Stockhouse investors have already been introduced to Xanthic Biopharma Inc. (CSE: XTHC, OTCQB: XTHCF, Forum). In a news feature from April 19, 2018; we alerted investors to this new “cannabis” listing. The Stockhouse Community was also introduced to XTHC’s innovative business model.
In general terms, Xanthic is in the “cannabinoid-infused beverage” market. Xanthic’s initial and continued focus is to partner with LP’s to deliver powdered Tetrahydrocannabinol (THC) and cannabidiol (CBD) within the licensed dispensary network. More specifically, Xanthic is delivering the many health benefits associated with cannabidiol (CBD) to its consumer base.
Xanthic has engineered water-soluble powders to produce cannabinoid-based beverages that boast the following qualities:
- Unsurpassed solubility
- Consistent dosing (of cannabinoids)
- Increased bioavailability
What exactly does this mean, and why is this of great significance?
Cannabinoid molecules are deemed to be not water soluble. Ingesting these cannabinoids (in their natural form) has two drawbacks: the loss of “bioavailability” (much of the cannabinoid content is consumed in digestion), and much slower onset of effects.
The additional consequence of having these cannabinoids fully digested is inconsistency. The same person could drink the same cannabinoid-infused beverage on two different days, but because of variability in the digestive process, different quantities of cannabinoids actually pass into the bloodstream.
Xanthic’s water soluble cannabinoid-infused products overcome these issues with its unique technology for producing these powders. However, there was still one issue faced by Xanthic – and all companies producing cannabis-infused products: legal/regulatory obstacles.
While the normalization of cannabis laws is now an irreversible trend, this is still an ongoing process. In certain jurisdictions (most notably the U.S.), there are still onerous restrictions on the production and distribution of these products. In a conversation with Stockhouse Editorial, CEO Tim Moore explained how (and why) Xanthic has moved “outside the cannabis dispensary network”.
First, cannabinoids exist in many different plants outside the cannabis genus. Most of these other plant species don’t produce cannabidiol in commercially available quantities, but Xanthic has uncovered an exception – and an especially rich source of CBD.
Accessing this (unnamed) plant from a large-scale supplier allows Xanthic to open up new markets for its CBD-infused beverages. On March 21, 2018; the Company announced its first initiative to capitalize on this new market: a “strategic partnership” with Avitas CBD Water, LLC, based in Portland, Oregon.
Re-branded as Xanthic Beverages (and Xanthic CBD Water), this provides a U.S.-based distribution source for Xanthic’s CBD-infused water that is totally outside of all the regulatory issues associated with any product derived from the cannabis plant. But this was just the starting point.
On June 11, 2018; the Company announced its next U.S.-based strategic partnership. Teaming up with ABH Pharma Inc., Xanthic will supply “Xanthic Powered” CBD-infused products. ABH Pharma will then retail these products through its large health supplements distribution chain.
CEO Moore offered these thoughts on this new deal:
Our partnership with ABH represents an important step for Xanthic. It allows us to introduce "Powered by Xanthic" CBD powder technology to a broader consumer audience across the United States. The ABH portfolio of state-of-art dietary supplements is a perfect partner for our technology.
ABH Pharma is licensing XTHC’s IP for producing CBD-infused products – from non-cannabis sources – while Xanthic gets the added advantage of its own branding (“Powered by Xanthic”) with every unit sold.
ABH Pharma is a U.S. industry leader in dietary supplements manufacturing. It develops and retails brand lines as either custom formulations or private label lines. It specializes in partnering with nutraceutical companies to expedite both brand development and sales growth.
For consumers, this provides a new/different option for obtaining the health benefits of CBD, but without the social stigma that still exists (for many people) with anything connected to “cannabis”. For investors, this addition to Xanthic’s business model provides parallel growth potential to its cannabis-infused products. At the same time, this provides the Company and its shareholders with downside protection should there be any temporary backtracking in the normalization of cannabis laws.
Over the immediate term, this means access to a much larger pool of potential U.S. consumers. Over the longer term, this is also an avenue to help the Company open up international markets.
Part of the cannabis “story” is providing access for consumers (after 100 years of Prohibition) to the health benefits of CBD. Part of the Xanthic story is that consumers no longer have to consume cannabis in order to derive these benefits.
xanthicbio.com
FULL DISCLOSURE: Xanthic Biopharma Inc. is a paid client of Stockhouse Publishing.