What if there was a marijuana industry without marijuana? That might sound crazy, but it’s a real possibility.
There’s a lot of research under way right now to genetically engineer yeast strains to produce cannabinoids, including cannabidiol (CBD) and tetrahydrocannabinol (THC). In a nutshell, scientists are taking the genes from cannabis plants that are key in making cannabinoids and putting them into yeast.
This approach could reduce the time required to produce cannabinoids. Marijuana plants take at least three months to grow, but genetically engineered yeast can create cannabinoids in around a week. It could also be much less expensive.
Several privately held companies are working on methods to produce high-quality cannabinoids from yeast. However, there are also a handful of publicly traded companies that are involved in this research. Here’s why…
Amyris (NASDAQ:AMRS), Cronos Group (NASDAQ:CRON), and OrganiGram Holdings (NASDAQOTH:OGRMF) are three stocks that are poised to profit from the massive disruption that could be on the way for marijuana.
Amyris is a synthetic biology company that has significant experience in developing chemicals using fermentation technology. It has been issued 499 U.S. or foreign patents for its technology and has another 314 patent applications pending.
The company’s current products include chemicals used in cosmetics, flavors, fragrances, sweeteners, and vitamins. But Amyris now has its sights set on producing cannabinoids, too.
In February, Amyris announced a collaboration with a “confidential partner” to develop cannabinoids using its technology platform. The company said that the deal is valued at up to $255 million including an upfront payment and contingent milestone payments, with more revenue possible from royalties.
Amyris provided no details about its partner, other than to say that it is “well-capitalized” and recognized Amyris as “the company best suited to leverage fermentation-based technology in the production of the best quality and lowest cost and sustainably produced cannabinoids.”
2. Cronos Group
Cronos Group captured the attention of many investors in December after tobacco giant Altriaannounced that it was buying a 45% stake in Cronos for $1.8 billion. This partnership elevated Cronos to the top tier of Canadian marijuana producers.
But there’s another partnership that could also be extremely important for Cronos. In September 2018, the company…
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