CV Sciences is a publicly traded company, formerly known as CannaVest, and trades under the ticker CVSI on the OTC Bulletin Board. The company sources bulk raw materials from European sellers with its U.S. offices and facilities in Las Vegas, Nevada and San Diego, California.
CV Sciences operates two business segments: a drug development division focused on developing and commercializing novel therapeutics utilizing synthetic cannabidiol (CBD); and, a consumer product division in manufacturing, marketing and selling plant-based CBD products to a range of market sectors.
Company revenues dropped to $4.9 million compared to $5.1 million for the year ended June 30, 2016 as the company cut pricing on some of its products. Gross margin rose to 67.1% for the three months ended March 31, 2016 compared to 58.1% for the three months ended March 31, 2015. This increase comes as the company transitioned from its historical reliance on bulk oil sales to a more diversified and profitable business model as a manufacturer and distributor of branded consumer products.
The company reports $12,826,207 of raw material and $740,205 of finished goods in inventory as of June 30, 2016. Company executives said this of the transition to finished goods. “Last year (approx.) 90% of our sales were in bulk material and now (approx..) 80% of our sales are in finished goods.”
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CV Sciences reports its distribution of consumer products increased to 705 retail locations as of June 30, 2016, compared to the 120 retail locations in June 2015. According to SPINs, the CV Sciences’ consumer brand, PlusCBD Oil™, is the top selling CBD product in the Natural Products Channel. Distribution is growing quickly in independent, small and medium sized chains (e.g. Chamberlain Akins). No chain larger than 20 stores are yet to carry PlusCBD Oil™, nor any CBD product.
The company has developed a steadfast presence at industry conferences and tradeshows, attending more than 30 the last year, and was chosen to present on CBDs by New Hope Media, the organizers of the Natural Product Channel’s largest tradeshow, Expo West.
In December 2015 CV Sciences acquired CanX to commence preclinical drug development for a chewing gum combining CBD and Nicotine to support cessation of smokeless tobacco use and addiction.
CV Sciences paid the shareholders of CanX the aggregate sum of $250,000 in cash at closing, and reportedly will pay another $250,000 in cash at the closing of a subsequent equity or equity-linked financing. CV Sciences issued the shareholders of CanX an aggregate of 5 million shares of its restricted common stock, and is obligated to issue further shares of restricted common stock upon the achievement of certain milestones related to CV Sciences’ development of an FDA-approved drug for human consumption utilizing CBD as the active pharmaceutical ingredient (API).
Mike Mona, President and CEO of CV Sciences, had this to say about the company’s pharmaceutical ambitions. “Given our established position as a market leader in CBD consumer products, we have pivoted our corporate strategy to include the development and commercialization of innovative medicines. The remainder of 2016 will be focused on laying the groundwork for our development of novel therapeutics, utilizing synthetic CBD as the active pharmaceutical ingredient aimed at significant improvements in patient treatment for unmet medical needs.”
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Image Credits: CV Science