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<h4>Overcrowding in 2015</h4>
<p>Speaking to INN, Technical420 founder Michael Berger agreed that the Canadian election was a major cannabis space catalyst in 2015, but said that the industry also had a rough time due to the influx of companies to the space since 2014.<br/>
“T<strong><span>here are currently too many stocks out there, with over 300 companies available for investment, and I would say 80 to 90 percent will not be around during the next two years,” he said. “One thing that it has really done to the market it spread out the capital among way too many companies. In early 2014 you maybe had 40 to 50 companies, and now that there are 300 the money is spread very thinly. It has been really tough for these companies to grow from a stock appreciation perspective. I definitely see a shakeout coming, it’s only a matter of time.”</span></strong><br/>
Even so, he emphasized that there are a lot of legitimate companies out there. He said that in the fourth quarter of this year, s<strong><span>ecurities analysts for penny stocks began pressuring investment firms to look out for penny stock fraud and to restrict trading in Canada securities, which “</span></strong>is going to be a headwind for a lot of the companies, but will also help with the shakeout process.”<br/>
Linton also spoke to the number of companies in the space, commenting, “t<strong><span>he nice part is that there are a lot of companies popping up that wish to be in the business, but there are still currently a total of 26 licences issued in Canada, and we have four of them. There are only a handful of legitimate-quality companies.”</span></strong></p>
<h4>Changes in 2016</h4>
<p>Moving forward, many will no doubt be eyeing Trudeau’s next moves toward cannabis legalization in Canada; the results of the US presidential election will also likely have a huge effect on the industry. Indeed, Berger thinks that the election is going to be a catalyst for legalization, and noted that a number of swing states have legalized some form of marijuana, while quite a few <strong><span>states are going to put recreational or medical marijuana on their ballots. </span></strong><br/>
Another major catalyst for the cannabis industry in 2016 will be test results from GW Pharmaceuticals (NASDAQ:<a href="https://www.google.ca/finance?q=NASDAQ%3AGWPH&ei=ZytWVvuWFeKDiwLUqpSIAw" rel="noopener noreferrer" target="_blank">GWPH</a>), which currently has three different drugs in the Stage 3 FDA testing phase. Those include Epidiolex for <a href="http://ir.gwpharm.com/releasedetail.cfm?ReleaseID=912152" rel="noopener noreferrer" target="_blank">the treatment of Lennox-Gastaut syndrome</a>, a rare and severe form of childhood-onset epilepsy, and Epidiolex <a href="http://ir.gwpharm.com/releasedetail.cfm?ReleaseID=904147" rel="noopener noreferrer" target="_blank">for Dravet syndrome</a>.<br/>
“O<span>nce one of these makes it through … </span><span>it will change how the FDA and DEA view cannabis because they simply cannot pretend that there aren’t medical benefits associated with cannabis,” Berger explained. “So this will be a huge industry for the whole market in the short term.”</span></p>
<p class="">As of August 2016, GW has <a href="http://www.gwpharm.com/PR090816.aspx" rel="noopener noreferrer" target="_blank">reported</a> two positive Phase 3 trials for Epidiolex. The company is also on track for its NDAfor both Dravet and LGS indications, slated for H1 2017 submission.</p>
<p class="">Berger also noted Canopy Growth and Aurora Cannabis (CSE:<a href="https://www.google.ca/finance?q=CNSX%3AACB&ei=sE5WVrmWKuKDiwLUqpSIAw" rel="noopener noreferrer" target="_blank">ACB</a>) as two companies of interest. He referred to Canopy as one of the best long-term investments and praised Aurora for its brand new, state-of-the-art facility. Aurora is licensed for both marijuana cultivation and <a href="http://www.marketwired.com/press-release/health-canada-issues-a-sales-license-to-aurora-cannabis-inc-cnsx-acb-2077741.htm" rel="noopener noreferrer" target="_blank">sale</a> under Health Canada’s Marihuana for Medical Purposes Regulations.</p>
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<p class="p1"><strong><span class="s1">This is an updated version of an article first published on <b>Dec 9, 2015</b> on Cannabis Investing News.</span></strong></p>
<p><strong>Securities Disclosure: I, Kristen Moran, hold no direct investment interest in any company mentioned in this article.</strong><br/><strong>Related reading: </strong><br/><a href="/daily/cannabis-investing/canadian-cannabis-stocks-justin-trudeau-liberal-party/?nameplate_category=Cannabis%20Investing" rel="noopener noreferrer" target="_blank">Canadian Cannabis Stocks Rise on Election Results</a><br/><a href="/daily/cannabis-investing/legal-cannabis-stocks-north-america/?nameplate_category=Cannabis%20Investing" rel="noopener noreferrer" target="_blank">Legal Cannabis Stocks in North America</a><br/><a href="/daily/cannabis-investing/how-to-invest-in-medical-cannabis-hemp-us-canada-north-america/?nameplate_category=Cannabis%20Investing" rel="noopener noreferrer" target="_blank">How to Invest in Medical Cannabis</a></p>
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