INMED PHARMACEUTIC COM NPV (OTCMKTS:IMLFF) has started to catch a new leg of momentum on the upside in recent days, so we thought it would be a good time to take a closer look at what seems to be separating this company from its peers. Some interesting methodological concepts are beginning to emerge.
InMed has developed a robust, high-yield biosynthesis process for the manufacture of naturally-occurring cannabinoids. This process combines the safety of the natural drug structures with the convenience, control and quality of a laboratory-based manufacturing process. The benefits of biosynthesis are striking, as we will discuss below. We think this is a big competitive advantage in a niche that is experiencing potential runaway growth.
INMED PHARMACEUTIC COM NPV (OTCMKTS:IMLFF), as you may recall, is a pre-clinical stage biopharmaceutical company that engages in the research and development of novel and cannabinoid-based therapies in Canada. The company’s products under pre-clinical development stage include INM-750 for the treatment of epidermolysis bullosa; and INM-085 for the treatment of glaucoma. It is also developing various drugs for diseases, such as ocular, pain and inflammation, dermatology, central nervous system, metabolic, and respiratory.
The company was formerly known as Cannabis Technologies Inc. and changed its name to InMed Pharmaceuticals Inc. in October 2014. InMed Pharmaceuticals Inc. was incorporated in 1981 and is based in Vancouver, Canada.
As noted above, InMed presents a value argument on the basis of methodological and operational competitive advantages that stem from the company’s process of high-yield biosynthesis for the manufacture of naturally-occurring cannabinoids. This gives them an edge along several lines:
- Significant cost savings versus existing methods. There isn’t much room for argument here. The process of synthesis has huge cost advantages over more commonly used processes for growing, extracting, and purifying cannabinoids. The initial fixed cost investment in equipment has an economy-of-scale advantage to the variable costs of equipment, space, and resources necessary to produce the same compounds through organic development.
- Easier path for Scale-up and Systems Optimization. This is a related point. The economy-of-scale advantage is particularly important when you consider how much extra space and equipment needs to be added to a facility for cultivating a greater scale when you farming than when you are synthesizing just that compound being sought.
- Enhanced Production, Purification and QC vs. current synthetic production methods. Due to the refinement factors available in laboratory conditions, the ability to control and target quality level in production is another clear advantage of a high-yield synthesis methodology. This should be fairly self-evident.
- Access to minor cannabinoids that are currently economically unfeasible to develop into drugs. Finally, this last point should be relatively self-evident as well: certain strains are harder to develop organically at a level that will yield a workable sample for research and iterative investigation. However, many of these issues are bypassed through the more selective and targeted process of synthetic production.
Strong Action: Recent action has seen 19% piled on for shareholders of IMLFF over the past week. Coming off a seeming bull flag pattern with support upheld at the key 200-day simple moving average, this may be a Canadian cannabis play to keep on the radar. Clearly, we are not alone in this thought. Average transaction volume on a per session basis is up just over 100% in the stock over the past month.
The pattern emerging here should not be overlooked. Technicians would call this an “Elliott Wave 3” getting started.
When a new trend begins to take shape, the first move off the lows is like a signal to other investors. Only the long-time, die-hard investors generally benefit from this initial thrust. But others take notice and begin to pay closer attention. In time, the market corrects and consolidates in a healthy manner after that first blush higher. That is when the strongest leg of the new trend often gets underway.
That may be where IMLFF is now in the evolution of its emerging trend. As more and more market participants start to take notice of this stock, and it begins to benefit from coming excitement about the boom in Canadian cannabis-related products and services, the competitive advantages they hold may indeed fuel a major advance.
We will continue to track the name as events transpire. Other notable stocks in the MMJ sector to keep an eyes are Cara Therapeutics Inc(NASDAQ:CARA), Pharmacyte Biotech Inc(OTCMKTS:PMCB), Greengro Technologies Inc(OTCMKTS:GRNH), Weed Inc(OTCMKTS:BUDZ), Insys Therapeutics Inc(NASDAQ:INSY), mCig Inc(OTCMKTS:MCIG), Mentor Capital Inc(OTCMKTS:MNTR), NOVUS ACQ & DEV CO COM USD0.001(OTCMKTS:NDEV)