OWC Pharmaceutical Research Corp (OTCMKTS:OWCP) Is Off To A Strong 2017 Start

OWC Pharmaceutical Research Corp (OTCMKTS:OWCP) has had a great start to 2017. The company closed out last year trading for around $0.16 a share. Earlier this week, it topped out at just shy of one dollar a share, and currently sits around $0.7 – a more than 350% gain year to date, even after the recent correction.Cannabis stocks pretty much ran up as an industry throughout November 2016, but many took a subsequent hit as market hype subsided and traders took profits off the table. Most of these remain down, and while they will likely pick up strength as the industry matures throughout 2017, this strength is probably going to be much more gradual than the initial November buzz suggested.A small number, however, have continued to gain strength on the back of their initial November run. These are the companies that not only have ties to the cannabis space, but have legitimate and promising business models to boot.OWC is one such company, and therein lies the driver for its recent strength.The company didn’t serve up too much in the way of operational clarity over the past eight weeks, but management just fixed this with a letter to shareholders, published Tuesday 23rd of January. The letter addressed pretty much the scope of the company's operations, as well as offered some insight into the strength of its management team. We are not going to go into the latter into much detail here – readers can find out who's in charge of the company at this link – but suffice to say, it's a very strong team. What we are going to look at, is the underlying business, and what to keep an eye on as we head into the early to mid-2017.For those not familiar with the company, OWC is a pharmaceutical cannabis company based in Israel. It is working on the development and commercialization of a number of different cannabis-based assets, targeting a range of pharmaceutical indications, in both Israel and internationally.The primary asset, and the one that we think will drive the most near-term value, is a psoriasis cream. It is a topical compound designed to ensure the effective delivery and dosage of a proprietary cannabinoid-based topical cream, and it is basically in its final round of efficacy testing before it hits the shelves. The company expects to have it commercially available in the US and Israel by the end of the first quarter (with a sales push starting second quarter) and has brought in a couple of $300,000 cash tranches by way of strategic partnerships based on the product. One is a non-dilutive loan, and underpins a US commercialization strategy, and the other is a $300,000 equity investment that underpins a European commercialization strategy.Beyond psoriasis, OWC is also pushing a multiple myeloma candidate through early stage trials, with the goal of getting the asset in question into clinical studies before the end of this year. Multiple myeloma is a large unmet need both domestically in the US and abroad, and the news stream alone associated with getting a drug into the clinical phase that targets this condition is worth considerable upside to a company of OWC's size.Finally, OWC is also working on a sublingual tablet designed to offer physicians a measurable and quantifiable method of dosing patients with cannabis related treatments. The current primary dosing method is smoking, but most agree that this is very inefficient. It's also tough to track from a physician perspective. OWC's asset aims to resolve this problem, and the company is looking to carry it into clinical trials for a range of conditions – posttraumatic stress disorder, fibromyalgia and the above discussed multiple myeloma to name just three – over the coming 12 months.At September 30, cash came in at around $90,000, but the $300,000 loan bolsters this, as does the $300,000 equity investment. Further, the sales push of the psoriasis cream should serve up some topline inflation near term, and will improve cash flow. As such, dilution is probably going to be a small near-term issue, but shouldn't have too much of an impact longer-term based on the growth potential of just the psoriasis product, not taking into account the wider pharmaceutical applications of this company's assets.We will be updating our subscribers as soon as we know more. For the latest updates on OWCP, sign up below!Disclosure: We have no position in OWCP and have not been compensated for this article.