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Back Cover Story: Changing Landscape

of the Legal Cannabis Industry Cannabis:
Not Just a Delivery System

Continued from back page. In 2018, Plus has recorded strong rev-
Canada, we expect to see strong demand enue numbers and generated more than for THC
for this product. Magical Butter has strate- $4 million in revenue during April. The
gic relationships with leading Canadian company has been laser focused on Contemporary thought and certain govern-
cannabis producers like Canopy Growth growth and has been focused on distribu- mental regulations have led many to believe that
and Aurora Cannabis (ACB.TO) tion, which has been a key driver for the cannabis and THC are synonymous. Not true.
(ACBFF), which will help create traction revenue growth. The plant, Cannabis Sativa, contains over 100
in the Canadian market. Plus Products has been seeing incredi- different phytocannabinoids. THC, tetrahydro-
We consider Magical Butter to be an ble demand for its gummy product and is cannabinol, is the psychoactive component of
acquisition target due to the strong sales focused on increasing production capaci- cannabis, responsible for the “high” or “stoned”
and brand recognition. In 2017, the com- ty. Earlier this year, the company moved sensation experienced by those who partake. The
pany generated more than $6 million rev- into a new facility and brought in state-of- other cannabinoids have a wide range of effects
enue and expects to see strong growth the-art production equipment in order to and comprise most of what is referred to as
going forward. In 2019, Magical Butter accomplish this goal. This is a significant “medical marijuana.” Terpenoids are the other
plans to launch an edible product line and initiative for the edibles company and we major organic components of cannabis. They
we view this as a major growth opportu- are bullish on the growth potential. exert their own pharmacological effect as well as
nity. This is a company to keep an eye on Earlier this year, Plus Products complet- enhancing the effects of the cannabinoids. Hemp
ahead of an IPO in early 2019. ed an oversubscribed non-brokered pri- and marijuana are both types of Cannabis. Each BY MELANIE BONE,
vate placement and raised more than $6 contains a full spectrum of cannabinoids as well M.D.
Plus Products: A Leading million in proceeds. This was a significant as THC and terpenes. The primary difference
California Edibles Opportunity raise and it generated a lot of interest. This between the two is that hemp has 0.3% THC and
The California marijuana market is one is a very good thing to see and provides marijuana has 0.9% THC.
of the most exciting emerging investment the company with easy access to capital. Clinicians often value the medicinal properties of cannabis by looking at
opportunities and we have been closely The recent financing was completed at research done only on THC. THC has been available for over 20 years in the
watching this market. The recreational a valuation of approx. $25 million (pre- form of a pill called Marinol. The pill consists of synthetic THC and is used to
marijuana market opened on January 1st money) and we think the continued exe- control nausea and vomiting, and to stimulate appetite in AIDS patients and
and is the world’s largest market. cution warrants a much higher valuation. those with cancer cachexia. Unfortunately, synthetic THC is absorbed different-
Although the market has been growing When compared to a company like ly by each patient and anecdotally it is less effective than medical marijuana.
quickly, we expect growth to slow after CannaRoyalty, which has a market cap This form of THC is probably less effective because it lacks the other cannabi-
new regulations are put in place. The new that is above $250 million, Plus trades at noids and terpenes found in medical cannabis.
regulations require retailers to only sell 1.7x revenue. This is significant and There is a name for the complex interaction of THC, other cannabinoids, and
marijuana products that have been tested leaves massive room for upside. terpenoids: the “Entourage Effect.” The synergies endogenous to the plant have
by a licensed third party that is registered We think Plus represents one of the evolved over thousands of years to provide a benefit that is far greater than any
with the state. most exciting new opportunities and single compound alone. Research has shown that using the Entourage Effect we
While these regulations will have a neg- cannabis investors need to keep an eye on have the potential to treat a variety of conditions which might not benefit from
ative impact on sales, they are better for this one. The strong and improving fun- pure THC. Multiple Sclerosis, Irritable bowel syndrome, Epilepsy, traumatic
the consumer which is the most impor- damentals, leading management team and brain injury, and Chronic Pain are just a few. Worldwide collaborative research
tant part of this business. Today, we have attractive valuation make this a company will help us identify strains of cannabis and delivery systems to maximize the
issued an update on Plus Products which that cannot be missed. Entourage Effect. This would help clinicians to improve patient access to a safe,
is a California-based edibles manufacturer affordable and effective treatment options.
and distributor. Last month, we highlight- Michael Berger is the Founder/President
ed the edibles company which plans to go of Technical 420 LLC and may be reached Dr. Melanie Bone is a certified medical marijuana provider in the state of Florida.
public later this year on the Canadian at (305) 458-9982 or For more information, visit www.DrMelanieBone.com.
Stock Exchange (CSE). Michael.berger@technical420.com.

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