Day After Moving into Cannabis, Shineco Reaches New Agreements with Hemp Research Institute
Shineco Inc. (Nasdaq: TYHT), a Beijing-based producer of Chinese herbal medicines, announced today that it signed three agreements with the Hemp Research Institute (HRI) of the Chinese Academy of Agricultural Sciences.
The three agreements include an industrial cannabis technology transfer agreement, as well as industrial cannabis apocynum planting technical service agreement, and a hemp industry technical service and product R&D cooperation framework agreement.
The agreement for the industrial cannabis technology transfer gives Shineco use rights and intellectual property rights for the institute's newly bred high CBD (Cannabidiol) industrial cannabis strains. The company agreed to pay an aggregate of $750,000 for the use rights to HRI under this agreement.
Under the terms of the technical service agreement, HRI agreed to provide Shineco with proposals for farmland infrastructure maintenance, agricultural product procurement and industrial cannabis, apocynum strain selection and planting. The R&D cooperation framework agreement gives HRI and Shineco the ability to strengthen technical cooperation in planting and seed production
Today's announcement came one day after Shineco said it would form a wholly owned subsidiary, Beijing Tenjove Newhemp Biotechnology Co. Ltd., to "capture growth in the industrial cannabis market."
"We believe our new business line of industrial cannabis will benefit from the industrial cannabis strains produced by the HRI, which are suitable for industrial production, as well as the technical knowledge and other resources that HRI possesses," said the chairman and chief executive of Shineco, Yuying Zhang.
Shineco, founded in 1997, is principally engaged in the production and distribution of Chinese herbal medicines, organic agricultural produce, specialized textiles, and other health and well-being focused plant-based products in China.
The company makes products including traditional Chinese herbal medicine products, organic agricultural products and specialized fabrics, textiles and other byproducts derived from an indigenous Chinese plant Apocynum Venetum, grown in the Xinjiang region of China, and known in Chinese as "Luobuma" or "bluish dogbane".
Shineco went public two years ago on the Nasdaq Capital Market at $4.50 per share. It rose 1.6 percent Wednesday to $1.24 per share.
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