Strong Potential: Targeting rapidly evolving medical cannabis market

Alpha Deal Group considers Tetra Bio Pharma Inc. (CSE: TBP; OTC: TBPMF), as a unique opportunity to benefit from the

rapidly evolving medical cannabis market, unique focus and numerous upcoming catalysts. TBP is a multi-subsidiary publicly

traded company engaged in the development of Bio Pharmaceuticals and Natural Health Products containing cannabis and other medicinal plant based elements. It is focused on combining the traditional methods of medicinal cannabis use with the supporting scientific validation and safety data required for inclusion into the existing bio pharma industry. The completion of Phase I clinical trials and the preparation for Phase III clinical trials for its lead product, PPP001, marks an important milestone for the Company and its shareholders. We believe that TBP is extremely under-valued at its current market cap of CAD87mn relative to its peers and we see a potential for a significant re-rating of the stock to levels of around two-three times the current price. We believe that TBP represents a compelling investment opportunity within the cannabis industry.

TBP is making tremendous progress in the execution of its strategy to become a leading biopharmaceutical company in developing and commercializing cannabis prescription drugs.

Cannabis preparations exert numerous therapeutic effects. They have antispastic, analgesic, antiemetic, neuroprotective, and antiinflammatory actions, and are effective against certain psychiatric diseases. Despite such potential, physicians cannot ethically prescribe or recommend a powerful pharmaceutical whose effects are not at least reasonably well-known. If there were a condition with a lot of anecdotal data and no other effective treatment, and the risks of the condition were such that they outweighed the health risks and dependence potential of marijuana, physicians would have something to work with. But for now, people who want to take cannabis cannot count on a doctor to approve it for them.

According to the Canadian and the US drug regulatory agencies, there is no evidence to support the safety and efficacy of marijuana for use in the treatment of pain or any other indication. TBP product development plan would provide the data necessary for drug regulatory agencies to grant marketing approval and physicians to prescribe or recommend its cannabis based products. In addition, as medical cannabis becomes legalized across the globe the medical and scientific community would still require pharmaceutical consumer drug products developed with proper research, data and protocol. Insurance companies will only be able to cover the cost of products with Drug Identification Numbers. TBP plans to take the natural aspects of medical cannabis and applies the science of pharma to develop products that patients want, doctors want

to prescribe and insurance companies will cover.

We believe that physicians would rather prescribe an approved FDA product vs. unapproved medical marijuana. Medical marijuana can have batch-to-batch inconsistency, leading to an inability to predictably dose the drug for a desired benefit. In addition, the supply of a specific strain can be locally driven. As a contrast, the Company’s drug will be consistently produced and can be predictably dosed for a desired effect as it will be an FDA regulated drug product.

TBP has a strong pipeline of cannabis sativa based prescription drugs. The Company’s key product is PPP001 which is a medical marijuana product that the Company is developing as a prescription controlled drug for inhalation using a fully assembled titanium pipe. In addition to PPP001, the Company is pursuing a number of other clinical programs designed to leverage the botanical rather than a synthetic. Its PPP002 program is a Phase III botanical drug that is targeting insomnia in chronic pain patients, while its PPP003 is a combination oral product designed to treat chronic pain, PTSD, and neurological conditions.

The Company also has a strong pipeline of natural health products that includes AGT001, a topical product for pain management; AGT002 product line-oral for cardiovascular disease prevention, athletic performance, and well-being; AGT003 product line for skin care; AGT004 for women-quality of life.

Developing prescription botanical based pharmaceuticals requires a high quality GMP system and well-established product specifications to ensure consistent efficacy and ultimately protect the safety of patients.

TBP has signed a supply agreement with Access to Cannabis for Medical Purpose Regulations (ACMPR) licensed producer Aphria Inc. (TSXVENTURE: APH) (OTCQB: APHQF) for the supply of dried medical cannabis as an Active Pharmaceutical Ingredient (API) for PPP's inhalation cannabis product PPP001. We believe that Aphria’s high quality GMP medical cannabis production facility and impressive quality assurance team will meet the expectations of both the Canadian and USA prescription drug authorities.

PPP001 is the first smokeable cannabis drug product being developed for the treatment of late-stage cancer patients with pain. Delivery via combustion has been shown to provide greater efficacy than oral ingestion for certain pain sufferers. PPP001 is aimed at the market for treating cancer patients, specifically Stage 3 and Stage 4 cancer patients.

With many of these patients having been diagnosed as terminal, concerns about potential hazards of smoking cannabis are minimal. In June 2017, TBP reported positive results from a Phase 1 study of PPP001, with safety data meeting the Company’s expectations. In addition, pharmacokinetic data demonstrated that inhalation of PPP001 achieved the targeted plasma levels of tetrahydrocannabinol (THC) that could potentially achieve pain relief in cancer patients. The Phase 1 trial also provided key information required to design a Phase 3 clinical trial for pain relief in cancer patients, which is expected to begin around the end of 2017. The clinical program will also address the potential of PPP001 to reduce the reliance on opioids for management of severe pain. Since cannabis is a known chemical entity, TBP is able to bypass Phase 2 studies and move directly into a pivotal trial. The Company hopes to sign a commercial partnership for PPP001 by the end of 2018

and receive a Notice of Compliance from Health Canada by the end of 2019 to launch PPP001. TBP hopes to begin selling PPP001 by the end of the summer.

According to Global Pain Management, approximately 50% of cancer patients suffer from pain and more than 600,000 of these patients suffer from moderate-to-severe pain. In the US, there are over 4 million cancer patients and this pain market is valued at over $5bn. Securing the evidence for smokable marijuana (PPP001) Marijuana-infused edibles have become a popular way to consume Tetrahydrocannabinol (THC) and Cannabidiol (CBD) without smoking the dried plant, but there are some key differences in the way that the drug is metabolized that could impact its medicinal value. The liver metabolizes edible THC, producing an active metabolite that is very effective at crossing the blood-brain barrier where it eventually produces a ‘high’ feeling. By contrast, when a consumer inhales marijuana, the majority of cannabinoids enter the body through the lungs where they are passed along directly into the consumer’s blood stream. The effect is almost instantaneous. Another benefit to inhalation is the ability to easily titrate one’s dose, making overconsumption less likely. Inhaled cannabis also leads to higher concentrations of THC in the blood, which tends to be roughly 50-60% compared to just 10-20% for edibles. In a 2007 study in the Journal of Chemistry and Biodiversity, subjects who consumed cannabis via inhalation reported feeling the effects of the medication within minutes, with peak effects around the hour mark and total duration of effects around two hours. These dynamics are important to consider from a medical perspective. The delay between the ingestion of edible THC and the onset of the ‘high’ effects could lead to overconsumption among patients. Individual differences in metabolism also make it difficult to come up with specific dosing and instructions applicable to everyone. By comparison, the instantaneous effects of inhaled cannabis enables patients to adjust their dosing as needed. Several studies have also shown that cannabis smokers don’t have higher rates of lung cancer – a key concern among doctors prescribing these treatments. For example, one study looked at 2,159 lung cancer cases and 2,985 controls from six

case-control studies across the US, Canada, the UK, and New Zealand.

The results provided little evidence for an increased risk of lung cancer among habitual or long-term cannabis smokers.

TBP is securing the evidence to prove that smokable medical marijuana has a place in healthcare by conducting rigorous clinical studies. Till date, nobody has proven to regulators that smokable cannabis has any medical benefits, therefore, it remains a Schedule I Controlled Substance in the United States and illegal in other countries as well. The Company believes that its smokable medical marijuana would provide patients with a better natural alternative to synthesized chemical concoctions being developed by other companies in the space. With so many patients already using smokable medical marijuana, the Company also has access to a wide patient population where it can draw data to support its clinical studies and ultimately secure regulatory approvals.

The Company’s Agro Tek (AGTK) subsidiary is focused on acquiring, manufacturing and distributing natural health products (NHP) containing cannabis and other non-psychoactive cannabinoids. Its NHP pipeline includes product for pain management, cardiovascular disease prevention, athletic performance, and well-being, among others. TBP is targeting both Canada and the US supplement (OTC) markets. AGTK intends to acquire formulations and established brands with the goal of integrating its cannabis R&D into the less regulated NHP market.

CBD or THC containing dietary supplements are currently not allowed on the US market. The Company has been awarded a National Sciences and Engineering Research Council of Canada (NSERC) Engage Grant partnership with McGill University that will allow AGTK to achieve its commercial strategy to launch cannabis-derived supplements that comply with the existing Canadian and the US federal regulations regarding cannabis and cannabinoid content. The goal of the McGill University partnership is the development of extracts of the plant cannabis sativa, including THC and CBD-free for the development of dietary supplements. In October 2016 AGTK acquired multiple intellectual property assets related to the initiation of manufacturing and distribution of products for natural health care including products containing extracts or oils derived from cannabis sativa. TBP is hoping to launch a line of natural health cannabis products by the end of this year to begin generating revenue. The Company may also seek to acquire additional product lines as well as license products for distribution in North America.

Significant Market Opportunity: Along with medicinal and recreational cannabis, natural health products containing non-psychoactive cannabinoids such as cannibidiol (CBD) are widely gaining popularity particularly in the US where more favorable CBD regulations exist. According to Hemp Industries Association (HIA), the total estimated size of the 2015 hemp market including CBD products, foods, personal care products, and others stood at $573mn, an estimated 10% increase over 2014. Hemp-based personal care products made up 26% of total sales, or $147mn, followed by industrial applications, consumer textiles, and others.

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