WHITEFISH, MT / July 25, 2014 / The U.S. cannabis industry grew 64% in 2013 and is expected to reach $2.34 billion by the end of 2014, according to ArcView Market Research
. So far, 23 U.S. states and Washington D.C. have legalized medical marijuana, while Colorado and Washington State have legalized recreational marijuana. These trends are poised to continue in the November general election with several outstanding ballot measures in place.
DigiPath Inc. (OTC: DIGP), a provider of digital pathology solutions, opted to expand into the rapidly growing cannabis industry in early 2014. By leveraging its digital pathology expertise, the company appointed new executive leadership, appointed a Chief Science officer, was awarded a permit to open a Clark County, Nevada cannabis testing laboratory and is forward to state approval in the coming months, and has also launched both educational and news media subsidiaries.
In its latest 10-Q SEC filing, following these significant business changes, the company reported $217,248 in digital pathology revenue and positive shareholders’ equity of $7,172,930 for the fiscal quarter ended June 30, 2014. Management also raised about $8.2 million in order to finance its digital pathology solutions, cannabis education curriculum development, and to explore new lines of cannabis businesses.
"We believe that the increased availability of and demand for medical cannabis – especially as states and the federal government move to ease laws around the cannabis industry – has created unprecedented growth opportunities," said DigiPath Inc. CEO Steve Barbee. "Our revenues are increasing, we have capital o hand, and we are focused on expanding our infrastructure and building shareholder value."Existing Revenue & Cash
DigiPath’s existing revenue and strong cash position set it apart from many other development-stage companies within the cannabis industry. For instance, aspiring Canadian medical marijuana growers under the country’s new MMPR or those awaiting regulatory approvals in the U.S. have generated little to no revenue, while massive overhead costs have eaten into their cash positions in the meantime.
DigiPath’s management team has taken a different approach by targeting already-legal industries, like cannabis testing and private education. Washington State’s I-502 mandates cannabis testing in order to ensure proper labeling and THC-CBD ratios, while companies like GP Strategies Corporation (NYSE: GPX) have demonstrated the viability of providing niche training programs as a business.
Recently, the company also launched a nationwide digital radio program called The National Marijuana News ("TNMNews") that takes an unbiased approach in covering issues about medical and recreational marijuana. Host Bruce Kelly, who has developed a number of radio platforms including Sirius XM Holdings Inc.’s (NASDAQ: SIRI) XM Radio, noted that the station has already picked up 17,000 FB likes and logged hundreds of listening hours.
These various initiatives combine to create a cohesive platform focused on cannabis testing, education, and awareness. Through its TNMNews program, management can create and foster connections within the industry.
DigiPath’s move into the rapidly growing, multi-billion dollar cannabis industry has only just begun. After raising $8.2 million in growth capital, the company is well positioned to build long-term shareholder value by investing in its existing and future initiatives within the industry in order to create a comprehensive platform that provides valuable services and the means to rapidly scale.
Investors in the cannabis industry that are already following the success of companies like GW Pharmaceuticals plc (NASDAQ: GWPH), may want to take a closer look at DigiPath Inc. given its numerous programs in development, existing revenue-generating business, and recent capital infusion to help management execute on its plans to build shareholder value.
For more information, see the following resources:
- Company Website - http://www.digipath.com/
- CannabisFN Profile - http://www.cannabisfn.com/mdc/digipath-inc/
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SOURCE: Emerging Growth LLC