Neptune Wellness (TSX:NEPT)(NASDAQ:NEPT) is a diversified and fully integrated health and wellness company. Through the company’s flagship consumer-facing brands, Neptune has built a broad portfolio of natural, plant-based, sustainable and purpose-driven lifestyle brands and consumer packaged goods products in key health and wellness markets, including hemp, nutraceuticals, personal care and home care. Neptune’s corporate headquarters is located in Laval, Quebec. The company owns a 50,000-square-foot production facility located in Sherbrooke, Quebec and a 24,000 square-foot facility located in North Carolina.
Cost-efficient supply chain infrastructure
Leveraging decades of expertise in extraction and specialty ingredient formulation, Neptune is a leading provider of turnkey product development and supply chain solutions to businesses and government customers across several health and wellness verticals. The company utilizes a highly flexible and cost-efficient supply chain infrastructure that can be scaled up and down or into adjacent product categories to quickly adapt to market demand.
Neptune’s vision is to provide wellness solutions that deliver optimal health and wellness. The company leverages Neptune’s scientific and technological expertise to create and provide global customers with the best available products and wellness solutions. In 2019, the company received a standard processing license from Health Canada, which allowed Neptune to process and sell cannabis and to pursue cannabis-related activities.
Differentiated product offerings
Recently, Neptune developed a novel cold ethanol extraction technology which, when combined with the high level of automation at the company’s Sherbrooke facility, should position it as a cost-efficient cannabinoid (CBD) extractor in Canada. The technology supports differentiated product offerings through the company’s various delivery systems, colours and branding possibilities. Furthermore, it is an effective technology for variable and multiple product formulation runs.
In February 2020, Neptune launched two brands called Forest Remedies and Ocean Remedies. Under the Forest Remedies brand, Neptune intends to commercialize a full line of health and wellness products with and without CBD. The initial launch of the Forest Remedies brand is expected to be focused in the United States and may expand to Canada once Neptune obtains a license amendment from Health Canada to include the authorization to sell cannabis products. This will ensure that Neptune is able to sell the Forest Remedies brand at retailers across the United States.
Demonstrated agility
Most recently, in April 2020, Neptune expanded into the production and sale of hand sanitizer products. Neptune decided to use the company’s facilities in Sherbrooke, Quebec and Conover, North Carolina and third-party manufacturers to produce and sell hand sanitizer gel products at retail and wholesale.
Additionally, in May 2020, Neptune announced the launch of Neptune Air, a non-contact infrared thermometer optimized for measuring a person’s temperature while reducing cross-contamination risk and thereby minimizing the risk of spreading disease.
The expansion of Neptune’s product portfolio with products, including hand sanitizers and non-contact thermometers was a strategic response to COVID-19. Based on Neptune’s expected growth rate and planned investment in the company’s equipment and facilities, management believes that the company’s manufacturing capacity will be sufficient to meet requirements for the near future. The company has demonstrated a clear intention is to maximize the return on investment.
