Digipath, Inc. announced that it has obtained a compliance testing license from the State of California for the Steep Hill California cannabis and hemp testing laboratory operated by Digipath in Berkeley, CA. The license immediately allows the Steep Hill California lab to conduct compliance testing for all cannabis products, in addition to its existing R & D testing operations. As previously announced, the Company signed a letter of intent to acquire a controlling interest in the Steep Hill California lab from EVIO, Inc. in exchange for shares of Digipath's common stock.

Pursuant to the letter of intent, Digipath is managing the operations of the lab pending the closing of the transaction. The new license is anticipated to result in increased revenues for Digipath following the consummation of the acquisition. Compliance testing has historically been the main revenue driver for Digipath at its Nevada laboratory.

The States of California and Nevada both require all cannabis products to be tested by an independent, accredited laboratory such as Digipath before they are sold in dispensaries. As with Nevada, California compliance licenses are both coveted and limited. In its Las Vegas laboratory, compliance testing makes up over 90% of the Company's total revenue.

The Steep Hill laboratory has not been able to pursue this larger market and generate any revenue from compliance testing to date as it awaited the issuance of the compliance license. Throughout its seven-year existence, Digipath has been committed to the highest level of cannabis and hemp testing and to the creation of a rich, detailed data compilation of cannabinoid and terpene profiles resulting in the “Digipath Data Vault.” The Company believes that this data asset is of value for product development in a wide variety of applications ranging from medical applications to recreational use of cannabis as researchers look to utilize the ideal chemoprofiles for certain ailments. The Company is open to and actively looking for licensing opportunities and joint venture partners.

Additionally, the California lab should produce large amounts of data that will be added to the current data set of chemoprofiles. Up until now, Digipath has been limited to collecting cannabis and hemp data from Nevada cannabis because of the restrictions on interstate commerce. Full compliance testing in California will add to the cannabinoids data set and for those who want terpenes tested, full chemoprofiles will be collected and analyzed.

Comparing the data will be the first step in determining how cannabis cultivars differ from state to state and can lead to even more research support down the road.