At the end of last month, Cannabis Science Inc (OTCMKTS:CBIS) got a big boost on the back of some news that the company had sold out on an initial test run of one of its lead products. A sold out test run is great news, of course, but in the context of Cannabis Science’s operational strategy, what does it actually mean for shareholders? In turn, and taken against the more recent correction that has brought the company to trade nearly 30% off early Feb highs, what’s next for Cannabis Science’s PPS?

Let’s take a look, and try and answer both questions.

So, for those new to the company, Cannabis Science bills itself as a phyto-cannabinoid development company. Phyto-cannabinoid is a bit jargony, but it really just relates to a compound found in the cannabis plant, which a raft of legacy data suggests has the potential to be an effective treatment in a range of indications.

There’s a collaboration effort in place with Dana Farber/Harvard Cancer Center (DF/HCC) to develop some pre clinical oncology assets – something we touched on in our previous highlighting of the stock (as a side note, we concluded in that piece that there was some real run room on a near term play – the company ran up 30% in around 72 hours post publication). This collab should serve up some nice near term catalysts, and is a back burner operational highlight.

What about the sell out product, however?

Well, it’s called a CBIS Metered Dose Inhaler (MDI), and it’s designed to deliver a dose of a cannabis compound in the form of a dry powder by way of (as the name suggests) inhalation. There are various dosing capabilities associated with this MDI product, and it’s designed as a rescue device; for an asthma sufferer having an attack, that sort of thing.

There are a couple of key points in our eyes.

The first, that this is a neat device, but it’s not game changing. With that said, there are others like it, but none that (as far as we can tell) are being marketed as cannabis compound specific, like this one is. That’s a plus point for Cannabis Science – small, but a plus point nonetheless.

The second is this was a very small run. We don’t have the numbers (the company hasn’t made them publicly available) but it was basically one batch sent to one center in California. If it hadn’t have sold out, and there was still some sitting on the facility shelves, we’d be worried. It has sold out, of course, and that’s great, but it was sort of expected.

Don’t read into this as us being negative about the stock, however. Sure, the news isn’t all that valuable to long term operations, but it tells us something very important – that markets are willing to react, and react strongly, to any suggestion that there’s a market for Cannabis Science’s products. This is very important right now.

Why? Because there’s not going to be any value realization from the oncology platform for a while. By their very nature, drug dev platforms are drawn out in progression. As such, while there’s probably a strong bull thesis rooted in the above mentioned Harvard collaboration, Cannabis Science is going to need something to bridge the gap between the present time, and that program starting to add-value.

This inhaler program looks as though it’s able to fill said gap.

There’s still plenty of risk, of course. Cash is an ever present concern, with dilution always just around the corner at this end of the market, and the oncology platform is young and – by proxy – unpredictable.

With that said, the company now has both a near and far term outlook, and where it currently trades (which looks to be in and around strong support from a technical perspective) could be a nice entry ahead of a return to the upside momentum.