Danny Deadlock, founder of Microcap.com, profiles a company that is working on a novel drug delivery technology with a focus on cannabinoids for the potential to treat various major diseases.
Revive Therapeutics Ltd. (RVV:TSX.V $0.16, OTCQB: RVVTF)
Shares Outstanding: Approx. 55 million
Market Cap: $9 million
Working Capital: Approx. $2 million
The graphics used below were taken from Revive’s
August corporate presentation. You can find that document here.
This snapshot provides an overview of Revive’s
business model. The company has several irons in the fire—but at the same time, is
doing a very good job controlling its burn rate (a pitfall many life science
companies fall into).
In addition to large markets for liver disease,
gout, and kidney stones, Revive offers low risk exposure to a sector that has done
very well this past year for several companies—cannabis sciences (health applications using the cannabis/marijuana plant). This is an aspect of life sciences that has limited public
company competition so Revive offers an attractive way to gain investment
Revive for the most part is unknown in the
cannabis science investment community. But others that have been properly
promoted, like Tetra Bio-Pharma (TBP:
CSE $0.62), command a market cap of $75 million with little cash and no revenue. This is eight times higher than RVV.
Others that were grossly promoted in the United
States hit huge unrealistic valuations in Q1/17. OWCP on the OTCQB is just one such example of a company that was valued
at more than US$400 Million—but now trades at 1/10th that—which is surprisingly, still seven times higher than Revive—yet the
Revive business model is just as promising (if not more) than OWCP.
GW Pharma (GWPH $108) on NASDAQ brought to light (in the marijuana sector) the valuation
potential of the “cannabis sciences.” But the trick has been finding public
companies that are “legitimate” and have the scientific expertise behind them.
GWPH has a market cap near US$3 billion. This
company has minimal revenue but a pipeline of potential drugs derived from
cannabis (CBD and THC)—primary focus is MS and Epilepsy. They came to fame in
the UK when its market cap hit $1 billion, but after listing on NASDAQ, its
valuation rose dramatically.
a VERY strong science/medical team as evidenced by the doctors noted
The cannabis sciences help provide some “sex
appeal” but Revive also has "more traditional" drugs in its research and development pipeline. A primary focus is on liver disease:
In addition to liver disease:
Unique (Cannabinoid—CBD) Drug Delivery Research/Partnership
Revive has a sponsored research agreement with the
University of Wisconsin (Madison) to evaluate a novel drug delivery technology
with a focus on cannabinoids for the potential to treat various diseases
(initial focus will be liver disease, pain and inflammatory skin disorders).
Dr. Jess D. Reed, PhD, and his research team will
evaluate the role and potential use of a chitosan-tannin-based
formula for the delivery of cannabinoids. The research will be based on Dr.
Reed’s patented technology in the use of tannin-chitosan composites for
Research on the interaction between tannins and
chitosan has led to the discovery of a new composite material that has anti-microbial
activity and can be formed into films, foams, hydrogels and nanoparticles that
have applications in food, agriculture and health. Chitosan is a derivative of
chitin, which is present in the shells of shrimp, crabs, insects and other
arthropods. Chitin is the second-most abundant biopolymer on the Earth’s
surface after cellulose.
This is new
drug delivery technology for cannabinoids if successful, would be a
There are only a few public companies with notable
research programs for topical CBD applications
(gels, creams, foams)—or advancements in drug delivery (oral strips, dermal
patches, or nasal sprays).
The market alone for topical gels is enormous
(tens of billions annually) and if
Revive and the University are successful with a unique CBD application, the
valuation of RVV would change dramatically—never mind the other life
science products in their pipeline.
Google, as we know, will find anything on the
Internet—including press releases, patents, documents in public libraries or
Universities. Other than the University
of Wisconsin, I could find no research filed using the combination of
Chitosan-Tannins. This is extremely important as it clearly demonstrates that
this is "groundbreaking" research.
www.google.com/patents/US8642088—a large but very detailed document.
successful, this research could become extremely valuable—FAR more valuable
than the $9 million valuation we currently have with Revive—and right now, few
investors know this company exists, which is why I believe there is a
significant opportunity with RVV below 20 cents. A person just needs patience.
Important Note Concerning the University Research:
The University of Wisconsin and this research
group are one of the few approved in the United States by both the DEA & FDA. They have already identified an FDA
approved supplier of synthetic CBD and received supply from AMRI (www.amriglobal.com). They have started
work on optimizing the formulation that should enable them to complete the
first milestone (permeability).
Danny Deadlock is the founder and publisher of Microcap.com. He has over 30 years of experience with Canadian microcap companies listed on the TSX and TSX Venture Exchange.
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1) I, or members of my immediate household or family, own shares of the following companies mentioned in this article: I own 200,000 shares of Revive purchased on the open market. I personally am NOT or members of my immediate household or family are NOT, paid by any companies mentioned in this article. My company (or anyone I am affiliated with) has NO financial relationship with ANY companies mentioned in this article. Danny Deadlock or anyone associated with him does NOT accept compensation in ANY form for featuring companies in MicroCap.com or Streetwise Reports. I determined which companies would be included in this article based on my research and understanding of the sector. Danny Deadlock is not a registered or licensed investment advisor and the information presented here is for educational purposes only.
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Charts and graphics provided by the author.
( Companies Mentioned: RVV:TSX.V,
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