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Nextleaf Solutions takes aim at infused beverages and edibles with patented cannabis extraction technology

Snapshot

The group is developing technology for distilling THC and CBD oils used to formulate 2.0 products at scale within a highly regulated environment

cannabis extraction

Quick facts: NEXTLEAF SOLUTIONS Ltd.

Price: 0.18 CAD

CSE:OILS
Market: CSE
Market Cap: $21.5 m
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  • Patented cannabis extraction technology, which is both scalable and repeatable
  • Sees ample supply of low-quality cannabis and hemp biomass and a lack of extraction and processing capacity
  • Has won 51 patents for its high-purity extraction/distillation methods for vapes, edibles, and beverages

What Nextleaf Solutions does: 

Nextleaf Solutions Ltd (CSE:OILS) (OTCMKTS:OILFF) is a cannabis-extraction-technology company that has a patented process for the commercial-scale production of high-quality cannabinoid distillate, the precursor to every cannabis-infused products. 

In short, the British Columbia-based company is bridging the gap from soil to oil, a reflection of its technology, which allows for low-quality, dried cannabis biomass to be processed into a high-purity distilled oil. A front-runner in the extraction space, Nextleaf is also getting into infused beverages and edibles.

The fact is that there is an ample supply of low-quality cannabis and hemp biomass - but there is a lack of extraction and processing capacity in the industry. Nextleaf is developing intellectual property around converting the cannabis plant into infused products through a scalable, repeatable process.

Nextleaf focuses on a premium distillate and believes the secret to producing standardized and impurity-free cannabis extracts is in the purification and refinement steps, which go above and beyond the typical crude extraction. Its highly concentrated THC or CBD distillate is odorless, tasteless, and standardized for potency. 

Nextleaf provides toll processing for licensed cultivators and wholesale of distilled THC and CBD to qualified Canadian and international B2B partners and manufacturers of edibles, beverages, and other infused products. The company delivers its proprietary technology through its Health Canada Licensed Standard Processing facility in greater Vancouver.

How is it doing: 

For most of 2020, Nextleaf has been expanding its technology portfolio as it moves into the adult-use market and gains more bulk-sales deals. The company also continues to build partnerships within the cannabis industry.

As of November, the company has been granted 51 patents in the US, Canada, Israel, Australia, New Zealand, Colombia, South Africa, and across the EU related to the production of high-purity, cannabinoid-rich distillate for vapes, edibles, and beverages.

Nextleaf owns a portfolio of 10-issued US patents for extraction, purification, and delivery of cannabinoids. It is the first publicly traded entity to be issued multiple US patents for industrial-scale extraction and distillation of cannabinoids. The company also has more patents pending in Europe, Jamaica, and Mexico for ethanol and butane hash oil (BHO) extraction, distillation and formulation of cannabinoids.

Via its commercialization partner Nextleaf Labs, the company has secured two Research Licenses from Health Canada. The licenses allow Nextleaf Labs, which has a 6,540-square-foot facility near Vancouver, to conduct R&D activities, including stability trials on the company's nano-emulsified water-soluble THC and CBD formulations. Nextleaf also has a processing license.

The company recently took its first meaningful steps through the Commercial Partners Program (CPP) into the adult-use market with the launch of vape cartridges powered by its high-purity distillate. The items are available at cannabis retailers in Saskatchewan, with more provinces to be announced in the coming months. 

The company is also pushing ahead with efforts to ramp up bulk sales of cannabis distillate (both CBD and THC) for the Canadian wholesale market and white label products. Some recent contract wins are with Canada's top-selling cannabis processors and brands. Since commencing commercial oil production earlier this year, Nextleaf has contracted the supply of over 27,000 kilograms of dried cannabis biomass from licensed cultivators through the CPP.

The company also uses partnerships -- whether with government, universities, or other companies -- to help develop its technologies, earn royalties and grab a piece of the retail-end of the post-extraction process.  It worked for a year with the National Research Council of Canada Industrial Research Assistance Program to develop a treatment process to remove chlorophyll and other unwanted elements from crude cannabis extract.

Nextleaf has also worked with The University of British Columbia and the British Columbia Institute of Technology on a project to repurpose cannabis biomass after extraction. The company discovered that burning hemp biomass creates ash that can be used as an ingredient to make cement, thus keeping tons of biomass out of landfills and creating a revenue-generating by-product.

The company recently entered into a patent licensing agreement with a British Columbia-based cannabis process equipment distribution company that allows the licensee to commercialize three of Nextleaf’s issued and pending patents related to post-extraction processing equipment. Nextleaf will receive a 20% royalty, which could yield more than $3 million in 2020.

Inflection points:

  • Anticipates $3 million in royalties in 2020 under patent licensing agreement
  • Expand further into provincial adult-use markets with vape cartridges 
  • Offer pesticide contamination remediation process in 2021 

What the boss says: 

Nextleaf CEO Paul Pedersen recently said: "Our strategy from day one was to be the absolute best at developing disruptive extraction technology and focus as a business, not worrying about growing or developing brands or retail, but to just focus on the underlying technology that goes from plant into product and being able to deploy that in a highly scalable way." 

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Nextleaf Solutions granted patent in Mexico as country legalizes adult-use...

Nextleaf Solutions (CSE: OILS- OTCQB: OILFF) CEO Paul Pedersen joined Steve Darling from Proactive with news the company has received another patent for their technology, but where it was issued makes it very interesting. Pedersen telling Proactive this patent is coming from the Mexican...

4 days, 22 hours ago

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