- Global testing services market expected to achieve 10 percent-plus CAGR growth
- California cannabis testing market also set for exponential increase
- EVIO to double national testing footprint to 18 labs
California, befitting its history as part of America’s westward expansion, has earned an appellation as the ‘Wild West’ of pot. Medical marijuana, legal in the state since 1996, has been largely bypassed by quality control and safety regulations. That is about to change. To coincide with the opening of the adult recreational market, a plethora of rules and rubrics has been issued. California MMJ businesses will have until July 2018 to ensure compliance. As a result, demand for cannabis testing services in California is set to increase rapidly, a development that means EVIO, Inc. (OTCQB: EVIO), which has acquired testing facilities in Berkeley, California, is in the right place at the right time.
The supply shortfall in California cannabis testing services is rising to crisis proportions at a time when one report warns that ‘much of the marijuana sold in dispensaries in California would fail safety standards in other states’ (http://ibn.fm/nXnjU). Quality issues plague the industry, as recent examples from further afield demonstrate. A couple of MMJ companies licensed under Canada’s ACMPR were found to be using banned pesticides, and a cancer patient died after acquiring a fungal contamination, which was said to have originated in smoked marijuana.
Despite this alarming state of affairs, there are only 22 testing laboratories operating in the state (http://ibn.fm/t9mH3). However, where there is crisis, there is also opportunity, and EVIO has been quick to recognize this. Earlier this year, the company announced that it was acquiring C3 Labs in Berkeley, California, which will give it a presence in the Bay Area to go along with its labs in Southern California and north of Sacramento. This will bring the number of labs operated by the company to nine in five states. These include four in Oregon, two in Florida, and one each in California, Colorado and Massachusetts.
Reporting on data compiled by Markets and Markets, High Times recently commented that ‘cannabis lab testing for potency, purity and detailed information such as terpene counts was worth $866 million in 2016.’ By 2021, the global testing services market is expected to hit $1.4 billion, representing a CAGR of more than 10 percent. Driven by such a powerful tailwind, EVIO is set for further revenue growth. The company saw testing services revenues for the nine months to June 30, the last reported period, climb 1,100 percent year-over-year in 2017 to $2.1 million. Now, through testing subsidiary EVIO Labs, the company plans to open 18 laboratories by the end of 2018 at locations throughout the United States.
EVIO is headed by William Waldrop, MBA, chairman and CEO. Waldrop, a co-founder of EVIO Labs’ parent company, spearheaded the acquisition of the company’s first analytical laboratory facility in Bend, Oregon. He has since grown the company to its present five labs and nine operating locations, and he is the driving force behind the nationwide rollout of EVIO Labs.
Previously, Waldrop was chairman and CEO of Newport Entertainment Group and president and COO of College Partnership, a publicly traded company that provided student services. In addition, while working as a senior manager at AirTouch Cellular, he led the team that, in just four years, built a 44-store distribution channel generating over $100 million in annual revenues. As vice president of operations for Leading Edge Broadband, he oversaw the design and roll-out of a global telecommunications sales and outreach network. Waldrop has also provided advisory services to several public companies.
For more information, visit the company’s website at www.EVIOLabs.com
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