Shares of Tilray Inc., a pharmaceutical company based in British Columbia, Canada, set a record high for a second time, rising as much as 28 percent to $153.88 as of 1:35 p.m. in New York on Sept. 18. The surge happened after it gets approval from the U.S. Drug Enforcement Administration to import cannabinoid drug into the United States.
DEA approved the import of cannabinoid for a clinical trial at the University of California San Diego Center for Medicinal Cannabis Research. The trial is aimed at examining the safety, tolerability, and efficacy of cannabis in the treatment of Essential Tremor, a neurological movement disorder characterized by involuntary and rhythmic shaking.
The increase in its shares price will add to Tilray's market valuation of nearly $3 billion, Bloomberg reported. The rise is also pushing the company's valuation above $14 billion which will place the company in the top position as the largest cannabis company, Bloomberg said.
For the trial, Tilray will provide researchers with a cannabinoid in capsule form. In this form, researchers will be able to examine the two essential ingredients of the formulation - the cannabidiol and tetrahydrocannabinol which are both extracted from the cannabis plant.
The study, to be headed by Fatta Nahab, a neurologist and director a lab at the UC San Diego Health's Movement Disorder Center, is expected to begin in early 2019.
Brendan Kennedy, Tilray's CEO, said he is aiming for a $100 billion market valuation for the company and that instead of aiming to be taken over by a bigger company in the future, he aims for Tilray to be the one buying other entities along the way.
Bloomberg reported that Tilray's shares ascend to about 800 percent since it began trading publicly in July. The company's valuation has exceeded the market's expectation in a very short time. The market has since been calling for Tilray to release more shares into the public.
At present rate, Tilray is outperforming its rival Canopy Growth Corp. which was the first cannabis company to attain a $1 billion valuation. Canopy's valuation at present is only at $11.5 billion.
In comparison, Tilray now has doubled the size of Alcoa Inc., the biggest aluminum company, and Barrick Gold Corp., the top producer of precious metals. Last year, Barrick earned more than $8 billion while Tilray's revenue was only at $20 million.
Bloomberg noted that the secret behind Tilray's rapid ascent is its decision to list on the Nasdaq instead of the Toronto Stock exchange. Tilray's listing in New York made the company more accessible to U.S. investors. In July, Tilray was only trading at $17 per share. Now, it is already trading at more than $150 a piece.
