In an incredible revelation, Cann Group (ASX:CAN) today announced that preliminary results of their low-dose CBD capsule phase 3 trials show no difference compared to the placebo.
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The negative result of the trial which included 257 participants and tested the effect of 25, 50 and 100 mg CBD capsules on sleep disturbances has disappointed investors who had high hopes for Cann Group’s flagship product.
The timing of the announcement couldn’t have been worse for newly appointed CEO Peter Koetsier who only took over the role from Peter Crock earlier in the week.
Many investors have let their frustration be known on Hotcopper.com.au, saying that the low dose was never going to work and that future prospects for the company look slim.
Indeed, a failed outcome of the trial puts at risk a mega deal with global pharmaceutical giant, Haleon, which depended on Cann providing evidence of their Satipharm CBD capsules. At the moment, the unique delivery system Cann boasted about for so long seems to be just a gimmick until proven otherwise.
Cann Group’s share price has fallen more than 7% after the announcement. The bad news is one in a string of let downs from the company over the past 3-4 years, including staff layoffs, high staff turnover in the finance department, a bungled $3.6 M payment to scammers, multiple capital raises, the forced sale of their cultivation facility and the resignation of the CEO. With a $50 M debt, rising energy prices and no flagship product, confidence in the future of Cann Group and their ability to compete in a booming industry has dwindled even amongst their most supportive investors.