Key Takeaways; Cannabis Sector
• Aurora resolved a patent dispute with Willow Biosciences; they also announced Q2 conference call.
• Canadian cannabis giant Tilray has taken a green leap with hemp packaging to reduce plastic waste.
• 22nd Century Group slashed debt by $8.1 million in a strategic move.
Key Takeaways; Psychedelic Sector
• COMPASS Pathways announced a CFO transition.
• Cybin secured additional patents for its DMT program, expanding its psychedelic portfolio.
• Awakn’s Prof. David Nutt is the world’s top psychopharmacologist according to ScholarGPS.
Below is a weekly roundup on the cannabis and psychedelic sectors. In this ever-evolving landscape, we explore the major developments and groundbreaking initiatives happening among companies operating in these industries; from advancements in medical research, therapeutic applications to shifts in legal frameworks and current market trends.
Top Marijuana Companies for Week
#1: Aurora Cannabis
Aurora Cannabis Inc. (NASDAQ: ACB), recently announced the settlement of a patent dispute with Willow Biosciences Inc. (OTC: CANSF). The dispute, which began in July 2021, centered around allegations that Willow’s biosynthetic process for synthesizing cannabinoids had infringed on patents co-owned by Aurora, the University of Saskatchewan, and Canada’s National Research Council.
The patented technology in question was developed by Jonathan Page, the co-founder of Anandia Labs and former chief science officer at Aurora, along with his colleagues. Their work at the University of Saskatchewan and the NRC involved identifying key enzymes and corresponding genes in the biosynthetic pathways of cannabis plants.
Aurora acquired Anandia in 2018 and initiated the patent infringement action against Willow. While the settlement terms remain confidential, Aurora’s CEO, Miguel Martin, expressed satisfaction with the resolution, emphasizing the importance of protecting and enforcing their intellectual property rights. He also underscored Aurora’s pioneering role in genetics work within the Canadian cannabis industry.
Additionally, in other news related to Aurora Cannabis, the company announced that it has scheduled a conference call to discuss its financial results for the second quarter of fiscal year 2024 on November 9, 2023. The call will be hosted by Aurora’s Chief Executive Officer, Miguel Martin, and Chief Financial Officer, Glen Ibbott. The financial results are set to be reported after the close of markets on the same day.
#2: Tilray
Tilray Brands, Inc. (NASDAQ: TLRY), a prominent Canadian cannabis producer, initiated a significant effort to reduce the use of single-use plastics in its packaging and product components. This transition includes converting packaging, pre-rolls, and vape components to hemp-based materials. This move is considered the first major commitment by a large Canadian cannabis producer to address the issue of plastic waste in the industry and could potentially set a precedent for others to follow.
Tilray estimates that its new hemp-based packaging program will divert approximately 131,000 kilograms (288,805 pounds) of plastic waste from landfills each year. The environmental impact of cannabis legalization in Canada has drawn attention, with packaging waste being a prominent concern.
A report by a government-appointed panel highlighted the challenges of recycling plastic cannabis packaging, particularly vaping cartridges and batteries, due to the presence of metal, glass, electronics, and batteries. It was also pointed that Canadian cannabis companies have been producing more products than they can sell, resulting in excess inventory.
Tilray stated that its transition to hemp-based packaging will commence with its Good Supply brand and later expand to include other brands like Riff and Broken Coast. According to the company, the Good Supply hemp initiative will include eco-friendly “hemp tubes” for pre-rolls and Pax Pods cartridges and hemp-composite mouthpieces for 510 vape cartridges. Furthermore, Tilray will replace plastic bags for whole-flower products with bags made from recycled content, diverting an estimated 38,000 kilograms of plastic waste from landfills annually.
The company believes that this initiative is beneficial for both business and the environment, citing research that shows consumers are 50% more likely to purchase cannabis products in sustainable packaging. The move could potentially influence competitors in the cannabis industry to adopt similar eco-friendly practices. Tilray originally pledged to adopt hemp-based packaging during a conference call with stock analysts in January 2023, with the goal of diverting thousands of kilograms of plastic waste from landfills.
#3: 22nd Century Group
Hemp biotech company 22nd Century Group, Inc. (NASDAQ: XXII), specializing in hemp, tobacco, and hops, successfully decreased its senior secured debt by $8.1 million. This achievement followed an amendment and waiver process with its lenders, reducing the outstanding debt from $22.1 million to approximately $14 million.
This significant reduction stems from a waiver and repayment of the required $7.5 million minimum cash balance specified in the original debenture agreements. Furthermore, an existing promissory note was reassigned as part of the deal, with $600,000 of the note allocated to reduce the outstanding principal and $2 million directed towards lowering the put price associated with the lenders’ outstanding warrants, a portion of which was subsequently canceled.
The remaining principal loan balance of $14 million and the outstanding $500,000 of the put price are now due at maturity in 2026, following the original terms of the debenture agreements. Chief Financial Officer, Hugh Kinsman, noted that this principal reduction will save 22nd Century Group approximately $500,000 in cash annually, emphasizing the company’s commitment to actively manage their balance sheet and focus on cost reduction initiatives.
Top Psychedelic Companies for Week
#1: Compass Pathways
COMPASS Pathways plc (NASDAQ: CMPS) recently announced the departure of its Chief Financial Officer, Mike Falvey, who is set to leave the company on November 3, 2023, to explore new opportunities. The company stated that Mary-Rose Hughes, who is currently serving as the Vice President of Finance, will take on the role of interim CFO with immediate effect, while the company initiates a search for a permanent replacement.
Compass Pathways expressed its gratitude to Mike Falvey for his leadership and substantial contributions during his tenure, highlighting his pivotal role in their recent successful private placement. According to Compass, this financing round not only extended the company’s cash runway, ensuring financial stability beyond expected phase 3 clinical data milestones, but also attracted significant investments from leading biotech investors.
The company stated that Mary-Rose Hughes, who joined Compass in May 2020 as its second finance team member, is well-versed in the company’s operations and has been instrumental in overseeing various financial aspects, including treasury, tax, financial planning and analysis, and external reporting. She also played a crucial role in Compass’s initial public offering (IPO), follow-on public equity offering, term loan facility, and private placement financing.
Furthermore, Compass Pathways informed investors that they will release their financial results for the third quarter of 2023 and provide updates on recent business developments on November 2, ensuring transparency and ongoing communication with their stakeholders.
#2: Cybin
Cybin Inc. (NYSE: CYBN) received two patent grants from the United States Patent and Trademark Office, bolstering its deuterated N, N-dimethyltryptamine (DMT) program. Following its recent acquisition of Small Pharma Inc., Cybin now boasts 32 granted patents and over 170 pending applications, establishing a commanding position in the development of innovative tryptamine-based therapeutics.
The two newly granted patents offer protection for Cybin’s deuterated DMT program, covering composition of matter, medical use, and the synthesis of certain DMT analogs. These patents are essential in safeguarding Cybin’s proprietary deuterated DMT compounds, CYB004 and SPL028, both of which are currently in Phase I clinical trials. These compounds aim to provide an extended DMT psychedelic experience with a short-duration drug profile, allowing for optimized dose formulations and distinct therapeutic benefits. Preliminary findings indicate that both CYB004 and SPL028 are well-tolerated and elicit a psychedelic experience lasting under an hour.
#3: Awakn
In a groundbreaking achievement, Prof. David Nutt, a renowned figure in the field of psychopharmacology, was ranked as the world’s leading psychopharmacologist by ScholarGPS. This prestigious acknowledgment is not only a testament to Professor Nutt’s remarkable career but also a reflection of his current role as a vital part of Awakn Life Sciences Corp. (OTC: AWKNF), a company committed to developing innovative treatment options for individuals struggling with addiction.
The recognition of Prof. Nutt as the world’s top psychopharmacologist is not just an accolade; it is a reflection of his profound dedication to improving the lives of those affected by addiction. As the leader of Awakn’s distinguished team, Prof. David Nutt plays a pivotal role in developing groundbreaking treatments for addiction. This milestone serves as a testament to the dedication and commitment of Awakn Life Sciences in their mission to address addiction-related challenges with innovative, science-based solutions.
The partnership between Awakn Life Sciences and Prof. David Nutt stands as a beacon of hope for those who have struggled with addiction, as well as a testament to the power of science and innovation in addressing one of society’s most pressing health crises. This collaboration marks a significant step forward in the ongoing battle against addiction.