Shares of Medipharm Labs Corp (OTCMKTS:MEDIF) exploded higher on Friday on strong volume, breaking the stock back above its 50-day MA to challenge multi-month trading range resistance. Helping to add some color to the narrative, the company just announced that its wholly-owned subsidiary, MediPharm Labs Inc., has entered into purchase agreements to secure a substantial 9,000 KG of dried cannabis supply from multiple cultivators in the last three weeks in June. The company also recently gave an indication that it is set to move up to the TSX exchange.
According to the release, in addition to MediPharm Labs’ ongoing procurement of cannabis biomass for existing contracts, this bulk purchase is expected to contribute to increased production for future sales and position the Company to meet the mandatory minimum monthly volume requirements to win new large white-label contracts.
Medipharm Labs Corp (OTCMKTS:MEDIF) bills itself as a company that primarily focuses on producing pharma-grade cannabis oil and concentrates in Canada. It also focuses on providing cannabis contract processing services to licensed producers and growers; supplying cannabis oil to companies for sale under its brand; and supplying raw materials and processing for the creation of ready-to-sell cannabis products. The company was founded in 2015 and is headquartered in Barrie, Canada.
Founded in 2015, MediPharm Labs has the distinction of being the first company in Canada to become a licensed producer for cannabis oil production under the ACMPR without first receiving a cannabis cultivation license.
This expert focus on cannabis concentrates from our cGMP (current Good Manufacturing Practices) and ISO standard clean rooms and critical environments laboratory, allows MediPharm Labs to produce purified, pharmaceutical-grade cannabis oil and concentrates for advanced derivative products. MediPharm Labs has invested in an expert, research-driven team, state-of-the-art technology, downstream extraction methodologies and purpose-built facilities to deliver pure, safe and precisely-dosed cannabis products to patients and consumers. MediPharm Labs’ private label program is a high margin business for the company, whereby it opportunistically procures dry cannabis flower and trim from its numerous product supply partners, to produce proprietary cannabis oil concentrate products for resale globally on a private label basis.
Through its subsidiary, MediPharm Labs Australia Pty. Ltd., MediPharm Labs has also completed its application process with the federal Office of Drug Control to extract and import medical cannabis products in Australia.
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As noted above, MEDIF just announced that its wholly-owned subsidiary, MediPharm Labs Inc., has entered into purchase agreements to secure a substantial 9,000 KG of dried cannabis supply from multiple cultivators in the last three weeks in June.
We’ve witnessed 32% tacked on to share pricing for the company in the past week. Furthermore, the listing has witnessed a pop in interest, as transaction volume levels have recently pushed 20% over what the stock has registered over the longer term.
“With the increasing availability of bulk supply and our ongoing dried cannabis supply purchases, we are well-positioned to significantly increase quarterly production over and above our existing contracts, which we expect to translate into additional sales from new white-label contracts that require substantial volumes monthly,” said Patrick McCutcheon, Chief Executive Officer of MediPharm Labs. “As the industry continues to mature, with additional cultivation supply sources coming online, we continue to focus on building on our specialized extraction skill set to provide a stable source of high quality, cannabis concentrates for the growing demand of value-add concentrate based products for medical and recreational consumers.”
Now commanding a market cap of $487M, MEDIF has a significant war chest ($8.6M) of cash on the books, which is balanced by about $35.7M in total current liabilities. One should also note that debt has been growing over recent quarters. MEDIF is pulling in trailing 12-month revenues of $32.1M. In addition, the company is seeing recent top-line growth, with sequential quarterly revenues growing at 115.2%. We will update the story again soon as further details emerge. Sign-up for continuing coverage on shares of $MEDIF stock, as well as other hot stock picks, get our free newsletter today and get our next breakout pick!
Disclosure: we hold no position in $MEDIF, either long or short, and we have not been compensated for this article.