Guest commentary: Let CBD to be marketed in dietary supplements and as food, beverage additives

Molson Coors will unwind the U.S. portion of its joint venture with Hexo at the end of this year, the beer giant announced. By shutting down Truss USA, Molson Coors will exit the CBD beverage business in the U.S., as of December 31. They follow numerous companies in the hemp and CBD space to either pivot or exit entirely in recent times.

The decision cited the continued inaction of federal lawmakers to reform cannabis laws in the U.S. In the company’s estimation, there remains no near-term pathway to federal legalization, which in turn has created an atmosphere of uncertainty and fear in which retailers and distributors hesitate to take on CBD brands, complicating distribution, and the path to profitability.

In July the House Agriculture Committee held hearings on Hemp derived CBD and regulatory issues.  Ranking Member Rep. Jim Baird (R-IN) stated, “I’d like to add is that the FDA hasn’t really had any kind of regulatory framework for hemp-derived CBD”. Ranking Member Glenn Thompson (R-PA) additionally bemoaned that the “FDA is missing in action”.  While great members recognized it, it is clear Congress’s inability to take action and to hold the FDA accountable has created an untenable situation for the hemp CBD industry to be successful.

“Not every project or innovation will meet our ambitions,” said Pete Marino, president of emerging growth at Molson Coors. “What’s important is that we learn from each and build capabilities that will serve us well into the future. The key for us is to go big behind what’s working and smartly pivot out of what isn’t working from a scale standpoint, like CBD beverages.”

Molson Coors and Hexo launched Truss in 2018 to develop cannabis drinks for the Canadian market. In 2020 it debuted its full lineup of brands which includes Veryvell, House of Terpenes, Little Victory, Mollo, Bedfellows Liquid Arts, and MXG. The company has continued to expand its portfolio, capitalizing on trends like the seltzer craze when Little Victory, for instance, extended with three sparkling fruit-flavored seltzers in June.

Truss USA was formed in 2020 to pursue CBD opportunities stateside. After launching its Veryvell CBD line of sparkling waters in Colorado in early 2021, it expanded distribution to a further 17 states in October of last year.

In 2021, Hexo’s U.S. subsidiary acquired a production facility in Fort Collins, Colorado, to create CBD drinks for the U.S. Truss joint venture. Hexo said Truss products were “now present across select grocery markets within Colorado” and 25 other states. Hexo said it stopped trying to sell the Fort Collins facility during its fourth quarter.

Smoke Wallin, who co-founded and led Vertical Wellness from 2019-2021 commented, “I understand Molson Coors decision completely.  We launched Vertical in 2019 with high hopes for ingestible products and had a wide range of beverages lined up for distribution but eventually concluded the FDA and Congress was unwilling to do what was necessary to enable the industry to thrive in mainstream retail in a realistic timeframe.   This caused virtually everyone who invested in the hemp and CBD business over the past few years to lose their investments and in many cases go out of business. 

 This is an indicative headline from the US Food & Drug Administration’s website: “FDA warns 15 companies for illegally selling various products containing cannabidiol as agency details safety concerns Violations include marketing unapproved new human and animal drugs, selling CBD products as dietary supplements, and adding CBD to human, animal foods”

Wallin continued, “The idea that Molson Coors decided to exit at this time, with their deep pockets and strong distribution footprint demonstrates how devastating the US FDA regulatory environment has been to the hemp industry.  It’s really counter to the ideas behind the 2018 Farm law, but consistent with the wishes of big pharma industry.  I made the case for regulatory relief publicly, throughout 2020-2021, in multiple publications and media shows. (see NASDAQ,  DENVER POST)”

Should the regulatory landscape in the U.S. change, the company said it would be prepared to re-enter the space. Currently, however, the ability to scale in the category remains difficult, Marino says. “The key for us is to go big behind what’s working and smartly pivot out of what isn’t working from a scale standpoint, like CBD Beverages.”

“Long-term hemp-based and full cannabis-based beverages will be major sectors in the industry.  They just can’t do it in mainstream retail under today’s regulatory environment.  Even so, there are a continuous stream of entrepreneurs willing to risk everything to pursue this,” Wallin said, “It’s like a game of ‘frogger’ for anyone navigating the industry today. You must leap between lily pads and survive the FDA alligator and the rushing river of cash to make it to the other side someday.  I have no doubt there will be successes, but it’s hard times for now.”

Sources: Molson Coors Press Release, Beverage Industry News Sources, Impact Newsletter, MJBiz, FDA website, Congressional Public Records, Interviews.

Smoke Wallin is a Partner and Managing Director of STS Capital Partners, a leading global M&A firm.

Smoke’s Cannabis Industry Check-in 420 2022 

Smoke’s Cannabis Industry Check-in 420 2022 

Over the past four months I’ve had the opportunity to travel the world, attend conferences, visit operations, and I’ve spent one on one time with multiple thought leaders in and around the cannabis industry on multiple fronts. Since December I’ve attended or presented at:

Cantor Fitzgerald Cannabis Summit 2022
  • YPO Summit 420 – Cannabis & Psychedelics / Plant Medicine – Miami, FL
  • Arcadian Capital annual meeting, Los Angeles, CA
  • South by Southwest SXSW – Austin, TX
  • YPO Health & Wellness Converge Miami – Miami, FL
  • Roth Capital Conference – Laguna Beach, CA
  • Cantor Fitzgerald 2nd Annual Cannabis Summit – Virtual
  • Cannabis M&A Event – hosted by STS Capital, Greenspoon Marder & CannaCPAMasters  – Los Angeles, CA
  • Beer & Spirits Industry Summit, Del Coronado, San Diego, CA
  • Visits to cannabis and beverage operations in Asia, Europe, Canada, Multiple US states

A summary of my observations is as follows:

Despite certain challenges state by state, and the lack of Federal leadership in the US, there remains a vibrant industry continuing to attract entrepreneurs and capital.  While there has been a huge separation in access to and cost of capital between the larger Multi-State-Operators (MSOs) and the smaller businesses, the industry continues to progress.  M&A is heating up at all levels.  We see increased activity into Q3 and Q4 with larger players looking to fill out their geographic coverage (state by state) and smaller players looking to gain scale by combining.  As we lurch toward potential Federal reform in at least the banking front, we expect deal making to heat up even more.  

I remain more convinced than ever that brands matter and will be the key drivers of value into the future.  That said, solid operations, making positive cash flow and not getting ahead of one’s skis are the most important characteristics in today’s market.  Long term, brands will win, but to get there, companies must have the staying power to build brands.  That is being done across the industry in individual businesses and markets but is still the exception.  

Europe is interesting as markets start to open.  Germany is the big bell weather that appears to be marching towards legalization.  Many players throughout the EU are positioning for entry there. Uncertainty with the war in Ukraine is perhaps slowing things a bit, but there is momentum in these markets building.

Asia has great promise with Thailand looking to lead the way recently in order to open up their tourism to the region. 

Smoke Wallin @ SXSW 2022

A key trend we are seeing across multiple sectors is convergence.  This is particularly evident in the beverage world from which I come.  One only needs to look at deals announced this year to see it clearly.  Examples include Coca-Cola entering alcohol with Fresca (partnered with Constellation) and Hard Topa Tia (partnered with Molson Coors), Pepsi with Hard Mountain Dew (Boston Beer), Monster Energy buying craft brewer CanArchy ($300m), Tilray buying Sweet Water brewing and Breckenridge Distillery.  We expect to see more cross category investment and when safe banking gets enacted, the floodgates will open up across the sector in cannabis and hemp.  

Regardless of the banking situation, we see MSOs and other new players looking to add successful growth businesses to their growing footprint in the 2nd half of 2022. Smaller player such as Vecanna (CSE: VENI) (OTCQB: TPPRF), where I set on the board are doing cash positive acquisitions and new market expansion as well (SEE TODAYS MERGER ANNOUNCEMENT for NV and NJ). I see more of these types of deals going forward.

Smoke is a partner and Managing Director at STS Capital Partners, Chairman of Taliera, Chairman of Vertical Wellness, a board member of Vecanna (Top Strike Holdings) and a serial entrepreneur.  He is focused on helping solve homelessness through innovative transitional housing NFP Dignity Moves

vive ut vivas – A Tribute to My Friend & Mentor Joe Gilpin

vive ut vivas – A Tribute to My Friend & Mentor Joe Gilpin

Live so that you may live.  The phrase suggests that one should live life to the fullest and without fear of the possible consequences. My teacher, mentor and friend, Joseph Gilpin helped to instill this into my soul.  Joe was an amazing soul, a Bostonian priest who ended up teaching Latin in Bradenton, FL.  Joe passed away unexpectedly in September 2021.  It has taken me a while to process what exactly Joe meant to me.  This is my tribute to my teacher, mentor, and friend. 

Joe Gilpin circa ~1983

I’m not sure how or why I signed up for freshman Latin at Bayshore High School in the Fall of 1980, but nonetheless, I ended up in Joe’s class.  I think I decided that learning the root of all romance languages would be a good base for any other language and for college. The first thing I learned was that Joe was not like any of the other teachers I had ever met. Joe cared first about us.  Each of his students mattered a lot more than the topic he was teaching.  We spent much of our time together in class discussing life, family, politics, and philosophy.  

Smoke in toga at a Latin Club event

Yes, we did learn Latin, and I would end up spending four years in his class, in leadership in the FL Junior Classical League, doing well on the SAT and learning a tremendous amount about the Roman Empire and the root of our language.  It most certainly contributed to me being the only student at Bayshore to be admitted to and attend an Ivy League University (Cornell). That said, I learned a lot about life, philosophy and perspective that simply could not be taught in a book.  I also was a less than stellar student of Kathy Gilpins for Freshman English.  Sorry Kathy (I mean it!)

Joe challenged us to think.  Something I fear has mistakenly been lost in much of our education system today. He would never accept your first answer.  Instead, he challenged his students to think and explain. For this, I put Joe into 5+ most influential people in my life. 

He was a champion and leader in the teaching of the Classics.  He and his wife Kathy and later his son Christopher, would trek all over the country to attend the National Junior Classics League events https://www.njcl.org/Teachers/Latin-Honor-Society  .   I was fortunate to attend the Florida JCL and win an award for the clay model of a Roman leader (LOL).  

The Latin Club (Kathy is far right next to Smoke and Joe is far left)

Student Council leadership….(before)
Story on the incident in Tampa Tribune

Not everything was roses in our relationship.  Joe was the faculty sponsor for the Student Counsel, and we attended the Palm Beach Gardens, FL meeting for all the High School Student counsels together.   Youthful indiscretion led a couple of us “Leaders” to bring some bottles of liquor to the convention.  We actually successfully “partied” during the event without incident, but the next morning Joe stopped by our room, and we had an empty bottle of Jack Daniels sitting by the TV.  He saw it, looked at me and teared up.  He had no choice but to report our indiscretion. This led to an embarrassing and public suspension of the guilty officers (not all) of the Bayshore HS student counsel. One of the other students had a family with money and they ended up suing the school because it wrecked his 4.0 grade point average.  I don’t know what ever happened with that, but I do know I had to explain my suspension on all my college applications.  Despite the situation that we experienced together; Joe wrote me recommendations to all my college choices. This included Cornell, MIT, Princeton, USC among others.    I ended up getting a full ride to USC but chose Cornell.  Princeton didn’t get it.  

A not very happy Joe on the way back from our student council convention!

The Gilpins at our Wedding

I always stayed in touch with Joe, albeit sporadically.  When I remarried I invited Joe and Kathy.  They unexpectedly accepted and joined us for our blessed event in the desert of Las Vegas in the Spring of 2008 along with about 100 of our family and friends. It was an amazing experience for us to reconnect and to share that magical time together.  On the funny side of things, my wife Anitra and I had a limo and everyone else was sent out to the Red Rocks Park on buses. As we were about to leave Vegas in our Limo, Joe and Kathy ended up missing the buses.  Of course, we had them join us for Veuve Clicquot in our wedding limo. Needless to say, certain things were not possible with Joe and Kathy in our limo (LOL) but it was as special moment together.  

We were blessed to have them join our family at this magical event.  I only wish we had another time to hang and reminisce.  I learned of Joe’s untimely passing through his son Christopher on Facebook back in September.  I knew I wanted to write a tribute to him and his influence on me and so many others, but it took me a while to put my thoughts together and express my gratitude.

Joe and Smoke at Red Rock State Park in Nevada

The Roman poet Horace wrote, “Seize the day; put no trust in the morrow.” or as you might recognize Carpe diem, in Latin form. In the spirit of what Joe imparted on me and so many others, vive ut vivas; Live so that you may live.  I don’t think any of us living through the past couple of years during the Pandemic think about life quite like we did before.  Never has it been more important to live your life fully.  I try to do so each and every day and wish that upon each and every one of you.

Joe’s official obituary can be found here.

CBD 2.0: Why 2021 is the Dawn of a Promising New Era in the Hemp

CBD 2.0: Why 2021 is the Dawn of a Promising New Era in the Hemp

NOTE: ABRIDGED VERSION ABOVE PUBLISHED BY NASDAQ 2-18-21

In 2004, Tim O’Reilly popularized the term “Web 2.0.” According to Tim O’Reilly, “Web 2.0 is the business revolution in the computer industry caused by the move to the Internet as a platform, and an attempt to understand the rules for success on that new platform.[3] He went on to say, “Web 2.0″refers to the historical context of web businesses “coming back” after the 2001 collapse of the dot-com bubble, in addition to the distinguishing characteristics of the projects that survived the bust or thrived thereafter.[4]As we enter year three of federally legal hemp CBD, I am calling CBD 2.0.

 I lived through the dot-com bubble having founded eSkye.com in 1999 as a B2B exchange for the alcohol industry. I then led through the transition from dot-com to Web 2.0 morphing eSkye.com into eSkye Solutions and shifting to become a SaaS software provider to the industry, at one point establishing it as the largest provider of dedicated software services to the wine industry. We also handled all the vendor managed pricing with Walmart, Walgreens, and other chains for many of the largest wine, spirits and beer companies in the world. I was also Chairman of Wine 2.0, which was a riff of the Web 2.0 movement to bringing technology and wine experiences together.

O’Reilly and Gary Vaynerchuk (winelibrary.tv and Vaynerchuk Media) joined us at the New York Wine 2.0 event that featured cutting edge wine start-ups and wineries, plus over 1,000 wine and tech lovers coinciding with O’Reilly Media’s Web 2.0 Expo.

This week, on Yahoo Finance, I characterized 2021 as “CBD 2.0.” as the beginning of a fundamental shift from the early “Wild West” days of the hemp CBD industry to a year that will lay foundation for national brands. Let me explain and see if you agree.  

Pablo Zuanic, the well-regarded research analyst at Cantor Fitzgerald, put out several reports this week on the Cannabis and CBD markets and companies. As he points out:

“Macro view: our projections remain bullish for the next five years. Despite lackluster trends in 2020, partly COVID-related, and a slowdown pre-COVID in 2H19 – as lack of regulatory guidelines from the FDA prevented the FDM channel from adapting CBD a widely as had been expected, across formats and by all major retailers – projections remain quite constructive. Most estimates by the industry’s trade shops continue to forecast US CBD $ sales of $15-20Bn by 2024. The Brightfield Group projects sales of $15Bn by 2024, up from $4.2Bn in 2019. BDS Analytics projects sales of $20Bn by 2024, more than 10x the $1.9Bn in sales generated by the industry in 2018 (~50% CAGR), as per their estimates. BDSA estimates 63% of the $20Bn 2024 figures would be hemp-derived CBD and 37% marijuana-derived CBD. The current market split is as follows, according to BDS Analytics: ingestibles 47%, topicals 26%, inhalables 21%, pet products 3%, and 4% other (including pharmaceuticals). But as discussed below, without clear FDA guidelines and formal classification of CDB as a dietary supplement, the bulk of the FDM channel will stay reluctant to stock CBD products, and this will limit growth, in our view.”

He goes on to point out that without a major FDA/regulatory catalyst, it’s hard to see things improving rapidly from 2020. While I agree with his general assessment of the handful of public CBD companies he covers – cbdMD (YCBD/Neutral), Charlotte’s Web (CWBHF/Neutral) and CV Sciences (CVSI/Neutral)— I think those companies’ biggest issues are more related to the rising tide of other serious brands from mostly private companies but also new entrants. This new onslaught is much more sophisticated and include larger scale CPG brands than what the early CBD companies are used to competing against. Two such examples are Martha Stewart’s CBD Gummies launched by Canopy Growth and Molson Coors announced launch of their CBD beverage, TRUSS CBD in Colorado. This new crop of brand focused companies is leading the way and initiating the dawn of CBD 2.0.

Hemp CBD Early Days

In 2014, after years of grassroots efforts, Congress included an experimental program that allowed hemp to be legally grown in the US for the first time since 1937, provided it was attached to a University. 14 states ended up participating in the program. It was quite restrictive but a huge step forward for the industry. This was pre-CBD 1.0, a period of primitive CBD industry and initial consumer trials of the cannabinoid. During this time, there was a volatile) gray/illegal market for CBD with shady operators popping up all over brokering CBD from China and putting it into products with no testing, no truth in labeling and zero reliability. It was truly the “Wild West” and was common to have “brokers” claiming to have for sale or want to buy millions of dollars or liters of CBD, only to have them disappear when one actually tried to make a deal. It was a close cousin to the illegal cannabis industry with many of the same players participating in both.

I went to Washington DC to meet with congressional leadership in March 2018 to gauge the likelihood of expanding the hemp program nationally and of cannabis prohibition repeal overall. My impression was that full-on cannabis prohibition repeal still had meaningful opposition, but that hemp legalization could move quickly with bipartisan support.

My team jumped into it in 2018 growing 115 acres with partner farmers in Kentucky and establishing a hemp processing facility there as well. Just about everything that could go wrong did. The seeds were not great, the weather was terrible (wet when we needed dry and dry when we needed wet – “Welcome to farming,” they told me), our equipment kept breaking as most was not designed for the hemp plant, etc. Despite these challenges, we learned quickly and were able to lay the groundwork for what was to come.

Hemp CBD 1.0

Enter the Farm bill, which passed on a bipartisan basis and was signed into law in December 2018. This laid the foundation for a truly national, legal hemp industry, provided that each state set up a system and apply with the USDA. The excitement was palpable. It was a bit like a mini dot-com in terms numbers of start-ups, money flowing into the space, and news coverage. We bet heavily that the market would expand dramatically with legalization and committed to growing more than 1,800 acres of hemp with partner farms in KY and TN. We plowed millions of dollars into the production side of the business while at the same time putting a portfolio of brands together. We successfully launched our first brands into nearly 1,000 convenience stores in late 2018. It was a CBD “Gold Rush” with 100s of new “brands” appearing out of nowhere. Farmers switched to hemp production in mass, and $100s of millions of investments pumped into hemp processing operations. Big retailers began taking meetings with the anticipation of rolling out CBD products in 2019.

Between the Fall harvest of 2018 and 2019, the hemp growing, processing, and CBD ingredient side of the industry collapsed. In retrospect, perhaps it seems obvious that a frenzy of new investment and market participants in a brand-new industry would cause over-supply. Also, the proliferation of start-ups, populated with inexperienced business operators, caused plenty of issues. However, in a twist unforeseen by anyone but perhaps big pharma, the regulatory headwinds led by the US FDA threw a wrench in the momentum towards retail adoption. Their position was that CBD ingestibles are unsafe until proven otherwise, and therefore not permitted. This declaration caused most of the major retail outlets to cancel plans to bring CBD onto their shelves. (See my article in the Denver Post on this here)

The resulting destruction of value in the industry was swift and massive. Seven of the largest hemp processors who had raised over $400 million failed by February 2020 (pre-COVID lockdown). The largest, GenCanna, had a reported $2 billion deal to go public in the Fall of 2019, only to collapse into bankruptcy months later. I was 36 hours from a $700 million+ merger into a SPAC on NASDAQ when it unraveled in October 2019. We faced a collapsing market and a flight of investment capital. My team at Vertical Wellness took immediate action by cutting our costs and pivoting to a services business to help recover investor/creditor dollars from all these failed companies. In the end, we landed contracts to dry or process over 18 million pounds of hemp, making us profitable in 2020 during the pandemic. Given the retail environment, our brand launches were pushed into 2021, but we used the time and cash flow to prepare and make strategic acquisitions to be ready for what was to come. I share our rare success during a dismal time in the industry not to boast, but simply to inspire other entrepreneurs and demonstrate that being resilient and never giving up are essential qualities.

Entering CBD 2.0

In five years, we can look back and see if I called this too early, but something feels different to me. To be clear, I’m not suggesting good times are here immediately, but rather, we will soon be able to clearly see the path forward for a thriving cannabinoid industry. Here is my case that 2021 is the turning point for CBD.

1.    Survivors: Only the strong survived the great destruction of CBD 1.0 – those of us remaining either pivoted, figured out how to make money, or emerged with new focus on execution.

2.    Execution and Funding: The extreme loss of value has scared away many investors. This makes it a lot harder for new entrants to attain funding and for existing folks who are not executing to stay in the business.

3.    State Permitted Ingestibles: In spite of the FDA inaccurate proclamation against the safety of CBD, consumer demand for health and wellness products has only grown. Fundamentally, consumers want natural alternative solutions (from Big Pharma drugs) to solve sleeplessness, anxiety, pain, and other ailments. Cannabinoids increasingly demonstrate their proper role in solving for this consumer demand. Just as in the overall THC-based Cannabis market, the States are leading the way in permitting ingestibles of CBD. This will accelerate in 2021. The states are driving permitted CBD consumption and consumer demand (it’s 47% of consumption nationally in spite of the FDA). Additionally, there are more studies coming out regularly, adding further lack of evidence of any harm caused by CBD. These factors and continued support from a growing bi-partisan group of lawmakers will eventually overcome big-Pharma’s grip over the FDA on this issue. I’m hopeful this can happen in 2021 but is not essential for my case for CBD 2.0.

4.    Retailers Need for Growth: Retailers who are coming out of a crazy year of focusing on essential supplies or in other cases being shut down are looking for new ways to grow. CBD is back on top of their list of growth categories in which many are not yet participating.

5.    Efficacy Matters: More and more companies and brands today are focused on the real impact CBD and other cannabinoids can have on people’s lives. Faster acting products with clear uses will lead the growth.

6.    Real Brands: More legitimate, credible brands, not named “CBD this” or “CBD that,” are emerging. That would be like naming my new beer brand “Beer.” CBD is simply one of about 150 cannabinoids in the Cannabis plant that, when combined with the right balance of other ingredients (e.g. melatonin), can have tremendous efficacy in solving or alleviating real health and wellness ailments. Consumers want it, but they don’t know who or what to trust because of the lack of workable regulations and proliferation of unknown, unproven, generic brands. That is starting to change as premium brands are being backed by credible companies and honest leaders with proven track records. Our kathy ireland Health & Wellness® CBD solutions is a great example of this. Kathy is a recognized leader and advocate for women’s health. Our acquisition of The Organic Candy Factory is another. We are very excited to bring these to market.

As Tim O’Reilly once said, “Pursue something so important that even if you fail, the world is better off with you having tried.” I believe “CBD 2.0” is a worthy endeavor and indeed will make the world better off. I recently had my whole team read the late Tony Hsieh’s (former Zappos CEO) book Delivering Happiness: A Path to Profits, Passion, and Purpose. In it, Tony shares a plethora of stories where Zappos was at the brink of going out of business but found a way to persevere despite the odds.  Had a small group of impassioned leaders not fought through those times, there never would have been a $1 billion exit. Many in the industry are in a similar moment. Those who show resilience and conviction will prevail. 2021 will prove to be the turning point in building a thriving, healthy industry that contributes to the societal good.

Guest commentary: Let CBD to be marketed in dietary supplements and as food, beverage additives

Guest commentary: Let CBD to be marketed in dietary supplements and as food, beverage additives

Guest commentary: Let CBD to be marketed in dietary supplements and as food, beverage additives

By  |

While the COVID-19 pandemic continues to wreak havoc across Colorado, small businesses and their employees are paying a heavy price. Colorado has been hit hard with more than half a million people having submitted unemployment applications and thousands of bankruptcies filed since the pandemic began.

With so many industries absorbing the shock and strain of the financial crisis, public officials and leaders should seek every solution to help protect and lift small business owners. For some farmers and small business owners in Colorado, one simple solution exists, and it costs nothing.

Rather than a bailout from the federal government, what Colorado hemp farmers and small business owners need is for the federal government to take action and classify cannabidiol, better known as CBD derived from hemp, as a food additive or supplement.

In the 2018 Farm Bill, hemp was removed from Schedule I controlled substances, making it a wholly legal agricultural commodity. However, the FDA still regulates its use in medicines and prohibits ingestibles from being sold.

There are two ways to remedy this. First, Congress has introduced HR 5587, which would allow FDA-regulated, hemp-derived CBD to be marketed in dietary supplements and as food and beverage additives. Several members of Congress have thrown their support behind such a measure.

The second path is for the FDA to take action. The regulatory body has a chance to stabilize and save small businesses as several companies in this industry across America have declared bankruptcy. Those companies, at least in part, blamed the FDA’s inaction on ingestibles for their decline. This one policy change would have
saved hundreds of jobs and kept revenue streaming into local restaurants, shops, stores and communities.

Either action would loosen restrictions on the marketing of CBD products and surely support the growth of hemp-derived CBD industry in 2020. The growth trajectory remains strong long-term including here in Colorado, where the industry already employs hundreds of workers. Yet it could be even greater if the FDA were to act. This
would allow companies like Walmart, Target and Kroger to get fully behind CBD products. Industry experts estimate the potential associated market with CBD edibles, beverages and other products could exceed $23 billion by 2023.

Another major benefit to federal action is CBD would be sold in a regulated manner with uniformity regarding labeling and potency. The industry applauds the recent decision by Virginia Gov. Ralph Northam for joining other states and allowing CBD in food despite federal prohibition. Yet without federal action, states will wind up with a
patchwork of laws and regulations potentially adding further confusion to the market and prohibiting the mainstream retailers from participating broadly in the category.

CBD is used by millions and widely considered safe. Oils, ointments and topicals are popular because they are natural occurring and are used for potential healing properties, including pain relief, inflammation and to fight anxiety, which is increasingly necessary as prescriptions for anti-anxiety and anti-depressants continue to spike during the pandemic.

There’s no reason why common-sense policy cannot prevail especially in a time of crisis. Colorado’s elected officials should urge the FDA to help the economy in Colorado, small business owners and farmers across America and allow CBD ingestibles into the marketplace.

It’s an easy win for us all at a very difficult time for the economy and does not require bailout dollars from the federal government.

Smoke Wallin is CEO of Vertical Wellness, a leading multi-national vertically integrated brand company in the hemp-based CBD industry.

Allowing CBD products in New Jersey could give the economy a boost

Allowing CBD products in New Jersey could give the economy a boost

May 3, 2020|CBD, congress, hemp, Regulation

Allowing CBD products in New Jersey could give the economy a boost | Opinion https://www.nj.com/opinion/2020/05/allowing-cbd-products-in-new-jersey-could-give-the-economy-a-boost-opinion.html 

#cbd #hemp #fda #congress #recovery #cannabis

By Star-Ledger Guest Columnist

By Smoke Wallin

While the COVID-19 pandemic continues to wreak havoc across the economy small businesses are paying a heavy price. A record number of unemployment applications and bankruptcies are being filed weekly and officials say the worse is yet to come.

With so many industries absorbing the shock and strain of the financial crisis public officials and leaders should seek every solution to help protect and lift business owners. One such solution exists, and it’s a simple one.

The market for oils, capsules, body lotions, and other products containing cannabidiol, better known as CBD derived from hemp, has been rapidly growing. But there’s room for further expansion with ingestibles. What the industry needs is for the FDA to take action and classify CBD as a food additive or supplement enabling it to be included in food, beverages and supplements.

The hemp industry, now legal to farm and cultivate in New Jersey, employs thousands of workers in America, and the growth trajectory remains strong long-term. Yet it could be even greater for New Jersey farmers if CBD ingestibles were allowed to be sold in mainstream retailers and online stores. This would allow companies like Walmart and Target to get fully behind the CBD category. Industry experts estimate the potential associated market with CBD edibles, beverages and other products could exceed $23 billion by 2023.

There’s already support from several members of Congress. Rep. Collin Peterson of Minnesota has also introduced a bipartisan Bill HR 5587 co-sponsored by both Rep. Comer and Massie of Kentucky, that would allow FDA-regulated, hemp-derived CBD to be marketed in dietary supplements and as food and beverage additives.

Not only would it provide a boost to the multi-billion dollar industry but it would help keep current hemp businesses thriving in the newly opened market here.

If the FDA had taken action, several companies from Kentucky to Colorado to Pennsylvania might have avoided bankruptcy. Those companies, at least in part, blamed the FDA’s inaction on ingestibles for their decline. This one policy change would have saved hundreds of jobs and kept revenue streaming into local restaurants, shops, stores and communities.

As many Americans know hemp plants and hemp-derived CBD are from cannabis plants with less than 0.3% THC and are not psychoactive and therefore cannot get you “high.”

CBD is widely used by millions and safe. Oils and topicals are applied for a variety of reasons from healing potential to pain relief to reducing anxiety.

There’s no reason why common-sense policy should not prevail especially in a time of crisis.

The FDA can help small business owners and farmers in New Jersey and take action by allowing CBD ingesitbles into the marketplace.

It’s an easy win for us all at very difficult time for the economy and does not require bailout dollars from the Federal Government.

Smoke Wallin is CEO of Vertical Wellness, a leading multi-national vertically integrated brand company in the Hemp-based CBD industry.

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