Diversity Spells Success in the Cannabis Market

NetworkNewsWire Editorial Coverage: For the growing population of investors within the cannabis market, marijuana-related portfolios are frequently designed to be diverse — an advisable investment strategy for any trading portfolio. From the cultivation side of the cannabis sector to biotech/medical/pharmaceutical, ancillary services, cannabis oils, edibles and beyond, the different avenues for marijuana investment are abundant. For companies like Earth Science Tech, Inc. (ETST) (ETST Profile), the existence of diversity within its own operations offers a similar advantage, enabling the company to touch on and benefit from the success of various subsectors within the cannabis market. Though uniquely structured, ETST is paced alongside other cannabis industry players like Insys Therapeutics, Inc. (INSY), Namaste Technologies, Inc. (CSE: N) (OTCMKTS: NXTTF), Corbus Pharmaceuticals Holdings, Inc. (CRBP) and Emerald Health Therapeutics, Inc. (TSX.V: EMH) (OTCQX: EMHTF).

A Diverse Arena

The forward-march of cannabis legalization throughout North America has led to record-breaking growth within this market, and business opportunities have gone far beyond the bud to include assorted products like gourmet marijuana edibles, cannabis-derived oils, cannabis-based pharmaceuticals, health and beauty products, vape pens and smoking accessories, agricultural innovations, payment solutions, and more.

As decriminalization efforts continue worldwide, the cannabis market only grows stronger. A recent Bloomberg report cites Brightfield Group’s prediction that legal cannabis sales will reach $31 billion on a global level by 2021 (http://nnw.fm/Xo0Ts). Like the individual strands in a rope, the diverse subsectors within the cannabis market are twining together to form an increasingly strong whole.

Strength in Variety

For companies like Earth Science Tech, Inc. (OTC: ETST), operating diversified subsidiaries is proving to be favorable path of growth within the cannabis market. The innovative biotech currently has three wholly owned subsidiaries under its umbrella, building an effective tripod of strength for the company. Though these subsidiaries are diverse in nature, their synergy lies in the application of science to the pursuit of optimal health.

Launched in February 2017, the Cannabis Therapeutics, Inc. (“CTI”) subsidiary is purposed to develop proprietary cannabinoid-based nutraceuticals and pharmaceutical products. At the core of this mission are Earth Science Tech’s existing cannabis cannabidiol (CBD) patent, IP and future technologies to be developed.

Focused on exploring and harnessing the medicinal power of CBD, CTI’s research and development efforts are geared toward the development of CBD-based drugs and nutraceuticals; and the integration of the CBD molecule with existing generic drug molecules to make drugs more efficient with fewer and less severe side effects.

The subsidiary’s pipeline includes two cannabinoid-based pharmaceutical drugs and three cannabinoid-based nutraceutical products for a variety of ailments, such as anxiety, depression, triple negative breast cancer and fatty liver disease.

CTI positions ETST in the rapidly evolving cannabinoid-based pharmaceuticals market, which Statista projects could reach $50 billion by the year 2029. Meanwhile, a report in Hemp Business Journal predicts the CBD consumer market will grow to $2.1 billion by 2020, while other industry experts expect an increase to almost $3 billion by 2021.

Discovering New Revenue Streams

ETST again extended its reach in June 2017 when it entered into a joint venture to launch its wholly owned KannBidoid, Inc. (“KBD”) subsidiary (http://nnw.fm/c6VBH).

Positioned to take advantage of the recreational vape/smoke shop space, each of KBD’s products is formulated with CBD and kanna — a small groundcover plant natively found in southern Africa — sold and distributed in the form of edibles and vapes/e-liquids products.

Rooted Research & Development

Though not centered on cannabis, ETST’s Earth Science Pharmaceutical, Inc. subsidiary represents the core of the company’s R&D capabilities.

Earth Science Pharmaceutical is focused on the development of low-cost, noninvasive diagnostic tools, medical devices, testing processes, and vaccines for sexually transmitted infections (STI) and/or diseases. Its first medical device, MSN-2, is a home detection STI kit being prepared for molecular diagnostics trials.

The subsidiary is managed by an executive team with years of scientific, medical and business experience in health, research and manufacturing. The expertise of this team — headed by ETST CEO and SCO Dr. Michael Aubé and COO Nickolas Tabraue — provides each of ETST’s subsidiaries a multi-dimensional approach to their respective markets.

Strategic Expansion via Acquisition & Partnerships

In 2017 Earth Science Tech also increased operational diversity with the acquisition of Montreal-based Canna Inno Laboratories, which provides ETST access to government grants for up to half of its R&D expenditures.

ETST also has agreements with the Centre de Développement Bioalimentaire du Québec (“CDBQ”), which specializes in helping companies develop the processes needed to take a prototype agro-food or nutraceutical product to industrial-scale production for the marketplace; and with Brazilian company, Bionatus. Inc. to develop a treatment for asthma (http://nnw.fm/PE43r).

Branded Cannabidiol

Leveraging the strategies of its subsidiaries, ETST continues to raise brand visibility, offering full-spectrum, high-purity hemp-derived CBD oil. In collaboration with the University of Central Oklahoma and the DV Biologics Laboratory, the company is conducting R&D projects designed to scientifically support the health care benefits of its completely natural and organic CBD oil.

Earth Science Tech’s products include CBD in the form of vitamins, minerals, herbs, botanicals, personal care products, homeopathics, functional foods and other products delivered in such forms as capsules, tablets, soft gels, chewables, liquids, creams, sprays, powders and whole herbs. They are available at retail stores throughout the United States, as well as online.

The company has also started pre-launch human trials on a new CBD formula to fight against the U.S. opioid epidemic. The new formula, expected to decrease cravings and the negative effects of withdrawal in addicts, is based on industrial hemp CBD oil mixed with a known natural ingredient proven to help increase dopamine levels.

2017 Performance Points to 2018 Potential

As discussed in a recent article (http://nnw.fm/pd0Md) and year-end review (http://nnw.fm/38VbO), ETST nearly doubled its revenues in 2017 compared with the previous year, and a price target of more than $4 has been set for its stock.

ETST’s achievements in 2017 add weight to Dr. Aubé’s positive forecast for the company’s future.

“This past year has been amazing. I am elated about the start of the New Year given all that we accomplished in 2017. … We have built the foundation and infrastructure the Company needs to succeed long-term … and I feel that we are now on the way to becoming the next billion-dollar (in-capitalization) company on the OTC Markets.”

Comparable Cannabis Players

Insys Therapeutics (INSY) is focused on improving patient care by addressing unmet medical needs through cannabinoids and novel drug delivery systems. The company’s approved products include SYNDROS, a cannabinoid medicine used to treat anorexia in adults with AIDS and to address nausea and vomiting caused by chemotherapy, and SUBSYS, which is used to manage breakthrough pain in adult cancer patients who have become tolerant to opioid therapy.

Namaste Technologies (NXTTF) is an online retailer of medical cannabis delivery systems, distributing vaporizers and smoking accessories worldwide through e-commerce websites in 26 countries and five distribution hubs. Through its 2017 acquisition of CannMart Inc., Namaste is pursuing a new revenue vertical in online medical cannabis retail sales in the Canadian market, with an aim of positioning itself as a retail medical cannabis distribution leader in Canada. During 2018, Namaste intends to establish a secure telemedicine portal that will connect doctors with medical marijuana patients, allowing Canadian patients to receive product recommendations via email and to have their prescriptions filled via postal mail. The company further plans to expand its product offerings in 2017 and to launch a Canadian warehouse in the CannMart facility.

Corbus Pharmaceuticals Holdings (CRBP) is a clinical-stage pharmaceutical company that is focused on developing and commercializing novel therapeutics to treat rare, chronic and serious inflammatory and fibrotic diseases. Lenabasum is the company’s lead product candidate and is a novel synthetic oral endocannabinoid-mimetic drug designed to resolve chronic inflammation and fibrotic processes. It is currently being evaluated in systemic sclerosis, cystic fibrosis, dermatomyositis and systemic lupus erythematosus.

Emerald Health Therapeutics (EMHTF) is an emerging global cannabis player and, through its wholly owned subsidiary Emerald Health Botanicals Inc., is a licensed producer of medical marijuana in Canada through the Access to Cannabis for Medical Purposes Regulations (ACMPR). The company currently operates an indoor facility in Victoria, B.C., and is in the process of constructing a 500,000-square-foot greenhouse in Metro Vancouver that has expansion potential to 1 million square feet. Emerald additionally owns 50 percent of Pure Sunfarms Inc. (a partnership with Village Farms International Inc.), which is currently converting just under half of its 1.1 million-square-foot greenhouse in Delta, B.C., from a tomato-growing operation into a cannabis-cultivation facility.

Broadening the Landscape

Diversity is advisable for any investment portfolio, and innovative companies like Earth Science Tech are proving diversity’s effectiveness as a business strategy as well. As the global cannabis market continues to gain strength, the above-mentioned companies are positioned to lead the way into the foreseeable green future.

For additional information about Earth Science Tech, visit Earth Science Tech, Inc. (OTC: ETST).

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