The past five days has seen the share price of Cannabics Pharmaceutical Inc (OTCMKTS:CNBX) experience a bull run. The run has seen the company’s share price rise to $1.43, a significant increase from $1.05 which the company was trading at about three days ago, a 36% rise in their share price.
The above stated price trend can be seen below:
The high valuation has been attributed to a number of things, key being their most recent release: their improved third quarter financials. Furthermore, the company has made a lot of strides in the medical cannabis field with some of their announcements tying to breakthroughs that they have made during the past month.
As such, this piece will go deeper into their most recent releases and evaluate their value proposition.
An Overview of CNBX
Cannabics Pharmaceuticals Inc was incorporated in 2004 and is situated in Bethesda, Maryland.
They are specialized in the development of Personalized Anti-Cancer and Palliative treatments with their research and development wing based in Israel. Here, they carry out both clinical and scientific research in the above stated area. Their incline to cannabis has been a great factor in ensuring the drugs they develop are tailored towards cancer patients. Moreover, the drugs are natural which serves as a plus for the company.
The company utilizes advanced screening systems and personalized bioinformatics tools in a bid to ensure that the highest quality of drugs are brought to the market.
Background to the Research
Cancer has been a nightmare in the medical community. The disease has been characterized as one of the chronic diseases in the world after being realized to have prolonged adverse effects on the patient.
As such, a lot of research has been done in this field with significant breakthroughs being made. The emergence of opioids to ease the pain of cancer patients has been a major plus for them, however, the negative side-effects of these drugs has also had its implications on these patients.
It is upon this backdrop that the emergence of cannabis and its products gained its relevance.
Cannabis has been seen to have the same effects on the patients as opioids which having less of the side-effects. The drug has been researched and tested on a number of patients and the results obtained have told a story of success for the drug and the patients themselves. Therefore, with each new day, more and more companies are taking time to venture into the research space with the aim of finding a specific way in which cannabis can alleviate the pain associated with specific ailments.
Cannabics Pharmaceuticals have not been left back as their team has been at the forefront researching and developing some novel drugs within the cancer field. To top it up, they have made a significant breakthrough this recent past as shown in the next section.
As earlier stated, CNBX has its research and development wing situated in Israel. While here, the company focuses their energies on conducting scientific and clinical work, both which are necessary in their bid to bring these drugs to the market. As such, any advancement in any of the two areas of research would be a major plus for the company.
During our last review of the company, their share price had risen courtesy of a lab that the company had just opened meant to aid in their cancer research, an announcement which was followed by another detailing their venture into the personalized screening of cancer cells.
It therefore came as no surprise when their share price rose courtesy of a more recent announcement that the company had been granted a license by the Israeli government to further their research.
The license which has allowed for the characterization of anti-tumour activity of cannabinoids.
Through this license, the company will grow its vision and be able to bring to the market some of the diagnostic tools and services tailored to the client’s needs. Furthermore, they will be working towards providing therapists and their patients with supportive data that will enhance the treatment of their patients.
All the above will be done through the enhancement of synergies between HTS (High Throughput Screening), CTCs (Circulating Tumour Cells), Drug Efficacy, and Genomic Data.
The company expects that they will not only benefit through better financials but also benefit the industry in general through the enhancement of these services.
They recorded higher revenues this year with the numbers standing at $2,870 from $1,571. These numbers were, however, offset by the jump in their research and development expenses as well as their selling, general and administrative expenses which stood at $110,108 and 978,364 respectively. Eventually, they recorded a loss of $1.1 million.
Despite this loss, the market remains positive given that they have invested a significant amount in R&D which alludes to their futuristic outlook. Furthermore, their marketing costs have also gone up significantly. Therefore, going forward, we expect the company to continue in their upward trajectory as the rewards from the latter will benefit them significantly upon payoff.
CNBX is on the verge of significant payoffs from their current investments. We remain hopeful that these payoffs will take shape quite soon and remain bullish about the stock price.
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Disclosure: We have no position in CNBX and have not been compensated for this article.