Auxly Cannabis Group Inc. (TSXV:XLY) (OTCQX:CBWTF) has announced the receipt of key cannabis oil sales licenses, but Auxly stock has dropped nearly 4%.
The licenses apply to two of Auxly’s wholly-owned subsidiaries, Dosecann and Kolab, and will allow the company to sell cannabis oil products when they become legal following legalization 2.0 in October. While the company views this Health Canada approval as a significant milestone in furthering its brand strategy, investors in Auxly stock clearly aren’t feeling as bullish with shares dropping nearly 4% to $0.725.
Dosecann is Auxly’s home for derivative product development, based in Prince Edward Island, and is also one of the company’s cornerstone brands. Dosecann has been accumulating oil-based cannabis products in preparation for receiving approval from Health Canada and is now well-positioned to take advantage of the cannabis derivatives market, which is set to rocket once legalized next month and could be an important factor in transforming the fortunes of Auxly stock.
Meanwhile, Kolab is Auxly Cannabis Group’s craft cultivation facility, which focuses on providing high cannabis flower, pre-rolls, and other derivatives and today’s licensing will allow the brand to expand its product offering, with the new range of oils being manufactured by Dosecann. Kolab has also submitted an application to amend its oil sales licenses so that it can begin offering other cannabis derivatives such as topical and vapes.
“These sales licenses are a key regulatory milestone for Auxly in executing our business plan of launching derivative products later this year […] We are firmly on track for our broader derivative product launch and look forward to bringing our portfolio of innovative derivative products to Canadian consumers later this year,” said Auxly CEO Hugo Alves in today’s statement. With the impressive expansion of its portfolio permitted by these new licenses, Auxly stock looks on track to meet analysts expectations of becoming the fastest growing pot stock next year.
Featured image: Canva