Medical marijuana treatment for animals?
CannPal is a biotechnology company focused on animal health, aimed at developing and commercialising cannabinoid-derived therapeutics for treatment in domestic animals.
Demand for pot companies reached an all-time high in 2017 as overhyped medical marijuana companies flooded the local market, taking advantage of investor appetite for ‘the next big thing’.
The hype had reached the pinnacle when Stemell United (ASX:STU) soared over 3,000 per cent in a single day after announcing the appointment of Nevil Schoenmakers – the ‘King of Cannabis’ - as strategic adviser to explore potential opportunities in the medical cannabis sector. Many other companies have doubled or tripled in value, but how high is too high for cannabis companies?
The medical benefits of cannabinoid-derived therapeutics are well documented and have already been demonstrated in human medicine. Studies show for example that the psycho-active compound of the cannabis plant, also known as THC, has the ability to significantly reduce pain syndromes.
Following publication of numerous medical research studies, the cannabis market has become more accessible to the public and general acceptance for using cannabis as a medical treatment is growing globally.
The coming listing of CannPal Animal Therapeutics offers investors another opportunity to gain speculative exposure to the medical marijuana sector. CannPal is a biotechnology company focused on animal health, aimed at developing and commercialising cannabinoid-derived therapeutics for treatment in domestic animals.
Initially focused on cats and dog, CannPal will be conducting clinical trials to demonstrate the medical benefits in order to develop regulatory approved pharmaceutical products. Investor appetite remains high as the initial public offer was oversubscribed and the OnMarket bidding was forced to close early.
The company is in the concept stage with no existing revenues, unforeseen costs and results of clinical studies are unknown. Whilst the latest trend towards acceptance of cannabis-derived therapeutic products will certainly create opportunities, investors should remain cautious and minimise exposure to a sector, that is showing signs of a bubble. Have a pun and see how it goes, but don’t bet your family savings on a concept that has not yet been proven.
CannPal Animal Therapeutics Limited
ASX Code: CP1
Shares on Offer: 30m
Listing Price: $0.20
Market Capitalisation: $18.5m
Listing Date: October 19
Author: Simon Herrmann
Oct 18, 2017
Simon is a financial analyst at independent research firm Wise-owl specialised in small-mid cap growth opportunities and ethical investment opportunities. Simon's aim is to disrupt the cliché approach to investment decision making as he believes that socially and environmentally responsible behaviour is a necessity to long-term wealth creation. Simon has a deep fundamental understanding of the global financial landscape and has compiled 300+ research reports, valuations and corporate appraisals. Simon is commonly featured in major media outlets and his research is published weekly in The Australian.