Top Marijuana Companies for Week

#1: Tilray

Tilray Brands, Inc. (NASDAQ: TLRY), a global leader in cannabis research, cultivation, production, and distribution, recently achieved significant milestones in Europe, particularly in Germany and Portugal.

On July 22, 2024, Tilray announced that its subsidiary, Aphria RX, which is based in Neumünster, Germany, received the first medical marijuana cultivation license under Germany’s newly enacted Cannabis Act. The new German Cannabis Act, which was approved on February 23, 2024, and took effect from April 1, 2024, removed marijuana from the narcotics list and legalized possession for adults of up to 25 grams.

The law also allowed the establishment of “cannabis clubs” and amended Germany’s Medicinal Cannabis Act (MedCanG). Under the revised MedCanG, operators can market and distribute their harvests themselves but must comply with stringent quality requirements, they must also obtain authorization from the German Federal Institute for Drugs and Medical Devices.

Aphria RX’s new license enables the company to cultivate and manufacture a broad range of medical cannabis, significantly expanding its production capacity and increasing the number of approved cannabis strains from three to 31.

In addition to its achievements in Germany, Tilray also made strides in Portugal. On July 24, 2024, Tilray Medical received approval for its third medical cannabis product in Portugal, the Tilray Solução Oral THC10. This approval follows the successful introduction of Tilray Medical’s whole flower THC 18 and its first cannabis extract in Portugal earlier this year.

Tilray’s recent licensing and product approvals in Germany and Portugal mark substantial advancements in the European medical cannabis market. The company continues to lead in the global medical cannabis industry, offering a diverse portfolio of EU-GMP certified medicinal cannabis products across over 20 countries. These milestones reflect Tilray’s strategic growth and dedication to providing high-quality medical cannabis to patients, reinforcing its position as a global leader in the industry.

#2: Glass House

A civil complaint against Glass House Brands Inc. (OTC: GLASF) by Catalyst Cannabis Co. was dismissed, with a summary judgment issued in favor of Glass House. The Superior Court of California in Los Angeles County ruled on July 15, ordering Catalyst’s holding company, 562 Discount Med, to cover legal costs related to the lawsuit.

Glass House President Graham Farrar expressed relief over the dismissal, labeling the lawsuit as frivolous. “But more importantly we are happy to be able to put the waste of time and energy and resources, for all sides, behind us,” he said via text.

“We are hopeful that we can stop the infighting and instead unite as an industry on the many common challenges, like over taxation and not enough legal access, that would benefit patients, consumers and all of the industry overall.”

The dispute began in June 2023 when Catalyst CEO Elliot Lewis accused Glass House of being a major black market cannabis operator. The court dismissed these allegations, indicating that addressing such claims would overstep the functions of California’s Department of Cannabis Control.

Prior to the court’s decision, Glass House had dropped its defamation suit against Catalyst in May, citing concerns about exposing sensitive customer information.

Despite the legal battles, both companies remain significant players in California’s cannabis market, with Catalyst operating 30 retail locations and Glass House being a large vertically integrated operator. Glass House’s shares saw a 1.8% increase to $7.05 following the news.

#3: GrowGeneration

GrowGeneration Corp. (NASDAQ: GRWG) announced a mixed update for its second quarter 2024 preliminary results, highlighting both revenue growth and significant store closures. The company reported a 10.6% sequential increase in net revenue, reaching over $53 million compared to $47.9 million in the previous quarter. This growth was driven primarily by commercial customers.

The company’s CEO, Darren Lampert, emphasized that the company aims to enhance its market reach and profitability by focusing on proprietary brands and an enhanced B2B e-commerce platform.

To support this shift, GrowGeneration stated that it’s implementing a comprehensive restructuring plan. This includes closing 19 underperforming stores, with seven already closed in the first half of 2024 and the remaining closures expected within 90 days, leaving 31 operational stores. According to the company, the restructuring plan aims to improve inventory management, sales, and marketing, targeting $12 million in cost savings over the next year.

Looking ahead, GrowGeneration aims to have 35% of its sales from proprietary brands by the end of 2025 and plans to introduce 50 new products in the next 12 months. Additionally, the company plans to launch a B2B e-commerce portal in the fourth quarter of this year to transition more transactional activities online.

In addition to announcing the preliminary results, GrowGeneration announced it had scheduled its second quarter 2024 earnings release conference call for August 8, 2024, after market close. The announcement will be followed by a live earnings conference call at 4:30 p.m. ET.

Top Psychedelic Companies for Week

#1: Awakn

On July 22, 2024, Awakn Life Sciences Corp. (CSE: AWKN) (OTC: AWKNF), a clinical-stage biotechnology company focused on therapeutics for substance use addictions and mental health disorders, provided an update on its intellectual property (IP) portfolio for its Aminoindane new chemical entity (NCE) series. This portfolio is being developed in collaboration with Graft Polymer (UK) Plc (LSE: GPL).

The Aminoindane NCEs are novel small molecule empathogens that enhance the release of serotonin, dopamine, and noradrenaline while inhibiting their reuptake. These compounds are targeted for treating trauma-related mental health disorders, such as post-traumatic stress disorder, which affects millions globally.

Awakn filed provisional patent applications for the Aminoindane NCEs in 2021, covering pharmaceutical compositions and innovative treatment methods. Since then, the patent portfolio has shown promising progress across multiple jurisdictions including The United States, Europe, and Canada.

Awakn initiated its IP protection strategy in May 2021 with two provisional patent applications. In May 2022, a Patent Cooperation Treaty (PCT) application was filed, claiming priority to these provisional applications. In August 2022, the European Patent Office issued a favorable search report and written opinion, confirming the novelty and inventiveness of Awakn’s lead compounds.

The PCT application was published in November 2022, followed by the International Preliminary Report on Patentability in November 2023, and entry into national phase in the US and Canada, and European regional phase in December 2023. In April 2024, a petition for the U.S. application to join the Patent Prosecution Highway was granted, indicating a likely U.S. patent grant.

Prof. David Nutt, Awakn’s CEO, commenting on these updates stated, “These advancements in our patent portfolio demonstrate the innovative potential of our Aminoindane NCEs. We are committed to progressing these compounds through the development pipeline to address substantial unmet needs in mental health and addiction treatment.”

#2: Compass Pathways

On July 23, 2024, RBC Capital Markets initiated coverage on COMPASS Pathways plc (NASDAQ: CMPS), a company that specializes in mental health care treatments, with an Outperform rating and set a price target of $23 per share. According to RBC this optimistic outlook is largely based on the company’s promising phase III clinical trials in the emerging field of psychedelic treatments for mood disorders, with a high likelihood of positive results expected in the fourth quarter of 2024.

Despite recent market downturns in the psychedelic sector, RBC Capital views current conditions as advantageous for investors, recognizing challenges such as commercialization and intellectual property concerns but still recommending Compass Pathways as a strong investment opportunity. RBC’s confidence is bolstered by a revenue projection of $2.3 billion, indicating significant growth potential.

Compass Pathways has recently taken strategic steps to prepare for potential regulatory approval and commercialization of its psilocybin formulation, COMP360, for treatment-resistant depression. This includes the appointment of Lori Englebert as Chief Commercial Officer and substantial progress in clinical studies, with key data expected by the end of 2024 and mid-2025.

Financially, the company reported $20.8 million used in operations and maintains a robust cash reserve of $262.9 million, which is projected to support operations until 2026. These developments is what has kept investors and market observers like RBC closely monitoring Compass Pathways.