy and has some interesting, if not controversial, views on who’s leading the charge for safe banking legislation and nationwide decriminalization.

To watch the full video, click here

About 4Front Ventures

4Front is a national multi-state cannabis operator and retailer, with a market advantage in mass-produced, low-cost quality branded cannabis products. 4Front manufactures and distributes a portfolio of over 25 cannabis distributed through retail outlets and their chain of strategically positioned Mission branded dispensaries. 4Front has operations in Illinois, Massachusetts, California, Michigan, and Washington State. From plant genetics to the cannabis retail experience, 4Front’s team applies expertise across the entire cannabis value chain.

To learn more about 4Front Ventures, click here




WeedMD: A possible winner as the US moves towards cannabis legalization at the Federal level

Cannabis stocks have been surging higher this month as the Reddit crowd that spiked GameStop jumped in, based on realistic hopes the Biden led Democratic Party will legalize cannabis at the federal level.

Last week US Senators Booker, Wyden, and Schumer released a joint statement declaring their intention to push forward major cannabis policy reform. The statement reads:

“The War on Drugs has been a war on people—particularly people of color. Ending the federal marijuana prohibition is necessary to right the wrongs of this failed war and end decades of harm inflicted on communities of color across the country. But that alone is not enough. As states continue to legalize marijuana, we must also enact measures that will lift up people who were unfairly targeted in the War on Drugs. We are committed to working together to put forward and advance comprehensive cannabis reform legislation that will not only turn the page on this sad chapter in American history…..”

One cannabis stock that is well worth considering is WeedMD Inc. (TSXV: WMD | OTCQX: WDDMF). WeedMD Inc. subsidiary WeedMD Rx Inc. is a federally-licensed producer of cannabis products for both the medical and adult-use markets. The Company owns and operates a 158-acre state-of-the-art greenhouse outdoor and processing facility located in Strathroy, Ontario, Canada. Another wholly owned subsidiary is CX Industries, which specializes in cannabis extraction and processing.

Key advantages for WeedMD include:

  • Vertically integrated with indoor & outdoor cultivation combined with in-house extraction, product development & manufacturing.
  • Ability to expand ~2x with modest incremental CapEx.
  • Quality products with strong brand recognition. Products include dried cannabis, cannabis extracts and cannabis vaporizes.
  • Market leader in insured medical cannabis. Cannabis is often used as an effective pain reliever in the medical setting.
  • Targeting valuable & overlooked medical channel sales.
  • Closed-loop model providing exclusive access to ~350,000+ potential patients.
  • Strategic institutional investor in the LiUNA Pension Fund. Strong balance sheet for expansion. Pathway to profitable growth.

WeedMD is vertically integrated with the ability to scale rapidly if the cannabis market takes off with US Federal legalization under the Democrats

WeedMD’s Colour cannabis products

Source: WeedMD company presentation

The WeedMD stock price has more than tripled since Jan. 25, 2021, boosted by the Democrat Senators’ move to legalize cannabis. Any success in the US at Federal legalization of cannabis has the potential to boost WeedMD’s revenues.

WeedMD revenue is forecast to grow strongly in 2021

Closing remarks

Cannabis stocks are the current latest trend with speculating retail investors. Of course, this leads to crazy price bursts and can be hard to predict. Despite the recent price gains WeedMD looks to have a strong future due to being a well-established and vertically integrated cannabis producer, especially given their strong focus on medicinal cannabis uses.

WeedMD trades on a current market cap of C$197 million, which is about 2.76x 2021 forecast revenues. Their forward PE is 31.33. Certainly, if the US legalizes cannabis at the Federal level it should have a very strong impact on the quality cannabis producers such as WeedMD. Stay tuned.




FinCanna Capitalizes on California’s Surging Cannabis Market

Cannabis sentiment in the United States has surged since the November election.

Tailwinds pushing the legal cannabis industry include being deemed “essential” during the current COVID-19 health crisis, five U.S. states passing legalization ballot initiatives, and the Joseph Biden election win that could result in easing some of the cannabis restrictions at the federal level.

This year could be another inflection point in the U.S. cannabis industry and the beginning of a multi-year growth cycle as more states legalize medical and recreational cannabis use.

A top cannabis market research firm recently pegged the United States cannabis market at more than US$18 billion in 2020 and expects it to grow by a staggering 33% to US$24 billion in 2021.

FinCanna is a Royalty Company

FinCanna Capital Corp. (CSE: CALI | OTCQB: FNNZF) is a cannabis-focused royalty company and does not operate as a cultivator, manufacturer, or dispensary. Instead, it is a capital company, looking to invest in businesses in California’s cannabis industry and earns revenue from royalties paid by its investee companies.

FinCanna’s royalty structure focuses on top-line revenue, enabling the company to fully benefit as sales grow and not be impacted by cost inflation. Currently, the company owns a diversified portfolio of royalties, lowering the overall company risk, and continues to search for other investment opportunities.

As a royalty business, FinCanna operates with low corporate overhead, making the business easily scalable as it does not have to worry about operations and can focus on the next investment. Also, as the cannabis supply increases, retail prices have been under pressure which makes royalties a better business to be in.

FinCanna’s investment model is to seek “best in class” businesses, provide capital to reduce the need for debt or equity financing, and are structured to align with the business’ long-term goals.

To fund the coffers, in July 2020, FinCanna closed a $2.5 million convertible debenture financing with FinCanna’s management subscribing to $500,000 of the offering.

Portfolio Companies

FinCanna made its first investment in Cultivation Technologies Inc. (CTI) in 2017. CTI, operating as Coachella Manufacturing, runs a 5,200 square foot cannabis extraction facility in Palm Desert, California.

CTI produces butane hash oil (BHO), which is a type of cannabis concentrate that is produced using butane. CTI has been operating for three years and FinCanna started receiving royalties in the second half of 2020.

CTI provides licensed BHO concentrates for white label manufacturing, toll processing, and packaging to brands and cultivators in California. FinCanna recently commented that CTI’s management team is working on growing their core business and expanding into other large-scale activities. FinCanna expects these activities to result in an increase in royalty revenues in 2021.

FinCanna’s second portfolio company is QVI Inc (QVI), doing business as The Galley, and is FinCanna’s largest investment and potentially the largest source of royalty revenues.

The Galley is a modern, 8,300 square foot, cannabis facility located in Santa Rosa, California. It operates as a co-manufacturer to provide large scale production and packaging for all types of edibles, topicals, and tinctures in California.

The Galley began operations in July 2020 and has already on-boarded 25 established brands. FinCanna expects to start receiving recurring royalty payments from QVI starting in early 2021.

An important note to make is that edibles market growth outperformed the overall cannabis industry growth in 2020 as consumers chose edibles over inhalables. This surge prompted edible manufacturers to invest more in product development and manufacturing making QVI an important player in that market.

FinCanna’s third portfolio company is ezGreen Compliance, which offers Health Insurance Portability and Accountability Act (HIPAA) compliant point-of-sale (POS) software for cannabis dispensaries. Features include integrated management and multi-store functionality with taxation and reporting functionalities.

In August 2020, FinCanna announced the acquisition of ezGreen and in October completed the transition of ownership. Recently, ezGreen began a marketing initiative with a marketing partner to focus on sales efforts, targeting dispensaries in California.

California is King of the Cannabis Market

California ranks as one of the largest legal cannabis market in the world and over 30% of the U.S. legal cannabis market. The COVID-19 shut-in measures resulted in higher purchase volumes and a very substantial and positive shift for the cannabis industry.

In California, legal cannabis retail sales are expected to exceed US$5 billion in 2020, up almost 70% from US$3 billion in 2019.

2021 Outlook

FinCanna’s management recently reported that it expects to see a “sizeable increase” in royalty revenues in 2021 and the positive cannabis market outlook, especially in California, should help generate operating profits that will grow throughout the year.

FinCanna is currently trading at $0.11 with a market cap of $8.5 million.




Sixth Wave’s Dr. Jon Gluckman talks about the election and the 2nd wave of cannabis investment

In a recent InvestorIntel interview, Tracy Weslosky speaks with Dr. Jon Gluckman, President, CEO and Founder of Sixth Wave Innovations Inc. (CSE: SIXW | OTCQB: ATURF) about what a Biden presidential win means for an energized and revitalized cannabis sector.

“We’re pretty excited,” said Dr. Gluckman, “that in addition to the Biden win it was pretty clear that the referendums on the state ballots in the U.S. were extremely positive and forward-looking for the future of cannabis and the significant expansion in the United States which is obviously a huge market.”

Asked about what it means, Dr. Gluckman said that Sixth Wave sees it “as a tremendous opportunity for licensed producers to expand their footprints into different spaces and certainly for new equipment requirements which will include Affinity, so we’re stoked.” Affinity™ is Sixth Wave’s cannabinoid purification system.

Discussing the Affinity cannabinoid purification system revenue model, Dr. Gluckman explains that it work on a “total system performance license” basis, where Sixth Wave provides the technology to licensed cannabis producers on a “small profit margin basis”, but then partners to provide upgrades and maintenance in exchange for a portion of the producer’s revenue stream. As Sixth Wave’s Affinity optimization can save a projected 50% of a producer’s production costs, this mutually beneficial arrangement can create a substantial revenue stream for both the producer and Sixth Wave.

Dr. Gluckman explains to Tracy how the application of Sixth Wave’s patented Molecular Imprint Polymers (#MIPs) technology creates “consistent and high purity” cannabinoid from a producer’s raw material that is essential to creating a commercial product.

Regarding revenue expectations, Dr. Gluckman said that they expect to see revenue through a deal with Green Envy as early as December, and ramping up in the first quarter of 2021. Answering Tracy’s question about investors who missed the “first wave” of cannabis investment, he said that “the very interesting thing now is that what we have seen is that the growers are all growing,” and that “as new states come on board they are all going to need new licensed producers.” And since there are federal restrictions on interstate movement of cannabis, production will have to be local to each state, requiring multiple production facilities

“We’re really looking forward to it and scaling up significantly next year,” Dr. Gluckman said.

To watch the full interview on YouTube, click here.

More videos: click here to subscribe to the InvestorIntel Channel

Disclaimer: Sixth Wave Innovations Inc. is an advertorial member of InvestorIntel Corp




Biden’s win brings a “green” market wave and cannabis extraction team attracts the Sixth Wave

“Waves are inspiring not because they rise and fail, but because each time they fall. They never fail to rise again.” — Josh Billings

The Democratic “blue” wave failed to materialize during the recent U.S. elections but the “green” cannabis wave continues to build. Five states (Arizona, Mississippi, Montana, New Jersey, and South Dakota) easily passed ballot initiatives for the legalization of either recreational or medical cannabis use.

Currently, the medical use of cannabis is legalized in 35 states and the recreational use of cannabis is legalized in 15 states. Although federally illegal in the U.S., there is speculation that the Biden win is an important first step on the path towards the federal decriminalization of cannabis.

In the U.S., medical and recreational cannabis sales are on pace to exceed US$15.5 billion by the end of 2020, an increase of approximately 40% over 2019, and grow by 30% in 2021.

To meet the higher demand, technology advancements have manifested in all parts of the supply chain, especially in the extraction and purification process.

Extraction

The three main methods of cannabinoid extraction are (1) ethanol or alcohol extraction; (2) hydrocarbon extraction, using butane or propane; and (3) carbon dioxide (“CO2”) extraction. If higher purity levels are required, a distillation process, often using chromatography technology, can increase purity levels into the high 90%.

As the industry shifts into pharmaceutical-grade production to meet medical and cannabis-infused products, cannabis extract producers continue to search for innovative ways to improve the purity of cannabinoid isolates and control costs.

One of the challenges for cannabis extract producers is that organic material has varying properties from batch-to-batch and a potential processing risk when scaling operations.

Sixth Wave – Cannabis Extraction Using Nanotechnology

Sixth Wave Innovations Inc. (CSE: SIXW | OTCQB: ATURF) is a nanotechnology company focused on the detection and extraction of target substances (e.g. cannabinoid, gold, or Covid-19) at the molecular level using patented technologies.

Led by a team of PhDs and scientists, Sixth Wave’s Affinity™ System uses a proprietary Molecular Imprinted Polymers technology in the process of extracting cannabidiol (“CBD”) and tetrahydrocannabinol (“THC”) from hemp and cannabis.

The extraction process uses porous polymer beads and the polymer is designed to attract a specific molecule. As CBD and THC are both molecules, Sixth Wave created proprietary polymers to specifically target those molecules in the extraction process.

Benefits of Sixth Wave’s Technology

Unlike other batch processes that purify components out of a product in various stages, Sixth Wave’s process can take a wide variety of input materials, run it through the solution, and the polymer will selectively extract the specific cannabinoids. The resulting cannabinoid isolate can be up to 99.9% pure.

Chromatography, the legacy technology for purifying cannabinoid extractions, is considered to have issues with high capital and operating costs, efficiency, and scalability.

The Affinity™ System was designed to be highly automated and user friendly, requiring minimal training and human intervention. The system uses lower-cost components, minimizes the need for intermediate batch processing, and can be operated continuously, making it a more cost-effective solution.

Dr. Jonathan Gluckman, President and CEO of Sixth Wave, said, “As we know, a major challenge for the cannabinoid purification industry will be the delivery of customization and flexibility, with medicinal and recreational applications demanding exceptional product diversity. The Affinity™ System is highly capable in this regard, with the potential to tailor extraction media to recover any one of the hundreds of cannabinoids available to us.”

Market Size

According to a recent study, the cannabis extraction market is expected to be worth US$28.5 billion by 2027, growing at 16.6% annually.

The growing legalization of cannabis in various countries and the use of CBD and THC for treating illnesses such as arthritis, anxiety, and nausea are the main factors driving growth.

Sixth Wave is currently working with several customers designing larger processing capabilities. In April, the Company announced an agreement with Green Envy for the purchase of a minimum of three Affinity™ extraction units. It expects to deliver the first revenue-generating system to Green Envy by the end of this year. Expect more deals to be announced as the Company shifts from development to production.

The Company is well funded as it recently closed a $1.15 million financing and intends to use the proceeds for the deployment of its Affinity™ cannabis extraction units as well as for other general corporate purposes.

Time to jump on Sixth Wave to ride the resurging cannabis trend.

Sixth Wave - Affinity Unit

SOURCE




Betting it all on California cannabis global dominance, FinCanna focuses on being the capital partner of choice

Cannabis is essential in California!

That statement may reflect the opinion of certain members of California society, but in actuality, at the start of the coronavirus pandemic in early March 2020 cannabis retailers were in fact declared an essential service industry by California state.

We were reminded of that in a video conference presentation in September done by CEO and Director, Andriyko Herchak, of FinCanna Capital Corp. (CSE: CALI | OTCQB: FNNZF). We were also reminded that California is the largest cannabis market in North America and in 2019, had legal sales of 21% of the global market – Canada was only 11%, the US was 61% and the rest of the world was only 7%.

Putting that into numbers, in 2019 the global market was $14.9 billion, with California representing $3.1 billion in legal cannabis sales, although black market sales are estimated to be double that number. According to the LA Times, licensed cannabis sales are projected to total US$7.2 billion by 2024, making California the global leader. Keep in mind that the state of California is the fifth largest economy in the world and has had legalized medical cannabis since 1996 with new laws that came into effect in January 2018 which significantly changed supply and demand dynamics.

Key success factors for the cannabis business – go to the biggest market, be the early entrant, keep your cost structure low and be the most profitable. Unfortunately, as many investors will attest, investing in cannabis has been a real challenge to navigate as capital intensive companies continue to lose money quarter after quarter. Recognizing this fact, FinCanna has a business model that is low cost, not capital intensive and is designed to be profitable.

FinCanna is first and foremost a capital company and their vision is to become the capital partner of choice for high growth, rapidly emerging private companies operating in the licensed U.S (California) cannabis industry. Management is focused on delivering high impact returns to its shareholders by way of a strategically diversified investment portfolio. They seek to invest in “best in class” businesses and align the interests of the existing company owner/operators with FinCanna shareholders.

This is done predominantly as a royalty company, which is perfectly designed for this business model. Management of FinCanna invests in various private cannabis industry companies that do not compete against each other – it could be said that they are complementary to each other in the overall cannabis market. So far, this strategy has worked well for FinCanna.

FinCanna became public as a result of a reverse takeover transaction that closed in late 2017. Recognizing the opportunity for a first-mover advantage ahead of new regulations coming into effect in early 2018, FinCanna invested in Cultivation Technologies Inc. who have a cannabis extraction facility in California. Their other manufacturing investment is in QVI, Inc., a contract manufacturer of high demand items, including edibles, topicals, tinctures, chocolates, hard candies, gummies, beverages, among others. Their third company, ezGreen Compliance offers a state-of-the-art enterprise compliance and point-of-sale software solution (“ezGreen”) for licensed cannabis dispensaries and cultivators. The ezGreen software is the only HIPAA (Health Insurance Portability and Accountability Act) certified point-of-sale software in the market. In August 2020, FinCanna acquired from its former royalty portfolio company 100% of the assets and economic interests of ezGreen and is currently focused on sales in California and certain other states.

As a result of this portfolio and royalty approach, FinCanna has low operating costs and once the corporate G&A is covered, the remaining royalty income streams are essentially a 100% margin business. Their largest investment (QVI), a leader in the high-growth edibles business, recently started operations in a brand-new facility.

Management has significant personal wealth invested in the company which should give investors comfort that their interests are in fact aligned with all shareholders. Management sees increasing revenues from all of their business segments in California, which is a positive for cashflow and profitability potential going forward. There is approximately $2.0 million of cash on the balance sheet with a total of just over C$6.0 million of convertible debentures which do not mature until early 2023. This appears to be a company that is well positioned in a market with significant barriers to entry. Actual performance by their private company investments will drive FinCanna’s share price.




Sixth Wave Innovations leads virus detection through breath testing

Using nanotechnology to quickly identify pathogens

Imagine if taking a coronavirus test was as simple as an alcohol breathalyzer, or a pregnancy test, and the results just as fast. One company has developed a test that uses molecular imprinted polymers with the possibility of detecting almost any pathogen, and is now using their technology to develop a way to detect for COVID-19 as easily as using a saliva test or a swab test.

Sixth Wave Innovations (CSE: SIXW | OTCQB: ATURF | FSE: AHUH) is a development stage nanotechnology company with patented technologies that focus on the extraction and detection of target substances at the molecular level using highly specialized ‘molecular imprinted polymers’ (MIPs). The target substances can be anything, such as pathogens (viruses & bacteria), gold, or anything made of molecules (that’s every substance).

Sixth Wave has technology to make a ‘polymer imprint’ for molecules including viruses. Sixth Wave is working to develop a molecular imprint for the coronavirus so they can capture the virus in their polymer and then apply various techniques to detect the virus such as colormetrics or electronics.

The company is working toward incorporating the technology into a mask so you could wear a mask that both protects and detects for COVID-19. Another concept is to have the MIP inside a coated barcode strip which you would then scan with your smartphone to see if you have been infected or not. (See: Sixth Wave working on a virus breath test.)

President, CEO and Founder Dr. Jonathan Gluckman explained that a “virus has a size and shape and we create an imprint in our polymer for that exact virus. Then we will detect that directly based on our chemistry.” He continued that Sixth Wave is “working to integrate this into masks and breathalyzers and then we can just utilize the breath, as we all know that’s the main transmission method. If you think about putting a mask on, not only will that mask provide protection, it can also, right there, be the test for COVID-19.”

Highlighting the advantages of Sixth Wave’s COVID-19 test over other tests, Dr. Gluckman also said that the test will be cheaper, faster, less invasive, and easy to use.

Dr. Gluckman says that Sixth Wave’s COVID-19 detection technology is currently under development, but the Company has successfully launched and commercialized other products with similar properties. The coronavirus tests are planned to be ready for an early 2021 rollout. The company has received a grant from the Canadian government to work with York University and the CTRI to use its virus detection technology to detect COVID-19 virus in wastewater supplies and in air handling systems.

Sixth Wave Innovations can detect and extract anything at the molecular level – Target markets include COVID-19 testing, gold extraction, and cannabis purification

Source

Sixth Wave Innovations technology can be used for other applications

Gold extraction

IXOS® is a line of extraction polymers for the gold mining industry 100% developed and owned by Sixth Wave and patented/patent pending in 40+ countries worldwide. CEO Gluckman says the technology can save gold mining companies about US$100/oz on their processing costs based on pilot scale test results for multiple mines.

Sixth Wave Innovations IXOS® can save gold miners up to US$100/oz in gold processing costs

Source: Corporate presentation

Cannabis Purification

Sixth Wave is in the process of commercializing its AffinityTM cannabinoid purification system. The Affinity™ Technology for the medical and recreational cannabis industry is 100% developed and owned by Sixth Wave with a patent pending. AffinityTM products are now rolling out and starting to generate revenue for Sixth Wave, including an initial 300 Affinity units.

Other applications

Sixth Wave’s Molecular Imprinted Polymers (MIPs) have also been applied in industries including security (SAFE-T explosives detective wipes), mining (gold & silver extraction, also removal of mercury), and other pathogen detection. The potential list of applications is enormous.

Sixth Wave Innovations planned revenue streams

Source: Corporate presentation

Closing remarks

History has repeatedly shown how mankind makes incredible innovative technology during incredible times. Here we are facing one of this century’s greatest pandemics and scientists globally are racing to develop better diagnostic tests, treatments and vaccines.

In the case of Sixth Wave Innovations it is fast-tracking the development of an innovative technology to detect and extract polymer molecules. They are now focused on adapting their technology to make a polymer imprint of the coronavirus that can, if successful, make COVID-19 detection as simple and fast as a breath test, whether on a test strip or even on a dual-purpose face mask. Imagine wearing a face mask that can also detect COVID-19. Sixth Wave’s COVID-19 detection technology targeted for early 2021, and if successful it will be a massive win-win for the public and also for Sixth Wave Innovations.

Meanwhile, Sixth Wave will be advancing their near term revenues from AffinityTM, and later hopefully from IXOS®. The current market cap of Sixth Wave Innovations is only C$21m thereby presenting a tremendous early stage speculative opportunity for investors.