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July 8, 2013

Nuvilex Benefits From Shifting Stance on Medical Marijuana

The medical marijuana industry received a major boost recently at the annual United States Conference of Mayors.  A unanimous and bipartisan resolution urging the federal government to let states decide for themselves how to handle marijuana policy passed with no speakers rising in opposition. The mayors' conference represents cities with populations of 30,000 or more across the country.  This news, on the heels of New Hampshire becoming the final state in New England to approve a medical marijuana program, serves only to benefit entities engaged in medical marijuana research such as Medical Marijuana Sciences, Inc., a subsidiary of Nuvilex, Inc. (OTCQB – NVLX - $0.11 – Spec Buy).

Moreover, a series of independent polls over the past few months indicate a disconnect between most U.S. citizens, physicians, and state legislators, and the federal government regarding medical marijuana. For example, a Fox News poll found that 85% of Americans support medical marijuana usage if prescribed by a doctor and 75% of doctors surveyed in a New England Journal of Medicine poll conveyed similar sentiments.  This disconnect is even more apparent if one considers that the U.S. Government, through the Health and Human Services division, was granted a patent (#633507) entitled “Cannabinoids as Antioxidants and Neuroprotectants” that concerns the use of components of medical marijuana for the treatment of neurologic, and other, disorders.

This groundswell of support will eventually lead to the re-classification or downgrade of cannabis from Schedule I of the Controlled Substances Act of 1970 and the greater availability of research grade quantities of marijuana. A change in classification would provide a huge boost to the entire medical marijuana industry as the current category classifies it as a drug with no medicinal value and high potential for abuse, despite the fact that prescription drugs kill more Americans than even hardcore drugs such as heroin and cocaine combined.

As broad, vocal support grows and favorable state legislation continues, the industry is likely to reach a major inflection point as early as 2014.  These events will aid in Nuvilex’s formative stages of studying the effect of cannabidiol (CBD)-based cancer treatments (CBD is one of the components of marijuana that are collectively known as cannabinoids) when combined with highly efficacious live-cell encapsulation-based therapies similar to those that have been used for oncologic diseases such as inoperable pancreatic cancer  and breast cancer.   Nuvilex’s combination CBD-based cancer studies with live-cell encapsulation therapy development might result in bringing a highly effective product and new delivery system for use to treat multiple diseases and conditions, which would be place Nuvilex near the head of the medical marijuana product development class.

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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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