Akanda, CEO on Hedgeye TV
We are very excited to be hosting a call with the CEO of Akanda Corp, Tej Virk. Akanda is an international medical cannabis platform company headquartered in London. Akanda's mission is to provide high-quality medical cannabis products to patients throughout the EMEA region - Europe, the Middle East, and Africa. The Company is vertically integrated across the supply chain with a "seed-to-patient" model that includes a robust set of assets that was assembled in a short amount of time.
Cannabis/Consumables Pro Subscribers CLICK HERE for event details.
Bright Green IPO
The next GW Pharma is priced for perfection on day 1, and they don't even have a business yet!
BRXX's direct listed IPO ended the first trading day with a $4.0 Billion valuation. For perspective, GTBIF will generate over $1.0 billion in sales at a 30% EBITDA margin and trades at a FD EV of $2.9B.
BRXX has no revenue and has committed to spending $300 million to build out its medical cannabis facilities in New Mexico. A direct listing is a process through which a company's shares become publicly traded without a formal IPO process. The Company does not issue any new shares in a direct listing and doesn't hire an investment bank to underwrite or promote the deal. Instead, they sell only existing shares of the Company, reducing the regulatory requirements, allowing for a quicker process, and saving money on investment bankers. There is also much less scrutiny on the fundamentals. The DLP takes the existing private shares and lists them directly on an exchange, allowing the market to set the price rather than the underwriter. The Company still needs to meet the intended exchange requirements and the SEC, but is this an indication of demand for listed cannabis equities?
Bright Green's mission is to be the premier federally-authorized provider of cannabis, cannabis-related products, and other legal medicinal plant-based therapies, manufactured in exact formulations for research and pharmaceutical applications and an active ingredient in consumer-based solutions. Through legal partnerships with state and federal agencies, the Company can operate at scale in a manner unlike those operating federally illegally. Like others in the space, the vision is to improve the quality of life across a broad spectrum of demographics through the opportunities presented by medicinal applications of plant-based therapies, mainly cannabis and cannabis-derived products. The Company is the first U.S. federally-licensed cannabis company. BRXX is one of a few companies who have received conditional approval based on already agreed terms from the U.S. Drug Enforcement Administration to produce federally legal cannabis and have entered into a Memorandum of Agreement ("MOA") with the DEA, which permits us to proceed towards a Federal Registration for the Bulk Manufacturing of cannabis under DEA Document Control Number W20078135E.
In May 2021, BGC entered into the MOA with the DEA to grow cannabis for federally sanctioned research. Final registration is anticipated in the coming months. It is contingent upon the completion of construction (which will require successful fundraising required to complete construction), and a successful inspection by the DEA of BGC's facilities, based on the terms agreed upon according to the MOA. The MOA with the DEA is effective for a one-year term and renewable for up to four additional one-year terms. There is no guarantee that we will obtain the necessary authorization now or in the future for renewal purposes. On July 23, 2020, BGC received approval from the State of New Mexico Board of Pharmacy to conduct Controlled Substances Manufacturing of Cannabis Products in the state, according to receiving approval from the DEA. On July 24, 2020, BGC submitted an application to the DEA for Controlled Substances Bulk Manufacturing of cannabis products for authorized purposes.
In May 2021, Jazz Pharmaceuticals (JAZZ) announced the completion of its acquisition of GW Pharmaceuticals for $6.48 Billion. GW was a leader in the science, development, and commercialization of cannabinoid-based prescription medicines. JAZZ wanted GW's Epidiolex drug, which looked to transformative treatment for childhood-onset epilepsy that provides a critical therapeutic option for refractory seizures. Launched in the U.S. in 2018, Epidiolex exceeded $500 million in annual net sales in 2020. With an expansion into Europe (under the tradename Epidyolex®) and ongoing research in additional indications, JAZZ believed Epidiolex has near-term blockbuster potential.
I understand that the market potential is big, and big pharma is looming, but that is more than discounted in the current valuation for BRXX.
CRON CEO on Hedgeye TV
We will be hosting a call live in the Hedgeye TV studio with Mike Gorenstein, CEO of CRON on 5/20 @ 2 PM. Topics for the call:
- The Founders Mentality and Cronos 2.0
- The significance of 1Q22 results and Spinach market share strength in Canada
- The importance of the Israel market and Crono's position in-country
- Borderless Products and the importance of Biosynthesis
- Why the focus on rare cannabinoids?
- During your time as Executive Charman, what did you learn about how you want to enter the US market?
- How do you want to deploy your $1B in Cash and equivalents?
Cannabis/Consumables Pro Subscribers CLICK HERE for event details (includes video and materials link)
