Top researchers have found a way to create cannabinoids from yeast. Here’s why they aren’t the first – and why it all matters…
Last week, researchers at Berkeley announced they discovered how to make cannabinoids from brewer’s yeast.
So rather than having the yeast turn sugar into alcohol, it turns sugar into cannabinoids.
According to the press, this was a groundbreaking discovery.
But, in fact, there are plenty of companies already doing what this team at Berkeley is doing, all of which have been covered extensively in our NICILytics database.
For instance, two of them are well-known cannabis producers that recently entered partnerships with private companies utilizing this sort of technology.
One is a pharmaceutical company with a pipeline of drugs manufactured through a similar process.
And one of the biggest Canadian LPs has been publishing research on the technique since early this decade.
So this breakthrough is really nothing new, and Lifetime Members of Cannabis Investor’s Report can look into each of these companies, see how we rate them, and also get access to updated research reports on these as well as the 150 other publicly traded cannabis stocks that we cover.
But, despite the fact that Berkeley’s research isn’t as groundbreaking as the press tries to make it, this type of technology has incredibly important implications for the future of the cannabis industry.
Tiny Bugs Doing All of the Work
As monks have known for centuries, yeast is really good at converting sugar into something else.
With brewer’s yeast, that something else is alcohol. What the researchers at Berkeley have done is change the genetics of brewer’s yeast.
With this change, instead of producing alcohol, the genetically modified brewer’s yeast turns sugar into cannabinoids. This means that cannabinoids, like THC and CBD – and even the less abundant ones like CBG – can be made in large vats rather than extracted from the plants.
They’ve turned yeast into little chemical cannabinoid factories.
The researchers can do this because yeast is a single-celled microorganism. And, like many microorganisms, its genetics are fairly simple. Science has known for a long time how to co-opt the genetics of microorganisms to produce compounds they wouldn’t normally produce.
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This co-opting of the genetics is called biosynthesis, and yeast isn’t the only tiny bug scientists use.
They also manipulate the genetics of the bacteria E. coli, algae, and other microorganisms.
The resulting cannabinoid factories can produce cannabinoids at scale with high levels of purity and do so using far less energy than it takes to extract cannabinoids from the plant. It also means that the less abundant cannabinoids like CBG can be produced in much larger quantities than can be obtained from the plant.
And since the inputs to biosynthesis are usually inexpensive feedstock like sugar, the cost of production is cheap. In fact, in a few years, producing cannabinoids through biosynthesis could be one-fifth the cost of plant-based extracts.
For cannabis growers cultivating cannabis for processing into cannabinoid isolates, or single-compound formulations without other cannabinoids or terpenes, this technology poses a major challenge – especially if they aren’t growing this cannabis where it grows best. Producing cannabinoids in vats doesn’t require acres of land, massive greenhouses, or enormous amounts of electricity – which can be a huge advantage.
Now, it’s not expected that biosynthetically produced cannabinoids can compete with products that tout the benefits of whole-plant extracts. In the past, we’ve discussed the research proving the advantages of the entourage effect, which is the combined effect of the multiple cannabinoids and terpenes found in cannabis extracts.
And for the cannabis flower that ultimately gets rolled into joints, biosynthetically produced isolates is no competition at all.
But those companies that understand, and patent, efficient biosynthetic processes have a tremendous opportunity to carve out a huge slice of what could be a $1 trillion cannabis market.
In fact, I just received the information about a company that makes cannabinoids from yeast which will be going public later this year. I’ve just started my due diligence to determine whether it will make the cut for members of The Cannabis IPO Insider.
In the end, it is the companies with a big head start on the research who will gain the most.
Take Anandia Laboratories, for example. It was purchased by Aurora Cannabis Inc. (NYSE: ACB) mid-last year, and it has been publishing research on the topic since 2012.
Other companies just want a reliable supply of THC or CBD. These companies are just interested in getting predictable results, which is how great brands are built.
Finally, some companies are using these processes to make entirely new cannabinoids. They are tailoring compounds that interact with human cells even better than natural ones.
In fact, members of our Cannabis Venture Syndicate are, at this very moment, doing their due diligence on a startup pharmaceutical company with patents on a host of synthetic cannabinoids. It also has a couple of FDA trials in the works. The company is still private, so Syndicate members are getting in long before the public has a chance to invest.
This private deal will likely get its funding needs soon, but we’ll be bringing other deals to this group of private investors over the course of the next 12 months.
At the end of the day, science and technology will have the same wealth-building impact on cannabis as it has had on many other fields. The opportunities abound, but you need to know how to spot them – and separate hype from reality.
Lifetime Members of Cannabis Investor’s Report know this well because they have the tools to see what really matters.
Thank you for being an important part of the National Institute for Cannabis Investors,
Executive Director, National Institute for Cannabis Investors
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March 07 2019