Health professionals already recognize the remarkable ability of
medical cannabis to relieve chronic pain and some of the worst
symptoms of illnesses such as cancer, AIDS, multiple sclerosis and
Crohn's disease. But a growing body of research also points to the
power of cannabis to prevent illness and preserve peak health by
optimizing the body's endocannabinoid system, which regulates and
maintains the stable internal environment of the human body.
The health case for cannabis is gaining support from doctors as
prominent as Sanjay Gupta, the Emmy-award winning neurosurgeon and
chief medical correspondent for CNN. In 2013 and earlier this year,
Gupta co-produced two documentaries on the medical benefits of
marijuana titled Weed and Weed 2. Increasing awareness of the
benefits could prompt more doctors to prescribe cannabis for their
patients and could fuel consumer demand. The vitamin and
nutraceutical supplement market in the United States is currently
worth an estimated $20 billion.
Canada's potentially huge medical marijuana market has been
labeled "the Green Rush," and Vancouver-based BC Chronic Inc. is
pursuing a strategy that could leave even its largest competitors
green with envy.
For context, the space has drawn serious investor attention as
noted by impressive market activity. A few standout examples:
Affinor Announced its plans to move into the space and has hit a
recent 52-week high of $0.52 likely as a result that Vertical
Design is taking a controlling (10%) stake in AFI. Affinor has
58,188,898 shares outstanding with a market cap of $28,513,000 (May
20, 2014).
Tweed listed as the first Medical marijuana producer on the
TSX.V, trading at $2.90. The Company just closed a $15 million
bought deal financing. Tweed has 39,943,991 shares outstanding
with a market cap of $115,840,000 (May 20, 2014).
Supreme Pharmaceuticals, trading at $0.115, has announced two
acquisitions of growers in BC and Ontario in the last month. As a
result, shares traded in the period of May 11-15 exceeded 60
million in Canada and the US. Supreme has 144,812,362 shares
outstanding with a market cap of $16,653,000 (May 20, 2014).
In stark contrast BC Chronic - Anexco (CSE:AXO) only has
13,839,582 shares outstanding, and is trading at $0.20 resulting in
a market cap of $2.6 million (May 20, 2014). This places Anexco in
an enviable position of having one of the tightest structures in
this space.
BC Chronic – a wholly owned subsidiary of Anexco Resources Ltd.
– recently concluded a letter of intent (LOI) to acquire the
operations of an MMAR (Marijuana Medical Access Regulations)
licensed medical cannabis producer in British Columbia's interior.
The agreement will allow BC Chronic to apply for a Licensed
Producer designation from Health Canada, and gives it control of a
state-of-the-art facility that already meets most of the standards
set out in the new federal Marijuana for Medical Purposes
Regulations (MMPR).
The operation is capable of producing 2,500 kilograms of high
quality biopharmaceutical-grade medical cannabis annually. This
production capacity translates into $14.7 million when calculated
at $6 per gram. "This acquisition is a very important step for the
company and its shareholders," said Anexco president Michael
Martinz. "I welcome this group of trusted and experienced
colleagues to become part of our cannabis 'dream-team.' Together,
using our combined talents and this facility, we will be able to
produce industry leading medical cannabis for clients at the most
affordable prices possible."
BC Chronic has assembled an exceptional team with a track record
for successful start-ups, brand creation, and more than 60 years of
combined cannabis cultivation expertise. "I am very excited to be
involved in a potential paradigm shift in the way people look at
the health benefits of marijuana," said Martinz. "These are very
exciting times."
In the late 1990s, Martinz was a key figure in the creation and
development of one of Canada's first industrial hemp companies. His
record of success as an entrepreneur spans a range of industries,
including the resource sector, agriculture as well as high-tech,
manufacturing and alternative energy. In the medical cannabis
field, he is well known as a co-developer of the Centurion machine,
a revolutionary cannabis trimming and processing device now sold
worldwide. CEO Rudy de Jonge has more than 25 years of experience
in international finance and corporate development. A number of the
companies he has founded and/or managed have achieved high market
valuations, ranging from several million to more than $100
million.
Health Canada estimates the country's medical cannabis market
could reach 400,000 registered patients and $1.3 billion in annual
sales by 2024. In the United States, the legal market for medical
and recreational cannabis has already surpassed that mark,
totalling about $1.53 billion, according to ArcView Market
Research, a San Francisco-based investor group focused on the
marijuana industry. ArcView estimates the U.S. market could grow to
$2.57 billion by the end of 2014, led by Colorado with $802 million
in yearly sales.
The value of the Canadian cannabis market could be much greater
if Canada pursues a commercialization policy. The Liberal Party of
Canada under leader Justin Trudeau has proposed commercializing the
marijuana market if the party wins the 2015 federal
election. The size of the Canadian commercial cannabis market
is estimated to be 800 million grams per year, valued at $4.8
billion at $6 per gram.
BC Chronic is convinced it has a clear competitive edge. Martinz
says British Columbia is associated with the best quality medical
cannabis in the world. And he predicts that the uniform quality and
convenience offered by licensed producers like BC Chronic will
ultimately win over health-conscious patients, including home
producers. "In the same way that most people don't brew their own
beer or wine," he says, "there's a large group of people who don't
have the technical expertise or the time or the space to grown
their own medical cannabis."
As the company grows, BC Chronic plans to develop spinoff
products such as cannabis ointments and edibles, as well as a seed
production and distribution business. It also plans to explore
international production opportunities, beginning with the U.S.
states of New York, Alabama, Alaska, Florida, California and
Oregon, where public plebiscites on medical or commercial cannabis
production are being considered. BC Chronic also has potential
opportunities to sell consulting services or to form joint ventures
related to planned production facilities in Uruguay and
Argentina.
To develop multiple streams of revenue, the company is
researching the viability of launching its own BC Chronic physician
referring dispensaries. It is currently searching for possible
locations in British Columbia.
BC Chronic recently participated in the successful Green Rush
Financial Conference in Vancouver, B.C. "In my 25 years of public
market experience," said de Jonge, "I have never witnessed such
excitement at a trade show."
BC Chronic has 13,839,582 shares outstanding and is trading at
$0.20 with a market cap of $2.6 million.
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CONTACT: Anexco Resources Ltd. (CSE: AXO)
604.782.4191
604.637.9614
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