Lexaria Bioscience Corp (LEXX)

[Shawking]

Ted Ohashi Oct 8 Let's Toke Business
https://4495825a-d729-4d8f-ade8-e78f828e1c8d.usrfiles.com/ugd/449582_3ab1fdc0e7744e519b8ced762f6a4486.pdf
Lexaria Bioscience (NASDAQ: LEXX) (NASDAQ: LEXXW) (CSE: LXX) announced its recent oral
nicotine absorption study NIC-A21-1 results in which nicotine delivery peaked in the bloodstream 10X to 20X faster than controls and peak levels achieved were up to 10X higher. This
means DehydraTECHTM-nicotine delivered via the oral pouch product format in animals required only
2 to 4 minutes to deliver nicotine levels in blood plasma comparable to levels achieved at 45 minutes
with concentration-matched controls. In fact, just four minutes after the pouch was placed in the mouth,
the DehydraTECH-nicotine had reached a higher delivery
level than the generic oral pouch achieved at any point during
the study.
DehydraTECH-nicotine also reached statistically significant
peak blood plasma levels up to 10-fold higher overall than
controls while still clearing from blood virtually as quickly as
the controls. This is important because it means DehydraTECH-nicotine will not result in a buildup of nicotine in the body. This would be a concern to regulators. The chart above right illustrates these findings graphically: the more rapid delivery, the higher
delivery and the evacuation of nicotine using DehydraTECH-nicotine.
It is also worth noting that this test was based primarily on mucosal absorption, that is, the nicotine was
introduced into the body primarily through the mucous membranes located in the mouth and not the
digestive system. I say “primarily” because it is unavoidable for some nicotine to pass into the saliva
which is then swallowed and digested. This is another first for DehydraTECH as it adds mucosal absorption to its delivery platforms for active pharmaceutical ingredients. DehydraTECH does not function
with cigarettes or with vape devices that can cause unnecessary harm. Instead, it is focused on providing less harmful nicotine dosing methods via oral mucosal absorption.
Lexaria believes that these findings support the world’s fastest-acting nicotine oral mucosal
absorption, offering a safer nicotine alternative for the world’s 1.1 billion smokers.
“We are extremely pleased with the performance of our latest DehydraTECH-2.0 nicotine oral pouch
formulations in this study,” said Chris Bunka, CEO of Lexaria. “Our technology was ten to twenty times
faster in delivering comparable levels of nicotine into bloodstream than the peak of the concentrationmatched controls and went on to far exceed their total delivery, which should provide much greater
consumer satisfaction.” Bunka went on to say these results could render “…pulmonary administration
practices like smoke and vaping as obsolete.”
I spoke to Bunka and the next step is a larger investigation in human volunteers to compare its DehydraTECH-nicotine pouch performance to that of existing leading brands such as products including Zyn
(Swedish Match) and ON! (Altria). Although Bunka could not be specific, it appears the human study
will be started in approximately two months with some results available in the first or second quarter of
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2022. An earlier 2021 subjective human testing utilizing DehydraTECH-nicotine formulations demonstrated the onset of initial nicotine effectiveness in as little as 1.5 to 4 minutes after an oral dose.
The global nicotine oral pouch market is among the fastest growing nicotine sectors in the world with
revenues estimated at $2.3 billion in 2020 and forecast to grow to $21.8 billion by 2027. Lexaria believes DehydraTECH-nicotine is ideally suited for the oral nicotine pouch sector and that this product
format, if empowered with DehydraTECH-nicotine for rapid and more complete nicotine delivery, could
revolutionize the nicotine industry as the first practical, reduced risk category to successfully challenge
smoking tobacco. In October 2019, the Food and Drug Administration for the first time ever, authorized
reduced risk claims for certain nicotine oral pouches stating that these products “…put you at lower risk
of mouth cancer, heart disease, lung cancer, stroke, emphysema and chronic bronchitis.” compared to
cigarettes.
Conclusion: In recent months, Chris Bunka and I have spent some discussing the fact that LEXX and
LEXXW does not appear to respond to news as an experienced investor would expect. The investor
reaction to this news is a good example. These results indicate the potential exists that Dehydra-TECHnicotine in conjunction with an
oral nicotine
pouch product
could challenge
smoking tobacco. There are
still many hurdles to overcome and scientific work to be done but these results are indicative of an enormous potential for LEXX in the smokeless nicotine delivery sector.
As a result, I was surprised that on the day of the announcement, October 5. 2021. LEXX traded only
406,900 shares on the NASDAQ in an unexpectedly tight price range of $6.30 to $6.71 per share. The
volume is from NASDAQ so to make it comparable to the reporting form other major exchanges, the
406,900 should be reduced to around 203,000 shares. Yahoo Finance reports the average daily volume of LEXX as 1,141,613 shares. So this news did not even generate an average level of trading.
It is also interesting to note that very shortly after the market close on October 5, 2021, LEXX rallied
up to a high of $7.19 per share in after-hours trading. This is the period from 4:15 p.m. to 3:30 a.m. the
following day. Pre-market hours are from 4:15 a.m. to 7:30 a.m. the following day. All hours are Eastern
time. By the start of pre-market activity, the LEXX stock price had dropped back down again. As afterhours and pre-market trading data are typically not reported by the usual Internet suppliers of such
information, most investors would be unaware of this activity.
In the meantime, there was an interesting report on Lexaria BioScience recently by Zacks Small-Cap
Research titled ‘An Investment That’s Easy to Swallow’ that values LEXX at US $15.00 per share.
(to read this report Ctrl-Click here) A shorter article titled DehydraTECH™ Nicotine Pouches Could
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Make Smoking Obsolete provides an excellent summary of what these nicotine results could lead to.
(to read this article Ctrl-Click here)
I’ve said it before and I’ll say it again, Lexaria Bioscience (NASDAQ: LEXX) (NASDAQ: LEXXW)
(CSE: LXX) is my top pick for a potentially explosive market response. LEXX now has two major applications for its DehydraTECH technology to pursue: hypertension and nicotine. After the hypertension
results, I said there was potential for more and now we have nicotine. Again, now that we have hypertension and nicotine, I think there is still potential for more to come. At a market cap of under US $40
million, I feel Zack’s estimate is conservative.