Stock markets are headed toward their newest record highs in the S&P 500 and Dow Jones Industrials, and economic news has been great if you are a long-term investor with exposure to the equities benchmarks. But if you are an investor that looking for true growth potential, your task is much more difficult. This is why industry selections within your portfolio allocations are important now more than ever, and this means a more creative approach is warranted with stock markets at these levels.
When looking to identify industry sectors capable of sustainable growth, there are not many options that have the potential to surpass forecasts that have been made with respect to the entrance of medical cannabis into the world of pharmaceutical treatments.
Impact of Recent FDA Warnings
Recently, there have been media stories highlighting FDA warnings for companies to stop making unproven claims that marijuana has the capability of curing cancer, saying that they will not allow "companies to market products that deliberately prey on sick people with baseless claims that their substance can shrink or cure cancer.” Furthermore, the reports have gone on to say that the FDA is “not going to look the other way on enforcing these principles when it comes to marijuana-containing products."
Stock Standouts in the Sector: Cure Pharmaceutical
On the surface, this might look like a negative for investors with heavy exposure in the medical marijuana industry. But the latest declines in prices really allow new buying opportunities to unfold if you are looking to build stock exposure at current levels. One of the most interesting names in the space is Cure Pharmaceutical Corp. (OTCMKTS: CURR), which has made significant advancements in its product pipeline as a means for identifying the true capabilities of cannabinoids in treating various forms of cancer.
Stock valuations in CURR are currently trading -75% below its 52-week highs, marking a steep discount in what is thought by many to be a broadly overvalued market. The S&P 500 has already made gains of roughly +20% this year, and so the extended valuations in the broader market do not support the argument for new buy positions. So when we add this to the fact that key players in the emerging marijuana sector are trading at significant discounts, there is a strong possibility for substantial upside when gaining stock exposure at current levels.
The current trends could reverse sharply, however, once the FDA realizes the breadth of research that has been done to suggest strong efficacies in the use of cannabis in treating cancer. In a collaboration with the Technion Israel Institute of Technology, the strategic course taken by Cure Pharma lies in researching the ways different cannabinoid compounds can be used to treat various subtypes of cancer. With this research, the two companies will offers ways to predict how to match a cancer subtype with an effective cannabis extract (to optimize treatment).
With these efforts, Cure Pharmaceutical has the chance to clarify the antitumor effects of phytocannabinoids and terpenes on various cancer-driving mutations and pathways, as well as further revealing the mechanisms of the cannabinoid-mediated antitumor effects. This will allow the identification of new drug candidates as well as create the ability to optimize cannabis treatment options for patients, furthering efforts toward the creation of personalized medicine.
Cure’s Industry Diversity and Product Innovations
Another important factor is that Cure Pharmaceutical has developed innovative product technologies that will likely have a significant impact on the way most people consumer medicine. The broad diversity within the company can be seen with its proprietary dosage and delivery systems known as CureFilm™. Drug compliance is one of the most problematic issues facing biotech companies today, and CureFilm™ can be applied to a broad range of molecules to improve drug efficacy, safety and the overall patient experience. Cure aims at targeting new chemical entities and marketed drugs from traditional pharmaceutical actives to emerging cannabinoid molecules. Cure’s delivery systems can offer unique strategic advantages -- and with the stock price trading at extremely cheap levels, it appears as though the upside for investors could be quite substantial.
Cure Pharma has proven its commitment to commercializing innovative therapies that address significant clinical unmet needs, and this points to an undervalued company when viewing the stock on its price charts. For investors, this is a story that is unlikely to fade from the headlines any time soon. While the FDA is telling companies to stop saying that cannabis can adequately treat (or even cure) cancer, there are innovative biotechs that are now capable of proving otherwise. Once these trends start to become more apparent, industry innovators like Cure Pharma could see significant rallies in their share prices.