OBX lands US$11.5M for CBD pain relief and personalized nutrition research

03 Jun 2021 --- US-based cannabinoid health and wellness company Open Book Extracts (OBX) has closed a US$11.5 million series B funding round. The company will use the financing to drive new research and an international expansion, as well as help personalize CBD offerings.

OBX says the investments, led by Nortecapital and Key Investment Partners, are a “resounding vote of confidence” in its manufacturing abilities. 

Currently, OBX has a large portfolio of cGMP-certified cannabinoid isolates at over 99 percent purity, including CBD, CBG, CBN, CBC and THCV. In addition, OBX provides formulation services and finished goods such as edibles, soft gels, tablets, tinctures, pet products and topical products. 

Speaking to NutritionInsight, Dave Neundorfer, OBX’s CEO, details the company’s forthcoming plans for research, business development, funding and the regulatory hurdles in the cannabinoid industry. 

OBX is formulating novel food applications for CBD, but legal uncertainty stands in the way.NPD and personalization 
OBX product development, combined with its upcoming research projects, will focus on how to personalize CBD supplementation, explains Neundorfer. 

“The first phase of this market saw CBD products that were to be used by everyone for everything. Consumers today are demanding a better user experience and products that fit seamlessly into their routines, including dissolvable tablets, soft gels, beverages and beverage enhancers.”

“There is a massive shift underway from a ‘one-cannabinoid-fits-all market’ to personalization and optimization with sophisticated form factors and elegant formulations that focus on a specific need for consumers. Research is driving this shift, and we are excited to play a leading role in this evolution.”

Innova Market Insights has labeled “Tailored to Fit” a top trend for 2021, spotlighting how technological and research developments are allowing for increasingly individualized approaches to nutrition. 

Investigating safety 
Neundorfer says OBX will focus research efforts on two central areas: efficacy and safety. 

“The two active safety studies in which we are currently participating are Validcare and the European Industrial Hemp Association (EIHA),” says Neundorfer. 

Validcare, a US-based healthcare technology company, is conducting a large-scale human safety study to provide the FDA with CBD safety data. The study is designed to respond to the FDA’s repeated requests for science-based data to inform regulations for hemp-derived CBD products. 

“This study will assess how long-term full- and broad-spectrum CBD use impacts liver safety, drowsiness and testosterone levels, with results expected later this year,” says Neundorfer.

OBX also supports the EIHA Novel Food Consortium’s safety studies for hemp foods and extracts in the UK and EU. 

Investigating efficacy 
OBX’s next funding round will aim to raise as much as US$50M.Through research, OBX is primarily investigating the efficacies of its pain relief and skin care applications. It has partnered with Radicle Science, a pharmaceutical and healthcare research company that gathers data for medical validation. 

“We are kicking off what we believe is the largest ever minor cannabinoid study with our partners at Radicle Science. The first phase is a multi-arm in-house-user-test with 1,500 participants per arm who will provide survey data on which of our five formulations are most effective in treating joint pain.” 

The second phase of the study will be placebo-controlled, double-blind clinical trials. 

“These studies will be the first of many that we conduct with Radicle, whose disruptive virtual, direct-to-consumer model enables speed, scale and reach relative to traditional clinical studies,” asserts Neundorfer. 

“We are also finalizing the design of our first topical clinical trial, which will test the effectiveness of minor-cannabinoid formulations on acne, rosacea and psoriasis.”

Facing down regulations
Among other developments, OBX will be financing a global expansion. As a member of the EIHA and its Novel Foods Consortium, the company serves a rapidly growing client base throughout Europe. 

OBX also supports global brands through OBX Asia, with headquarters in Hong Kong and Africa, through a partner in South Africa. The company is now setting its sights on expansion opportunities in Mexico and Latin America through Nortecapital’s relationships. 

However, regulatory hurdles still stand in the way of commercial progress, with debates continuing over how to enforce CBD dietary supplements, in particular. 

“We are looking forward to clarity in the US market from the FDA regarding the treatment of non-psychoactive cannabinoids as dietary supplements. This clarity will help accelerate research, funding, and market growth in our domestic market,” says Neundorfer.  

“We are excited about what has become a pattern of favorable regulatory developments across the globe and are actively positioning OBX to serve these emerging markets. Safety and efficacy research will help raise all ships.”

Next round of funding 
Following the close of the series B round, OBX is likely to enter another round of capital raising from one or multiple strategic investors in the second half of this year, says Neundorfer.

“This will be another true growth round that will give us the capital needed for strategic acquisitions and accelerated global expansion,” he notes. 

“We are currently in discussions with multiple potential strategic investors from the tobacco, cannabis, nutraceutical and pharmaceutical markets and suspect this round will be between US$15 to 50 million depending on the partner and strategic vision.”

By Louis Gore-Langton