Harvest One Cannabis Inc (CVE:HVT) CEO on Satipharm Brand Shoppers Drug Mart Launch – Midas Letter

Harvest One Cannabis Inc (CVE:HVT) (OTCMKTS:HRVOF) (FRA:2CN) CEO Grant Froese believes the company’s portfolio sets it apart from its industry competitors. Harvest One products are available in 30,000 stores in North America. Harvest One’s Satipharm branded products are now available at Shoppers Drug Mart. Satipharm products join the company’s Dream Water and Delivra brands, which already feature in the pharmacy chain. The company has partnered with major US retailers like Kroger and Walmart US to distribute Dream Water, a sleep aide. Forese emphasizes that consumers already recognize Harvest One’s brands, which will be an advantage once the company’s CBD products are introduced. Harvest One has developed a CBD product for epilepsy that had an 82 percent success rate in clinical trials. The product is sold in Europe, Australia, and most recently Asia under the company’s Satipharm brand.

Transcript:

Narrator: Harvest One is a global cannabis company that develops and provides lifestyle and wellness products to consumers and patients in regulated markets around the world. The company’s range of lifestyle solutions is designed to enhance quality of life.

Shareholders have significant exposure to the entire value chain through three wholly owned subsidiaries: United Greeneries, a licensed producer; Satipharm, medical and nutraceutical, and Dream Water Global, consumer; and a minority interest in Burb Cannabis, a retail operation.

Harvest One trades on the TSX Venture under the symbol HVT.

James West:   I’m joined now by the CEO of Harvest One, Grant Froese is here, and Harvest One, as was indicated in that last little bit, trades on the TSX Venture under the symbol HVT. Grant, welcome.

Grant Froese: Thanks very much, James.

James West:   Grant, tell us about Harvest One – what does it do in this vast cannabis revolution now underway?

Grant Froese: Oh, wow. That’s a long question, however, I think the biggest question that people ask is, why are we different, and what’s your differentiator? Well, I think the important thing is, we’re not just a cultivator, we’re not just a cannabis company; we’re a house of brands. We currently have a number of consumer brands already in front of consumer across many different jurisdictions, internationally, North America, and roughly we have our products in 30,000 stores, currently.

James West:   Really? In North America?

Grant Froese: In North America and, of course, we have our Satipharm CBD products selling over in Europe, as well.

James West:   Okay, so where do you produce – do you have, I’m assuming you have a cultivation profile then, an extraction profile, a product generation/formulation environment?

Grant Froese: Yeah, so in Europe, we actually produce our proprietary gel pill technology, which is a microbead technology that is CBD in a capsule – that’s produced in Switzerland, in an EU GMP-certified facility. And that product, we believe, is one of our differentiators, and really our thin edge of the wedge, as we think about it, as we move into international markets both in medical and recreational where it’s regulatory approved.

That product has gone through Phase I and Phase II trials; currently it has no THC in it, but it’s also proved that it has higher bioavailability – that’s a tough word to say, at times –

James West:   It is.

Grant Froese: -than many other products, and it also has proven to reduce the onset of childhood epilepsy in some of the cases, in 82 percent of the patients that took it in Israel. So we’re pretty impressed with that product, and we’re excited about moving that through Europe, and then of course, bringing that into Canada.

James West:   Sure. Where do you do your growing?

Grant Froese: Currently we have a facility which is the jewel of our operation, in Duncan, on the island. It’s a small grow, it produces about 1,000 kg; we’re currently expanding that facility to triple that output within the next couple of months. We have a facility that we’re building out in Saskatchewan, currently, and that should be online by the fourth quarter of this year, and that’ll produce another 12,000 kg, roughly, of premium indoor product. We’ll have another, a few supply agreements out of Ontario that’ll supplement that roughly to about 20,000 kgs of premium indoor grown product, and just recently announced, as of yesterday, we’ve just taken a majority ownership position of Greenbelt Nurseries, who basically, that’ll produce another 15,000 kgs of greenhouse product, as well as allow us the opportunity to build extraction into that facility with the 42,000 square foot head house, there.

James West:   Wow. Okay, so that’s a lot. So the 152,000 square foot facility is Greenbelt, which is your acquisition?

Grant Froese: Yes.

James West:   Okay. So then, how do you get the – so, do you supply the CBD from these operations to the packager in Switzerland?

Grant Froese: No. So I mean, I heard you talking about CBD a little bit earlier; obviously it’s a fascinating category, and one that we’re very focused on. Our product in Europe comes from European sources, currently, and we’re looking at a number of other suppliers that are international as well. That product goes into Luxembourg, gets extracted and processed there, and then it gets shipped over to Switzerland for processing just in the EU, currently.

James West:   In Luxembourg?

Grant Froese: In Luxembourg.

James West:   So this must be, I’m assuming, extracted from hemp.

Grant Froese: It is extracted from hemp; less than 0.03 percent, or yeah, 0.3 percent.

James West:   Sure. And what is the average content of CBD in the hemp that you process?

Grant Froese: Well, we – our full-spectrum capsule is a 10 milligram capsule, and I think the average – well, it’s 10 milligrams of CBD in that capsule.

James West:   Okay, but what about the plant? Do you know what the ratio is? I’m just curious, because I’m growing some CBD at home and it’s about 20 percent CBD by weight, so I’m just curious as to, like, is the hemp that is allowed to be grown in Europe allowed to have a high-CBD content, or does it have to have a more hemp CBD content, which is typically, you know, 6 to 9 percent?

Grant Froese: So I’m not sure what the regulations are with regards to the hemp content allowed in Europe; I’m more familiar with what the THC content is allowed. If you have a hemp product that produces 20 percent CBD, I believe that’s fairly rare. The numbers are generally in the, the highest ones I’ve heard of are in the mid-teens, but I’m not an expert in terms of the concentration of CBD in some of the genetics of hemp. In Canada, there’s nothing anywhere close to that, at this point.

James West:   Yeah. Interestingly, Charlotte’s Web, the strain that was developed by the Stanley Brothers to create their oil product, is known to produce upwards of 20 percent CBD.

Grant Froese: Is that right?

James West:   Yeah, but as you say, it’s not available in Canada. Okay, so what is Harvest One’s main – so you’ve got this product, and you’re going through trials in the European Union?

Grant Froese: Yeah. No, the trials have completed in Israel some time ago. We’re currently selling the product in the European Union, Australia, New Zealand, and we’ve just signed an agreement to distribute that in Asia. That’s only one part of our company; that’s the Satipharm brand. We’ve just launched that Satipharm brand in Shoppers Drug Mart as well, in our dried bud format.

James West:   Wow.

Grant Froese: We have Dream Water as well, which is a natural sleep aid that you’ll see in many facilities, you see them at airports, you’ll see them across many of the retailers in Canada. we just signed an agreement with Walmart US, Kroeger, and Publix down in the US. And what the beauty of that product, and of course, our other product, Liver Relief, which I’ll talk about in a second, is that it’s a natural extension of the sleep categories to add CBD or cannabinoids into these products.

When I say that we’re differentiated because we have these products already available, consumers are familiar with our brands, they trust our brands, and as we add a variant, which is really a product with the addition of cannabinoids, consumers will already recognize the efficacy of our products, and it’ll be easier sell across the US and Canada for consumers to pick it up.

James West:   Sure. So you’re in Shoppers Drug Mart, you said?

Grant Froese: Shoppers Drug Mart, we’re there. We have our Dream Water product there, we have our Delivra product there as well, and we have our dried bud through the medical.

James West:   Is the Dream Water available without a prescription?

Grant Froese: It is.

James West:   Oh, it is?

Grant Froese: It’s a 100 percent natural product, it’s like a five-hour energy shot but does the opposite kind of thing. Melatonin, you know, five HTP and Gavis, so all-natural ingredients, and we have a number of different variants and a few down the pipeline. But you know, the one we’re most excited about is the addition of cannabinoids into that product for distribution in the US.

James West:   Right, very cool. How do you sell Dream Water? Does the Dream Water have any CBDs in it right now?

Grant Froese: Currently, it does not.

James West:   Oh, I see. That’s why I was confused. Okay, so now, do you think, Grant, that the Canadian rules are going to loosen up, sort of like they have in the US, where it’s kind of funny that suddenly in the US with the Farm Bill Act that now you can get CBDs everywhere. Suddenly, it’s like the Viagra ads and the Nigerian ‘I’ve got money for you over here in a bank account’ ads have been replaced with CBD ads.

Grant Froese: Yeah, yeah.

James West:   And that’s because now, CBD is more or less allowed to cross state lines in the mail. Do you think that the Canadian government and the Canadian regulatory regime is on a trajectory to make that CBD product more widely available without prescription, or without being 19 since it’s not psychotropic and is merely, you know, bio-beneficial?

Grant Froese: I would like to think so. Obviously, there needs to be a lot of education around cannabinoids. I think the way the government originally positioned it, they want to make sure that the products are safe, and before distributing to the population, they want to be sure. There’s not a lot of research that’s been done, and a lot of the work that we’re going to be doing on cannabinoids is going to be around research in terms of efficacy, some of the attributes that, you know, people say it reduces anxiety, and people say it relieves pain, and people say it does a number of other things, but there really isn’t any real research that proves that.

So I think, you know, I don’t know what the government’s going to do; there’s obviously lobbyists, lobbying groups, that are trying to push the availability of cannabinoids, other than, you know, non-psychoactive cannabinoids. But I believe that we need education, and I believe that we need research to ensure that the product’s safe and it actually delivers on the claims that they’ve been actual health products.

I personally believe it does, but again, that’s anecdotal, and we need a little bit more than that.

James West:   Wow. So you’ve got quite a head start on the international market with all these products already out there.

Grant Froese: Well, I think so. The other product I didn’t mention, and it’s soon to be closed, is our recent foray into the topical market. Obviously that’s a big area. The three major areas that we’re focusing on currently are sleep, which I’ve just described; anxiety, which is the CBD product, the gel pill; and now we’ve got pain, which we’re focusing on with our purchase of Delivra, which currently has a product called LivRelief, available across pharmacies in Canada. And that product is a natural product that has a proprietary transdermal delivery system; those ones are hard to say, frankly.

But anyway, nonetheless, we’re super excited about that. As we add cannabinoids, THC and CBD into those products for distribution across Canada when legal, and then distribution across the US where it isn’t currently. But again, it’s a brand that has consumer-facing properties, and we’re looking forward to doing that, as well.

James West:   You bet. I used CBD oil to treat a sunburn when I was in Mexico back in February.

Grant Froese: And?

James West:   Well, it works incredibly. Like, I scorched myself so badly, you know how you really overdo it and your skin is just so red and it stings and you can’t sleep, you can’t sit down, it’s just ugh. I had CBD oil rubbed all over my back, went right to sleep, it let me sleep. I woke up about three hours later; the stinging was back. Rubbed it on again, it immediately subsided. You know how you put calamine lotion on poison ivy? It was like that – instant relief. And you know, I’m just like, it does not cease to amaze me how much homeopathic value there is to this plant extract, and I can’t really wait till more product formulators, you know, continue to evolve and understand them and concentrate them in different ways.

Grant Froese: I couldn’t agree more. I’m an advocate. When I’m in Europe trying our gel pill product, which is a capsule, as I mentioned earlier, and there’s a lot of technology around it which is far too long to describe today, but when I take that product there as a supplement – because that’s how it’s sold – you know, there is a feeling of well-being, so to speak, and pain-free environment, and there’s something there; it’s just we have to be able to prove it with research. That’s when the larger companies, I think, will get behind it as well.

James West:   Sure. All right, well, Grant, that’s a great update on Harvest One. You guys have clearly been keeping your head down and making things happen. We’ll come back to you in due course; thanks very much for joining me today!

Grant Froese: Thanks.

Source: https://midasletter.com/2019/04/harvest-one-cannabis-inc-cvehvt-ceo-satipharm-brand-shoppers-drug-mart-launch/