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June 20, 2013

New Major Medical Marijuana Market Could Be a Boon for Nuvilex

Although Nuvilex Inc. (OTCQB – NVLX - $0.11 – Spec Buy) is noted for its pancreatic cancer treatment studies, it may be that a combination of its canine mammary cancer trial and medical marijuana research that may open up huge, new multi-billion dollar markets for the Company.

While most of the attention and focus in the medical marijuana industry is related to the addition of new states passing laws for the engagement of various development and usage initiatives for its citizens, a small but ever-increasingly vocal group of medical marijuana proponents has brought a new idea to the forefront: medical marijuana use for pets.

According to the American Pet Products Association (APPA), pet owners spend around $25 billion annually on pet health care with $15 billion alone going toward various veterinary services.  These statistics are not just huge, but they are surprising, considering the poor domestic economy.  A Wall Street Journal article that was published in the middle of the recent recession noted that the average annual amount spent on doctor’s visits and surgeries for just cats alone rose by 73% over the previous 10 years, which dovetailed exactly with the rise in expenses for human health care.

The reason for the big rise has a great deal to do with the increased availability of expensive treatments and procedures for pets.  Most pet owners view their pets as a member of the family and would go to any length to ensure their health, quality of life and the extension of their lives. In fact, according to the Veterinary Pet Insurance Co, 70% of pet owners polled said that they would spend whatever it would take to save a pet’s life. 

The increasingly common diagnosis of cancer and other serious diseases in pets has prompted a number of pet owners that use medical marijuana to give Rex or Spot marijuana to treat his illnesses and increase the quality of life.  As the proliferation of medical marijuana research and product development occurs across the U.S., it is natural to assume that the clinical research will migrate to pets as well, which could be a big benefit to Nuvilex.

Since the Company aims to be a leader in medical marijuana research and product development in the oncology arena, Nuvilex could elect to enter into animal studies along these lines as well as into human trials, which could potentially increase its market opportunity by billions of dollars. After all, Nuvilex already has a track record of engaging in canine and human oncology trials with its live-cell encapsulation-based cancer treatments for mammary and pancreatic cancer, respectively. The possibility that the cannabidiol (CBD)-based cancer treatments planned for development by the Company’s subsidiary, Medical Marijuana Sciences, Inc.,  if combined with its live-cell encapsulation-based therapies, can be used for oncology treatments for pets as well as for humans, is indeed intriguing.

Senior Analyst: Robert Goldman
Rob Goldman has over 20 years of investment and company research experience as a senior research analyst and as a portfolio and mutual fund manager. During his tenure as a sell side analyst, Rob was a senior member of Piper Jaffray's Technology and Communications teams. Prior to joining Piper, Rob led Josephthal & Co.'s Washington-based Emerging Growth Research Group. In addition to his sell-side experience Rob served as Chief Investment Officer of a boutique investment management firm and Blue and White Investment Management, where he managed Small Cap Growth portfolios and The Blue and White Fund.

Analyst Certification
I, Robert Goldman, hereby certify that the view expressed in this research report accurately reflect my personal views about the subject securities and issuers. I also certify that no part of my compensation was, is, or will be, directly or indirectly, related to the recommendations or views expressed in this research report. 

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