WHITEFISH, MT / ACCESSWIRE / August 25, 2014 / Canada’s Marihuana for Medical Purposes Regulations ("MMPR") program
has been mired in controversy since the beginning. After switching from
the Medical Marihuana Access Regulations ("MMAR") to the MMPR program in
October 1, 2013, Personal Use Production Licenses ("PUPL") and
Designated Person Production Licenses ("DPPL") were phased out on March
from the MMAR to the MMPR program was designed to move marijuana
production out of homes and into tightly regulated corporations.
Unfortunately, these dynamics translated to an immediate increase in
costs for many medical marijuana patients, which led to lawsuits against Health Canada to permit home growing until a better plan was established.
In the meantime, Health Canada has approved
13 licensed producers under the MMPR program that have already begun
selling product. These sales are likely to accelerate as the new MMPR
program picks up steam, with the government projecting about $1.3
billion per year in revenue by 2024, while home growing operations are
likely to end in the near-term following the court resolutions.
Industry Heating Up
The large potential market for licensed producers under the MMPR
program has led to tremendous investor interest in the space. With four
licensed producers undergoing transactions to become publicly traded,
including OrganiGram Inc. (TSX-V: OGI), Mettrum Ltd., Bedrocan Canada
Inc., and PharmaCan Capital, investors will have the ability to invest
directly or indirectly in seven of the 13 licensed producers.
Tweed Marijuana Inc. (TSX-V: TWD) (OTC: TWJMF) was the first publicly traded licensed
producer and has already achieved a market capitalization of over $100
million, as of August 2014. Many private licensed producers have also
reported rising demand from fund managers and venture capital firms
looking for a piece of the action, signaling investor confidence in the
MMPR’s ultimate success.
With many of these publicly traded companies already reaching $50 to
$100 million valuations, investors may want to take a look at promising
aspiring licensed producers that may be trading at a discount.
Diversification across several companies that are approved and/or
seeking approval may be the best way to reduce risk in a sector that is
characterized by its high volatility.
Making Steady Progress
Enertopia Corp. (OTC: ENRT), with a market cap of only $10.6 million, is an aspiring
licensed producer under Canada’s MMPR program that sets itself apart
from the competition. With extensive experience under the prior MMAR
program, the company has experience growing and handling medical
marijuana, unlike many other newer applicants, and regulators know they
can trust the firm to deliver on its promises.
CannabisFN Executive Interview | Enertopia Corp. (OTCQB: ENRT) from TDM Financial on Vimeo.
The company’s three major projects are all making steady progress. Security upgrades are being installed at the Green Canvas project in Saskatchewan; design upgrades are in the works at the GTA project in Ontario in partnership with Lexaria Corp. (OTC: LXRP); and, the World of Marijuana project is awaiting its Health Canada site visit as the government continues to work through its backlog.
The company is also actively pursuing opportunities to diversify into
related areas like oils, edibles, and industrial hemp markets across
North America. Management hopes that these efforts to establish multiple
revenue streams will reduce risk for investors and ultimately help
internally finance its growth. These efforts also set the company apart
from many other pure-plays in the space.
Canada’s medical marijuana space may have had a rough start, but the
MMPR program appears to be picking up steam. As Health Canada’s site
visits take place, many companies are also becoming acquisition targets,
as evidenced by Tweed’s acquisition of Park Lane Farms following its approval earlier this month. These dynamics could justify even higher valuations for smaller firms in the space.
Enertopia has a key advantage with its MMAR operating history and
experienced management team. As it continues to progress towards
licensure, investors in the marijuana space may want to take a second
look, including those involved with U.S.-based companies like Medical Marijuana Inc. (OTC: MJNA) or Hemp Inc. (OTC: HEMP), given Canada’s more established federal-level programs.
For more information, see the following resources:
- Company Website - http://www.enertopia.com/
- CannabisFN Profile - http://www.cannabisfn.com/mdc/enertopia-corp/
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Disclaimer: Except for the historical information presented herein,
matters discussed in this release contain forward-looking statements
that are subject to certain risks and uncertainties that could cause
actual results to differ materially from any future results, performance
or achievements expressed or implied by such statements. Emerging
Growth LLC is not registered with any financial or securities regulatory
authority, and does not provide nor claims to provide investment advice
or recommendations to readers of this release. Emerging Growth LLC may
from time to time have a position in the securities mentioned herein and
may increase or decrease such positions without notice. For making
specific investment decisions, readers should seek their own advice.
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SOURCE: Emerging Growth LLC
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