Cannabis
Beverage Companies Look to Capitalize on CBD’s Benefits and Accessibility
For centuries, hemp has been used for a vast array of applications. In particular, hemp was predominantly used to manufacture textiles, paper, and construction materials because of its durability. However, now hemp has become even more popular because of its CBD compound. Hemp is derived from the cannabis plant and is one of the two main families found within the plant, the other being marijuana. Unlike marijuana, hemp’s main active component is CBD or cannabidiol, which does not cause psychoactive effects for its consumer. Generally, the hemp plant contains less than 0.3% THC levels, which is an insignificant amount. However, because hemp is derived from the cannabis plant, federal regulators deemed hemp to be unsafe, and as a result, hemp and its CBD compound were listed as a controlled substance. Yet, researchers and scientists have begun new studies to better understand the biological makeup of hemp and compiled compelling results that went against the previously established understanding of the plant and its effects. As a result of these studies and the non-psychoactive nature of hemp, regulators lowered the scheduling of hemp and its CBD compound on the controlled substance list. Moreover, the passage of the U.S. Farm Bill paved the way for the broader CBD industry, further accelerating its presence in legal channels. Previously, the U.S. Department of Agriculture and other state departments only allowed pilot programs to study hemp, which allowed for small-scale cultivation. To note, the Farm Bill legalized the commercialization hemp and CBD, which caused a spur of retailers to add the product to their shelves. For instance, local stores and even e-commerce giants have CBD-based products being publicly sold for every-day consumers. Notably, the bill does not put any restrictions on the sale, transport, or possession of hemp-derived products, meaning that CBD is federally legal as long as it is consistent with the law. Now, the CBD market is one of the fastest-growing market segments within the cannabis industry, due in large part to its lenient guidelines. And as a result, more companies are looking to enter into or expand within the CBD marketplace because of the vast potential that has opened up for the market. According to data compiled by Hemp Business Journal, a division of New Frontier Data, sales for the U.S. hemp industry totaled USD 820 Million in 2017. The research suggests that the industry is expected to grow to USD 1.9 Billion by 2022 at a CAGR of 14.4% during the 5-year period. Pressure BioSciences, Inc. (OTC: PBIO), Cronos Group Inc. (NASDAQ: CRON) (TSX: CRON), Aphria Inc. (NYSE: APHA) (APHA.TO), Charlotte’s Web Holdings, Inc. (OTC: CWBHF) (TSX: CWEB), iAnthus Capital Holdings, Inc. (OTC: ITHUF) (CSE: IAN).
In 2017, hemp-derived CBD products accounted for the largest market share, as the segment delivered sales of USD 190 Million, accounting for 23% of the overall market share that year. Other segments such as personal care, food, and industrial care followed closely. However, by 2022, CBD products are expected to take off, outpacing the rest of the hemp sector. Hemp-derived CBD products are anticipated to deliver sales of USD 646 Million by 2022, followed by industrial application sales of USD 527 Million. While other segments are projected to grow, they are nonetheless expected to lag behind the exponential growth of the CBD product segment. CBD can be used to simply relax after a strenuous and stressful day but it is now being leveraged within the medical sector for patients suffering from ailments such as arthritis, multiple sclerosis, chronic pain, and epilepsy. In particular, the U.S. Food and Drug Administration has already legalized a CBD-based drug, Epidiolex, which is used to treat epilepsy. However, the FDA has mentioned that researchers will need to conduct more large-scale positive clinical trials in order for cannabis-based treatments to be approved. Currently, evidence of CBD effects comes from animal testing or very small-scale clinical trials that are minuscule compared to the FDA’s standards. For example, Esther Blessing, a psychiatrist and researcher at New York University, pointed to a 2011 study where a few dozen people who had anxiety disorders were asked to speak in front of a large audience. The study concluded that people who received CBD reported significantly less anxiety compared to those who received the placebo. Despite the study’s positive results, Blessing acknowledged that there still needs to be more studies conducted to fully understand the efficacy of CBD. “I think there’s good evidence to suggest that CBD could be an effective treatment of anxiety and addiction” and other disorders, said Blessing. “But we need clinical trials to find out.”
Pressure BioSciences, Inc. (OTCQB: PBIO) yesterday announced, “The initial sale of its revolutionary BaroShear K45 processing system. This novel instrument system is based on the Companys proprietary Ultra Shear Technology (UST) platform. The BaroShear K45 is a unique and powerful nanoemulsification system designed to resolve one of the most critical problems facing CBD manufacturers today: the extremely poor water solubility of CBD Oil.”
CBD is a non-psychoactive compound that has been broadly demonstrated to offer powerful health benefits, addressing a variety of challenging medical conditions. CBD is extracted from the cannabis plant in an oil form. After ingestion of CBD, because oils are not well absorbed by human and other animal water-based bodies, most of the CBD is flushed from the system, leaving little of the product absorbed and circulating to provide its beneficial properties. Because of these solubility issues, many CBD products on the market today contain a costly and inefficient over-abundance of CBD, and/or undesirable chemicals that may be have been used to try and improve its solubility in water.
Processing most oil-based products into nanometer-size droplets in emulsions with water (nanoemulsions) often improves their absorption, medicinal benefits, visual appearance, and sensory presentation. Unfortunately, traditional processing methods used to make nanoemulsions struggle with this challenge. PBIs patented UST platform uses ultra-high pressure to create extreme shearing forces that create highly stable, homogenized nanoemulsions of materials that normally do not mix, such as CBD Oil and water. To view PBIs UST-processed CBD Oil being added to a soft drink, a sports drink, and a beer, please use the following link: PBI UST CBD Video 040219.
Mr. Christopher Holden, Founder of Nano CBD Cosmetics LLC, commented: “We are thrilled to be the first purchaser of the BaroShear K45 system. This groundbreaking technology will enable companies producing nano-scale CBD emulsion products to meet the ever-increasing demand for CBD nanoemulsion products. In fact, our own nano-CBD products are currently selling faster than we can produce them. However, with PBIs cutting-edge technology, we expect to increase our nano-emulsified, water-soluble CBD production capacity to many multiples of what it is todayand that is huge.”
Mr. Dan Jorgenson, a Director of Nano CBD Cosmetics LLC, said: “We strongly believe that nano-emulsified CBD products will soon become established as an important new standard in the industry. Consequently, Chris and his team have spent significant time working on the development of our own nanoemulsification strategies, while concurrently evaluating options from multiple sources. In the end, we came to the inescapable conclusion that PBIs BaroShear K45 CBD processing system offers the most important opportunity that we have identified to truly revolutionize the water-soluble, nano-CBD industry.”
The total cannabinoid market is expected to hit $89 billion by 2024 (https://mordorintelligence.com/industry-reports/cannabis-market), with CBD oil-based products being the cornerstone of the non-psychoactive portion of this exploding market. For CBD products commonly consumed orally – including CBD oils in edibles and beverages – absorption is typically below 10% (ERTH 8/28/2018: Water Soluble CBD – The Science of Nanoemulsions and Bioavailability). PBI believes that processing with the UST-based BaroShear K45 system will deliver greatly improved absorption results (potentially as high as 90%) for CBD and a universe of other oil-based supplements.
Richard T. Schumacher, President and CEO of PBI, said: “From my first meeting with both Dan and Christopher earlier this year, I was impressed with their knowledge of the industry, the quality of their products, and their dedication to their company and customers. I was most impressed with their commitment to make and sell only the highest quality CBD products possible. Although they have spent significant time and money developing their own methods to make water-soluble CBD, they ultimately were compelled to invest in PBIs UST-based method for achievement of truly superior and stable nanoemulsion results. They are fully committed to switching to the BaroShear K45 system as it becomes available from our initial production run. We applaud their dedication to their customers and feel privileged to welcome them into the PBI Family.”
Mr. Schumacher continued: “We are also pleased to announce that we are in advanced discussions with over a half dozen additional companies about the potential of their purchasing the BaroShear K45 processing system. Since we plan to make only about a dozen processing systems in our initial manufacturing run, we are optimistic that purchase orders will be received for all available BaroShear K45 systems well before our original forecast of September 30, 2019. This is truly an exciting time to be a stakeholder in PBI.”
About Pressure BioSciences, Inc: Pressure BioSciences, Inc. (OTCQB: PBIO) is a leader in the development and sale of innovative, broadly enabling, pressure-based solutions for the worldwide life sciences industry. Our products are based on the unique properties of both constant (i.e., static) and alternating (i.e., pressure cycling technology, or PCT) hydrostatic pressure. PCT is a patented enabling technology platform that uses alternating cycles of hydrostatic pressure between ambient and ultra-high levels to safely and reproducibly control bio-molecular interactions (e.g., cell lysis, biomolecule extraction). Our primary focus is in the development of PCT-based products for biomarker and target discovery, drug design and development, biotherapeutics characterization and quality control, soil & plant biology, forensics, and counter-bioterror applications. Additionally, major new market opportunities have emerged in the use of our pressure-based technologies in the following areas: (1) the use of our recently acquired, patented technology from BaroFold, Inc. (the BaroFold technology) to allow entry into the bio-pharma contract services sector, and (2) the use of our recently-patented, scalable, high-efficiency, pressure-based Ultra Shear Technology (UST) platform to (i) create stable nanoemulsions of otherwise immiscible fluids (e.g., CBD Oil and water) and to (ii) prepare higher quality, homogenized, extended shelf-life or room temperature stable low-acid liquid foods that cannot be effectively preserved using existing technologies.”
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Cronos Group Inc. (NASDAQ: CRON) (TSX: CRON) is an innovative global cannabinoid company with international production and distribution across five continents. Cronos Group Inc. recently announced financial results and business highlights for the first quarter ended March 31st, 2019. Net revenue was USD 6.5 Million in the first quarter of 2019, representing a 120% increase from USD 2.9 Million in the first quarter of 2018, primarily driven by the launch of the adult-use market in Canada. Net revenue increased 15% quarter-over-quarter from USD 5.6 Million in the fourth quarter of 2018, primarily driven by increased sales in CBD oil, which carries no excise tax reduction and increased sales of dry flower. 1,111 kilograms were sold in first quarter 2019, representing a 122% increase from 501 kilograms sold in first quarter 2018, primarily driven by increased cannabis production and the launch of the adult-use market in Canada. Kilograms sold increased 7% quarter-over-quarter from 1,040 kilograms sold in fourth quarter 2018, primarily driven by increased cannabis production. “In the first quarter of 2019, the business performed in line with our expectations. We continue to stay laser-focused on our strategy of building our supply chain, distribution, intellectual property and brand portfolios,” said Mike Gorenstein, Chief Executive Officer of Cronos Group. “We’re delighted to have officially closed our transaction with Altria and to kick off a relationship we expect to lead to significant growth and value creation. Altria’s investment and the services that Altria will provide to Cronos Group will enhance our financial resources and allow us to expand our product development and commercialization capabilities. Altria’s skills in these areas as well as its regulatory expertise position Cronos Group to compete, scale and lead the rapidly growing global cannabis industry as markets open and welcome legalization.”
Aphria Inc. (NYSE: APHA) (APHA.TO) is a leading global cannabis company driven by an unrelenting commitment to our people, product quality and innovation. Aphria Inc. recently announced that it had expanded the scope of its previously announced agreement expanding the territory where Aphria has been granted exclusive preferred rights to license, manufacture, distribute and sell RDT’s QuickStrip
Charlotte’s Web Holdings, Inc. (OTCQX: CWBHF) (TSX: CWEB) is the market leader in the production and distribution of innovative hemp-derived cannabidiol (“CBD”) wellness products. Recently, Charlotte’s Web Holdings, Inc. had entered into a research initiative with Rodale Institute and Natural Care to pioneer regenerative organic hemp farming. The research will be conducted at Pocono Organics, a start-up regenerative organic farm in Long Pond, Pennsylvania. In alignment with its corporate social responsibility values, Charlotte’s Web has been active in responsible farming practices since 2016. Over the past five years, Charlotte’s Web has been transitioning its hemp farming from conventional to sustainable organic agriculture practices. Charlotte’s Web already has certain cultivation fields that have been certified organic as it pursues broad organic certification for its end products. This new research initiative will take that effort further. Regenerative organic agriculture, which has been pioneered and led by Rodale Institute for more than seventy years, goes beyond simply “sustainable” by supporting the ecosystem’s natural tendency to regenerate. “We’re very proud to be an active partner supporting this research, which aims to bring regenerative agriculture to hemp in this region of the country, through our collaboration with Rodale Institute, Natural Care, and Pocono Organics,” said Deanie Elsner, Chief Executive Officer of Charlotte’s Web. “As the industry leader, Charlotte’s Web aims to continually raise the bar for responsible hemp farming practices. It is our intent that the data from this research will support furthering sustainability for hemp farming.”
iAnthus Capital Holdings, Inc. (OTCQX: ITHUF) (CSE: IAN) owns and operates best-in-class licensed cannabis cultivation, processing and dispensary facilities throughout the United States, providing investors diversified exposure to the U.S. regulated cannabis industry. iAnthus Capital Holdings, Inc. recently announced that CBD For Life, a top-ranked, national CBD brand in the U.S. which the Company agreed to acquire on March 29th, 2019, has entered into an agreement with Urban Outfitters, a lifestyle-oriented general merchandise and consumer products store with 245 locations throughout the United States, Canada and Europe. The agreement places CBD For Life products in Urban Outfitters’ e-commerce platform and top 6 retail locations in the U.S. The CBD For Life products are expected to launch in the select Urban Outfitters stores later this month. “Our partnership with Urban Outfitters represents a major step forward for CBD For Life, placing us in one of the United States’ most successful retail chains that also serves as a tastemaker for the rest of the retail market,” said Julie Winter, Chief Operating Officer of CBD For Life. “With the backing of iAnthus, we look forward to further growing our footprint and making our products top of mind for consumers around the world.”
SOURCE FinancialBuzz.com