$PKPH Brings CBD-based Therapies to Pets

WHITEFISH, MT / ACCESSWIRE / February 11, 2015 / The medical marijuana industry has grown at a 16.2% CAGR between 2009 and 2014 to reach $2 billion in revenue, according toIBISWorld, driven by widespread legalization and promising new data from clinical trials. Some of the non-psychoactive cannabinoids found within the drug – including cannabidiol (“CBD”) – could prove useful in treating conditions ranging from neurological diseases like Alzheimer’s disease to metabolic diseases like diabetes or obesity.

Over the same timeframe, the U.S. pet industry grew at an 8% CAGR to reach $58.51 billion by 2014, according to the American Pet Products Association, driven by an increasing portion of consumer spending being dedicated to “man’s best friend”. Spending on food and over-the-counter medications were the two largest subsets of the burgeoning industry, generating revenue of $22.62 billion and $13.72 billion, respectively.

In this article, we’ll take a look at Peak Pharmaceuticals Inc. [OTC: PKPH], a leader in the research, development, sales and marketing of safe, hemp-based, medicinal products and supplements that’s well-positioned to take advantage of these trends.

Bringing Relief to Pets

Peak Pharmaceuticals acquired an exclusive worldwide license and rights to the products and technologies developed by Canna-Pet LLC in late-2014 in exchange for royalties. By doing so, the company quickly entered into the pet industry with a CBD-based product line that it plans to aggressively expand over the coming quarters. These products are supported by Doctors of Veterinary Medicine in six states and an MIT-educated entrepreneur.

Nearly half of pet owners (41%) have tried alternative therapies to improve their pets’ health, including nutritional supplements (29%), herbal remedies (7%), and homeopathy (4%). Capturing just a fraction of the $13.72 billion over-the-counter pet medication market with its CBD-based products could generate significant long-term value for shareholders. For instance, just 1% of the market would equate to $137.2 million per year in revenue.

According to Dan Goldfarb, President of Canna-Pet LLC, “Twenty years of animal research mirrors many current human studies indicating that CBD therapies can assist with inflammation, anxiety, compromised immune systems, allergies, digestive issues, nausea, chronic pain, cancers and seizures. Our relationship with [Peak Pharmaceuticals] complements their ongoing human health science R&D efforts while rapidly elevating our core science competency, operational and financial planning, and provides access to the first domestic hemp crops produced in over 60 years.”

Low-Risk, High-Value

Non-psychoactive hemp-based foods have been fully legalized following a February 2004 court decision – HIA v. DEA – where a judge ruled that the DEA could not regulate naturally occurring THC not contained within or derived from a marijuana plant. With hemp-based CBDs excluded from the DEA’s Schedule I Controlled Substances list, anybody is free to sell non-psychoactive hemp-based nutritional supplements or other food-based products.

The science supporting the efficacy of CBD-based therapies has been building over time. As an immunomodulator, CBD2 interrupts the cytokine inflammatory cascade that’s activated by oxidative stress and disease states so local inflammation doesn’t damage tissue. These dynamics are useful for treating a number of diseases and conditions in both humans and animals, with a growing number of clinical studies confirming efficacy.

For example, GW Pharmaceuticals plc (GWPH) is conducting clinical trials evaluating cannabinoids for the treatment of cancer pain, neuropathic pain, arthritis, and bladder dysfunction. With over 60 different cannabinoids being studied, CBD marks just one of many potential targets worthy of future evaluation. Many other companies have also joined the fray over the past couple of years, contributing to a growing body of research.

Looking Ahead

Peak Pharmaceuticals is just scratching the surface of its long-term potential. With agreements in place with a hemp farm and CBD-based pet products partner, the company is uniquely positioned to take advantage of the “low hanging fruit” within the industry. The success of pet companies like Zoetis Inc. (ZTS) or PetSmart Inc. (PETM) demonstrates the industry’s significant size and impressive growth characteristics.

The long-term potential comes into play when looking beyond the pet industry to the human nutritional supplement industry, which is considerably larger by almost any measure. With access to extensive research and development resources, the management team plans on identifying the best way to access the market by leveraging revenue from its pet business to avoid going to the market to raise significant amounts of dilutive capital.

For more information, visit the company’s website at www.peakpharma.com.

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