Amidst a media frenzy, Cellular Goods (CBX) - the David Beckham-backed provider of consumer products based on synthetic cannabidoil - has listed in London (26 Feb), turning its founders into multi-millionaires and at one stage generating a more than four-fold gain for those private investors able to get a look-in at the IPO (initial public offering).

Unlike other firms peddling cannabis-related products, Cellular Goods secured a listing on the Main Market, the first company to do so since the regulator relaxed the listing rules for such stocks in 2020.

It also differentiates itself from its many rivals by its use of a biosynthetic, laboratory-produced cannabidoil rather than the natural extract of the cannabis sativa plant.

‘DOWN THE RABBIT HOLE’

Chief executive Alexis Abraham, who set the company up in 2018, described the decision to use a synthetic version of cannabidoil as a ‘happy accident’ which arose from discussions over how to overcome the potential legal and regulatory hurdles to bringing the company to market.

Rather than cultivate cannabis plants on a mass scale and extract the oil, making sure not to extract at the same time THC, the mind-altering and illegal active component, the decision was taken to ‘go down the rabbit hole’ and search for a chemical substitute.

This has the advantage of being ‘greener’, as it doesn’t need the mass cultivation of plants and the associated water usage, as well as being much quicker to produce.

‘We are looking at seven days to produce one batch versus about 200 days for the equivalent field-grown. On top of that you are using probably 1/200th of the energy and water, and you have no issues around pesticide taint or contaminants. It’s not just a slightly better process, it’s an order of magnitude better’ said Abraham, interviewed days before the IPO.

AUTUMN LAUNCH

The firm is using the money from the float to invest in developing a range of skin care and sports recovery products like lotions and oils which can be rubbed into the skin.

Although cannabidoil has a reputation as an anti-bacterial, anti-oxidant and an anti-inflammatory, Cellular Goods is ‘not going after any kind of medical claim’ says Abrahams.

The aim is to have a range of products ready for sale this autumn, both on the firm’s own website and through third-party partner website and stores. Ultimately the company hopes to collaborate with large consumer goods companies selling brand-name goods which contain its biosynthetic cannabidoil.