What a time to be alive; there was a period in our civilized history where getting alcohol on a Sunday was a tough racket, now we’re exploring the safe supply of cocaine, goverment sold weed, prescribed MDMA, magic mushroom microdosing and, increasingly, the wondrous powers of peyote being safely available to those who partake.

It hasn’t always been easy to do the peyote thing, at least without befriending a self-professed ‘shaman’, usually a first year BCIT Engineering student with dreadlocks who calls himself Mujambo (though his student ID says Charles) and crashing a Third Beach drum circle.

But it doesn’t have to be that way. Peyote has a host of use cases, most of which don’t involve white kids and drums, thank god.

Just as with shrooms, which are now becoming a mainstream alternative to cocktails and weed, those trying peyote and other psychedelic substances are increasingly boomers and beyond. They have pension plans and PT Cruisers. The Age of Aquarius has moved from a tie-dye poainted mini-bus to a store in the mall.

Which is why Lophos Holding (MESC.C) is seeing its stock volume increasing hard of late.

In Canada, Peyote is legally accessible due to an exemption from the Controlled Drugs and Substances Act (CDSA), and Lophos is North America’s largest cultivation and research facility to deal with peyote cactus. Peyote is also legally available in the United States, under certain circumstances, and several other countries permit the owenrship and use of the substance.

So why isn’t in every drug store?

A couple of reasons.

First, it takes 13 years to harvest, an issue Lophos says they’ve figured out, and which will come down to as little as three years in their facility.

Second, it’s not well understood outside of First Nations circles, so Lophos has gathered a  leadership team of individuals with diverse backgrounds, from biotechnology, pharmaceutical manufacturing, food technology, quality assurance, and cybersecurity, as well as indigenous groups, so they can properly respect and produce the plant.

That’s a good start, but you also need Health Canada on board to run things in a consistent, safe, secure, licensed way or else you’re just another white guy with dreadlocks and birkenstocks.

Thankfully, Lophos has been dealing with Health Canada for some time now, and are trusted by the regulators enough that they recently had their license expanded, and the government body has deemed Lophos’ primary product – peyote – to be a natural health product.

Health Canada’s recent recognition of lophophora williamsii [aka peyote] as a natural health product ingredient marks a pivotal moment in the therapeutic use of psychoactive plants, reinforcing Lophos’s position at the forefront of this innovative field.

Lophos Pharmaceuticals Corp., a wholly owned subsidiary of Lophos Holdings, operates from Napanee, Ont., focusing on the cultivation and production of lophophora williamsii. This decision by Health Canada not only highlights the therapeutic potential of lophophora williamsii but also demonstrates Lophos’s commitment to integrating traditional wisdom with modern science to revolutionize natural health products.

This move opens avenues for novel and innovative applications of psychoactive cacti for medicinal purposes and there’s no company in Canada that has done as much of that work to this point as Lophos.

I spoke to the company early in the week, and they tell me they’re looking to have enough peyote to sell to the public by year end, with enough cash runway to not need any financing until that point.

With a super low cash burn in the low five figures per month, a level of trust with regulators that sees them actively working with oversight groups to ensure responsible product development, and a controlled substance dealers licence that allows responsible cultivation and production at Lophos’s Ontario facility. I’m being told the company has its ducks in a row and expects ongoing news over the coming months.

Their recently amended license allows the company to research and develop products involving mescaline, psilocybin, ketamine, MDMA, LSD and more, and in the last few days they announced they’ve finalized product release specifications for dried and fresh peyote – while their competitors haven’t even started work on the plant due to its long time frames to grow and difficulty to acquire in commercial quantities.

I’ve talked up Lophos before, but previously the potential drawback on the stock was its low liquidity and somewhat low cash holdings. Now the volume is picking up and their cash spend is marginal, which gives the group a good solid run up through til the end of the year to show folks what they can do. That’s seen the stock, which was $0.03 last time I talked it up, run to $0.08 before profit taking took it to $0.055 at the time of writing.

This is an interesting little deal with a very tight $4.7 million market cap, which I think is a steal.

Mind you, it was a $2 million marke cap last time we told you it was a steal. Hopefully you listened.

Either way, as the federal and provincial governments continue their march towards a safe zupply of controlled drugs, their dependence on companies like Lophos to provide that supply will only grow.

— Chris Parry

FULL DISCLOSURE: Lophos os NOT an Equity.Guru marketing client, but that may change in the weeks and months ahead.