CBD Sector Continues to Mature – Sector Snapshot on CBD Brands and Opportunities (OTC: $RLBD) and (NYSE: $ACB), (NYSE: $APHA), (OTC: $TGIFF)
Point Roberts, WA and Delta, BC - November 4, 2019 (Investorideas.com Newswire) Investorideas.com, a leading investor news resource covering cannabis and hemp stocks releases a sector snapshot reporting on the growth of the CBD industry and how companies are looking to differentiate their unique brands.
According to a report 'Trends in Internet Searches for Cannabidiol (CBD) in the United States', Google searches for CBD are seeing exponential growth as popularity and availability increases. "Searches for CBD are now rivaling searches for yoga and electronic cigarettes, with 0.96 and 0.85 of their respective search volumes, and are searched for more than half as much as dieting."
Another recent report stated, "As applications for cannabidiol are brought to market across diverse industries such as cosmetics, health products, food and beverage, pet products, skin care, and pharmaceuticals, the collective market for CBD sales is expected to exceed $20 billion in the United States by 2024," according to BDS Analytics and Arcview Market Research.
"We're witnessing CBD maturing from a cannabis sub-category into a full-blown industry of its own," said Roy Bingham, Co-Founder and CEO of BDS Analytics. "Our growth forecast for the CBD market, across all distribution channels, predicts a compound annual growth rate of 49 percent by 2024. This is a great opportunity for all involved, but it means the road ahead will include decisions that need to be informed by the best possible data."
As major retailers continue to announce their stocking and private label development of CBD products, BDS Analytics predicts that the majority of CBD product sales will soon occur in general retail stores, rather than cannabis dispensaries, as is currently the case. Moving forward, BDS Analytics market insights indicate that the success of products is dependent on education and understanding, dosing and consistent labeling.
BDS Analytics feels CBD is in a unique position compared to other nutraceutical or supplement ingredients for two reasons: 1) as an active ingredient in cannabis, it has a storied history of health and wellness use and anecdotal evidence of efficacy, and 2) it is one of the few natural remedies with scientific basis for at least some of the claims being made about its curative powers. Unsurprisingly, consumers are fascinated by the perceived benefits of CBD.
This growth and drive of the CBD industry is bringing in major branding opportunities such as sports and celebrity endorsements for each innovative formula.
Real Brands, Inc. (OTC: RLBD), a leading brand building company in the legal Hemp-Derived CBD consumer products category, announced that it has closed the previously announced acquisition of the proprietary CBD formulas from Integrative Medicine US of Coral Springs, Florida. The formulas consist of Ancient Chinese and other Ancient Herbal Remedies that are paired with the latest scientific breakthroughs in endocannabinoid systems, nutrients and hemp-derived CBD.
"We are pleased to announce the signing of the definitive agreement to acquire these proprietary formulas," said Real Brands, Inc. CEO, Jerry Pearring. "Since completing our audit earlier this month, we are now focusing on launching our brands and E-commerce website," added Pearring. "We are concluding the final steps in developing our unique packaging design and formulations for each of our brands: CBD Pharmacy™, HempAid®, Humboldt Brands® and Omegahemp™. This acquisition bolsters our efforts to offer consumers innovative CBD products and, as we previously announced, we intend to use these formulas for our CBD Pharmacy™ brand and feature the Chinese symbol for healing in our new logo."
In addition, as part of this acquisition, Jonathan Fields, AP DOM, has entered into an agreement to formulate additional products for Real Brands and become the initial member of Real Brands, Inc.'s Advisory Board. "I'm pleased to become a member of the Real Brands team and look forward to applying my education and ongoing research into traditional eastern medical therapies to create delivery mechanisms that act synergistically with CBD," said Fields.
Aphria Inc. (TSX: APHA) (NYSE: APHA) recently reported its results for the first quarter ended August 31, 2019, with a net revenue of $126.1 million in the first quarter, an increase of 849% from prior year quarter and a decrease of 2% from the prior quarter, revenue for adult-use cannabis of $20.0 million in the first quarter, an increase of 8% from the prior quarter and a net income of $16.4 million and adjusted EBITDA of $1.0 million in the first quarter.
"We are pleased to report a second consecutive quarter of profitable growth with strong contribution from our Canadian cannabis operations. Our success was also driven by our international business and the strength and growth of our brands, particularly Broken Coast, despite a small fire at our British Columbia facility at the end of the quarter. This solid start to the year keeps us on track to achieve our fiscal year 2020 financial outlook," stated Irwin D. Simon, CEO of Aphria, Inc. "Going forward, we remain focused on our highest-return priorities both in Canada and internationally as our team furthers the development of our medical and adult-use cannabis brands to drive growth through innovation and return value to shareholders."
The company, through its subsidiary Aphria Deutschland GmbH launched their CBD-based nutraceutical, featuring CBD derived from hemp, CannRelief. The brand of products are being produced in the European Union and distributed by the Company's subsidiary, CC Pharma, which has access to more than 13,000 pharmacies throughout Germany.
"We are excited to introduce our first brand of CBD products for the German nutraceutical and cosmetics market," said Jakob Ripshtein, President of Aphria. "Supported by our extensive distribution network through CC Pharma, CannRelief provides a natural extension to Aphria's growing business opportunities in the German medical cannabis market. We look forward to providing a full range of CannRelief CBD products this year."
CannRelief CBD oils are being sold in both a 5% and 10% CBD concentration and can be found in select stores across Germany. A range of skincare and other products, including creams, serums and masks will be introduced under the CannRelief brand in a phased rollout in 2019.
Aurora Cannabis Inc. (NYSE: ACB) (TSX: ACB), a Canadian company that's defining the future of cannabis worldwide, and the UFC, the world's premier mixed martial arts organization, announced their launch of a joint clinical research program that will produce multiple studies under the terms of their recently announced partnership.
The ground-breaking research partnership is aimed at understanding key health and recovery needs of elite athletes in such a highly physical and competitive sport as mixed martial arts. Research data will then be used to drive the development of science-backed, hemp-derived CBD topicals that will be safe and reliable. These new products will help combat the rapidly growing market of untested CBD treatments currently being used by high-performance and non-professional athletes.
Once research is complete, any resulting product will come to life in the US under the new high-performance sports brand ROAR Sports, a portfolio of high-quality, hemp-derived CBD topical treatments scientifically formulated with elite athletes in mind. Through analysis of athlete needs and scientific data, ROAR Sports will challenge the status quo, seek to alleviate the stresses of competition, and earn designation as the "Official CBD product of UFC."
The multi-phase clinical study at the UFC Performance Institute® in Las Vegas will be led by Dr. Jason Dyck, Chair of Aurora's Global Scientific Oversight Committee; Dr. Kelly Narine, Aurora's Vice President Global Research and Medical Affairs; and the team of sports performance experts at the UFC Performance Institute, led by Dr. Duncan French, UFC Vice President of Performance. Using active UFC athletes on a strictly voluntary basis, the study will help establish peer-reviewed, publishable research in this area. Products will be developed in full compliance with U.S. federal law and with UFC's anti-doping program, which adheres to WADA and USADA regulations.
"Our partnership with UFC is about committing to the science that will educate and advocate," said Aurora CEO, Terry Booth. "We are going to work together to change the way people think, to change the industry, and to launch the first hemp-derived CBD products that are backed by scientific research. The brand-building and product development are all part of our move into the U.S., and in collaboration with UFC, and we intend to play a major role in that market."
"We know anecdotally that professional athletes across sports disciplines are turning to hemp-derived CBD treatments to assist with physical recovery, with varying degrees of success," added Jason Dyck, Chair of Aurora's Global Scientific Oversight Committee. "The work we do in partnership with UFC will create an evidence-based, science-backed pipeline of consistent, and 'clean' hemp-derived CBD topicals that the high-performance athletes of UFC can rely on to treat the pain, inflammation, injury and other conditions associated with competing at such a high level."
"Collaborating with Aurora is the best way to educate ourselves and our fighters about the impact of CBD on MMA athletes and our sport," said Dr. Duncan French, UFC's Vice President of Performance. "We want to apply science and see where it leads us. Ideally, these studies will give us the clarity we need to determine the effectiveness of hemp-derived CBD on athlete health and injury recovery."
"Although CBD is allowed under USADA and WADA regulations, we want to be the leaders on educating UFC athletes on CBD use," said Jeff Novitzky, UFC Senior Vice President of Athlete Health & Performance. "Athlete safety is a top priority for UFC, and we will collaborate with Aurora to ensure that any new products are third-party tested for all WADA-prohibited substances to make certain they meet WADA standards."
1933 Industries Inc. (CSE: TGIF) (OTC: TGIFF), a vertically integrated cannabis consumer packaged goods company, recently announced that it will introduce its newest product, the Birdhouse CBD Balm by Canna Hemp X™, on November 4th, 2019. The CBD Balm was developed in collaboration with Birdhouse Skateboards™, targeting the action sports market and will be available for sale in dispensaries, wellness stores, skate shops and specialty retailers, including Zumiez in the United States.
Focusing on the wellness market through the creation of innovative products that enhance and improve people's lives, the Company's CBD-infused line is nationally recognized for its quality and purity of ingredients. Building on its already successful Canna Hemp X™ brand, the new Birdhouse CBD Balm is a must-have for any athlete in need of fast results before, during, and after exercise. The quick-acting Birdhouse CBD Balm is specially formulated with a blend of essential oils, arnica, peppermint, menthol and other natural ingredients. With broad-spectrum CBD, all Canna Hemp™ products are nanoparticulated to ensure total transdermal absorption for maximum effects, while being 100% THC-free.
The sports world is fast embracing the use of cannabidiol or CBD, one of over 100 non-psychoactive and non-addictive compounds extracted from the cannabis plant, in a variety of new products aimed at enhancing performance and recovery. Pro and amateur athletes are now advocating CBD as an alternative to opioid use. "We are just starting to scratch the surface of the many applications associated with the cannabis plant and we are pleased to be part of a national conversation about its potential. The anecdotal benefits keep mounting and we believe that this market is underserved," commented Mr. Chris Rebentisch, 1933 Industries CEO.
He added, "We constantly improve our formulations through research and we worked closely with the Birdhouse team over several months to develop a next-generation CBD topical product that would have wide appeal in the sports world. We are pleased to unveil the Birdhouse CBD Balm that both companies are proud to endorse."
Internationally recognized skateboarding legend Mr. Tony Hawk, Founder of Birdhouse Skateboards™ said, "The Birdhouse CBD Balm is our first collaboration with the team at Canna Hemp X™ and was created with skateboarders and athletes of all levels in mind. Sports like skateboarding require the highest quality recovery products to sustain longevity. We also hope to create awareness of the potential of CBD and in making natural products more accessible nationwide."
As this CBD industry continues to grow, in many ways almost independent of the cannabis sector, brand awareness will become essential as consumers gain more familiarity and awareness of the Hemp/CBD space. As one recent news piece put it, "CBD now has 'a life of its own'", and it will be the companies able to build their brands out early through sponsorship agreements, as well as show consistent quality of their innovative formulas that will stand ahead of the rest.
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