Special report: CBD keeps on growing
A category with the potential to reach $22 billion in annual sales, is taking its first baby steps — albeit pretty big steps for an industry that essentially did not exist just two or three years ago.
With the passage of the 2018 Farm Bill, the cannabidiol, or CBD, industry has stormed into the public consciousness, looking to provide consumers with improved health and retailers with definite opportunities. The bill now allows broad hemp cultivation and transfer of hemp-derived products across state lines.
“Hemp CBD in the U.S. will see explosive growth in the near term, with a compound annual growth rate of over nearly 150% to reach $22 billion in sales by 2022,” said Kay Tamillow of the Brightfield Group, an analytics and market research firm for the legal CBD and cannabis industries.
While marijuana and hemp — both members of the cannabis family — contain CBD, hemp possesses much more of it, making it a preferable option for extraction. Conversely, marijuana is rich in tetrahydrocannabinol, or THC, which provides users with an intoxicated feeling. CBD, which contains 0.3 % or less of THC, does not make users high.
Today, CBD is gaining shelf space across the wide range of retail, first gaining acceptance at independent retailers and bodegas, and now on the verge of winning acceptance at drug stores, supermarkets and mass merchandisers. Amazingly, CBD-infused products are crossing the wide spectrum of retail, finding their way into such diverse items as beauty supplies, pet supplies, and vitamins and supplements.
As the seemingly thousands of suppliers keep introducing items to the marketplace — and back up those items with advertising and other marketing support — demand will continue to rise. Now, though, the big question is when do these items start flooding retail shelves?
In addition, do they truly work? Clinical studies have demonstrated that CBD does indeed help with seizures. In June 2018, the drug Epidiolex became the first and only FDA-approved CBD-prescription medicine used to treat seizures for two rare forms of childhood epilepsy.
Others point to even more benefits. Internet accounts claim CBD can help with anxiety, pain and sleeplessness. It also is said to lower blood sugar, ease depression and help with recovery after a workout. It also may help ease menstrual cramps, lessen the symptoms of Crohn’s disease and relieve arthritis pain.
Some claim it can assist with cancer treatment, while others said it helps treat or prevent the disease. Many also are using it to make them beautiful. Such stores as DSW, Neiman Marcus and Barneys recently started selling beauty products containing CBD.
“CBD products are the next big thing in beauty,” Kim D’Angelo, Neiman Marcus’ beauty buyer, told CNN Business last winter.
That growth has made mass retailers pay attention. Chains including Walgreens, CVS Pharmacy, Walmart and Rite Aid have taken notice and are getting prepared to move quickly when the FDA makes its decision on availability. Some already are testing CBD-based products in certain stores.
“CBD is gaining popularity among consumers, particularly those looking for alternative care products,” said Joseph Goode, a spokesperson at CVS Health, whose CVS Pharmacy stores are rolling out CBD goods in more than 800 stores in seven states. “Anecdotally, we’ve heard from our customers that these products have helped them with pain relief for things like arthritis and other ailments.”
Walgreens will feature CBD products in stores located in nine states. “We have begun offering certain products containing CBD in nearly 1,500 Walgreens stores in select states,” Walgreens spokesperson Phil Caruso said. “The CBD-related items we carry are topical creams, patches and sprays. This product offering is in line with our efforts to provide a wider range of accessible health and well-being products and services to best meet the needs and preferences of our customers.”
In April, Rite Aid also entered the market, selling CBD creams, lotions and lip balms as part of a pilot program in Oregon and Washington, where the chain has about 200 stores in those states.
Because of differing state laws, big brand retailers usually sell CBD products in states allowing retailers to sell industrial hemp-derived products and avoid ones having recent law enforcement actions or pronouncements that raise the risk of sales.
For now, most mass retailers have stuck to creams, lotions and salves “We’re not selling supplements or food additives that contain CBD,” CVS Health’s Goode said. Yet, all manner of CBD products are being offered in countless stores, gas stations, food places and other businesses. For example, Bed Bath & Beyond is offering tinctures of CBD oil for oral use.
While the opportunity to market and sell CBD products is robust, issues abound. Retailers want to know where they can offer CBD without concern of violating the patchwork of conflicting state laws. They also face questions about which companies to do business with — ones that offer customers a safe and effective product.
“There are a ton of companies out there right now, and many are just now qualified to do business with,” said one supplier attending the FDA’s public hearing on CBD in late May. “Retailers need to be very careful who they work with, and they need to vet those companies to ensure they are abiding by a strict set of rules in the manufacturing process.”
Those questions remain complicated and, in many cases, unanswered. Still, the CBD opportunity for retailers is staggering. The demand for CBD products grew by more than 80% in 2018 to about $591 million, according to the Brightfield Group. “The U.S. CBD market,” Tamillow said, “represents an enormous opportunity for both chained and independent pharmacies, which are a trusted retail partner for
many consumers.”
An Evolving Market
With news outlets reporting on CBD’s potential — along with a preponderance of websites touting its benefits — U.S. consumers are clamoring to try it. In fact, an April study by the Food Marketing Institute said 25% already have used CBD.
Yet, because of CBD’s success as a medicine, the Food and Drug Administration has begun taking a harder look at the burgeoning industry. As Consumer Reports reported in its May 2019 issue: “Now that the agency has approved a CBD-based prescription drug — Epidiolex — it says any product that markets the compound for health purposes should go through the FDA’s rigorous official drug approval process. In addition, the FDA notes that when CBD is put into food — say, a cookie, honey, coffee or water — it is considered a ‘food additive.’ And the agency has not yet approved CBD for that purpose.”
However, many businesses across the nation continue to ignore that lack of FDA approval, disregarding the administration’s warnings and offering everything from CBD smoothies to burgers.
“It’s a Wild West kind of environment right now,” Yasmin Hurd, a psychiatry professor at the Icahn School of Medicine at Mount Sinai who researched CBD for almost a decade, told The Washington Post. “I’m inundated every day with patients wanting to know how much CBD they should take, which ones to buy. But we don’t know what’s in the stuff now being sold. … We’ve had this explosion without guidance to the public or regulation.”
Strange Brew?
At the FDA’s public hearing on CBD in Silver Spring, Md., the agency’s acting commissioner, Ned Sharpless, kicked off the hearing by stating “We’ve seen an explosion of interest in products including CBD, [but] there is much we don’t know.”
The 10-hour hearing featured testimony from 140 business owners, doctors, researchers, hemp farmers and consumer advocates, who urged the FDA to quickly craft CBD regulations to address issues.
One of those issues was regarding CBD product ingredients. Jackie Bowen, executive director at the Clean Label Project, a nonprofit focused on health and transpa
With the passage of the 2018 Farm Bill, the cannabidiol, or CBD, industry has stormed into the public consciousness, looking to provide consumers with improved health and retailers with definite opportunities. The bill now allows broad hemp cultivation and transfer of hemp-derived products across state lines.
“Hemp CBD in the U.S. will see explosive growth in the near term, with a compound annual growth rate of over nearly 150% to reach $22 billion in sales by 2022,” said Kay Tamillow of the Brightfield Group, an analytics and market research firm for the legal CBD and cannabis industries.
While marijuana and hemp — both members of the cannabis family — contain CBD, hemp possesses much more of it, making it a preferable option for extraction. Conversely, marijuana is rich in tetrahydrocannabinol, or THC, which provides users with an intoxicated feeling. CBD, which contains 0.3 % or less of THC, does not make users high.
Today, CBD is gaining shelf space across the wide range of retail, first gaining acceptance at independent retailers and bodegas, and now on the verge of winning acceptance at drug stores, supermarkets and mass merchandisers. Amazingly, CBD-infused products are crossing the wide spectrum of retail, finding their way into such diverse items as beauty supplies, pet supplies, and vitamins and supplements.
As the seemingly thousands of suppliers keep introducing items to the marketplace — and back up those items with advertising and other marketing support — demand will continue to rise. Now, though, the big question is when do these items start flooding retail shelves?
In addition, do they truly work? Clinical studies have demonstrated that CBD does indeed help with seizures. In June 2018, the drug Epidiolex became the first and only FDA-approved CBD-prescription medicine used to treat seizures for two rare forms of childhood epilepsy.
Others point to even more benefits. Internet accounts claim CBD can help with anxiety, pain and sleeplessness. It also is said to lower blood sugar, ease depression and help with recovery after a workout. It also may help ease menstrual cramps, lessen the symptoms of Crohn’s disease and relieve arthritis pain.
Some claim it can assist with cancer treatment, while others said it helps treat or prevent the disease. Many also are using it to make them beautiful. Such stores as DSW, Neiman Marcus and Barneys recently started selling beauty products containing CBD.
“CBD products are the next big thing in beauty,” Kim D’Angelo, Neiman Marcus’ beauty buyer, told CNN Business last winter.
That growth has made mass retailers pay attention. Chains including Walgreens, CVS Pharmacy, Walmart and Rite Aid have taken notice and are getting prepared to move quickly when the FDA makes its decision on availability. Some already are testing CBD-based products in certain stores.
“CBD is gaining popularity among consumers, particularly those looking for alternative care products,” said Joseph Goode, a spokesperson at CVS Health, whose CVS Pharmacy stores are rolling out CBD goods in more than 800 stores in seven states. “Anecdotally, we’ve heard from our customers that these products have helped them with pain relief for things like arthritis and other ailments.”
Walgreens will feature CBD products in stores located in nine states. “We have begun offering certain products containing CBD in nearly 1,500 Walgreens stores in select states,” Walgreens spokesperson Phil Caruso said. “The CBD-related items we carry are topical creams, patches and sprays. This product offering is in line with our efforts to provide a wider range of accessible health and well-being products and services to best meet the needs and preferences of our customers.”
In April, Rite Aid also entered the market, selling CBD creams, lotions and lip balms as part of a pilot program in Oregon and Washington, where the chain has about 200 stores in those states.
Because of differing state laws, big brand retailers usually sell CBD products in states allowing retailers to sell industrial hemp-derived products and avoid ones having recent law enforcement actions or pronouncements that raise the risk of sales.
For now, most mass retailers have stuck to creams, lotions and salves “We’re not selling supplements or food additives that contain CBD,” CVS Health’s Goode said. Yet, all manner of CBD products are being offered in countless stores, gas stations, food places and other businesses. For example, Bed Bath & Beyond is offering tinctures of CBD oil for oral use.
While the opportunity to market and sell CBD products is robust, issues abound. Retailers want to know where they can offer CBD without concern of violating the patchwork of conflicting state laws. They also face questions about which companies to do business with — ones that offer customers a safe and effective product.
“There are a ton of companies out there right now, and many are just now qualified to do business with,” said one supplier attending the FDA’s public hearing on CBD in late May. “Retailers need to be very careful who they work with, and they need to vet those companies to ensure they are abiding by a strict set of rules in the manufacturing process.”
Those questions remain complicated and, in many cases, unanswered. Still, the CBD opportunity for retailers is staggering. The demand for CBD products grew by more than 80% in 2018 to about $591 million, according to the Brightfield Group. “The U.S. CBD market,” Tamillow said, “represents an enormous opportunity for both chained and independent pharmacies, which are a trusted retail partner for
many consumers.”
An Evolving Market
With news outlets reporting on CBD’s potential — along with a preponderance of websites touting its benefits — U.S. consumers are clamoring to try it. In fact, an April study by the Food Marketing Institute said 25% already have used CBD.
Yet, because of CBD’s success as a medicine, the Food and Drug Administration has begun taking a harder look at the burgeoning industry. As Consumer Reports reported in its May 2019 issue: “Now that the agency has approved a CBD-based prescription drug — Epidiolex — it says any product that markets the compound for health purposes should go through the FDA’s rigorous official drug approval process. In addition, the FDA notes that when CBD is put into food — say, a cookie, honey, coffee or water — it is considered a ‘food additive.’ And the agency has not yet approved CBD for that purpose.”
However, many businesses across the nation continue to ignore that lack of FDA approval, disregarding the administration’s warnings and offering everything from CBD smoothies to burgers.
“It’s a Wild West kind of environment right now,” Yasmin Hurd, a psychiatry professor at the Icahn School of Medicine at Mount Sinai who researched CBD for almost a decade, told The Washington Post. “I’m inundated every day with patients wanting to know how much CBD they should take, which ones to buy. But we don’t know what’s in the stuff now being sold. … We’ve had this explosion without guidance to the public or regulation.”
Strange Brew?
At the FDA’s public hearing on CBD in Silver Spring, Md., the agency’s acting commissioner, Ned Sharpless, kicked off the hearing by stating “We’ve seen an explosion of interest in products including CBD, [but] there is much we don’t know.”
The 10-hour hearing featured testimony from 140 business owners, doctors, researchers, hemp farmers and consumer advocates, who urged the FDA to quickly craft CBD regulations to address issues.
One of those issues was regarding CBD product ingredients. Jackie Bowen, executive director at the Clean Label Project, a nonprofit focused on health and transpa