NEW YORK, Aug. 5, 2021 /PRNewswire/ — At least 18 states in America have legalized recreational marijuana and 37 have legalized different forms of medical marijuana thanks to the growing push for legalization at the state and federal levels. If passed, the Marijuana Opportunity Reinvestment and Expungement (MORE) Act would remove marijuana from the Controlled Substances Act where it is listed as a Schedule I drug. As both state and federal governments move closer to legalizing cannabis, companies within this sector are also laying the groundwork and pursuing initiatives to gather a market share within the cannabis industry. Sixth Wave Innovations Inc. (OTCQB:SIXWF) (CSE:SIXW), Neptune Wellness Solutions (NASDAQ:NEPT) (TSX:NEPT), Canopy Growth Corp (NASDAQ:CGC) (TSX:WEED), Sundial Growers Inc. (NASDAQ:SNDL), and GrowGeneration Corp (NASDAQ:GRWG) are among the companies capitalizing on the growing push for legalization and the increased demand for cannabis products.
Sixth Wave Innovations Inc. (OTCMKTS:SIXWF) (CSE:SIXW) announced the completion of the initial design for manufacturing for its Affinity System, a cannabinoid purification system. The company has therefore given Advanced Extractions Systems Inc. (AESI) approval of the design and commissioned the delivery of the first Affinity System. The company estimates that the system will be ready for its wet testing at AESI in late September. The company also anticipates shipping for Sixth Wave’s Maryland laboratory shortly after the wet testing.
Sixth Wave Innovations is currently on schedule for the Affinity System and hopes to optimize the final product before delivering it to customers. The company is also on schedule to deliver the first 3 Affinity Systems to Green Envy Extracts in the fourth quarter of the year. Once they complete the delivery of the first system, Sixth Wave will operate the system for 60-90 days as per the purchase agreement to produce a high-purity full-spectrum cannabinoid distillate before completing the purchase order for an additional two systems at Green Envy’s facility.
“We are pleased with the pace of design, development, and build effort that AESI is providing. We are achieving our expected milestones on schedule allowing us time to optimise the final product prior to customer delivery,” said Sixth Wave’s CEO John Cowan. “In addition, product design has been heavily influenced by AESi’s past experience with primary extraction equipment which will reduce risk and ensure a smooth production scale up to meet anticipated customer demand.”
The company also expects to take delivery orders from other companies later in the year after thoroughly testing its systems. The company estimates that it will deliver three or more Affinity Systems in each quarter depending on the production capacity. The company has plans to increase its production capacity in 2022/2023.
The success of the Affinity System will give Sixth Wave Innovations an entry into the growing cannabis industry whose legalization appears to be just around the corner. The company also anticipates that the continued state-to-state cannabis legalization will expand its market for the Affinity System.
These Cannabis Stocks are Dominating the Market
Whether the MORE Act is passed or not remains to be seen, but it isn’t preventing cannabis companies from posting gains in current legal markets. Integrated health and wellness company Neptune Wellness Solutions (NASDAQ:NEPT) (TSX:NEPT) recently released its Q4 2021 and FY 2021 financial results, which revealed full year revenue of $46.8 million, a 50% increase year-over-year. Among the highlights for the company in FY 2021 include the agreement with SQDC, the sole legal retailer for recreational cannabis in Quebec, receiving the amended license from Health Canada to sell dried cannabis flower and pre-rolled cannabis in Canada, and the launch of three Mood Ring SKUs (capsules, oil, and flower) in British Columbia.
Canopy Growth Corp (NASDAQ:CGC) (TSX:WEED) launched Tweed Quickies and Ace Valley Pinners, two new offerings in the continued evolution of its pre-roll portfolio that matched consumer preferences. Its two new products are developed to meet the growing preference among consumers for smaller joints that they can consume in one sitting, without the need to share, given the current times. The Tweed Quickies come in 0.35 grams while the Ace Valley Pinner is even smaller at 0.3 grams. The quantities are based on the results from a research Canopy Growth recently commissioned. This new addition in its product portfolio brings customers smaller joints that they can enjoy within a group setting without the need to share their joints.
Sundial Growers Inc. (NASDAQ:SNDL) completed the previously disclosed acquisition of Inner Spirit Holdings Limited by acquiring all the issued and outstanding common shares of Inner Spirit. This transaction sets Sundial as one of Canada’s largest vertically integrated cannabis companies and gives the company a strategic entry into the cannabis retail sector. This acquisition will also strengthen the company’s retail expertise thanks to Spiritleaf’s reputation as an industry leader through its sales, support, customer benefits, and employee training initiatives.
GrowGeneration Corp. (NASDAQ:GRWG) has signed an asset purchase agreement to acquire HGS Hydro, which has six stores across Michigan and a third store scheduled to open in the fall of 2021. The company, which provides hydroponic and organic garden centers for other companies, expects to complete the asset by the end of the fiscal year 2021. Once complete, the transaction will expand GrowGeneration’s hydroponic garden centers to 65 (14 in Michigan) making GrowGeneration one of the largest chains of hydroponic garden centers in the nation.
With governments moving closer to the legalization of cannabis, companies such as Sixth Wave Innovations Inc. (CSE:SIXW) (OTCQB:SIXWF) are preparing themselves to enter the market through collaborations with major players in the extraction space.
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