Published on
June 11, 2020

Ben Nikolaevsky | CEO, Pure Extracts

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Ben Nikolaevsky

Pure Extracts began as a cannabis extraction company. Could you talk about the genesis behind the company’s expansion in to mushroom extraction?

Pure Extracts is a hardcore manufacturer of oil based products. You are correct that we got our start in cannabis, but we also had experience dealing with other functional plant matter including mushrooms. For Pure Extracts, this is an extension  of our extraction capabilities; we are continuing to rapidly grow the hemp and cannabis business which will generate a material amount of highly profitable revenue. Pure Extracts has been sought-out by the new wave of functional and psychedelic mushroom companies to formulate and commercialize biomass for them.

What problems are you working on solving within functional mushrooms? What customer types will benefit from these solutions?

Currently most products in the functional mushroom space are essentially powdered mushrooms. This limits the amount of active ingredient people can easily consume. It can also lead to problems with accurate dosage. Through extraction we can create a concentrated, high potency, dosage of active ingredients that can be accurately measured and is easily to consumed. These products can have many health benefits to a wide range of consumers. Research have shown functional mushrooms can help with physical discomforts such as pain and inflammation as well as a host of other things such as depression, anxiety and Insomnia.

What part of Pure Extracts’ business model will be relevant to psychedelic medicines, versus purely functional mushroom?

The Psychedelic part of our business model from a revenue perspective is small in 2020 and into 2021. As you know, psychedelics are still considered illegal by Health Canada and the FDA, although clinics are being allowed in some geos and some clinical trials have been approved. We see our revenue stream coming from functional mushroom extraction in 2020 and 2021 and the research and development and formulation of psychedelics will increase as we work with our partner companies to develop new formulations to treat PTSD and addiction etc. The functional mushroom business will help us expand our knowledge of the different mushroom species and allow us to better formulate them into other compounds that will ultimately make the psychedelics more effective.

Cannabis extraction vs mushroom extraction. What are the key differences?

The extraction processes for mushrooms and cannabis are very similar. Mushroom extraction begins to differ from cannabis when you start looking at stabilizing the extracted compounds for longer shelf life. Mushroom extract can be crystalized, slowing the break-down of active ingredients and allowing products to stay potent for exceptionally long periods of time.

Investors are skeptical of pre-existing companies that pivot or expand to industries with momentum and greater investor attention, like psychedelics. Why does this expansion make sense for Pure Extracts and what makes the Company's offering unique?

Pure Extracts is a manufacturer, not simply a hemp or cannabis only extractor. We have previous experience in extracting mushrooms and other forms of biomass. Furthermore, Pure Extracts has been sought-out for its extraction capabilities by several of the new, but well financed, entrants into the functional and psychedelic mushroom space, so I would not say this is a pivot as we are continuing our core business and we are expending our offering.

What is the most exciting opportunity you see when it comes to psychedelic medicines and how is Pure Extracts positioning itself to support this opportunity?

Through our consulting agreement with Dr. Alexander MacGregor, Founder & CEO of Transpharm Canada Inc., the parent company of the Toronto Institute of Pharmaceutical Technology, and their fully compliant Health Canada licensed Good Manufacturing Practice (“GMP”) manufacturing and testing facility located in Toronto, we are able to help formulate and develop new psychedelics. We will be the commercialization engine for extracting psychedelics for our partner companies. We are not a clinical trial company nor will we ever be. We are a manufacturer of products and our formulation and extraction skill set will be key to developing new compounds for use in treating PTSD and addiction disabilities.

What would you say to potential investors considering plant and fungi extraction as a space to invest? The space is an emerging market.

Not all mushroom companies are created alike. Pure Extracts is in the unique position, as it will have significant revenue from its cannabis,  hemp and edible products business lines while we ramp-up our functional mushroom extraction and psychedelic products businesses. We can continue to grow and develop our mushroom business and bring the best products to market. Pure Extracts has the first-mover advantage to be one of the leading functional mushroom extractors. This first-mover advantage will give Pure Extracts many opportunities to work with the new companies that are coming to market, but lack the expertise of formulating and commercializing products. Pure Extracts will be that engine.