Here’s why the Creso Pharma (ASX:CPH) share price is surging 6% today

The cannabis and psychedelics company released a positive update today.

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Back view of a man lifting hish hands high in front of hemp plants grown for cannabis.

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The Creso Pharma Ltd (ASX: CPH) share price is climbing today after its Canadian subsidiary announced it has secured approval to produce more psychedelic substances.

At the time of writing, Creso Pharma shares are in the green, up 6.25% trading at 10.2 cents.

Creso Pharma is a cannabis and psychedelics company with operations in Switzerland, Canada, Colombia, Israel and Australia. In July, Creso Pharma completed the acquisition of Canadian-based psychedelics company Halucenex Life Sciences.

What did the company announce today?

Today, Creso Pharma had some positive news for the ASX market about Halucenex Life Sciences. Halucenex has secured an amendment to its dealer licence from Health Canada.

The company said this would enable it to produce psychedelic substances including psilocybin, ketamine, LSD, salvia divinorum, harmaline, salvinorin A, and MDMA.

Halucenex also plans to start growing its own botanical psilocybin and manufacturing psilocybin. And is looking to spearhead more research and development on botanic and synthetic psilocybin.

Halucenex will forward with a clinical trial investigating the use of psilocybin to treat post-traumatic stress disorder, pending regulatory approval.

Management commentary

Halucenex CEO Bill Fleming said:

We will now begin the steps towards synthetic psilocybin manufacture and botanical psilocybin growing immediately.

Both of these initiatives have the potential to deliver a number of commercial and research and development benefits and will shape future product development, clinical trials and potential licencing agreements.

Creso Pharma share price snapshot

The Creso Pharma share price has soared 62.70% over the past 12 months. This has outpaced the S&P/ASX 200 Index (ASX: XJO) which is up 9.8% over the same period.

However, in the 2021 year to date, the company’s shares are in the red by around 43%. Creso Pharma shares are also down from the monthly high of 15 cents on 8 November.

The company’s shares reached a 52-week high of 25.5 cents on 11 December 2020.

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The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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