x min read

Cannabics Pharmaceuticals Inc (OTCMKTS:CNBX) Has The Perfect Mix Of Catalysts

Cannabics Pharmaceuticals Inc (OTCMKTS:CNBX) Has The Perfect Mix Of Catalysts
Written by
Chris Sandburg
Published on
February 21, 2017
Copy URL
Share on LinkedIn
Share on Reddit
Share on Twitter/X
Share on Facebook
InsidrFinancial

At the beginning of February, we published this article on Cannabics Pharmaceuticals Inc (OTCMKTS:CNBX), noting the upside momentum seen during the period running up to our coverage, and attempting to ascertain whether this action was a one-off run, or whether it highlighted an opportunity to get in ahead of a longer-term revaluation. Our conclusion fell in line with the latter of these two suggestions, and we closed out on the thesis that while cash was an issue, and as such, dilution could be not far away if the company wants to capitalize on its growth potential, we would almost certainly see some near-term upside momentum.Fast-forward a few weeks, and that momentum has materialized.At the time of our coverage, Cannabics went for a little over $1.30 share. At the most recent print, the company traded for $4.72. That's a 260% gain, or thereabouts, in the space of a few weeks.Again, we've now got to ask the question – what's next?Before we get into that, let's kick off with a brief introduction. The company has developed a cancer diagnostics technology that seeks to identify the type and severity of a patient's cancer using a blood test. In turn, the goal of the testing technology is to test the response of the patients' tumor cells to cannabinoid based treatments (which are currently in development by Cannabics, of course) alongside standard of care chemo regimens.Back at the beginning of February (and this was the spark behind our initial coverage) the company announced the initial commercialization run for the diagnostics product (which as yet remains unnamed in official communication). The run will kick off in March 2017, when 10 first patients' liquid biopsies will be tested using the tech. This update, and the info offered up on the commercialization run, is the latest to hit press, and for us, it's the most important near term driver.Why?Because it's going to provide a steady stream of news flow from the end of the first quarter onwards, and for a company like this, of this size and in this market, news flow is a real key input for perceived valuation.That, and if the technology proves commercially viable (read: if the physicians that make use of it see value in it, and are inclined to request an expansion on the relatively small sample of ten individuals that it currently encompasses), it doesn’t just bode well for the test itself, but it also paves the pathway for the company to employ the test to point towards the viability of its own cannabinoid based therapies as oncology treatments, be that in combination with the standard of care chemo regimens or as standalone therapies.Now, it's important to note that while this run is about to kick off in March, the bringing of any cannabinoid rooted cancer treatments to market is a long way off. The company still has to push said treatments through the FDA approval pathway, and this will years.With that said, there is plenty of room for value appreciation along the way.Not only is this a cannabis stock, and as such, is privy to the gains we are going to see as the recreational and medicinal cannabis markets expand over the coming half decade, but it's also a biotech with an oncology asset and – with any luck – a suite of complimentary oncology therapies to follow the asset into battle.If we were looking for a combination of inputs to output a maximum number of potential catalysts, it's that which we just described.There's risk, of course, and it's rooted in those generally associated with the biotechnology industry. The path to commercial approval, never mind success, is long, costly and notoriously hard to navigate. Cannabics is going to need to raise capital, and it's likely going to do so at the expense of early stage shareholders.Even with this noted, however, we think there's plenty of room for further upside on the current price, and we're watching the stock closely.We will be updating our subscribers as soon as we know more. For the latest updates on CNBX, sign up below!Disclosure: We have no position in CNBX and have not been compensated for this article.

Discover Hidden Gems

Don't miss the next big opportunity. Subscribe for timely alerts on potential market movers.