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"Lexaria Corp"


Recent cls, $0.18 p/sh

Issued shares 34,682,984

Warrants 13,259,913

Options 2,625,000

Total 50,567,897

52 wk hi/lo: US$0.27/$0.04

Market cap: $7.19 million

Av daily vol (3 mth): approx. 130,000 shares

President John Docherty. Ex president/COO Helix BioPharma Corp. (TSX: HBP)

18/09/15 | Kb

I’m trying to picture a medical marijuana world: The eggheads at GW Pharmaceuticals suddenly get invitations to Pfizer’s summer barbecue, and Marc Emery goes golfing with Merck CEO Kenneth Frazier.

And when exactly will that happen? After hell freezes over?

George Carlin was right, industry is a big club and you and I aren’t in it. Big pharma doesn’t need to sabotage the marijuana industry when they can just ignore it. The conspiracy, if there is one, is mere indifference. Pot scientists can labour away on developing and patenting their cures, and good luck to them. Send us a postcard!

Strange bedfellows indeed: Marc Emery and Kenneth Frazier, CEO of Merck

I can tell you with complete confidence that Pfizer and Novartis and Merck won’t embrace medical marijuana before you and I die of old age, or unless and until the U.S. government releases its patents on cannabinoids, (the strongest of which is the single compound cannabidiol, or CBD). Who needs them anyway, right?

Uh, ok.

So the next question is, how can you make a boatload of dough on a pot stock right now if its chance of being taken over by a Fortune 500 company are next to none? Well if you don't mind tepid sales and long clinical trials you can buy GW Pharma (Symbol GWB.NASDAQ) at $9.25 p/sh.

Or you can do like me and find a back door. Look, a sector play is like betting at the track: You make the minimum bet on the featured race and win big or lose small. Yes, the odds are long, which is why you need an edge. I like Lexaria Corp because it’s not in the business of selling marijuana for medical uses, or any other market segment requiring years of research and government lobbying and infrastructure. Rather, it owns the patents on a hemp tea infusion process with many of the same properties of the plant, the self-same compounds in fact that are found in medicinal marijuana, only minus the THC.

Lexaria's ViPova product suite is basically a black Chinese tea, grown in Yunnan province, which contains active hemp ingredients fused within fatty acids, called lipids.

Forget the clinical trials and peer-evaluated Johns Hopkins studies published in Scientific American. Any ethno-botanist will tell you straight up that CBD has been used for millennia to treat eating, sleeping, and pain and stress related disorders; just the raw plant, what you grow in your yard. They’ll also tell you hemp as a food has an unpleasant taste. Lexaria's ViPova product family includes a black Chinese tea, grown in Yunnan province, herbal teas with Rooibos, and Indian green teas, all of which contain active hemp ingredients fused within fatty acids, called lipids. This binding with lipids masks the strong hemp taste. Lipids may also increase the body's absorption of the cannabinoids, as per Lexaria's August announcement of in vitro study results that delivered bioabsorption rates 499 % higher than controls.

What intrigues me the most however is what Lexaria still has in the lab, namely CBD loaded drops and especially vaping eliquids. Not only do those intake methods potentially improve absorption, they also reach large demographics like non tea drinkers and especially worried cigarette smokers.

Lexaria trades on the Canadian Stock Exchange (CSE) and over the counter in the U.S., and while I tend to prefer emerging plays which are interlisted with the major exchanges, I have to admit we live in extraordinary times. Progressive alternatives such as the CSE claim to be weeding out the tech-savvy arbitage players who are spoiling the game, and encourage private equity. Good for them. I hope they go on stealing liquidity from the TSX until they eventually rival them, and the sooner the better.

I genuinely think an investor runs the risk of being too clever, too soon in the industrial and medicinal hemp segments. There are just too many problems in the foreseeable future. The products aren’t defined, markets aren’t developed, supply chains aren’t there. Neither is the infrastructure or technology. It’s greenfields. There’s a lot of trial and error and hit and miss on that particular road to success. What I’m looking for among the pack is a company with a chance to create or define its own market segment, or even better, become synonymous with it, like Bayer is to aspirin.

Mood altering, performance enhancing, recreational dope is handed out like candy to the public at large. Why can't we just drink tea?

- Kb

The marijuana-as-superfood door is a shortcut to the teeming, CBD-craving public, and I can assure you with complete confidence that big players will be happy to look at it. I’ll give you a list: Monsanto, General Mills, Cargill, Coca-Cola, DuPont, Kraft Foods, Metro AG, Nestlé, PepsiCo, SABMiller, Syngenta, Unilever, and Wal-Mart. The regulatory climate for food is just so much simpler than pharmaceuticals, it’s really comes down to just proper labelling.

No fuss, no muss. We’re just selling tea here folks. Legal, marijuana tea loaded with health giving goodies to help you through your day.

Meanwhile, I’ve tuned my ear for encouraging noises from the big commodities exchanges. Can you imagine if this thing In Colorado gets legs?

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