When the coronavirus (COVID-19) first hit North American shores in March, few people would have expected cannabis companies to try and fight the pandemic in any real way.
But as more research about COVID-19 came to the fore in the months since the virus emerged, Canadian company Delta 9 Cannabis Inc (TSE:DN) realized it may have the technology and resources to step up and help stop the spread.
Now, with Canada and the US firmly in the grip of a devastating second wave of the virus, Delta 9 is debuting its Decontamination Pods, or D-Pods, a retrofitted shipping container specially equipped with UV lights and heaters that will kill the virus on things like personal protective equipment. If that sounds familiar, it’s because the D-Pod is essentially a redesign of the company’s popular Grow-Pods, which are modular facilities used to cultivate cannabis.
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The idea first came to the team when studies from the National Institute of Health broke over the summer indicating that exposure to high temperatures over a set length of time was effective in decontaminating personal protective equipment (PPE). Although only a small scale study, the results spurred Delta 9 to consider whether they could take the concept and build a commercial application.
And thus, after a few tweaks and trials, the D-Pod made its debut in November. Developed in partnership with three other local firms, the unit is equipped with a combination of powerful UV lights and heaters to decontaminate articles placed inside its chamber. Temperatures inside the pod can reach up to 60 degrees Celsius, which is above the necessary threshold laid out in the studies. It takes around 30 minutes to decontaminate items in the chamber in combination with UVC light saturation. An independent third party laboratory validated the technology as being able to kill 99.9% of microorganisms.
It is a game-changer in the fight to stop the spread of COVID-19 as, until now, PPE and items potentially exposed to the virus carried a one-time-use-only guarantee. Hospitals, care homes, retail stores, sports arenas and others can use the D-Pods to sanitize their equipment, and its modular design allows for easy installation. The 15ft by 8ft decontamination area has capacity for a significant amount of PPE or equipment, allowing hospitals or governments to clean large amounts of material. In the midst of record-high case levels exacting a strain on healthcare facilities, having a steady supply of clean PPE is crucial.
“I hate to say that it is timely, but if there's a way for us to retool our facilities to come up with a novel technology, that's another tool in the toolkit for governments and other stakeholders to help flatten the curve,” Delta 9 CEO John Arbuthnot told Proactive. “While we're doing it, we can diversify revenue and continue to employ people and invest in the community. It’s a win-win scenario.”
The D-Pod is essentially just a redesigned Grow-Pod, Delta 9’s flagship technology. Arbuthnot called it a “quick pivot” from its current technology. “We're taking a standard 40-foot shipping container and customizing wall panels, electrical, HVAC, and all of those components that we would regularly incorporate into a Grow Pod in a slightly different way,” Arbuthnot told Proactive.
“The novel elements like the UVC lighting and the real heat components were kind of the X factors for us. Almost to our surprise, the lab validation results started to come in and they were very encouraging to start. Ultimately we found we far exceeded the design parameters from an effectiveness standpoint to where the final lab validation showed us a six sigma reduction in biological counts.”
Delta 9 is planning to start rolling out its first D-Pods this month. They are manufacturing the units at the company’s 50,000-square-foot facility in Manitoba, which is where the Grow-Pods are developed. The company inaugurated a subsidiary Blue Horseshoe Manufacturing Inc that will be responsible for producing up to 20 D-Pods per month, depending on demand. Priced around $250,000, they are already gaining interest from customers in both the public and private sector.
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Even with the D-Pods, Delta 9 is still a cannabis company at its core. The group's wholesale and distribution business is seeing strong activity.
In its third quarter, retail sales showed quarter over quarter improvements. Sales of its Grow Pods waned slightly during 3Q due to COVID-19-related volatility, providing good opportunity for the company to diversify its revenue stream. The firm recently upsized an ongoing financing to raise C$5 million after the initial $4 million amount was oversubscribed within 24 hours, at a mere 6% discount to market.
For the cannabis company, the D-Pods are an exciting new technology with real-world applications and a complement to its main business. Arbuthnot said that governments are now questioning whether the Pods could be useful in another key part in subduing the pandemic by transporting vaccines. The Grow Pods already incorporate security measures like cameras and beam brake sensors, making it ideal to store and ship vaccines once one becomes available.
D-Pods are one example of the many ways in which companies are stepping up in the fight to curb the COVID-19 pandemic.
“When we started to see the initial validation come in from the lab, we realized, hey, this is probably something that could help,” Arbuthnot said. “If we can at least do a small part in limiting some contact with COVID and prevent some cases, we're happy to do it.”
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