Article by Vanmala Subramaniam, Financial Post
Kevin Chen spent much of the last two years attending every cannabis-related conference he could find, trying to convince investors about the potential of a scientific development he had come up with in his student lab at Concordia University: Using yeast to create cannabinoids such as CBD, a compound now widely used in cannabis-based ingestibles and pharmaceuticals.
A month before legalization, Chen finally struck gold — Organigram Holdings, a New-Brunswick-based licensed producer agreed to invest $10 million in Hyasynth Bio, Chen’s Montreal-based startup.
“We are a lot closer to being able to produce our ingredients in bulk because of the investment,” Chen told the Financial Post in an interview recently. “Two years ago, we just had a frozen vial of yeast cells, but now, our yeast strains are producing many different cannabinoids that we’re hoping to sell on a large scale.”
Hyasynth Bio is one of just a few Canadian companies experimenting with non-plant-derived cannabinoids, a sub-sector within the cannabis space that is starting to gain the attention of major investors and industry players.
The concept is relatively simple — instead of extracting cannabinoids from a cannabis plant to be put into oils, drinks, food, medicines and beauty products, compounds like CBD and THC can be created in a lab using either organic hosts like yeast and sugar (to create biosynthetic cannabinoids), or petroleum-based industrial chemicals that mimic the chemical structure of a cannabinoid (synthetic cannabinoids).
“If you think of aspirin, for example, it was originally discovered in the bark of a willow tree. But today, we don’t have forests of willow trees to extract aspirin because it was chemically synthesized many years ago,” explained David Eisley, chief executive of Cardiol Therapeutics Inc., a publicly-listed biotechnology company that manufactures a synthetic CBD drug used for heart failure called Cardiol Rx.
“It is absolutely inevitable that synthetic cannabinoids are going to become a large part of the cannabis industry. History teaches us that to ultimately make any medicine widely accessible to the public, it has to be made pharmaceutically at an affordable cost,” said Eisley.
The demand for pure CBD as an active pharmaceutical ingredient traverses both the recreational and medical cannabis space. Hyasynth Bio, for instance, wants to eventually be able to produce thousands of kilograms of CBD in powder-form using its yeast formula to be sold to major pharmaceutical or consumer-packaged goods companies.
But they’re at least two years away from being able to achieve that level of yield. Chen says his lab is still at an R&D stage, producing a few grams of CBD at most.