Shares of British Columbia-based cannabis producer Tilray Inc. surged nearly 30 per cent on Tuesday after the marijuana company received a key approval related to a clinical trial in the United States.

While Tilray’s stock has enjoyed a heady rise since its initial public offering in July, Tuesday’s staggering gain — shares closed up more than US$34 at US$154.98 on the Nasdaq — was alone equivalent to more than double the company’s IPO price of US$17.

The shares have now increased more than 800 per cent since the offering, propelling Tilray’s market valuation to about US$14.4 billion, well ahead of previous market leader Canopy Growth Corp., which closed Tuesday with a market cap of around US$11.5 billion.

Tilray’s U.S. footprint is likely having an effect on the stock, with the company’s Nasdaq listing being a differentiating factor.

“I think that … one of the big drivers behind the run in that name is perhaps a bit of scarcity appeal, in that it’s one of a small number of cannabis companies listed on a major U.S. exchange,” said Russell Stanley, analyst at Echelon Wealth Partners, who does not formally cover the stock.

And while the Canadian market for legalized cannabis is one thing, it pales in comparison with the potential that lies south of the border.

Tilray’s announcement that the U.S. Drug Enforcement Administration had given it the green light to import a drug needed for a clinical trial at the University of California San Diego appeared to trigger Tuesday’s run.

Cowen analyst Vivien Azer said in a note that the news was “a positive” for both Tilray and the broader cannabis sector, “as additional medical applications and improved government support add another domino to future legalization in the U.S.”

“Further, the new clinical trial supports TLRY’s medical cannabis prospects (both in U.S. and globally) as it competes with WEED (Canopy Growth, which has 39 U.S. patents and 15 clinical trials) in an IP-arms race,” Azer added.

There is also only so much of Tilray to go around. According to Bloomberg data, a majority interest in the company is still owned by U.S. private equity firm Privateer Holdings Inc., which touts Tilray as “the only American-owned, federally licensed commercial producer of medical cannabis in the world.”

Tilray reported a net loss for its second quarter ended June 30 of US$12.8 million, up from US$2.4 million a year ago. Tilray said this “was primarily due to the increase in operating expenses related to continued growth, expansion of international teams, and costs related to financing and the initial public offering.”

With its shares climbing, Tilray also recently came under fire from short seller Citron Research, which warned that the cannabis-related IPO pipeline “will detract capital from Tilray and traders will have new toys to play with.”

The clinical trial supports TLRY’s medical cannabis prospects in the U.S. and globally as it competes with (Canopy Growth) in an IP-arms race.

Vivien Azer, Cowen analyst