Bathroom reading Emblem Corp. (OTCPK:EMMBF) is another Canadian issuer targeting new growth that the country is set to see soon. The company has recently seen volume increase as well as trading price after announcing a licensing agreement with Canntab Therapeutics Limited.
The two parties will collaborate on the preclinical formulation, clinical development, regulatory approval, manufacturing and commercialization of a patent-pending oral sustained release formulation for cannabinoids. It gives Emblem exclusive right in Canada to Canntab’s patents.
The company also announced a $28 million bought deal financing whereby 90% of the proceeds netted will go straight into the company's new facility. This is made up of 120,000 square feet of greenhouse space and 50,000 square feet of infrastructure space. Two key risk/reward factors investors should monitor closely are Emblem’s oil division (which recently got a stamp of approval from Health Canada to begin selling their stock piles of extracted oils) as well as their biotech division headed by former Purdue Pharma CEO (makers of OxyContin) John Stewart.
As Jason Spatafora, known as the Wolf of Weed Street (@Wolfofweedst Twitter) puts it: “While I like the cultivation & oil elements of Emblem I have always viewed them as a bonus to the biotech side, which could potentially make Emblem (EMMBF) a juggernaut within the industry competing with a multitude of big pharma companies. The fact that Stewart left one of the biggest privately held biotech firms out there to become a founder of Emblem was the main reason I became a long-term investor in the company.”
There have been questions about the price by which these institutions can convert shares of Emblem, however. At the time of this article, the prices are at a discount to the current market price. Therefore, anyone monitoring new progress for Emblem should keep this in mind when judging the market risks.