CBD is everywhere. Here is the continuation | Health, medicine and fitness
By Parija Kavilanz, CNN Business
The CBD gold rush has begun.
CBD, the chemical found in hemp and marijuana plants, appears in shampoos, lattes, body oils, gummy bears, and dog treats. It is sold in cafes and farmers’ markets, moms and pops and upscale department stores and, more recently, the CVS drugstore chain.
“Literally overnight, you see CBD all around you and in everything,” said Troy Dayton, CEO of The Arcview Group, a cannabis research and investment firm based in Oakland, Calif. “It is a product which passes from relative obscurity to the minds of all: producers, consumers and above all entrepreneurs.”
The floodgates for CBD opened after President Donald Trump enacted the Farm Bill in December. Among other things, the bill legalized the production of hemp, which contains high levels of cannabidiol, or CBD. CBD is not psychoactive, which means it won’t get you high. (THC, or tetrahydrocannabinol, is the chemical in cannabis that does this.) Instead, CBD is marketed for everything from relieving pain and inflammation to reducing stress and anxiety. .
Yet the Food & Drug Administration has yet to decide how to regulate CBD products. In a recent interview with Brookings Institution, outgoing FDA Commissioner Scott Gottlieb said it could be several years before the agency fully legalizes CBD for use in food products and dietary supplements.
So far, little clinical research has been done to prove the effectiveness of CBD. Last year, the FDA approved the first drug containing CBD for the treatment of certain forms of epilepsy, but no other drug has been approved since.
Dayton warns that there is also a lack of standardization in terms of recommended doses and quality control.
“As exciting as it is, it does come with some challenges,” he says. “Standardization and testing are important. Otherwise, it is difficult to differentiate the hype from the reality in terms of determining the effectiveness of CBD products.”
Lack of access to banking services remains another obstacle.
“We have spoken to clients who are still struggling to find a bank willing to work with them and we have spoken with banks and credit unions who want to support the hemp industry, but still feel there is a considerable risk associated with the CBD industry, ”says Evan Eneman, CEO of MGO ELLO National Cannabis Alliance, a financial and tax advisory service for the cannabis industry. “Both parties want clear and actionable banking guidelines from the federal government.”
Despite these hurdles, the Arcview Group predicts that sales of CBD products will exceed legal sales of marijuana in the United States in five years. Here are some of the entrepreneurs who are hoping to make money.
“We want customers to trust our products”
“For us, 2018 is the year so many of our big problems started to go away,” said Chase Terwilliger, CEO of Denver-based Balanced Health Botanicals.
Before the Farm Bill was passed, many banks and payment processors refused to work with his business.
“We had accounts at a lot of big banks and they all shut us down,” he says. “Now the banks and credit card processors are constantly calling to lend us money.”
Founded as CBDistillery in 2015, the company initially sold pure CBD extract derived from hemp in powders that can be added to foods and drinks or mixed with oils and lotions.
Sales have skyrocketed as the company has expanded its portfolio to include oils, tinctures, capsules and gummies. In 2016, the company achieved sales of $ 200,000, he said. Last year, annual revenue was $ 41 million and sales of the Terwilliger projects will double to $ 80 million by the end of this year.
“We have now grown to 101 employees, our products are sold in all 50 states, and I have 20 openings in Denver,” he says.
Terwilliger says he tries to responsibly navigate the CBD industry landscape. He says the company tests each product in three separate labs to make sure they meet standards, such as making sure THC levels don’t exceed 0.3% (as required by federal law) and that the products do not contain contaminants such as heavy metals.
“We are doing this on purpose because there is a lack of standardization in the CBD industry and we want consumers to trust our products,” he says.
High-end retail embraces CBD
Shortly after Katherine, Alison and Juliana Ragusa launched their Lab to Beauty line of CBD-infused facial cleansers, masks and moisturizers, it was stocked on the shelves of the upscale chain of Barneys New stores. York.
The sisters, who began developing the line early last year, already had in-house expertise in creating and marketing beauty products through their family business, The Advantage Co., which manages a portfolio of brands and beauty, fashion and jewelry restaurants. They worked directly with the hemp growers to source the CBD and with the Advantage Co. lab and scientists to formulate the products.
In the summer, after testing the products with a third-party lab, they sent samples to Barneys’ beauty team.
“It was exciting for us to see how willing they were to try our samples on location,” said Katherine Ragusa.
Jennifer Miles, senior vice president of Barneys, responsible for the merchandise, cosmetics division, said the department store chain is looking for a CBD skin care line. She says Barneys is trying to dispel customer misconceptions about CBD “as it becomes more and more common and customers are learning more about the benefits and how to add these products to their wellness routine.” .
The eight product line is now sold in seven Barneys stores, including its stores in New York, Chicago and Beverly Hills and on Barneys.com.
“The response has been overwhelming. Barneys have sold some products online, but we have now restocked,” says Katherine.
A market for mints, pets and beyond
College friends Tim Moxey and Chris Abbott launched BotanicaSeattle in 2012 with a line of cannabis infused chocolates. Since then, they’ve added Mr. Moxey’s CBD mints and a line of pet CBD products called Austin & Kat which includes cookies and oils that they believe can ease pain and calm anxiety in people. dogs, cats and other animals.
Last year, the company recorded around $ 7 million in sales and Moxey expects sales to reach $ 20 million by the end of this year.
But to get there, we had to convince consumers and build trust.
“We spoke with customers who bought other products that they found on the internet and felt cheated because those products did not contain the indicated amount of CBD or contained traces of THC,” explains Moxey. “Pushing to build trust and transparency is difficult in this industry where so many dishonest companies enter the market every day. “
He hopes the FDA will move quickly to establish quality control guidelines.
Moxey says the company has several new CBD products in the pipeline, including topical solutions and other pet products.
“As we educate people about our products and research continues, our long-term goal is to make products that bring the cannabis plant into people’s lives in a meaningful way,” he says.
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