It must be hard to get noticed, as pot stocks proliferate. Witness last week’s announcement by Vireo Health International, one of the smaller multistate cannabis sellers. It brands itself as “science-focused” and physician-led. Last Thursday, Chief Executive Kyle Kingsley, M.D., said the U.S. Patent and Trademark Office had allowed his application for mixing cannabis-derived substances with tobacco—an invention that sounds a lot like the marijuana-laced cigarettes that Americans call a spliff.
“The best outcome would be that we disrupt the nearly $1 trillion global tobacco industry,” Kingsley told Barron’s. Vireo says the potential benefits of adding cannabinoids to cigarettes and other tobacco products include “the reduction of irritation, inflammation and carcinogenicity.”
Read our recent cover story: You’d Have to Be High to Buy American Marijuana Stocks
There little credible evidence to support those grandiose hopes. Investors perusing Vireo’s recently-listed stock (VREO. Canada or VREOF. OTC) might care about its licenses to grow and sell pot in 10 states, but the patent scarcely enhances the little Minneapolis-based firm’s $90 million stock market value. Vireo points out that its fully-diluted market cap would be $450 million, if Kingsley converted his super-voting control shares.
People have been combining cannabis and tobacco for a long time, Kingsley concedes. “It’s not really a novel concept,” he says, “but this may be a new reason to do it.”
But patent law isn’t the only legal hurdle Vireo must jump. In many states that permit cannabis sales, it is illegal for cannabis dispensaries to sell tobacco products.
More than 30 states have legalized marijuana because cancer patients found that cannabis alleviates some symptoms of the disease and its chemotherapy. But doctors, scientists, and regulators are justly alarmed when patients forego effective cancer treatment after reading bogus social media claims that cannabis is a cancer cure.
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No clinical studies have demonstrated any anticancer efficacy for cannabinoids. The first clinical investigation of that question is now under way, as GW Pharmaceuticals (GWPH) sponsors a test of the cannabis derivative CBD for treating the brain cancer glioblastoma. In an industry swamped with unproven medical claims, GW has taken the expensive scientific road. Last year, the U.S. Food and Drug Administration approved GW’s cannabis-derived Epidiolex as a treatment for childhood epilepsies. Another CBD product company, CV Sciences (CVSI), hopes to test cannabinoids as a way to get people to quit tobacco.
With its talk of reducing tobacco’s carcinogenicity, Vireo cites a review article in an obscure European medical journal. The scientific hurdle for a patent claim is different—and lower—than the evidence expected by regulators and doctors. After all, the patent office’s overworked examiners have allowed patents for perpetual motion and antigravity machines.
Asked for evidence that cannabinoids make tobacco safer, Vireo’s chief said, “There’s definitely evidence there. What we need to do is quantify this in humans.”
Kingsley said he’d like to partner with academic institutions or Big Tobacco to fund the expensive studies.
“Research is really important,” said Kingsley. “There are not going to be risk-mitigated tobacco products with cannabinoids out next month—that’s for sure.”
But he still has big dreams. “I imagine a future where we don’t have tobacco products that don’t have cannabinoids added for harm reduction,” says Kingsley.
Should a doctor promote anything that keeps people hooked on tobacco?
“As a physician, I’m not terribly excited about people smoking,” Kingsley responds. “But the reality is that tobacco is here to stay and why not reduce that harm, if we’re able?”
That Vireo’s cannabis additive will be able to reduce tobacco’s harm is far from proven.
Write to Bill Alpert at william.alpert@barrons.com
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