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Extraction deal to give Creso Pharma (ASX:CPH) an edge in psychedelics

Health Care
31 March 2021 18:10 (AEST)
Creso Pharma (ASX:CPH) - Adam Blumenthal

Source: EverBlu Capital

Creso Pharma’s (CPH) soon-to-be subsidiary is teaming up with Canadian-based extraction specialists to manufacture high-quality psychedelic extracts.

The agreement between Creso’s potential buyout, Halucenex Life Science, and Advanced Extraction Systems (AESI) makes headway towards CPH’s goal of developing and licensing psychedelic compounds for the pharmaceutical and nutraceutical markets. Under the agreement, Halucenex will purchase an AESI extraction system.

This will rely upon a receiving a Dealer’s Licence and Licence Amendment from Health Canada, which will allow the production of botanical psychedelic extracts from psilocybin mushrooms for future research and development.

Halucenex anticipates the receipt of the Dealer’s Licence imminently, with the Licence Amendment expected to be received within 45 days after the grant of the Dealer’s Licence.

Halucenex will also seek to produce a naturally extracted product that has been certified by under Good Manufacturing Practice for use in future clinical trials, subject to approval by Health Canada.

The deal with AESI will help increase psilocybin supply security for Halucenex, reducing its reliance on third parties for in-demand supply.

AESI is based in Charlottetown, Canada and specialises in the design, engineering and fabrication of supercritical fluid CO2 extraction systems with a specific focus on the medical and recreational cannabis and hemp industries.

The CO2 Supercritical Extraction System will take approximately six to eight weeks to design and install at Halucenex’s onsite laboratory and cost approximately $70,000 to build.

“This agreement with AESI is a major development for a number of reasons,” Halucenex Founder and CEO Bill Fleming said.

“Firstly, the ability to extract psychedelic compound concentrates will allow us to progress the development of a number of delivery methods with broad applicability, including capsules, sprays, tinctures and lozenges amongst others, which may result in a higher standard of treatment,” he continued.

“Additionally, the extracted product will allow us to analyse, characterise and compare the major components in various psilocybe mushroom strains through our established laboratory setting, leading to initial research and the potential entourage effects of psychedelic compounds.”

Fleming said the company anticipates that considerable future research will be undertaken between synthetic and botanical psilocybin to fully understand the benefits it can offer.

“Having the extraction system in place and the ability to produce solvent-free distillate in-house will be key for future comparative bioactivity studies,” he said.

Creso Pharma shares rounded off the trading day at 20 cents each.

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