Cardiol Therapeutics (TSX:CRDL) Goes Public on the Toronto Stock Exchange, Focused on Pharmaceutical CBD and Biotech Science

After decades of limitations on scientific study of cannabis, new regulatory environments are starting to allow science to catch up with the widely recognized therapeutic potential of the plant. To date, the U.S. Food and Drug Administration has approved only three cannabinoids as drugs: two synthetics for chemotherapy-induced nausea, and GW Pharmaceuticals’ Epidiolex (cannabidiol or CBD) for two rare forms of epilepsy. But in 2017, the National Academies of Sciences, Engineering, and Medicine published recommendations to encourage cannabis research in the United States. Earlier this year the U.S. government granted Tilray approval to import its cannabinoid trial for the treatment of Essential Tremor. Leading the way, Canada has legalized the drug, and this could open the doors to more and wider-ranging research.

Cardiol Therapeutics (TSX: CRDL) is a Canadian biotech company that aims to bridge the gap in some key areas of cannabis research. In collaboration with its exclusive manufacturing partner Dalton Pharma Services, Cardiol produces pharmaceutical cannabidiol for its own research purposes, while preparing to commercialize cannabidiol products in 2019. Additionally, the company is armed with a proprietary nanotherapeutics drug delivery platform that can deliver drugs, including cannabinoids, directly and efficiently to sites of disease. Finally, the company has several clinical drug candidates for the treatment of heart failure and Glioblastoma Multiforme.

Pharmaceutical CBD

Coming out of years of prohibition, pure cannabinoids produced for research and medical uses are hard to find. In conjunction with Dalton Pharma Services, in 2019, Cardiol plans to introduce to the market a Health Canada-certified pharmaceutical CBD product boasting greater than 99.5% purity. Dalton Pharma Services is a cGMP certified, FDA and Health Canada approved manufacturing facility that meets the most exacting standards. Important to note here is the CBD produced contains less than 10 ppm THC, allowing Cardiol to avoid having to label the product with Health Canada’s standardized cannabis THC warning symbol.

Cardiol believes this product offers a significant near-term revenue opportunity in the medical market due to its unique offering of being the only Canadian THC free product on the market. CBD-infused products, like edibles and beverages, are generally recognized as the next wave in the industry, though they will not be available for use in Canada until late 2019. CBD is currently approved for medical patients in Canada, and New Frontier Data estimates that annual sales of medical cannabinoids have doubled from approximately $600 million in 2017 to $1.2 billion in 2018. Cardiol looks to be well positioned for any market with its pharmaceutical CBD offering.

The company also plans to introduce a pharmaceutical CBD sublingual spray in the second half of 2019. This water-like spray will offer an easy to use alternative delivery option. The sublingual spray may deliver CBD more directly to the bloodstream through the membranes under the tongue, bypassing the liver and avoiding the ‘first pass effect’.

Cannabinoid Delivery

To shorten what could be a very long scientific explanation, cannabinoids are lipophilic and hydrophobic, meaning they are soluble in fat but do not dissolve in water. The human bloodstream is a water-based environment. The liver filters out many drugs including cannabinoids when taken by mouth before they even get to the bloodstream, the so called ‘first pass effect’. The cannabis industry is very interested in overcoming the issues associated with the first pass effect in order to streamline the delivery of the plant’s active ingredients, both for medical and recreational purposes. Controlled dosing, targeted delivery, and predictable results are the goal.

Cardiol has developed a system whereby lipophilic drugs, like CBD, are encased in a hydrophilic shell. The shell allows the active lipophilic ingredient to circulate readily in the bloodstream. Normally, taking CBD orally results in less than 10% bioavailability of the drug. Cardiol’s nanotherapeutics platform, by avoiding the oral route, allows for much higher levels of lipophilic active ingredients in the bloodstream and, most importantly, has the potential to deliver drugs to sites of disease in the body. This proprietary technology could be licensed, sold, or partnered with other companies. The opportunity here is not limited to cannabinoid delivery, as these same problems have vexed companies developing other lipophilic drugs.

CBD and Heart Failure

Chronic heart failure affects more than six million people in Canada and the United States and is associated with obesity and diabetes. Taken together, these are among the fastest growing health issues in the developed world. Obesity and diabetes lead to chronic inflammation of heart tissues which can then lead to heart failure. There is plenty of research that points to the anti-inflammatory action of CBD, and this action underlies the drug’s potential effectiveness in the treatment of heart failure.

Cardiol is advancing CTX01, its proprietary pharmaceutical CBD formulation, for the treatment of heart failure. Backed by an impressive array of accomplished researchers on its Scientific Advisory Board, the company believes the available evidence points to CBD’s potential efficacy and hopes to establish a clinical trial program in the first half of 2019, following its pre-clinical work with the drug. Cardiol is also advancing two other heart failure candidates, as well as an immunotherapy/cannabinoid combination therapy candidate for Glioblastoma Multiforme, in its current pipeline.

Cardiol’s CEO, David Elsley, has plenty of experience founding and running a biotech. In 1990 he formed Vasogen Inc., taking the company public on the TSX and NASDAQ and advancing a novel anti-inflammatory therapy through Phase III clinical trials for two cardiovascular conditions including heart failure. The company employed over 250 people and had operations in Canada, the United States, and Europe.

Looking Ahead

2019 promises to be a pivotal year for Cardiol Therapeutics. The company plans to introduce its pharmaceutical CBD to the market as regulations allow and advance its clinical trial programs for heart disease. Freshly public, Cardiol Therapeutics offers investors the opportunity to participate in the intersection of scientific research and cannabis, a marriage that has been, until very recently, prohibited.

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About Robin Lefferts