Creso Pharma Ltd (ASX:CPH, OTCQB:COPHF)’s wholly-owned Canadian subsidiary Mernova Medicinal Inc’s initial testing of cannabinoid content for four of its new cannabis strains have indicated that each new strain has shown a high level of THC content.
This is a major achievement as it exceeds the industry average and is another key competitive advantage, underpinning Mernova’s potential expansion into new provinces and sales growth.
The new strains are expected to be introduced under the company’s leading Ritual Green and Ritual Sticks brands in the first quarter of 2022.
Major milestone
The new Miracle Alien Cookies strain tested at a THC content level of 30.1% THC.
Grape Cream Cake tested at 26% THC, with Monkey Berries and Vineyard Select testing at 23.6% THC and 19.6% THC, respectively.
This is a major milestone and highlights that three of the four new plant genetics have exceeded the industry average THC content levels for dried flower products.
The current THC content of most commercially available cannabis is between 15% and 20%.
This testing was undertaken by Nova Scotia-based, Bloom Labs, a laboratory licensed by Health Canada to conduct cannabis testing.
The four strains tested are the first of 14 new plant genetics acquired in July 2021 and those that qualify will be added to Mernova’s line of high-quality Ritual Green and Ritual Sticks products.
Competitive advantage
Mernova managing director Jack Yu said: “Acquiring such high-quality genetics and having the ability to grow them to such a high level of quality with this level of THC content, are major achievements for Mernova, and will provide us with a competitive advantage.
“With the increase in skill level of the staff, we have been able to increase implementation of advanced grow methods, and the results have been great.
“So far, they have resulted in an increase in potency and quality, with a recent Lemon Haze batch testing at 26.9% THC, a batch of Black Mamba allocated for pre-roll joints testing at 30.84% THC, and a batch of Black Mamba allocated for dried flower testing at 32.60% THC.
New products
As the skill and experience level of Mernova’s staff continues to increase, advanced grow processes are being implemented and the benefits are starting to be seen.
Mernova will soon introduce recently harvested Lemon Haze for sale, which tested at 26.9% THC, followed soon by Black Mamba pre-roll joints, which tested at 30.84% THC, and Black Mamba dried flower, which tested at 32.60% THC.
The company believes that the 32.60% THC Black Mamba should be the most potent recreational cannabis sold as dried flower in Nova Scotia, once it becomes available for sale.
It has also recently begun to upgrade its facility, including the lighting and irrigation, which is expected to result in an increase in quality and yield.
Increase in sales
Yu continued: “We anticipate that the increased level of quality will lead to an increase in sales.
“Recently, we have also begun to make improvements to the facility, including lighting and fertigation upgrades, which we expect will improve our quality and yields, leading to further enhancements of our top-quality product suite.
“We are very excited by the initial cannabinoid test results and are eager to introduce these new strains under our established Ritual Green and Ritual Sticks brands."
Consumers are currently seeking new, leading-edge, high THC strains and cannabis products, and Mernova is positioned to capitalise on the current market demand and the opportunities we hope these new strains will offer.
Potential purchase orders
Mernova will utilise the new strains to increase its product offerings, attempt to increase market share, and further strengthen brand recognition.
Management expects the new, high-THC content strains will be well received by consumers seeking access to top-quality, craft cannabis.
The company remains in discussions with a number of provincial partners regarding range increases and expects to expand its presence across new provinces in the near term.
Yu said feedback from provincial partners “is very positive, as always.”
“We look forward to updating shareholders about near-term opportunities and potential purchase orders as they materialise.”
Recent orders
Mernova’s strong growth has been highlighted by recent POs totalling over A$800,000.
Further, in the last week, the company secured an additional A$152,236 (C$139,666) in new orders from its existing provincial partners, Cannabis NB and the Nova Scotia Liquor Corporation.