Satori in the news
posted on
Apr 03, 2014 01:24PM
Satori Resources (V.BUD) makes not-so-quiet mine-based medical marijuana shift.
If you use medical marijuana a lot is changing today.
And with the changes are coming a whole new regulated industry and the potential for some to make a lot of money. This shouldn’t surprise you, but what may is who is jumping into the industry -- junior mining companies.
“We have all been in the ditch and I wasn’t lonely there,” says Jennifer Boyle, a former securities lawyer and now president and CEO of Satori Resources, to Kevin Newman Live. She says over the past 18 months everyone has lost confidence in the mining industry and it’s nearly impossible to raise capital. “Something has to change. So when I sniff something new and sexy I jump on it.”
The last time something like this happened was in the tech industry in 1998 and 1999. She says old miners and seasoned business executives were jumping into bed with 21-year-olds. She has heard the comparison to investing in Seagram’s before prohibition ended, but she prefers to compare it to the tech industry, calling this "dot pot" instead of mining dot com. Satori also lucked into getting the ticker symbol of BUD on the venture exchange.
“People are blindly going into the market…it’s a feeding frenzy,” says David Stadnyk, whose management team recently took over Supreme Resources and renamed it Supreme Pharmaceuticals, to Kevin Newman Live. “It’s a sector that only has growth in front of it.”
Stadnyk says this amazing growth is happening now, but what he is really excited about is when the recreational side opens up and when they are able to export it. “There are so many investors sitting on the sidelines and now all of a sudden something is hot.”
Satori and Supreme Pharmaceuticals are two of about a dozen companies that have jumped into this space in the past couple months leading to massive increases in stock prices. They are both penny stocks. Satori’s jumped from about 3.5 cents at the beginning of March to 16 cents and Supreme Pharmaceuticals’ stock has hit a two-year high of eight-cents per share. The reason for the excitement is the industry is projected to be worth $1.3 billion by 2024.
Supreme Pharmaceuticals is in the process of purchasing a company in B.C. that is working on getting a licence to sell medical marijuana and Satori announced they have hired an advisor for the agri-mining and agri-pharmaceutical sectors. Boyle laughs when I call him a weed expert. Scott Walters isn’t an expert is smoking or rolling it. He’s a Bay Street veteran with more than 20 years of experience. In 2001, he started a hedge fund.
“I’m not trying to bet on a horse,” he says to BNN. Walters is also consulting for Thelon Capital and Pan American Fertilizer. “I am trying to build a racetrack where everyone else can come and place their bets...We are witnessing the volatile birth of a new industry in Canada and I want to be in front of it.”
Walters says the money in the industry isn’t in the plants – it’s in the software, hardware, water systems and fertilizers.
These companies were waiting to see their stock prices spike even more today as new rules come into effect. Users, who are allowed to grow their own for personal use are supposed to stop doing so and instead will have to purchase it from a licensed provider. There is a temporary injunction so people can continue to grow their own for now, but the federal government plans to appeal the injunction. As a result, the prices didn’t fluctuate much, but Stadnyk is very pleased with how much is company is being traded. The other big change is that now patients will have to get a prescription from a doctor and then send a request to a commercial producer.
Both these changes have users worried. A handful of them protested on Parliament Hill today saying it will cause prices to rise and limit access to the drug.
Nitin Mehra of Canadian Alternative Health agrees with the College of Family Physicians saying, “I would argue they are putting them (doctors) in a difficult position” because the doctors now need to recommend dosage and take on more responsibility. Some users fear this will make doctors less likely to write prescriptions, but Mehra disagrees. Doctors he talks to are just racing to learn because this isn’t something they are taught in medical school. “The onus is now on the patient to inform the doctor.”
He also says prices will likely rise because the government is trying to bring quality and standards to the industry. The government argues it is changing policy because people growing it at home pose hazards including mould, fire, toxic chemicals and security. The facilities the licensed providers have to build aren’t cheap and the user will have to pay the cost in the end.
Users who currently grow it at home or buy it from small producers can buy it for about $1 per gram. When buying from licensed producers, they will most likely be paying about $6-10 per gram.
This has many users pretty upset, but with the number of prescriptions expected to jump 600 per cent in the next 10 years, there are a lot of people who hope to make a lot of money in this green rush.
Read more: http://knlive.ctvnews.ca/small-mining-companies-looking-for-big-profits-in-medical-marijuana-1.1756580#ixzz2xqSUHopk