Could DehydraTECH(TM) CBD be Worth $3 Billion a Year to Lexaria?

New York, New York--(Newsfile Corp. - March 9, 2021) - PCG Digital -- Hypertension, or high blood pressure as it's commonly known, affects over three million Americans every year and is a primary or contributing cause of death for 25% of them. On a global scale, hypertension kills roughly 7.6 million people per year.

Lexaria Bioscience, a Canadian biotech firm specializing in cannabinoid research, is hoping to change those numbers. DehydraTECH CBD, the company's revolutionary oral deliverable for hypertension sufferers, is in human clinical trials right now and results are promising.

"Our 2018 human clinical trial showed that DehydraTECH CBD lowers blood pressure by about 5% after just a single 90 milligram dose," said Lexaria CEO Chris Bunka. "Generic CBD doesn't do that. Our objective in our new 2021 clinical studies is to evidence a 10% or greater drop in blood pressure to be competitive with industry demands."

The 2018 European study also showed evidence of DehydraTECH CBD facilitating higher volumes of blood flow to the brain and faster delivery of CBD into the bloodstream. Ensuing studies will determine what that means for hypertension sufferers.

New Human Clinical Studies are Underway in 2021

Lexaria currently has three human clinical studies about to commence, using 300 to 450 milligram doses. In comparison, GW Pharmaceuticals is administering up to 1200 milligrams of Epidiolex, an FDA-approved CBD-based anti-seizure medicine for children, and even at those higher doses side effects have been minimal.

"In the hypertension industry, drugs that provide a 10 to 20 percent reduction in blood pressure are generally successful," Bunka adds. "We are confident we can get to that level and expect our studies to provide evidence supporting that over the next six to nine months."

DehydraTECH CBD utilizes a patented dehydration process that changes how the body senses and absorbs drugs orally. In earlier clinical trials, DehydraTECH CBD has been proven to deliver over 300% more CBD than generic CBD in less than 30 minutes.

Positive results in the human clinical studies would provide more evidence for consideration of DehydraTECH CBD as a regulated form of CBD, a status in the cannabinoid sector that only Epidiolex has earned to date. Bunka and his team are confident they will get there.

Hypertension Relief is a $30 Billion Market

There are obvious health care benefits to developing an effective cannabis-based hypertension treatment. Financially, a success in this area would be huge for Lexaria. In 2019, the market for antihypertensive drugs was worth $26.1 billion.

By comparison, the pediatric anti-seizure market that Epidiolex serves is worth ~$1 billion per year. GW Pharmaceuticals was just purchased for $7.2 billion by Jazz Pharmaceuticals, a major Big Pharma player. In the United States alone, there are three antihypertension drugs that have recorded between $1 and $3 billion in annual sales:

• Diovan, manufactured by Novartis, had $60.8 billion in lifetime sales between 1997 and 2012. It has since been replaced by a generic version called Valsartan.

• Amlodipine, a calcium channel blocker known more commonly as Norvasc, has been on the market since 2005. By September 2019, it had been prescribed 75,201,622 times.

• Lisinopril, a medicine used to treat high blood pressure and heart failure, was prescribed over 89 million times within one year of its introduction in July 2011.

None of these drugs are cannabis-based and each has unwanted side effects. Assuming Lexaria reaches that level, the company could be looking at a drug with over $1 billion in annual revenue after FDA approval. What might Lexaria be worth at that point?

With existing patents granted in the EU and Australia already secured for the treatment of heart disease using cannabinoids, Lexaria is confident it will receive regulator approvals in multiple geographic markets in due time. Investors seem to agree. As of this morning, Lexaria (LEXX) was up over 25% since first listing on Nasdaq in January.

Lexaria is Open to Partnership Opportunities

CEO Bunka sees the opportunity and is open to partnering with a larger company. "Lexaria would be open to partner with Big Pharma to deliver this potentially life-saving treatment," he said. "Our business model includes out-licensing our technology for appropriate royalty streams."

Companies with a royalty revenue stream have been known to earn a valuation of up to 30 times annual revenue. If you do the math on the partnership possibilities, Lexaria could be looking at valuations as high as GW Pharmaceuticals recently reached. That's not unrealistic in this sector.

With Lexaria, it's possible to happen soon as they are not reliant on government funding to conduct clinical studies: All existing trials are 100% funded from internal company resources. Therefore, the ramp-up to commercialization can be faster, and these potential revenues, can have a significant impact on its current market cap of only $35 million.

"The Jazz acquisition of GW shows that Big Pharma is finally taking cannabinoid research and CBD-based medical treatments seriously," Chris Bunka said. "One of the big benefits of CBD is its modest side effect profile - pharma simply HAS to research this thoroughly in the interests of public health."

This story will be worth keeping an eye on as it unfolds. Results from Q1 studies of DehydraTECH CBD will be made available starting around May, with human clinical study results to follow soon thereafter. If all goes well, the path to FDA approval could become clearer. Relief for hypertension sufferers can't come soon enough.

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