LONDON, July 23, 2018 /PRNewswire/ --
As the global marijuana industry booms, one little company has just hit a huge payday. Mentioned in today's commentary includes: Innovative Industrial Properties (NYSE: IIPR), AbbVie Inc (NYSE: ABBV), Zynerba Pharmaceuticals (NASDAQ: ZYNE), Insys Therapeutics (NASDAQ: INSY), Compass Diversified Holdings (NYSE: CODI).
Scythian Biosciences Corp. (SCYB.V) (SCCYF) is a tiny company with a big secret. It has accomplished a huge coupe: it's agreed to sell its assets in Jamaica and Latin America to Aphria, the marijuana giant, for $193 million. That's because weed is GLOBAL. It's much, much more than Canada and the US.
The global weed sector could be worth $57 billion in just 10 years, and that is mainly focused on the recreational market. But there are better ways to profit from the Green Revolution, ways that the hedge funds and venture capitalists haven't discovered yet.
Scythian knows the secrets to making minor marijuana assets into a $193 million investment. It's the only truly global cannabis opportunity spotter, an incubator for marijuana ventures and research throughout the world.
Everyone's been paying attention to the North American weed market…but they've been missing the big picture. 1.37 billion people in Europe and Latin America could soon gain access to legal marijuana. And most people have no idea. But the team at Scythian Biosciences Corp. (SCYB.V) (SCCYF) sure does.
# 1 Tipping Point for an expected $57 Billion Market…
A report from Arcview Market Research and BDS Analytics found cannabis sales accounted for $9.5 billion in consumer spending. The total size of the global cannabis market is estimated to reach $32 billion by 2022 and $57 billion by 2027.
The bulk of pot sales are in the United States, which at the moment has a patchwork of state regulations dictating how marijuana can be sold and consumed legally.
Across North America, marijuana is having its best year ever. Support for legalizing weed across the U.S. is at its highest level in years-polls find as much as 80 percent in favor. And the limited space for medical marijuana is blossoming into a much broader market.
The FDA, for instance, just approved the first ever drug based on cannabis. States are rushing towards legalization: super-conservative Oklahoma, for instance, just legalized medical marijuana, becoming the 30th state to do so. The greener North America gets, the bigger the opportunity in pot becomes.
# 2 …And That's Just the Beginning
North America is driving an investment surge in the cannabis sector. But the opportunity is even bigger than people have realized.
Scythian Biosciences Corp. (SCYB.V) (SCCYF) is unique because it taps into this opportunity…something that firms focused on North America have overlooked.
The company got its start in biosciences, but now it's made the transition to investing and incubating marijuana assets. Scythian's approach is to identify quality assets and build them up into something of value-an approach it clearly demonstrated with its recently announced asset sale to Aphria.
It's the "first mover" approach-search out corners of the market for the assets no one else has found. Scythian sets up strategic "cultivation hubs" with local partners, and also works with medical institutions. Scythian's model gains exposure to the whole global cannabis market and accesses assets that, when they meet their goals, can go from pennies to millions in just a few short months.
One such avenue for exposure is in Latin America, where Scythian has already laid down a foundation. And the European market could be even bigger. The continent has twice as many people as the U.S. and could provide double the sales, once laws are relaxed.
Scythian has a plan in place to tap into the European market, laying a foundation in a number of key markets including Italy and the United Kingdom.
The UK, where new cannabis laws could be just around the corner, could be a huge opportunity-a country where black market marijuana sales totaled $3.46 billion and counted 3 million users. When European laws change, Scythian should be in prime position to seize a chunk of the market.
# 3 Diversification
Scythian's (SCYB.V) (SCCYF) plan is bigger than just production and distribution. The company invests in every part of the cannabis supply chain. It is also setting out to incubate marijuana distributors across the world-building markets that both Aphria and Scythian can exploit with Canadian pot.
There are lots of different opportunities for Scythian to hit it big. A consumer marijuana product, a "Coca Cola" for pot smokers, could let it tap into the recreational market. A "Pfizer," on the other hand, would let it access the medical marijuana industry, one that could grow by leaps and bounds if more marijuana-based drugs receive approval from the FDA.
Scythian could be bringing in a huge payday: announcing an agreement to sell off its Colombian, Argentinian and Jamaican assets to Aphria for $193 million.
Beyond distribution, Scythian is incubating marijuana research ventures at the University of Miami, University College Dublin, Universidad de la Plata and the University of West Indies. From these investments, Scythian could acquire lucrative new patents for marijuana products-from cannabis oils to new strains of pot to pill-based THC consumables.
# 4 Global Firm, Global Vision
The team at Scythian (SCYB.V) (SCCYF) is dedicated, professional-and led by a true visionary.
George Scorsis sits on the Board of Directors for Scythian. Over fifteen years, Scorsis has led a number of companies to rapid growth, all in highly regulated fields from alcohol to energy drinks (he was key in developing Red Bull, the super popular energy drink) to medical cannabis.
The management team behind Scythian is a huge, 75-person squad scattered across the globe in Scythian's different regional offices. These pros are identifying and incubating marijuana ventures in a dozen different time zones.
#5 Global Cannabis Market
Scythian (SCYB.V) (SCCYF) has been lurking in the shadows, but now it's about to burst on to the scene. And Aprhia is one of the biggest players in the marijuana space: a $2.952 billion company that dominates medical marijuana and is bound to profit from Canada's legalization.
The cannabis market may have attracted some big money, but NOBODY has realized the potential of the global weed market…except for Scythian. And with Aphria backing them, this little company is planning to make some big moves in Italy, Portugal and the UK.
Rather than banking on fly-by-wire growers in North America, where markets might get saturated with pot, savvy companies should look abroad, where billions of customers remain underserved and where legalization legislation is probably not far off.
As many 1.37 billion people in Europe and Latin America may soon be free to shop for pot. And Scythian wants to bring it to them before the competition discovers the opportunities.
Other companies to watch as cannabis goes global:
Innovative Industrial Properties (NYSE: IIRP) is set to boom in the coming years. The company has formulated a strategy to target properties for acquisition and management to be leased to state-licensed marijuana growers, a market which is certain to flourish. Innovative Industrial's leasing plan is simple: the tenant is responsible for everything from taxes to maintenance.
AbbVie Inc (NYSE: ABBV) is no stranger to the biopharmaceutical industry. AbbVie was one of the first companies to enter the pharmaceutical marijuana space with Marinol, which is almost chemically identical to THC, the main component in marijuana.
Zynerba Pharmaceuticals (NASDAQ: ZYNE) is a company that is diving deep into cannabinoid therapies. Currently, the company has only two drugs in development; ZYN001 and ZYN002. ZYN001, a THC pro-drug patch, aims to treat a number of conditions through a revolutionary transdermal delivery system while ZYN002, another transdermal delivery system, this time through a gel, is the first and only synthetic non-psychoactive CBD drug of its kind.
Insys Therapeutics (NASDAQ: INSY) main product is a sublingual pain medication known as Subsys. However, using the same proprietary sublingual spray technology and their advanced knowledge of synthetic cannabinoids, the company is at the forefront of a new pharmaceutical movement.
Compass Diversified Holdings (NYSE: CODI) is a holdings company which rings true to its name. Its portfolio is diversified and expansive. Compass Diversified is included in this list due to its Manitoba Harvest holding. Manitoba Harvest is a leading hemp foods producer and distributor, priding itself on high quality and easily accessible products.
By. Ian Jenkins
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