New Opportunity in the Cannabis Industry
This profile is part of a paid investor education campaign.*
FluroTech (TSXV:TEST) is an Alberta-based technology company dedicated to providing a fast, accurate, and cost-effective testing platform for the cannabis industry. To this end, FluroTech Ltd. has designed and developed a proprietary technology, CompleTest™, which uses fluorescence spectroscopy technology with specific test kits that each measure the content of a given attribute including CBD, THC, pesticides, heavy metals and more.
The CompleTest™ device was developed in collaboration with the University of Calgary and the University of Alberta, originally conceptualized by FluroTech CTO Dr. Elmar Prenner. The portable, user-friendly device provides accurate results within minutes. This is in contrast to traditional lab testing, which typically takes between three days and three weeks to deliver results.
As regulated cannabis markets continue to emerge in North America, and with Canadian legalization underway, the need for rapid and effective testing is pressing. Regulatory bodies will require licensed producers to test their products to ensure they meet the established requirements for sale putting increased pressure on the already overloaded certified labs. As the industry is currently supplied by labor-intensive and expensive third-party testing laboratories, cultivators, processors and retailers are recognizing the benefit of having access to a user-friendly solution on-site that can be employed during the entire growing cycle. In addition, the technology could be indispensable for government regulators and enforcement agencies looking to implement roadside testing of cannabis product use.
CompleTest™ plays a key role in testing cannabis for potency and contaminates, providing greater ease and efficiency for licensed producers to optimize harvest time while delivering a safe product. The device along with associated test kits are set to be invaluable across the entire cannabis chain, from growth to extraction to consumption.
FluroTech has completed their heavy-metal testing kits and their THC and CBD potency testing kits, which will be available for purchase in November 2018. The company has also developed a biomarking technique and has accelerated the development of a roadside testing device. These will be followed by an additional three revenue streams including pesticide testing, myclobutanil – aflatoxins testing and industrial testing. As the company continues to develop its capabilities, it will also work towards securing global patents for its proprietary technology as it penetrates markets in the US and worldwide.
With plans for revenue generation commencing late Q4 2018, FluroTech has initiated establishment of a licensed producer customer base in Canada, initially in the Alberta and British Columbia regions. Both provinces host numerous licensed producers, ranging from recent market entrants to established, profitable corporations. The company is engaged with a number of producers to conduct field trials to further refine its product. Once FluroTech has expanded across Canada, the company plans to target the United States, followed by further expansion into the European market.
FluroTech is led by a management team with extensive experience in biotech, finance, and marketing. The team includes Dr. Elmar Prenner, company CTO, who holds two patents for antimicrobial peptides and optic filters. Management is significantly invested in the company, holding over 35 percent of shares.
- Proprietary technology designed to test cannabis products for multiple attributes
- Seven planned revenue streams
- Revenue generation to begin in Q4 2018
- Heavy-metal testing kit is ready to market.
- Developing roadside testing device on an accelerated development schedule
- THC and CBD test kits are a proven alternative to existing technology
- Developing a method for biomarking cannabis
- Establishing initial customer base in Alberta and British Columbia, Canada
- Strong management team includes innovators in the space
- Management holds over 35 percent of shares
CompleTest™ Testing Technology
The CompleTest™ device and its test kits has been designed to provide quick, consistent and accurate results for users across the cannabis supply chain and regulatory environment. Focused on consumer safety, the technology helps provide concise insight into the contents of a given cannabis product. FluroTech expects the products to be available for purchase in Canada late Q4 2018 and anticipates selling their device internationally in 2019.
Through the design of various test kits, which each test for different materials, plus additional testing scenarios, FluroTech has developed seven potential revenue streams that will be deployed to market sequentially.
Heavy Metal Test Kits
The first revenue stream is a focus on heavy metal testing specifically identifying materials like cadmium, mercury and lead, all dangerous to consumers in small amounts over time. The test kits are able to measure the quantities of heavy metals in parts per billion, which is more accurate than the part per million measurement that is required by Health Canada standards.
The test kits are compatible with a heavy metal scope and the CompleteTestTM device to provide fast, accurate and consistent in-house testing results that are also cost-effective. Each test result will be logged into FluroTech’s software, which can then be transferred to an external database. Additionally, each kit comes with a training application that teaches users how to conduct the tests within a half hour and allows supervisors to monitor staff’s progress and test results.
THC and CBD Test Kits
The second test kit that will hit the market is designed to measure potency. This will include testing for levels of THC, cannabis’ psychoactive component, and CBD, the plant’s medicinal attribute. In September 2018, FluroTech completed the development of the test kits for THCa and CBDa, which will be able to provide onsite results within 15 minutes using the company’s CompleteTestTM. The solution will provide time saving benefits for companies as testing can be done onsite and with greater accuracy.
Later in the month, FluroTech announced that preliminary good manufacturing practices (GMP) validation testing, completed by the University of Alberta, recorded a less than two percent difference on the THCa and CBDa assays from the CompleteTestTM device when compared to the industry quality-control standard High Performance Liquid Chromatography (HPLC) technology. HPLC analytic equipment requires a highly-technically trained individual to operate it, can be an expensive purchase and takes time to process the data.
Pesticide Test Kits
The third test will identify myclobutanil, a fungicide, and aflatoxins, which have been labeled as poisonous carcinogens produced by certain molds in soil and decaying vegetation. This will be followed closely by the fourth revenue stream, testing for pesticides.
Roadside Testing Device
FluroTech is developing, on an accelerated schedule, a roadside testing capability for its CompleteTestTM device. This would allow law enforcement to easily, effectively test for cannabis use via a simple saliva swab, which is being designed to be completed in less than two minutes.
The device will utilize a validated and proprietary spectroscopy-based technology that will be able to work in a wide range of ambient temperatures and suppress background substrates. The device will be easy to use by law enforcement in the field, as the entire test routine will be completed in under 10 minutes.
“Based upon the other successful tests designed for cannabis, the Company believes its device test results will have a high level of accuracy and reliability,” said Dr. Prenner. “Our development team is benefiting from the feedback from government officials and law enforcement who have detailed the issues with the devices they have tested.”
The company will present this solution to Canada’s Department of Justice for consideration. Roadside testing capability would also open up another market and revenue stream, industrial testing.
The company believes that plant biomarking will play a significant role in a regulated cannabis industry and will provide another revenue stream. In this context, licensed producers would biomark their plants to prove they are ‘legal’ allowing regulators and customs enforcement to use FluroTech’s device to test product for those distinct biomarkers.
In July 2018, FluroTech announced that the company, in collaboration with a team of nanoscientists, botanists and biochemists, was able to provide proof-of-principle for biomarking cannabis oil in a fast, cost-effective manner that requires no technical training. The biomarking identification techniques use the company’s CompleteTestTM technology. This is the first phase in FluroTech’s development of a seed-to-sale tracking solution.
“The Company has achieved an important milestone in commercializing its unique pharmaceutical grade biomarking technology and we are engaging in discussions with national and international industry stakeholders to ensure licensed producer brand protection and a reduction of illegal black-market product entering the legal system,” explained Dr. Prenner. “Other biomarker companies utilize relatively expensive DNA strands that can be labeled and deposited on the surface of cannabis products. In this process, often expensive and time consuming third-party laboratories must be engaged to validate the DNA strand. FluroTech’s pharmaceutical biomarker can be validated utilizing the portable or desktop CompleTest™ device.”
Danny Dalla-Longa—CEO and Director
Danny Dalla-Longa brings over 35 years of corporate finance and valuation experience. He was a partner at a major international accounting firm for over 18 years. He also served as an MLA, as the energy critic in the Alberta Legislature. Dalla-Longa holds a B Comm. degree in Chartered Business Valuation, is a Certified Business Appraiser and has a Chartered Accountant designation.
Dr. Elmar Prenner—CTO and Director
As Founder and CTO of FluroTech, Dr. Prenner brings over 28 years of expertise in fluorescence spectroscopy. He holds two US patents on antimicrobial peptides and optic filters and has contributed to over 70 peer reviewed publications. He also works as a Professor at the University of Calgary, within the department of Biological Sciences.
Rex H. Kary—COO
Rex H. Kary brings to this venture 38 years of marketing and finance experience with early stage companies. Often his responsibilities included the negotiation and implementation of multi-jurisdictional transactions with long term agreements for the purchase and sale of company’s current and future production.
Gary Jones holds a B Comm. (Hons) and was one of the Managing Partners for a Private Equity firm involved in the Energy Sector. He still serves as a Director for a number of Canadian private companies. He has also served as Vice-President, Investment Counsellor for one of Canada’s major Financial Institutions.
Dr. Kirat Singh—Director of Research
Dr. Kirat Singh holds a PhD in physics from the University of Salford, England. He is the inventor of eight filed patents, focused mainly in optical technology. He conducted the first 2-D simulation of Anti-Resonant Reflecting Optical Waveguides. Dr. Singh is also the recipient of a Marie Curie Fellowship to develop microfluidic technology.
Duane Sniezek—Director of Science and Technology
Duane Sniezek is the CEO of Terecel Inc., a technology management company focused on driving business results from technology. Duane has a proven executive management track record starting and running 12 private and public companies. With over 30 years of technology strategy, management, product development and commercialization experience, he has a successful track record of launching new products to market. Duane holds a B.Sc. in Electrical Engineering and a B.Sc. in Computer Science from the University of Saskatchewan, and a Diploma in Electronics Engineering Technology from the Southern Alberta Institute of Technology.
Sid Dutchak is the President of Genstate Development Corp, a private Calgary-based consulting firm. He holds a Bachelor of Laws Degree from the University of Saskatchewan, where he practiced commercial and corporate law for many years. He also served as Minister of Justice and Attorney General in Saskatchewan. In Calgary, Dutchak served as Director and Executive Officer for several companies listed on the TSX, TSXV and NASDAQ exchanges in sectors including technology, resource development, oilfield services and entertainment.
Dr. Brendan Mills—Director
Dr. Brendan Miles is an academic family physician and Assistant Professor at the University of Calgary. He holds Medical Doctor, Master of Public Administration and BSc (Honours) degrees from Queen’s University.
After working as a community family physician in Calgary and New Zealand, he became an academic family physician in July 2015, when he joined the University of Calgary Department of Family Medicine Residency Training Program full time. He works in the roles of Enhanced Skills Program Director and Education Site Lead at the Sunridge Family Medicine Teaching Centre where he is also a Major Clinical preceptor. He has been extensively involved in Behavioral Medicine and Mental Health teaching and curriculum development within the program.
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The information contained here is for information purposes only and is not to be construed as an offer or solicitation for the sale or purchase of securities. Readers should conduct their own research for all information publicly available concerning the company. Prior to making any investment decision, it is recommended that readers consult directly with FluroTech and seek advice from a qualified investment advisor.