CBD and Cannabis Markets Continues to Grow Despite Regulations

CBD and Cannabis Markets Continues to Grow Despite Regulations

FinancialBuzz.com News Commentary

PR Newswire

NEW YORK, April 4, 2019

NEW YORK, April 4, 2019 /PRNewswire/ -- Cannabis distributors and cultivators have been facing severe shortages due to the demand outpacing the supply in recent months. Specifically, the recent bout of legalization efforts has caused consumers to flock to brick-and-mortar or even e-commerce stores to purchase cannabis-based products. However, businesses involved in the cannabis industry are still facing barriers due to numerous government regulations. For instance, Canada recently legalized cannabis in late 2018, however, the country is struggling to keep up with consumer demand. Canadian authorities limit retail hours, shutter businesses, regulate retail expansion and pause license issuing. Despite these regulatory concerns though, the cannabis industry is still positioned to become a disruptive and global marketplace. So far, both public and private sectors have entered into the cannabis industry, helping to further propel its overall growth. And the cannabis marketspace is also seeing large investments from other sectors, particularly from the tobacco and alcohol industry. The aforementioned industry is seeing declining sales, in large part due to the decreasing consumer consumption of those products. On the other hand, the cannabis industry is also seeing a large influx of users each year as legalization efforts continue to spread around the globe. According to data compiled by Grand View Research, the global legal marijuana market is expected to reach USD 146.4 Billion by 2025, registering a CAGR of 34.6%. The market is largely being driven by the rising demand within the medical cannabis sector, however, countries such as the U.S. and Canada are expected to help bolster the recreational sector growth as well. Furthermore, as the U.S. and Canadian markets continue to mature and develop, the recreational sector is expected to account for a greater portion of the market share than the medical sector. Pressure BioSciences, Inc. (OTC: PBIO), Cresco Labs Inc. (OTC: CRLBF) (CSE: CL), HEXO Corp. (NYSE: HEXO) (TSX: HEXO), New Age Beverages Corporation (NASDAQ: NBEV), The Alkaline Water Company Inc. (NASDAQ: WTER)

The rapid development of the cannabis industry has led companies to manufacture innovative products. Traditionally, most consumers smoked cannabis, but now, consumers have a wide range of products to choose from such as concentrates, oils, tinctures, creams, edibles, and most notably, beverages. The cannabis-infused beverage marketplace is one of the fastest growing segments because it is seeing sizeable demand from both the medical and recreational sectors. According to Zion Market Research, the global cannabis beverage market is expected to reach USD 4.46 Billion by 2025. Additionally, the market is expected to register a CAGR of 15.6% from 2019 to 2025. Companies developing infused beverages look to either provide consumers with pure relaxation or leverage the beverages for therapeutic benefits. Primarily, most companies are using cannabidiol, or CBD, within their beverages because of its non-psychoactive biological makeup. Yet, CBD still offers consumers healthcare benefits such as reducing inflammation and pain. And on a larger scale, CBD can also be used to treat symptoms associated with cancer, Alzheimer's, epilepsy, and many others. "Interest has spiked from the beer industry on mounting evidence of a substitution relationship between cannabis and alcohol, while large soda companies increasingly view CBD as a natural fit within their strategically important wellness offerings," Bobby Burleson, Canaccord Genuity Managing Director wrote.

Pressure BioSciences, Inc. (OTCQB: PBIO) earlier this week announced breaking news that it had, "released a new, short video demonstrating the ability of the Company's proprietary Ultra Shear Technology (UST™) platform to create water-soluble CBD Oil that dissolves instantly, resulting in improved dosing effectiveness, enhanced absorption, and more aesthetically-pleasing products when added to carbonated soft drinks, vitamin-infused sports drinks, and beer.

Link to video: https://youtu.be/gAqFQmsGHcA 

In addition to superior aesthetic quality, the Company believes the resulting low nanometer-scale emulsions ("nanoemulsions") of UST-processed CBD Oil will also result in optimized and reproducible bodily absorption, bioavailability, and dosing safety for CBD oil and other UST-processed materials, when compared to many of the processed CBD oils and products that are commercially available today.

Mr. Edgar Ward, President and CEO of NutraLife Biosciences (OTCQB: NLBS), said: "NutraLife manufactures and sells NUTRAHEMPCBD, a line of CBD-infused products that includes creams, sprays, and other products that support daily health and wellness uses. We strive to ensure that our CBD-infused products will always be of the highest quality possible; therefore, we are constantly looking for advanced technologies to continue to improve our manufacturing processes.  After reviewing available data and PBI's videos, we believe methods like PBI's UST platform may enable us to offer products with superior quality and effectiveness."

CBD is a non-psychoactive, oil-soluble compound extracted from the cannabis plant, and is typically marketed dissolved in plant oil. It has been widely reported to offer numerous health benefits from stress and anxiety relief, to decreased muscle, joint, cancer and other pain, reduced inflammation, and to nearly miraculous relief of persistent seizures. However, because CBD is an oil-based product, its ingestion typically results in poor absorption in water-based living systems. There has been enormous interest in the development of truly water-soluble CBD, to achieve efficient absorption and bioavailability from foods and beverages. The market for CBD beverages alone could achieve revenue of $260 million in just the U.S. by 2022 (Bloomberg, September 27, 2018) and much more world-wide. Unfortunately, because of solubility issues, many CBD products on the market today contain an inefficient over-abundance of CBD and/or undesirable chemicals to improve and stabilize its solubility in water. PBI believes that all of these beverages and other CBD-based products could substantially benefit from PBI's Ultra Shear Technology platform, to achieve water solubility and stability from the physics of high-pressure shearing – rather than from dependency upon chemistry and reliance upon use of undesirable chemicals.

Dr. Brad Young, Chief Commercial Officer of PBI, commented: "We are very pleased to now show (in this follow-up video) the ability of our proprietary UST platform to mix CBD oil in water and infuse carbonated soft drinks, vitamin-infused sport drinks, and beer. This latest video further highlights the power of our UST platform to make nanoemulsions and its potential to help nutraceutical and beverage manufacturers make high-quality, oil-based products. With such compelling results to rely on, and with numerous opportunities ahead of us, we intend to accelerate the development of our UST platform to better address what we believe are several multi-billion-dollar markets in nutraceuticals, cosmetics, and food & beverages."

For our latest "Buzz on the Street" Show featuring Pressure BioSciences, Inc. recent corporate news, please head over to: https://www.youtube.com/watch?v=wwh_rr3s3h4 

Cresco Labs Inc. (OTCQX: CRLBF) (CSE: CL), based in Chicago, is a leading U.S. cannabis company with experienced management, access to capital and a demonstrated growth strategy. Cresco Labs Inc. and CannaRoyalty Corp. d/b/a Origin House (CSE: OH) (OTCQX: ORHOF) recently announced that they have entered into a definitive agreement, pursuant to which Cresco Labs will acquire all of the issued and outstanding shares of Origin House. Under the terms of the Agreement, holders of common shares of Origin House will receive 0.8428 subordinate voting shares of Cresco Labs for each Origin House Share. Origin House has become a leading distributor and provider of brand support services in California, the world's largest regulated cannabis market. Origin House's proven strategy has been to build relationships with established dispensaries, build partnerships with established market-leading brands, develop promising cannabis product companies, and then leverage its full suite of support services to transform those products into strong California consumer brands. Origin House delivers over 50+ cannabis brands to more than 500 dispensaries in California, representing approximately 60% market penetration. "The acquisition of Origin House is another example of our focused and disciplined approach to creating a meaningful presence in key cannabis markets through excellence in brand development and distribution," said Cresco Labs Chief Executive Officer and Co-founder Charlie Bachtell. "It establishes Cresco Labs as the leading multi-state operator with one of the largest distribution platforms in California, which is projected to be a USD 7.7 Billion cannabis market in 2022 by Arcview Market Research/BDS Analytics. Having a similar priority on consumers and consumer brands with the expertise of executives from the largest wine and liquor distribution company in the United States, the team at Origin House has established the premier cannabis distribution company in the largest cannabis market in the world. It's an incredible platform for Cresco in California and the distribution infrastructure will provide a valuable framework to leverage as we scale our platforms in other states. Congratulations to Marc and the team at Origin House – through strategic M&A and purposeful investments, they've built something very special."

HEXO Corp. (NYSE: HEXO) (TSX: HEXO) creates and distributes innovative, easy-to-use and easy-to-understand products to serve the Canadian cannabis market. HEXO Corp. and Molson Coors Canada (MCC), the Canadian business unit of Molson Coors Brewing Company (NYSE: TAP) (TSX: TPX) recently announced that they have closed the transaction announced on August 1, 2018, to form a joint venture to pursue opportunities to develop non-alcoholic, cannabis-infused beverages for the Canadian market following legalization. The joint venture, Truss, will be led by former Molson Coors executive, Brett Vye, in the role of Chief Executive Officer. Vye will report to the Truss board of directors consisting of three members appointed by MCC and two members appointed by HEXO. "With the backing of two partners with deep Canadian roots, proven success, and market-leading experience in the respective beverage and cannabis industries in Canada, Truss will hit the ground running," said Brett Vye, Chief Executive Officer at Truss. "When consumable cannabis is legalized in Canada, Truss will be ready to make its mark as a responsible leader in providing high-quality beverages for the Canadian consumer. Why "Truss"?  We are joining together the extensive experience and excellent practices of each partner to build a powerful foundation for the future."

New Age Beverages Corporation (NASDAQ: NBEV) is a Colorado and Utah-based healthy beverage company dedicated to inspiring, educating consumers to live healthily. New Age Beverages Corporation recently announced the signing of an agreement to develop and distribute Marley branded cannabis-infused beverages. The first product to rollout in the Marley+CBD portfolio will be Marley+CBD Mellow Mood, relaxation drinks in 15.5 oz cans with 25 mg of pharmaceutical grade CBD per serving. Initial market rollout to customers will be in Colorado, Oregon, Washington, and Michigan where cannabis is legal for responsible adult consumption. This rollout gives New Age a significant first-mover advantage in the CBD space with a globally-recognized brand platform, and positions the venture well for further expansion as regulations permit. Since beginning conversations with retailers and distributors in October 2018, New Age has received commitments and confirmation from major national accounts and distributors encompassing more than 125,000 outlets, including two of the largest U.S. retailers in the convenience and grocery channels. New Age expects to expand distribution of the Marley+CBD brand to additional markets as the regulatory landscape allows. Michael Cunningham, Senior Vice President of Sales for New Age commented, "It makes my job a lot easier when I have retailers and distributors reaching out to me asking for specific products. From the moment the CBD movement began, I've been receiving calls nonstop asking when we'd be going to market with a Marley+CBD product. Retailers and distributors realize that it will be a long road for smaller CBD brands to gain traction and brand equity. Under the Marley brand platform, we are able to leverage a massive global brand with ties to healthy cannabis use, to ultimately grow a beverage brand beyond anything we have seen to-date."

The Alkaline Water Company Inc. (NASDAQ: WTER) has developed an innovative, state-of-the-art, proprietary electrolysis process that produces healthy alkaline water for a balanced lifestyle. The Alkaline Water Company Inc., with products bottled under the trademark Alkaline88®, recently announced that its wholly owned subsidiary, A88 Infused Beverage Division, Inc., has entered into an exclusive formulation, development, and supply agreement with American Nutritional Products Inc., headquartered in Carson City, Nevada. This Agreement solidifies the Company's ongoing relationship with ANP to finalize the formulations for the Company's Cannabinol (CBD) and infused products. ANP has agreed to initially develop 5 to 7 functional waters including 3 to 4 in the CBD area and 2 to 3 in the vitamin and antioxidant segment. Each will be uniquely formulated to match both consumer demands and taste profiles. Under the terms of the Agreement, A88 Infused will be granted the exclusive right to products developed by ANP, which will be used in the development of the Company's new line of infused beverages. "For over 25 years, Maria Watson, President and Chief Executive Officer of ANP, has been an industry leader in the nutraceutical world. Her formulation team has over 40 years of experience in the development and marketing of infused beverages containing CBD, nutraceuticals, and organic flavoring, making them an ideal partner to work with in the development of our new line of products. We both recognized the synergies of our companies and this agreement was a logical extension of our recently signed co-packing agreement.  The depth of knowledge and expertise provided by ANP will ensure that A88 Infused is able to introduce some of its infused beverages to market by the end of this calendar year," stated Richard A. Wright, President and Chief Executive Officer of The Alkaline Water Company.

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