Nextleaf Develops Technology to Produce Distilled THC-Free CBD Oil (CSE: OILS) (OTCQB: OILFF)

“We are incredibly excited for this technology to remove the THC and get the tax out of our CBD oils,” said Nextleaf Co-Founder and CEO Paul Pedersen. “Adding THC-Free CBD ingredients to our portfolio is further validation of our team’s ability to innovate and will help unlock mass market CBD therapeutic products.”

Nextleaf believes that excise tax-free molecules like THC-Free CBD will be a disruptive ingredient within the Canadian market, and an alternative to CBD isolate for those that prefer a more holistic cannabis product.

As jurisdictions around the world, like Germany and Mexico, begin to announce cannabis legislation, the Company anticipates its patented technology to produce standardized THC-Free CBD ingredients within a regulated market will unlock further opportunities to export Nextleaf’s IP, brands, and products.

Excise Tax-Free Delta-9-THC Alternative

Last month, Nextleaf announced that it produced D⁹-tetrahydrocannabinol acetate (D⁹-THC-OAc, delta-9-THC-OAc, THC-OAc), colloquially referred to as THC-O (“THC-O”). The Company has received strong interest in its THC Alternative Ingredients from provincial government buyers and other manufacturers.   

Federal Regulators have confirmed the Company’s understanding that THC-O is not subject to excise tax as it does not meet the definition of “Total THC” as defined under the Excise Act 2001, which is aligned with the definition of the same in the Cannabis Act.

With THC-O, Nextleaf sees potential for market disruption by launching its novel cannabinoid ingredient as a tax-free alternative to delta-9-THC. Excise tax on delta-9-THC extracts makes up a large portion of the price consumers pay, with some delta-9-THC products subject to excise tax over 40% of the duty paid landed cost to provincial government distributors and medical cannabis pharmacies.

Nextleaf is commercializing its plant-based THC-O ingredient as a therapeutic product sold under the Company’s brands through provincial distributors and medical cannabis sales partners.

Anecdotally, THC-O products are reported to have psychedelic-like effects, and are longer-lasting with more gradual onset, as compared to delta-9-THC.

Nextleaf’s patented process to manufacture THC-O enables the standardization of a more potent analog of delta-9-THC. The Company has been issued U.S. and Canadian patents for its method to produce THC-O.

With the addition of THC-Free CBD Distillate, the Company can now offer its licensed manufacturing partners two distinct tax-free cannabinoids through bulk ingredient purchase.