Potential for FDA Fast-Track Approval Designation & Imminent Product Launch

Pure Pharmaceutical Cannabidiol, Cardiol Therapeutics Inc.’s (TSX:CRDL)(OTCQX:CRTPF) Medicine has a Significant First-to-Market Advantage

When it comes to pharmaceuticals, timing is EVERYTHING.

The 2010s were defined as a decade of drug breakthroughs. Over the last 10 years, the Nasdaq Biotech Index is up 355% from 843 to 3,000 (this is even after the coronavirus crash!).

Among the top 10 performing stocks of 2019, an incredible SIX were pharma companies… including four of the top five.^[1]

Even with this coronavirus market crash, many biotech stocks have been flying. There’s always a disease or condition that is looking to be treated.

Many successes came from the pursuit to discover a breakthrough treatment. But there also came a surge of innovation for developing products for rare diseases and conditions, thanks to added incentives put forth by the FDA^[2], and a Global Orphan Drugs Market that is expected to generate $169 billion in revenue by 2022.^[3]

Drugs that are being developed to treat rare diseases (defined in the US as those affecting less than 200,000 patients) can take advantage of the FDA’s Office of Orphan Products Development (or Orphan Drugs)^[4] incentives and enjoy additional benefits as well as being first to market.

In particular, orphan drug developers get an expedited approval process, which saves millions of dollars in drug development costs and provides a period of seven to nine years of exclusive access to the market.

Once successful, companies granted orphan status for their drugs have a very substantial profit window.

Cardiol Therapeutics Has Major Near-Term Catalyst Right Around the Corner

Last June, Cardiol Therapeutics (TSX:CRDL)(OTCQX:CRTPF), a still under-the-radar specialty pharmaceutical developer, announced its plans for an orphan drug program in acute myocarditis with its CardiolRx™ CBD formulation.

Acute myocarditis is an inflammatory condition of the heart most often resulting from viral infection and is a major cause of sudden death in children and young adults. Plans for a Phase 2 international trial of CardiolRx™ in acute myocarditis, to be conducted at world leading centers of excellence for heart research, were announced in November.

The potential benefits of CBD on myocarditis have been studied experimentally and have attracted major medical interest over the past few years.^[5],[6]

The Cardiol Therapeutics (TSX:CRDL)(OTC:CRTPF) team consists of winners from within the pharmaceutical sector, including a President and CEO who previously founded and grew a company to a $1 billion valuation, and a legendary Chief Medical Officer who’s received the Order of Canada among many other accolades.

Now there is the potential for CardiolRx^TM to become the next cannabidiol product to be approved and the first one that is synthetically derived, 99.9% pure, and THC free (<5ppm).

This has analysts watching Cardiol Therapeutics (TSX:CRDL)(OTC:CRTPF) with keen interest.

Cardiol’s analyst coverage includes:

• AltaCorp Capital Inc.
• Raymond James

With its industry-leading product purity levels and accomplished management team, Cardiol Therapeutics (TSX:CRDL)(OTC:CRTPF) is in the process of making a strong case to potentially gain the approval of both Health Canada and the US FDA for CardiolRx™—a feat that could potentially yield them that coveted first-to-market advantage.

Cardiol Therapeutics – A Pharmaceutical Cannabidiol Company from Cardiol Therapeutics on Vimeo.

Purity Levels That Far Outpace Peers

Perhaps where Cardiol Therapeutics (TSX:CRDL)(OTCQX:CRTPF) excels the most is in the purity of its product—namely, its extremely low levels of THC.

This means the product is completely non-intoxicating.

It’s worth noting that in 2018, the US FDA approved the first drug comprising an active ingredient derived from cannabis.^[7]

This drug treats rare, severe forms of epilepsy, and is produced by GW Pharmaceuticals, plc (NASDAQ:GWPH).

Note: Cardiol recently appointed former GW Pharmaceuticals Scientific Affairs Director, International and R&D Operations Director, Colin Stott, to its Board of Directors.

Purity matters, as even small traces of THC may possibly yield THC-positive urine drug tests.

The US government defines CBD oil as any extract containing 0.3% or 3000ppm THC or less.

By comparison, Cardiol’s high-purity product goes far beyond the standard, with levels even less than GW Pharmaceuticals’ FDA approved medicine for rare forms of paediatric epilepsy.

Comparable Purity Levels for High Concentration Cannabidiol Formulations

It’s clear that Cardiol Therapeutics’ CardiolRx^TM has an ultra-high purity, (<5ppm THC), that sets a new purity standard for the industry.

This unique product profile should offer a significant competitive advantage when it comes to future drug approvals and meeting the growing demands from physicians, patients, consumers, and regulators for consistent, high quality, high purity products.

Cardiol Therapeutics Launching Commercial Sales While Advancing its Clinical Program

Looking ahead in 2020, Cardiol Therapeutics (TSX:CRDL)(OTCQX:CRTPF) is preparing to launch its flagship commercial product, CardiolRx™, as the purest high-concentration cGMP manufactured pharmaceutical CBD oil alternative product in the world.

CardiolRx™ will be launched imminently in the growing $1.2 billion medicinal hemp oil market in Canada, while in parallel the Company prepares to initiate its clinical development programs in Canada, the US, and Europe targeting life-threatening heart disease.

Back in 2018, another drug, Epidiolex®, which contains ultra purified CBD as its only active ingredient became the first ever FDA-approved drug that contains a purified active ingredient derived from cannabis.

Now there is the potential for Cardiol’s CardiolRx™ to become the first pharmaceutically produced product to be commercialized that contains the identical active ingredient found in Epidiolex® at the exact same concentration. This ultra-pure (<5ppm THC) product has analysts watching Cardiol Therapeutics (TSX:CRDL)(OTCQX:CRTPF) with keen interest.

A Standout Biotechnology Play

What truly makes Cardiol Therapeutics (TSX:CRDL)(OTCQX:CRTPF) stand out as a leader with a strong competitive advantage is its unparalleled supply chain to pharmaceutically produce commercial scale volumes of a cannabidiol commercial product that will be available to consumers in early 2020.

Through its exclusive partnerships with one of the world’s largest pharmaceutical manufacturers of controlled substances, Noramco, Inc., (through Purisys, LLC, an affiliate of Noramco) and one of the most experienced pharmaceutical formulators of controlled substances, Dalton Pharma Services, Cardiol Therapeutics has created an ultra-pure/THC free product.

Currently, the Canadian medicinal cannabinoid market is valued at an estimated $1.2 billion, but patients under 25 and over 65 are underserved. Cardiol has created a premium, ultra-pure product to address the needs of these patient populations where there is little to no competition.

CardiolRx™ has been developed with <5ppm THC. This product provides a distinct competitive advantage for Cardiol as it addresses the growing demand from patients who should not be exposed to THC; essentially, anyone under the age of 25 and many over the age of 65. These age groups represent large underserved segments of the growing $1.2 billion Canadian medical hemp oil market.

Physicians have been cautioned by the Canadian Paediatric Society that exposure to THC before the age of 25 can lead to unknown effects on brain development. In older patients, side effects of exposure can lead to unfavorable drug interactions and intoxication.

The company just received the green light from Health Canada to proceed with a Phase 1 study of its pharmaceutically produced (cGMP), high concentration, pure CBD oil formulation.

This is a huge milestone for Cardiol Therapeutics (TSX:CRDL)(OTCQX:CRTPF) and for the industry as a whole, as it’s the first-ever Canadian clinical trial of a pharmaceutically produced CBD oil formulation that is specifically designed for patients who should not be exposed to THC.

The Phase 1 study, which the company expects to start in Q2, 2020, is designed to measure the pharmacokinetics (blood levels of drug) following both single and multiple doses of the high concentration, pure CBD oil formulation in up to 55 healthy subjects, both in the fasting and fed states.

The study will also measure standard safety parameters at escalating doses to help select the optimal dosing levels for the company’s planned international Phase 2 study in acute

Health Canada First, then on to the FDA

Cardiol Therapeutics’ (TSX:CRDL)(OTCQX:CRTPF) ultra-pure formulation is pharmaceutically produced specifically for medical purposes.

With less than 5ppm THC, this pharmaceutically produced cannabidiol is one of the purest in the world; the level is below Health Canada’s threshold for requiring manufacturers to place a THC warning label on product packaging.

But it has so much more going for it.

It’s free from side effects of THC.

It’s produced using controlled processes at a cGMP, Health Canada approved, FDA registered and inspected pharmaceutical company.

This allows for consistent quality and purity, resulting in a pure (<5ppm THC) oil—ideal for patients who should not be exposed to THC.

Orphan Drug Candidate Entering Clinical Trials and Mass Market Nanoformulation in Development

Cardiol has engaged an international research network to develop novel pharmaceutically produced CBD oil medicines to target the treatment of heart failure. There have been no significant treatment advances in diastolic heart failure in over 20 years. Over six million adults in Canada and the United States suffer from chronic heart failure and it is the leading cause of death and hospitalization in North America, with associated annual healthcare costs in the U.S. alone exceeding $30 billion.

Cardiol Therapeutics’ (TSX:CRDL)(OTCQX:CRTPF) ongoing research program has shown the potential of the company’s patented nanoformulation of cannabidiol at the prestigious Houston Methodist DeBakey Heart & Vascular Center, Texas, the home of the first heart transplant performed in the United States. The Houston data demonstrated the ability of the company’s nanotechnology to target CardiolRx™ to sites of inflammation and fibrosis in diseased hearts.

World-Class Partnerships

Cardiol Therapeutics Inc. (TSX:CRDL)(OTCQX:CRTPF) is not going into this alone. The company has wisely entered into world-class partnerships, enabling it to meet global demand through unparalleled access to cGMP manufacturing of a pharmaceutically produced CBD oil.

1 – Dalton Pharma Services – Health Canada-approved, FDA-registered, cGMP manufacturer of pharmaceutical cannabidiol products

Cardiol has an exclusive global manufacturing agreement with Dalton for the supply of cGMP manufactured pharmaceutical CBD oil products for commercial introduction. Dalton recently received a three-year renewal and amendment of its Health Canada license.

2 – Noramco, Inc. – Global leader in the manufacture and supply of controlled drug substance APIs

Cardiol has an exclusive agreement with Noramco (through Purisys, LLC, an affiliate of Noramco) for the manufacture and supply of a pure active pharmaceutical ingredient found in CBD oil for Canada and Mexico.

3 – TecSalud del Tecnológico de Monterrey – Latin America’s Largest Private Research Network

Cardiol is working with TecSalud to develop the scientific background to support clinical trials. TecSalud has made a US$3,000,000 investment commitment in Cardiol to support nanotherapeutics research and is collaborating with leading heart centers, including the Houston Methodist DeBakey Heart & Vascular Center, and Massachusetts Institute of Technology (MIT).

Superstar Management Team and Board Leading the Way

David Elsley – President and CEODavid Elsley is a business leader with a proven track record of developing, financing and managing all aspects of corporate development in biotechnology and high-growth organizations. The best example of this, was his previous role as founder, President, and CEO of Vasogen Inc. which he grew from a start-up to an organization with a valuation of more than $1 billion, over 250 employees, and operations and R&D programs in North America and Europe.

Eldon R. Smith, MD – Chairman and Chief Medical OfficerDr. Eldon Smith is one of Canada’s most respected minds in cardiology. He has served in countless prominent roles including Head of Cardiology at Foothills Hospital and the University of Calgary, where he also served as Chairman of Medicine and Dean of Medicine, and as President of the Canadian Cardiovascular Society and the Association of Canadian Medical Colleges. Having published more than 250 papers, and contributed to many organizations, Eldon has received numerous accolades, including the Order of Canada in 2005, and a Lifetime Achievement Award from the City of Calgary in 2013.

Thomas Moffatt – Chief Commercial OfficerTom Moffatt is a veteran senior operations and retailing executive, with an extensive background in corporate mergers and acquisitions, franchise, corporate retail and consulting, particularly in the pharmaceutical environment. He is the former National Vice-President Operations and Strategy for Shoppers Drug Mart, where he was responsible for the growth, marketing, and development of all operations for more than 45 stores.

Anne Tomalin – Director of Regulatory AffairsAnne Tomalin is an expert in regulatory affairs in Canada, the United States, and Europe. She founded and grew CanReg Inc. to be Canada’s largest regulatory affairs consulting firm, as well as TPIreg, and currently sits on the Advisory Board for Canadian Association of Pharmaceutical Regulatory. Tomalin has also chaired the Manitoba, Saskatchewan, and Ontario Committees for the Pharmaceutical Manufacturers Association Canada, now Innovative Medicines Canada.