Medicinal cannabis firm Incannex has posted a 12-month loss of almost $4.7 million in a year that saw it sell products in Australia for the first time.

The deficit was 73% greater than the previous year as the company stepped up its research and development, salaries increased and advertising and promotion expenses grew.

Incannex, which rebranded from Impression Healthcare in early July, said the year saw “much progress”.

Incannex rebranded from Impression Healthcare in July

Sales of its range of cannabis oil products totalled just under $605,000 while revenue from oral and dental services – a sector it has now exited – hit $718,000.

All cannabis sales were driven through the distribution network of Cannvalate whose chief executive Dr Sud Agarwal is also chief medical officer and non-executive director. Cannvalate holds a 4.2% stake in Incannex.

While the medicinal cannabis division made a loss of more than $2m, chairman Troy Valentine said the company was gearing up for growth.

Cannvalate CEO Dr Sud Agarwal joined the board of Incannex during the 2020 financial year

“The past year has seen much progress… as the company accelerated its efforts to build out its medical cannabis business and novel drug development program,” he said. “We now have a range of medicinal cannabis oils in a specific product mix to cater to Australian prescribers and patients. Additionally we have also entered into an exclusive supply agreement with Entourage Therapeutics to import CBD inhalers into Australia, a first for this country.”

Core to the company’s future, however, is its ambitions to develop cannabinoid medicines for sleep apnoea, traumatic brain injury, acute respiratory distress syndrome (ARDS) and temporomandibular joint disorder.

Valentine described the vision as a “multi-billion-dollar” opportunity, with the company developing a “clear pathway” to develop multiple products.

Registration will be sought from major registration bodies including the Therapeutics Good Administration (TGA), Food and Drug Administration (FDA) and European Medicines Agency (EMA).

“The company has taken a patent filing strategy whereby it anticipates the derivation of wholly owned patent protected products upon research success,” Incannex said. “Importantly, the company has chosen areas of research and development whereby there is both urgent therapeutic need and significant economic opportunity.”

The firm added that the revenue opportunities for each of the four research areas runs into “many billions of dollars each year”. There are also no existing available drug options, Incannex said.

Shares in Incannex slipped marginally to close on $0.058.

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