Small cap cannabis plays Queensland Bauxite and Algae Tec are teaming up to enter the world of animal therapeutics.
Shares in both companies surged on Friday, Queensland Bauxite (ASX:QBL) trading up 18 per cent and Algae Tec (ASX:AEB) 25 per cent.
Under the agreement, AEB will licence seeds from QBL’s subsidiary Medical Cannabis (MCL) to establish cannabis-based supplements and medication for animals.
Algae Tec say they’ll be developing medical cannabis products for anxious or in-pain pets from next year.
“There’s no doubt we have secured one of the most coveted assets in the medical Cannabis industry, being our own exclusive lawful and licensed Cannabis seed bank for our further business development,” chairman Malcolm James said.
“We are adamant that 2018 will essentially be an extremely busy and fruitful year with many plans being put into action while both our companies take advantage of new and innovative opportunities this agreement now opens for us.”
In particular, they’ve got their eye on MCL’s low THC variety, with hopes that there could be lessons learnt in pets that are applicable to humans down the line.
“We’re all well aware that all genuine drug development involves animal testing, and there definitely is no better place to start the journey than to look at large stock, other farmed livestock and companion animal drug development which will produce an immense amount of data to feed into subsequent human applications,” MCL technical director Andrew Kavasilas said.
Under the licensing agreement, MCL will become a 19.99 per cent shareholder in AEB with 50 million shares to be paid as a deposit.
AEB was trading at 2.5c at midday on Friday, and has traded between 1.8c and 6.5c over the last year.
The value of the vet supply industry is estimated to be in the multi billion dollar range, but these two aren’t the only ones in the pet pot realm.
Dedicated cannabis pet product developer CannPal listed earlier this year but was today trading below its 20c issue price, at 19c.