BOCA RATON, FL - Greenlane Holdings, Inc. (NASDAQ:GNLN), a leading distributor of cannabis accessories and vaporization products, has entered into an exclusive multi-year agreement with Safety Strips Tech Corp. to distribute their fentanyl, xylazine, and drink spike detection test strips in the United States.
The distribution partnership, announced today, aligns with Greenlane's strategic priority to offer affordable, reliable substance testing solutions amid the ongoing opioid crisis. CEO Barbara Sher highlighted the critical need for such products to prevent accidental overdoses and protect individuals from drug-facilitated crimes.
Safety Strips provides a single test strip designed for rapid detection of dangerous adulterants in substances, which are contributing factors in the opioid epidemic. The product, which is ISO 13485 validated, enables users to detect various synthetic opioids and is marketed as an effective tool to avert accidental overdoses.
The test strips are now available for order through Greenlane's online retail platforms and its wholesale portal. This addition to Greenlane's product offerings is expected to enhance the company's revenue potential by tapping into a high-margin segment.
Greenlane, founded in 2005, operates a global platform for the development and distribution of smoking accessories, vape devices, and lifestyle products. The company's portfolio includes its own brands as well as exclusively licensed products, distributed to a wide range of clients including specialty retailers and consumers.
The company's forward-looking statements indicate an anticipation of future events and trends affecting its business, subject to known and unknown risks. These statements are based on current expectations and are not guarantees of future performance.
This news is based on a press release statement and aims to provide investors with a concise overview of the new partnership between Greenlane and Safety Strips Tech Corp.
In other recent news, Greenlane Holdings has restructured its debt and extended its maturity, reducing its debt by approximately $617,000. The company has also successfully reduced its U.S. vendor accounts payable by nearly $4.4 million. Greenlane Holdings has entered into distribution agreements with CURB Lifestyle for its patented inhalation device and Safety Strips for their drug detection test strips.
In addition, Greenlane issued a $3.2 million convertible note to Cobra Alternative Strategies, providing immediate capital and the potential for equity conversion. The company's CEO, Barbara Sher, has demonstrated her confidence in the company's potential by purchasing 12,500 common shares. Greenlane also plans to raise $6.5 million for working capital and general corporate purposes by issuing over 2.3 million units, with Aegis Capital Corp. as the exclusive placement agent.
Lastly, to meet Nasdaq's minimum bid price requirement, Greenlane announced a one-for-11 reverse stock split of its Class A common stock. These are all recent developments in the company's ongoing growth initiatives.
InvestingPro Insights
Greenlane Holdings' recent partnership with Safety Strips Tech Corp. comes at a critical time for the company, as revealed by InvestingPro data. With a market capitalization of just $1.59 million, Greenlane is operating in a challenging financial environment. The company's revenue for the last twelve months as of Q2 2024 stands at $29.37 million, but more concerningly, it has experienced a significant revenue decline of 68.83% over the same period.
This new distribution agreement could be a strategic move to address some of the financial challenges highlighted by InvestingPro Tips. For instance, one tip notes that Greenlane "May have trouble making interest payments on debt," which underscores the importance of this potentially high-margin product line in improving the company's financial health.
Another relevant InvestingPro Tip indicates that "Analysts anticipate sales growth in the current year." The exclusive distribution of Safety Strips' test products could contribute to this projected growth, potentially helping to reverse the recent trend of declining revenues.
It's worth noting that Greenlane is "Trading at a low Price / Book multiple" of 0.25, which could suggest that the stock is undervalued. However, investors should approach this with caution, given that the company is "Not profitable over the last twelve months" and is "Quickly burning through cash," as per additional InvestingPro Tips.
For a more comprehensive analysis, InvestingPro offers 16 additional tips for Greenlane Holdings, providing deeper insights into the company's financial situation and market performance.
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