Shares of Charlotte’s Web Holdings (OTC:CWBHF) were jumping 5.7% higher as of 2:42 p.m. EDT on Thursday after rising as much as 9.8% earlier in the day. The gain came after the company announced late Wednesday that it had won a U.S. patent for an improved variety of hemp.
The U.S. Patent and Trademark Office (USPTO) awarded the patent to CW1AS1, a new variety of hemp created by co-founder and board chairman Joel Stanley and Senior Director of Cultivation R&D Bear Reel. This marked Charlotte Web’s second U.S. patent for hemp genetics.
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The USPTO has issued very few patents for hemp genetics so far. CEO Deanie Elsner said that the patent “gives Charlotte’s Web the highest level of protection for our proprietary genetics and ensures that Charlotte’s Web products will continue to be available to the thousands who use them in a form that is consistent and provides the same user experience time and time again.”
Perhaps the biggest immediate impact, though, is that the patent victory reinforces the perception that Charlotte’s Web remains at the forefront of the hemp CBD market. The company generated $21.5 million in sales in the first quarter, more than twice as much as its closest rival.
There are three things for investors to watch with Charlotte’s Web. The company expects to close its acquisition of Abacus Health Products either late in the second quarter or early in the third quarter of 2020. Moreover, Charlotte’s Web should benefit as retailers reopen after shutdowns related to the COVID-19 pandemic. The big potential catalyst for the cannabis stock, though, is the finalization of FDA regulations related to hemp CBD products. It’s unknown how soon the FDA will hand down these regulations.
Keith Speights has no position in any of the stocks mentioned. The Motley Fool recommends Charlotte’s Web. The Motley Fool has a disclosure policy.”>