SEATTLE, WA / ACCESSWIRE / June 22, 2015 / The
expansion of the legalized marijuana industry at the state level has created a
diverse array of ancillary businesses, each of them with their own competitive
landscape and growth potential. This
week, GreenWave
Advisors, LLC, an independent investment research and advisory firm serving the
burgeoning cannabis industry, published a report titled “Marijuana Lab Testing:
An in depth analysis of investing in one of the industry’s most attractive
plays,” which projects marijuana lab testing revenues could reach $850 million
a year by 2020.
Unlike
many other marijuana-related businesses, including 22nd Century
Group (NYSE MKT: XXII), which focuses on vaporizer products, Cara Therapeutics
Inc. (NASDAQ: CARA), which focuses on research, or MyDx Inc. (OTCQB: MYDX),
which focuses on chemical sensors, cannabis testing labs address an immediate
need from dispensaries and growers looking to meet state-mandated regulations
before they can sell to the public. As a result, the market has been rapidly
expanding across many states with few public companies well positioned to take
advantage.
The
report covers each state’s requirements for testing, which vary considerably
from state to state, and highlights for investment considerations the leading
indicators for what is considered to be a top growth sector within the
marijuana industry.
“As individual states debate the efficacy of current legislative
statutes or contemplate initial legalization referendums, lab testing
requirements of cannabis products has become an increasing subject of concern
and attention. Although the current governing statutes regarding
legalized marijuana uses vary in great degrees from state to state, one common
theme that has emerged is the increased awareness on the part of legislators
and health officials, as well as cultivators and laboratories, of the critical
importance of product testing and quality assurance.”
Required cannabis testing
is relatively new. In fact, Colorado had no protocols in place at the start;
the program was only began a year ago after a series of overdoses on edibles
made the news. Similarly, Washington
State did not begin compulsory testing for potency, contaminants, moisture and
microbiology until 2013 when recreational cannabis became legal, even though
medicinal use had been in effect since 1998.
While
many of the cannabis testing labs are privately owned, DigiPath Inc. (OTCQB:
DIGPD), a publicly traded company based out of Nevada, is a potential
opportunity for investors to participate in this portion of the industry. The company is one of only two labs operating
in the Las Vegas area, and recently inked a one-year agreement with
Euphoria Wellness to test for unsafe levels of
contaminants such as heavy metals, microbes, mycotoxins, pesticides, and
solvents, which can exacerbate patient health issues.
Comprehensive cannabis
potency testing is critical for patient care. Cannabis is believed to contain
over 400 medicinal compounds, most notably cannabinoids and terpenoids, each of
which affects the body differently. One compound, THC, is known to induce cancerous cell death. Another compound, CBD, keeps certain cancers from spreading. Different compounds can reduce tissue inflammation, treat epilepsy, and fight methicillin-resistant Staphylococcus
aureus (MRSA) infections.
It
is no wonder that so many states are now requiring that lab testing be a step
in the seed to sale process. Of the 23 states that permit medical marijuana,
eight currently require testing and five additional states are considering
testing legislation, which is likely to expand over the coming years as more
states pass marijuana laws and state legislators continue to better define what
is considered safe.
In a recent article from Smithsonian.com,
Andy LaFarte of Charas Scientific, who operates one of only eight labs in Colorado,
said “It’s pretty startling just how dirty a lot of this
stuff is,” and “There’s a stereotype, a hippy kind of mentality, that
leads people to assume that growers are using natural cultivation methods and
growing organically…That’s not necessarily the case at all.” Surprisingly, Colorado doesn’t even require
testing for contaminants, just for potency. Washington, on the other hand, tests for microbial agents like E.
coli, salmonella and yeast mold, and officials there rejected about 13
percent of the marijuana products offered for sale in 2014.
A company like DigiPath Inc.
(OTCQB: DIGPD) is well suited to take advantage of this growing industry with
their existing lab, trusted scientific team, and experienced management
professionals.
To learn more about DigiPath Inc.
please visit their website at http://www.digipath.com.
Or
visit CannabisFN’s profile at http://www.cannabisfn.com/mdc/digipath-inc/.
Legal Disclaimer:
Except
for the historical information presented herein, matters discussed in this
article contain forward-looking statements that are subject to certain risks
and uncertainties that could cause actual results to differ materially from any
future results, performance or achievements expressed or implied by such
statements. Important factors that could cause these differences include, but
are not limited to, the demand for the company’s services and the company’s
ability to execute its business plan. Emerging Growth LLC dba TDM Financial,
which owns CannabisFN, is not registered with any financial or securities
regulatory authority, and does not provide nor claim to provide investment
advice or recommendations to readers of this release. Emerging Growth LLC dba
TDM Financial, which owns CannabisFN, may from time to time have a position in
the securities mentioned herein and may increase or decrease such positions
without notice. For making specific investment decisions, readers should seek their
own advice. Emerging Growth LLC dba TDM Financial, which owns CannabisFN, has
been compensated for its services in the form of cash and equity securities by
DigiPath. For full disclosure please visit: http://www.cannabisfn.com/legal-disclaimer/.
SOURCE: Cannabis Financial Network
ReleaseID: 430015
