Aphria Inc. APHA

RE:Expect a Bounce Back for Cannabis Vaping

[RandomCommenter]

Combine that with the fact that Aphria's biggest competitor is black market for vapes, and you got yourself a mid and long term winner here...  The biggest threat is short term shorts and overreaction from regulators.

https://www.marketwatch.com/story/aphria-shares-surge-nearly-20-after-surprise-profit-2019-08-01

Daredevil1964 wrote: https://stockhouse.com/news/newswire/2019/09/30/expect-bounce-back-for-cannabis-vaping

(Vaping products will perform well in regulated markets)

Aside from the usual political turmoil dominating the news, a lot of media attention has been focused on vaping.

September in the US saw a sudden increase in a mysterious lung illness reportedly caused by the consumption of nicotine and THC vape pens. Does this mean that vape pens are on their way out and cannabis businesses and investors should divest? Not at all.

A deeper dive into the news reveals what’s likely going on in the market. It also shows why Canadian cannabis companies and their compliant American counterparts have been in the clear.

The purported culprit is the illicit vaping market, and specifically, bootleg cartridges laden with contaminants. Doctors have found a high level of vitamin E acetate, a type of vitamin E oil that acts as a thickener and is used to dilute vaping cartridges and make them appear more viscous.

That’s likely why the overwhelming majority of cases have either been in states that haven’t legalized cannabis yet or states with large illicit markets like California. And illnesses have occurred in people that have vaped only nicotine, only THC, or a mix.

Attention has turned to tighter product testing and regulation, especially in Oregon, which had two fatal case linked to THC purchased from dispensaries. Meanwhile, countries with strict product regulations like the UK stand by the safety of vaping products as they haven’t seen the illness.

Likewise in Canada, cannabis producers are confident ahead of vape cartridges launching in the market. Due to Health Canada’s strict product regulations, cannabis products get thoroughly tested before approval, and major producers have stated they take care not to use contaminants or dilute their products. Canada has had only one confirmed case that tracks with the vaping illness, from a nicotine-only product.

Should investors be concerned about companies invested in vape pens with “Cannabis 2.0” around the corner? Not by a longshot. For starters, the quick rise of the vaping illness tracks accurately with new contaminants entering the illicit market.
Secondly, the cases are almost entirely isolated to the US, another indicator that a specific supply-chain issue is to blame. Solving the issue has been complicated since researchers haven’t yet been able to accurately pin down the cause, in large part due to restrictions against study in the US.

All-in-all, the dangers of the illicit market are only serving to add more value to the regulated market and companies of Canada. And for the US, the market might be down on vape pen cartridges at this moment, but just as with bootleg gin during prohibition, safe products will win out and once again take their place in the market.