• Sun. Jun 16th, 2024
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Lexaria Biosciences: An Undervalued Biotech Opportunity

When analyzing biotech companies, positive clinical trial results are the most significant potential catalyst for businesses. For this reason, we are favorable on companies that have been reporting positive results and have an extensive pipeline of pre-clinical or clinical trials.

Another important trait for biotech companies is intellectual property (IP) and patents that have been granted. If a company has a significant amount of IP and patents, such that the technology or focus of the study is protected and we consider this is an important aspect of the story. 

Lexaria Bioscience Corp. (Nasdaq: LEXX) is biotech company that has been advancing pre-clinical and clinical trials and has a very strong IP portfolio. The biotech company operates a licensed in-house research laboratory and has 28 patents granted and many patents pending worldwide.  We are bullish on the strength of the company’s IP portfolio and are favorable on how the management team continues to focus on this aspect of the business.

An Execution Story To Be Aware Of

One of the most exciting aspects of Lexaria’s business is its DehydraTECH drug delivery platform. Based on independent studies, the drug delivery platform improves the way active pharmaceutical ingredients (APIs) enter the bloodstream by promoting more effective oral delivery. The company is highly focused on improving bioavailability for a variety of treatments and is currently conducting several studies on animals and humans.

Lexaria is investigating how DehydraTECH-processed CBD may benefit a wide range of patients who are suffering from debilitating conditions and we are favorable on this. From dementia to diabetes, DehydraTECH is currently in the following stages for indications which have specific unmet needs:

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So far, the data from studies on DehydraTECH have been impressive and we consider this to be a core pillar of our bullish view on Lexaria. Pharmacokinetic (PK) studies have shown that the technology can deliver higher quantities of APIs in less time. So far, this has been proven to work for CBD for hypertension, epilepsy and diabetes, oral nicotine for reduced-risk, phosphodiesterase inhibitors (“PDE5 inhibitors”), and antiviral drugs for COVID-19 and other infectious diseases.

A Commercial Growth Story That Is Flying Under The Radar

DehydraTECH has generated interest from major multi-national conglomerates and Lexaria has been able to form licensing agreements for it with Fortune 500 companies. Going forward, the company plans to expand the commercialization process by forming licensing agreements and partnerships with other global companies and we consider this to be a testament to the efficacy of the technology.

When it comes to commercial opportunities, Lexaria is focused on forming strategic relationships with companies that are interested in exploring formulation opportunities with their specific APIs of interest. The company out-licenses its technology (for up-front fees, milestone payments and/or royalty payments) and generates revenue from CPG-destined formulations to corporate clients on a toll processing basis.

We believe the market is not assigning enough value to the commercial aspect of Lexaria’s business and want our readers to be aware of this. Over the next year, we expect the company to report significant advancements on this side of the business and believe this is a major growth opportunity. 

A Biotech Company That Is Trading At A Discount 

For biotech companies, valuations tend to surge higher when positive clinical trial data is reported. According to Bay Bridge Bio, typical company valuations at the start of Phase I are USD $88 million and USD $248 million at the start of Phase II. Based on these valuations, we believe Lexaria has substantial upside potential.

At current levels, we believe that Lexaria has a compelling valuation and a favorable risk-reward profile. We are of the opinion that there is a major valuation disconnect between Lexaria and the stock market and expect this to change if positive clinical trial data is reported from the studies it is conducting.

Another reason for our bullish view on Lexaria is related to the amount of stock that is owned by the management team (including additional insider buying as recently as October, 2022). We consider this to be a testament to the strength of the business and want our readers to be aware of this.

If you are interested in learning more about Lexaria Bioscience, please send an email to support@onthebids.com with the subject “Lexaria Bioscience” to be added to our distribution list.

Company Relationship Disclosure

OTB is responsible for the OTB opinions provided in this disclosure except all sources or information provided by other parties were not verified or authenticated and OTB does not undertake to confirm or substantiate or be responsible for such information provided by other parties.

Any Content posted regarding a Profiled Issuer is not a solicitation or recommendation to buy, sell or hold securities. We cannot and do not assess, verify or guarantee the adequacy, accuracy or completeness of any information, the suitability or profitability of any particular investment, or the potential value of any investment or informational source. All information should be independently verified. We are not responsible for errors or omissions in our publications, and any opinions expressed are subject to change, without notice. We do not, nor are we under any obligation to undertake due diligence or investigation or authenticate and verify whatsoever regarding Profiled Issuers or any Content posted in relation thereto and we do not receive any verification from the Profiled Issuer regarding the Content we disseminate. Similarly, while we endeavor to facilitate the provision of quality information, we are not responsible for any loss or damages caused or alleged to have been caused by its use nor verify or authenticate or update such information.

Pursuant to an agreement between Spotlight Media and Lexaria Bioscience we have been hired for a period of 30 days beginning April 10, 2023 and ending May 10, 2023 to publicly disseminate information about Lexaria Bioscience including on the Website and other media including Facebook and Twitter. We are being paid $2,000 per month by Lexaria Bioscience and were paid “ZERO” shares of unrestricted or restricted common shares. We plan to sell the “ZERO” shares of Lexaria Bioscience that we hold during the time the Website and/or Facebook and Twitter Information recommends that investors or visitors to the website purchase without further notice to you. We may buy or sell additional shares of Lexaria Bioscience in the open market at any time, including before, during or after the Website and Information, provide public dissemination of favorable Information.

This article contains forward-looking statements within the meaning of applicable securities laws. All statements that are not historical facts, including without limitation, statements regarding future estimates, plans, programs, forecasts, projections, objectives, assumptions, expectations or beliefs regarding future performance are “forward-looking statements”. Forward-looking statements can be identified by the use of words such as “expects”, “does not expect”, “is expected”, “believes”, “intends”, “anticipates”, “does not anticipate”, “believes” or variations of these words, expressions or statements, that certain actions, events or results “may”, “could”, “would”, “might” or “will be” taken, will occur or will be realized. Such forward-looking statements involve risks, uncertainties and other known and unknown factors that could cause actual results, events or developments to differ materially from the results, events or developments expected and expressed or implied in such forward-looking statements. These risks and uncertainties include, but are not limited to, dependence on obtaining and maintaining regulatory approvals, including the acquisition and renewal of federal, provincial, state, municipal, local or other licenses, and any inability to obtain all necessary government authorizations, licenses and permits to operate and expand the Company’s facilities; regulatory or policy changes such as changes in applicable laws and regulations, including federal, state and provincial legalization, due to fluctuations in public opinion, industry perception of integrative mental health, including the use of psychedelic-assisted therapy, delays or inefficiencies or any other reason; any other factor or development likely to hamper the growth of the market; the Company’s limited operating and profitability track record; dependence on management; the Company’s need for additional financing and the effects of financial market conditions and other factors on the availability of capital; competition, including that of more established and better funded competitors; the impact of the Russia-Ukraine conflict on the global economy; the continued impact of the COVID-19 pandemic; and the need to build and maintain alliances and partnerships, including with research and development companies, customers and suppliers. These factors should be carefully considered, and readers are cautioned not to place undue reliance on forward-looking statements. Despite the Company’s efforts to identify the main risk factors that could cause actual measures, events or results to differ materially from those described in forward-looking statements, other risk factors may cause measures, events or developments to materially differ from those anticipated, estimated or intended. There can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in forward-looking statements. The Company does not undertake to revise forward-looking statements, even if new information becomes available as a result of future events, new facts or any other reason, except as required by applicable laws

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