CPH Launches First Animal Product in Partnership with Global Animal Health Giant
PUBLISHED: 14-11-2017 09:00 a.m.
10 minute read
Hey! Looks like you have stumbled on an old article that is archived from our old business model.
In 2019 the original founding team returned to run Next Investors, we launched a managed investment fund where we only write about stocks we carefully research and are invested in for the long term - see our current investment portfolio here.
The below article was written under our previous business model before we became a managed fund but we have kept it kept online for your reference - read more about the Next Investors evolution to a managed investment fund.
Our new mission is to build a high performing ASX micro cap investment portfolio and share our research, analysis and investment strategy with our readers. - click here to read how our current business model works.
Creso Pharma (ASX:CPH) has hit a major milestone with the launch of its first animal health product in Switzerland and Lichtenstein.
This Swiss approved hemp product is a natural complementary feed for companion animals containing a standardized amount of hemp extract with cannabidiol (CBD), the non-psychoactive substance of the hemp plant. The product supports companion animals’ immune system, its natural defences and contributes to balanced behaviour.
CPH launched its anibidiol® product in Switzerland and Lichtenstein in conjunction with Virbac, a global pharmaceutical animal health company with presence in over 100 countries.
Virbac (EPA: VIRP) with a turnover of €872 million (A$1.33 billion) in 2016, and capped at circa €1 billion (A$1.53 billion), is the 7 th largest pharmaceutical veterinary company worldwide – this is clearly a strong partner for CPH as it follows through on its animal health strategy in Europe and beyond.
Importantly, anibidiol® is now available to Swiss veterinarians through CPH and Virbac’s partnership.
When you consider the worldwide animal health market is estimated to be worth US$30 billion (A$39.4 billion) and is expected to continue to grow at a rapid rate, entry into this market at this time with a regulated high quality product is highly significant.
The move is CPH’s first entry into the European market, with many more products expected to follow.
However it should be noted that CPH remains an early stage company and investors should seek professional financial advice if considering this stock for their portfolio.
The Virbac announcement comes hot on the heels of the formation of a strategic partnership with TSX-listed LGC Capital (TSX-V.LG).
This alliance is intended to create a vertically-integrated cannabis company with a global footprint spanning cultivation, IP generation and commercially-viable innovative products.
The companies will work together to develop innovative pharmaceutical solutions addressing the growing demand for cannabis and hemp-derived therapeutics, cosmetics, nutraceuticals and lifestyle products.
CPH continues to develop cannabis and hemp therapeutic products, manufactured to the highest pharmaceutical GMP standard and delivered to the highest quality levels across the supply chain.
Now as it releases its first animal health products into Europe, it looks as though CPH has the backing and resources to continue to fast track its development.
Updating you on:
Creso Pharma (ASX:CPH) has continued to make solid ground since we last caught up with the company. In July this year the focus of the article CPH to Acquire Canadian Cannabis Grower and Strengthen Position in Multi-Billion Dollar Market , was on the acquisition of Canadian-based Mernova Medicinal Inc., an acquisition that would position CPH as a Canadian producer of legal cannabis.
In fact, we have been following CPH’s progress every step of the way since its IPO in October 2016, with the stock now rapidly approaching its previous all-time high. Could this latest product launch with Virbac be the catalyst for the stock to eclipse that?
The past performance of this product is not and should not be taken as an indication of future performance. Caution should be exercised in assessing past performance. This product, like all other financial products, is subject to market forces and unpredictable events that may adversely affect future performance.
With the Canadian government this week announcing a proposed new tax regime for recreational cannabis, CPH is well positioned to take advantage of this highly positive development given its strong Canadian presence on the back of the Mernova acquisition and its partnership with LG Capital.
The Trudeau government has proposed a tax of C$1 per gram (A$1.03) of legalized recreational cannabis, with the tax not likely to exceed C$1 per gram or 10% of the producer’s price, whichever is higher.
For the likes of CPH, the low-level tax number is welcome and the company expect it will quash the black market for recreational marijuana and lure customers into legitimate purchase of legal products.
Events in Canada are setting the regulatory scene across the globe, however CPH has much more than its Canadian operations to focus on.
CPH launches first product
Whilst CPH continues to work diligently in Canada following the acquisition of a 20,000 square foot medicinal cannabis growing facility in Nova Scotia, it is its two latest announcements that have created significant recent momentum and will be the primary focus of this article.
This week, CPH launched its first Swiss approved hemp product with CBD as a complementary feed for companion animals.
The product, known as anibidiol® is the first Swiss Agroscope (the Swiss Confederation’s centre of excellence for agricultural research) conformed complementary feed. This refers specifically to feed for companion animals that contains natural hemp extract with CBD and is THC-free.
anibidiol® promotes the well-being of the animal by supporting its immunity and natural defence system, whilst also supporting a balanced behaviour of the pet.
anibidiol® contains natural full plant hemp extract as well as hemp seed oil. This proprietary combination of CBD, the fatty acids Omega 3, Omega 6 and Omega 9, terpenes, flavonoids, and other active herbal ingredients have a complex interaction which enhances their overall health-promoting effect.
The anibidiol® product range directly addresses the need for natural, non-pharmaceutical therapeutic approaches which are well tolerated by animals.
The CBD contained in anibidiol® (www.anibidiol.com) does not cause GI and dependency side effects and has a very good safety and tolerability profile.
Here’s a look at CPH’s first two products.
The individually-packed portions contain a granulate formulation, which is mixed once a day with the pet’s food.
anibidiol® is marketed in Switzerland exclusively by Virbac and only through veterinary practices. It is produced in Switzerland by Creso’s partner Swiss-based food and pharma development company, Domaco, Dr. med Aufdermaur AG (Domaco).
CPH’s relationship with Virbac is crucial to its European push. Virbac has presence in over 100 countries and more than 4,800 employees and sales subsidiaries in 31 countries. Virbac operates through presence in North America (17%), Europe (39%), Latin America (16%), Far East (15%), and Rest of the World (13%).
That’s a significant market reach, but the company’s clout doesn’t end with its size.
Its wide range of vaccines and medicines are used in the prevention and treatment of the main pathologies for companion and food-producing animals.
CPH has picked the right partner for its first launch in Switzerland and with the help of Virbac, it fully intends to promote, market and launch many more in what could be a short amount of time.
The recession‐resistant worldwide animal health market is estimated to be US$30 billion (A$39.4 billion) and is projected to continue to show rapid growth.
Furthermore, 41 per cent of pet owners have considered or tried various alternative therapies including nutritional supplements (29%) and herbal remedies (7%).
Yet, what the extent of CPH’s penetration into these markets will be remains to be seen, so investors should take a cautious approach to their investment decision based on all publically available information.
The numbers speak for themselves and for CPH this is just the start of something that could produce long-term revenues across the European spectrum and beyond.
Here’s to another strategic alliance
Virbac is a significant partner, yet CPH continue to form alliances with companies that can help it meet its objective.
In anticipation of the launch of its first products into the Swiss market, CPH is looking to aggressively expand its market reach.
This is an approach that is not confined to Europe only as evidenced by the formation of a strategic alliance with LGC Capital (TSX-V: LG).
LGC and CPH have joined forces to engage in developing sales and distribution of products across Europe, Canada, Latin America, Africa, Japan and the Asia Pacific.
The companies will produce and market innovative animal and human health solutions. These solutions will be designed to meet the need of the growing demand for cannabis and hemp-derived therapeutics, cosmetics, nutraceuticals and lifestyle products.
The alliance is expected to result in better access to high quality cannabis-based consumer products globally and LGC will be instrumental in the upcoming launch of CPH’s human health cannaQIX®range of products in Q1/Q2 2018.
Put simply, the alliance between CPH and LGC is designed to create an integrated cannabis products’ opportunity with a global footprint that covers everything from seed to final goods.
One thing that may work in CPH’s favour with regard to this partnership is the involvement of renowned Australian-based investor, David Lenigas.
Those with an interest in mining would be familiar with Mr Lenigas, whose past involvement with Artemis Resources (ASX:ARV), led to instant market headlines for its recent gold discovery in WA. Artemis is also strategically backed by Lenigas’ investment company LGC.
Not only does Mr Lenigas have an excellent track record in investment, he could well attract further investment and capital to CPH.
Mr Lenigas said of the alliance, “Creso operates under the highest GMP Swiss standards and all of its products are manufactured, quality controlled and certified in Switzerland. Creso’s team consists of globally-recognised pharma professionals and this alliance between Creso and LGC is a terrific development for both companies.”
Yet CPH remains a speculative stock at this stage and investors should seek professional financial advice if considering this stock for their portfolio.
CPH and LGC have entered into a Letter of Intent intended to lead into a Collaboration Agreement, which is expected to be signed off before December 31.
What do the analysts say?
Even before the announcement that LGC had come on board, interest in CPH was continuing to grow.
A recent independent research report by Morningstar gave a “Fair Value” of 99c – CPH is currently trading at less than 80 cents at the time of writing – which indicates there may be some upside in the stock.
The future performance of this product is not and should not be taken as an indication of current or past performance. Caution should be exercised in assessing future claims of performance, as these are based on assumptions. This product, like all other financial products, is subject to market forces and unpredictable events that may adversely affect future performance.
CPH is currently capped at approximately $63 million, which still leaves plenty of upside should it be able to successfully launch its products into global markets.
The final word
CPH’s team consists of globally-recognised pharma professionals and the alliance between CPH and LGC could be a powerful development in the roll out of further products.
Certainly, as CPH operates under the highest GMP Swiss standards and all of its products are manufactured, quality controlled and certified in Switzerland, the launch of its first products is a significant milestone and could now open the door to the broader European market.