Industrial Hemp Floodgates Open as CBD Demand Grows

CannabisNewsWire Editorial Coverage: The growing popularity of cannabidiol (CBD), a powerful but nonpsychoactive cannabinoid found in plants of the cannabis family such as industrial hemp, has a lot to do with consumer experience roundly validating the increasingly body of scientific evidence for CBD’s therapeutic value.

CBD demand is increasing rapidly as consumers run ahead of the studies.
Branding is key to capturing market share while formulation quality drives consumer loyalty.
The global potential for the CBD market is immense and largely untapped.

Marijuana Company of America Inc. (OTC: MCOA) (MCOA Profile) has taken several key steps to set itself up as a power player in the burgeoning CBD space, acting as a cultivation site landlord while also developing revolutionary products containing proprietary CBD compounds via its wholly owned subsidiary, hempSMART. CV Sciences Inc. (OTCQB: CVSI) just introduced PlusCBD Oil™ Gummies at the Natural Product Expo East 2018. Los Angeles-based MedMen (CSE: MMEN) (OTCQX: MMNFF) just signed a $33 million deal to acquire Kannaboost Technology Inc. and CSI Solutions LLC, collectively known as Level Up, an Arizona-based vertically integrated marijuana firm. OrganiGram (TSX.V: OGI) (OTCQX: OGRMF) has just has signed a supply agreement with BC Liquor Distribution Branch, the sole, wholesale distributor of nonmedical cannabis for British Canada. And symbolic of its presence in the cannabis market, Aphria (NYSE: APHA) (TSX: APH) debuted on the New York Stock Exchange last week.

To view an infographic of this editorial, click here.

CBD Already Hot and Getting Hotter

No doubt about it, the CBD market is hot right now. With analyst projections ranging from $2.1 billion to $3 billion within the next three to four years, historic change in the form of a 2018 U.S. Farm Bill that could make CBD and industrial hemp legal nationwide might send the market into hyperdrive.

Diverse Approach Focused on Legal Market

Marijuana Company of America Inc. (OTC: MCOA) has constructed a business model around the immense potential of the industrial hemp-based CBD market and just recently applied for an uplisting to the OTCQB in conjunction with an S-1 filing and anticipated access to a $10 million line of equity financing. The company also tapped former Price Waterhouse and Deloitte & Touche man Jesus Quintero for its CFO job, where his extensive public company reporting and SEC/SOX compliance experience should help expedite matters handily.

The success of the company’s hempSMART line comes from its innovative products, such as HempSMART Brain, a unique formulation of Ayurvedic herbs and botanical compounds with premium CBD designed to enhance brain function. The company’s success also stems from its affiliate marketing program, which allows people to earn income via commissions and bonuses, assisted by a sophisticated networking architecture that was engineered to maximize customer loyalty and market penetration.

Global Potential, Next Level Moves

MCOA has even tapped 35-year direct sales industry veteran Ian Harvey to spearhead hempSMART’s upcoming international product launch starting in Europe at the outset of 2019. As the company’s global sales director, Harvey will seek to deliver the same kind of success with the hempSMART network marketing program as was demonstrated throughout his career in the direct sales industry.

Recently the first of many regional events to be held across the country took place, and the hempSMART South West Regional Event showcases how quickly MCOA has built up its CBD product brand and leveraged its advanced affiliate marketing platform to harness the might of the $189.6 billion direct sales industry. While the company is busy breaking new ground at the forefront of direct sales and CBD, MCOA continues to advance its property interests as well and is focused on leasing turnkey facilities to sector operators in appropriate states and jurisdictions. The latest news from the company’s CBD hemp farming joint venture in New Brunswick, Canada, with Global Hemp Group Inc. demonstrated the ingenuity of MCOA’s farming group. An OXBO bean harvester was used at the New Brunswick project to maximize target yields of the parts of the plant with the highest CBD concentrations, despite unusually difficult crop conditions created by this year’s drought.

Just the Beginning of the Property Leasing Ladder

At the partnership’s Covered Bridge Acres joint venture in Scio, Oregon, work is proceeding apace of expectations. The facility will comprise when completed, some 19,000 square feet of greenhouses for year-round production, paired up with traditional outdoor orchard-style cultivation on the remaining square footage of the 109-acre site. MCOA plans to continue to expand its property footprint in both the United States and Canada as the overall cannabis industry heats up. The company may hold an ace up its sleeve in the form of a close working relationship with British Columbia-based Global Hemp Group. Both companies share a common vision about the disruptive potential of industrial hemp, particularly as evinced by the growing popularity of CBD.

And while many in the mainstream media may still be skeptical about what consumers seem to be discovering firsthand about CBD’s health benefits, a growing body of scientific data appears to back up popular sentiment. Research regarding the ability of cannabinoids such as CBD to regulate homeostasis by impacting the body’s endocannabinoid receptors found throughout nearly every tissue system suggests that consumers are not just experiencing some kind of placebo effect.

Two-Pronged Solution to Soaring Demand

MCOA has put together a noteworthy approach to the overall space, emphasizing immediate access to legal areas of the market. On one hand, Marijuana Company of America has a dynamic affiliate marketing program to promote and sell its legal hemp-based consumer products. In addition, the company has put together a growing property-based presence that looks to increasingly benefit its hempSMART brand’s performance metrics. CBD continues to be costly to produce, and the demand for cultivation sites will likely continue to increase proportionally.

A preeminent supplier and manufacturer of hemp-derived phytocannabinoids, CV Sciences Inc. (OTCQB: CVSI) added to its leading brand, PlusCBD Oil™, with the release of its gummy product. CV Sciences operates two distinct business segments: a drug development division focused on developing and commercializing novel therapeutics utilizing synthetic CBD, and a consumer product division focused on manufacturing, marketing and selling plant-based CBD products.

By acquiring control of Level Up, MedMen (CSE: MMEN) (OTCQX: MMNFF) gains access to two vertically integrated operations in Arizona, which include retail locations in Scottsdale and Tempe, as well as 25,000 square feet of cultivation and production capacity in Tempe and Phoenix, and a stake in the top-selling K.I.N.D. Concentrates (“K.I.N.D.”) brand, which is currently distributed in more than 90 percent of Arizona dispensaries. The acquisition strengthens MedMen’s presence in one of the top cannabis markets in the United States.

A leading licensed producer of cannabis for the medical and adult-use recreational markets, OrganiGram (TSX.V: OGI) (OTCQX: OGRMF) has now secured cannabis distribution agreements in eight of ten provinces in Canada. Organigram also recently signed an agreement with to acquire 8,333 common shares of Alpha-Cannabis Germany, representing a 25% stake in ACG’s capital. ACG has been preparing the development and production of further cannabis-based products for the swiftly growing German and European markets.

In addition to uplisting on the NYSE, Aphria (NYSE: APHA) (TSX: APH) recently closed acquisitions of assets in Latin America and the Caribbean from Scythian Bioscences. As a result of the transaction, Aphria has solidified an important foothold in Latin America and the Caribbean by acquiring industry-leading cannabis-related companies in Colombia, Argentina and Jamaica as well as a right of first offer and refusal to a majority interest in a Brazilian entity seeking a cannabis cultivation and sales license.

CBD is quickly establishing itself as the darling of the booming cannabis industry. Investors will want to keep a close eye on companies such as MCOA that are able to operate within the sizeable, already-legal portions of the overall cannabis market and that have a specific emphasis on products containing CBD derived from industrial hemp. However, the entire cannabinoid market is worth examining in greater detail, while those companies with unique advantages deserve special attention, as they could be tomorrow’s brightest stars and richest buyouts.

For more information on Marijuana Company of America, visit Marijuana Company of America, Inc. (OTC: MCOA)

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Changing Attitudes in Washington Offer Promise for Hemp and Cannabis Market

CannabisNewsWire Editorial Coverage: Legal changes could soon make transacting business easier for the cannabis industry.

Reports indicate that the president plans to reform cannabis laws, making commerce easier for businesses working in states with legal markets.
Reforming the law could improve the position of companies working with cannabidiol (CBD) as a food additive and industrial hemp.
Hemp and CBD are now large segments of the cannabis sector.
These anticipated legal changes are part of a wider international shift.

One of the companies that may benefit from changes in the United States is Marijuana Company of America, Inc. (OTC: MCOA) (MCOA Profile), which works primarily in cultivating industrial hemp and developing CBD products. Tilray, Inc. (NASDAQ: TLRY), which has affiliates around the world, may use its global experience to adjust to changes in the United States. Research into cannabis by companies such as Cronos Group, Inc. (NASDAQ: CRON) (TSX: CRON) will become easier, eventually improving product ranges and patient well-being. The legislative shift is also being encouraged by companies such as PotNetwork Holding, Inc. (OTC: POTN) through efforts at public and industry events. And as industry leaders such as Aphria, Inc. (OTC: APHQF) (TSX: APH) swallow up smaller companies, a stronger, consolidated sector is likely to result.

To view an infographic of this editorial, click here.

White House Hints at Cannabis Reform

Spirits have been lifted in the American cannabis industry following a report that the White House is planning to support drug law reform. California Sen. Dana Rohrabacher told Fox Business that insiders around the president have said he intends to push for a reform of cannabis regulation. This would reportedly involve encouraging the federal government to make medical marijuana legal on a national level while leaving the status of recreational cannabis up to individual states.

The reasons behind Rohrabacher’s announcement are clear. As a Republican defending a closely fought seat in a pro-cannabis state, he stands to benefit from convincing his constituents that his party is pro-cannabis. But the stance is also part of a wider trend in politics.

A growing number of politicians from both main parties have shown support for legalization, driven by shifts in public attitudes. Polls this year have indicated that 64 percent of Americans support legalization and 74 percent support legislation that would protect states that legalize cannabis despite the federal government’s opposition. Always happy to ride a high-profile trend, President Donald Trump has previously indicated that he will support a states’ rights agenda on the issue, despite action in the opposite direction by his attorney general.

What will this mean for cannabis companies?

Making Life Easier for Cannabis Companies

Cannabis is already big business in the United States. Nearly two-thirds of states have legalized medical marijuana in some form, and one in five have legalized its recreational use. Clearly, there’s a large legal market to be served. This has led to growth not only for companies catering to those sectors but to those engaging in cannabis in other ways, such as Marijuana Company of America (OTC: MCOA).

MCOA illustrates the variety of ways in which companies are now engaging in the cannabis sector. Rather than producing medical or recreational cannabis, the company has focused on varied uses of industrial hemp, a form of cannabis without the psychoactive qualities. Derivatives of hemp can be used in food, textiles, construction and medicines, making it a versatile and valuable crop.

Within that part of the sector, MCOA has a variety of operations. The company is engaged in two partnerships to improve plant strains and cultivation techniques, and sells a range of products derived from hemp. This range of business opportunities is part of what makes the cannabis sector so profitable, with a value in the billions of dollars in Canada alone.

The potential profits of the sector mean that ambitious companies such as MCOA have been able to raise finance through investment rather than through hard-to-come-by bank loans, which have been in short supply in the United States because of the federal government’s stance toward the plant. Clearing up the contradictions between state and federal laws would make business much easier.

Industrial Hemp

One of the biggest growth areas within the current cannabis market may not necessarily feed into the medical or recreational cannabis markets. That sector is industrial hemp.

Hemp is a form of cannabis that contains only a minimal level of tetrahydrocannabinol (THC), the chemical that gets cannabis consumers high. Before the general prohibition on cannabis cultivation, hemp was largely used in producing rope and textiles. Now this space is seeing a resurgence thanks to changes in cannabis legislation. MCOA is involved in growing hemp through businesses such as its New Brunswick Hemp Project, one of many companies exploring hemp’s potential.

In the United States, hemp is currently grown legally on sites designated as research and test projects. This was made possible following the 2014 Farm Bill, which included provisions for such sites.The potential for that bill to be expanded this year to full agricultural legalization of hemp is expected to drive spectacular success for farmers who choose to cultivate it. Hemp can be grown outdoors in fields and will grow quickly in a wide range of conditions. Some farmers have predicted that they may see revenues of $90,000 per acre for the crop, compared with only $600 for alfalfa, one of the most popular crops in the United States.

The 2014 Farm Bill expired at the end of September this year, and the bill scheduled to replace it has not yet been passed, thanks to battles on a wide range of issues between Republicans and Democrats. Surprisingly, hemp is fairly noncontroversial. The plant has found cross-party support, with backing for legal reform driven by Republican leaders. As a result, provisions in the bill that would allow for more hemp farming will almost certainly be passed when work on the bill is completed after the November mid-terms.

The updated Farm Bill will make it easier for companies such as MCOA to expand their operations and sell their products. And following reports about cannabis law reforms coming out of the White House, the bill looks likely to become a herald of wider potential.

Hemp’s Big New-Profit Area — CBD

One of the most exciting areas for exploration is how hemp can best be turned into profit. CBD is hemp’s primary active ingredient. Recent research has found a range of uses for CBD in health and wellness products. It’s the extraction of CBD that makes hemp so potentially profitable for modern farmers.

CBD is already being used in a wide variety of products. MCOA’s hempSMART line alone includes pain capsules, a topical pain cream, face cream and pet wellness products. Legal changes will make it easier for companies to research and manufacture products such as these, broadening the scope of the CBD market.

Unregulated CBD grants companies more potential to go international, as its sale is less limited than that of medical and recreational cannabis. MCOA is currently preparing to launch hempSMART into Europe and has appointed a new global sales director to oversee this work.

Legal Changes Affect Many Companies

Whether it’s the Farm Bill or President Trump’s promise to accept a revision of federal laws, the possibility of legal changes has the potential to affect a lot of companies working within the cannabis sector. State-level legalization and changes in Canada’s laws this month have allowed companies to emerge working entirely within this sector.

Like MCOA, Tilray, Inc. (NASDAQ: TLRY) is working beyond the boundaries of the United States. The company has affiliates in Australia, Canada, Germany, New Zealand and Portugal, and is now adding Chile to that roster through the acquisition of Alef Biotechnology SpA. Tilray’s products are already used by tens of thousands of patients as well as physicians and researchers around the world. That gives the company existing experience and infrastructure to expand in a reformed American market.

Another company with international reach — Cronos Group, Inc. (NASDAQ: CRON) (TSX: CRON) — is earning a name for itself not just as a supplier of cannabis products but also as a researcher in the arena. Cronos has recently announced a study into the effectiveness of medical cannabis in tackling sleep disorders. Such research will be both easier and more profitable as more countries legalize cannabis.

A sign of the power of the sector is the growing number of holding companies now built around cannabis. PotNetwork Holding, Inc. (OTC: POTN) is one of those, with subsidiary companies covering cannabis production and related parts of the industry. The company is reaching out to customers through large events such as the 2018 World Vapor Expo, designed to increase the profile of cannabis and remind those in power of the plant’s popularity. Such corporate PR work is increasing the momentum of the movement towards legalization.

The growth of the industry has also led to a series of mergers and acquisitions, as big players consolidate their hold. Aphria, Inc. (OTC: APHQF) (TSX: APH) recently completed acquisitions in Latin America, the Caribbean and Canada, bringing with them supply agreements reaching into Europe and Israel. Liberalization of cannabis laws is becoming a global trend, and as the businesses involved become bigger, so will the push for further reform.

Legal changes appear certain to come to the United States. When they do, there will be plenty of companies making the most of them.

For more information on Marijuana Company of America, visit Marijuana Company of America, Inc. (OTC: MCOA)

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CBD Supplements Primed to Explode Ahead of Biopharma as Farm Bill Legalizes Hemp

CannabisNewsWire Editorial Coverage: With Canada legalizing cannabis nationwide in October and the 2018 U.S. Farm Bill completely removing hemp from the DEA’s controlled substances list, the stage has been set for an explosion of products ranging from functional foods and supplements to CBD-based (cannabidiol) biopharma indications.

U.S. farm bill legalizing hemp could make CBD an open-pit gold mine.
List of demonstrable CBD health benefits growing daily.
CBD growth may outpace entire cannabis market combined.

Even before the landmark inclusion of the Hemp Farming Act of 2018 in this year’s Farm Bill, plant-based nutrition experts at leading omni-direct lifestyle company Youngevity International, Inc. (NASDAQ: YGYI) (YGYI Profile) had begun marching the team towards the development of a full line of proprietary hemp-derived CBD oil products. And while the identified health benefits of CBD ranging from reducing inflammation to managing pain and anxiety haven’t entirely been proven yet, one need look no further for foundational evidence of such benefits than the success of GW Pharmaceuticals Plc’s (NASDAQ: GWPH) FDA-approved oral solution EPIDIOLEX, which is used to treat severe seizures associated with extreme forms of epilepsy. Pharma-grade medical cannabis producer Aphria, Inc. (OTC: APHQF) (TSX: APH) already has a wide selection of carefully engineered medical cannabis and CBD oil products made from 100 percent greenhouse grown strains. Cara Therapeutics, Inc. (NASDAQ: CARA) is another company that stands to benefit from easing regulations in North America. And as a principal investment firm dedicated to cultivating medical marijuana companies, Cronos Group, Inc. (NASDAQ: CRON) surely understands the potential of the space.

To view an infographic of this editorial, click here.

Cannabis Market Booming Amid Deregulation

Canada moving to fully legalize recreational marijuana across the country is a watershed event for the cannabis industry. This event will help to normalize the presence of cannabis-based medicines in the broader market, paving the way for even more widespread research into the non-psychoactive cannabinoid CBD. With more than 37 million people in North America already consuming cannabis in one form or another, even the lofty projections by Amadee & Company of a market worth over $95 billion by 2026 may be entirely possible.

After more than eight decades of prohibition, cannabis is rapidly heading towards decriminalization across the global marketplace. The latest projections from established cannabis sector analysts at Arcview Market Research and BDS Analytics indicate that the North American cannabis market will go from just $9.2 billion last year to $47.3 billion within a decade (17.79 percent CAGR), even as the global market surpasses a whopping $57 billion.

The hemp-CBD segment is set to grow at an even faster pace according to Brightfield Group, hitting upwards of $22 billion by 2022, outpacing the rest of the cannabis market combined. Hemp Business Journal estimates for the underlying hemp market, which grew 16 percent last year in the United States alone to around $820 million, are similarly encouraging, projecting the market to grow around 700 percent by 2020.

And when it comes to regulating the human body’s complex endocannabinoid receptor systems, the upper limits of the pharmaceutical value of CBD — and other phytocannabinoids such as THC — may have not yet been fully validated by clinical studies. Such studies have been and are being done.

Consumers definitely seem to have got the message about CBD and are already enjoying access to this organic compound in an increasing variety of formats. According to Cannabis Trades Association UK official data, cannabis oil users across the UK doubled last year. Given stats like that, it is little wonder that the latest numbers out of Technavio on the global CBD space project a 39.19 percent CAGR through 2021.

Established Supplement Purveyor with Scale, Presence and Reach

To many investors, the burgeoning CBD market is a natural play for a company such as Youngevity International, Inc. (NASDAQ: YGYI), a multivertical lifestyle brand that provides a wide variety of consumer goods to people all over the world via direct selling, e-commerce and social selling. In many circles, the name Youngevity is synonymous with plant-based nutrition, and as Youngevity CEO Steve Wallach recently put it during the launch of YGYI’s new proprietary HempFX^™ line of hemp-derived CBD oil products, “CBD oil perfectly complements” Youngevity’s product development philosophy.

Already known to consumers around the globe for its broad array of nutritional and healthy lifestyle products formulated using ingredients of the highest quality in state-of-the-art laboratories, Youngevity has garnered increasing prominence with the success of its wholly owned subsidiary CLR Roasters’ various gourmet boutique coffee blends. CLR Roasters is produced by a vertically integrated “farm-to-cup” pipeline stretching from the company’s fully licensed fields in Nicaragua, through a state-of-the-art roasting facility in Miami and ending up in consumer’s coffee cups all over the world. YGYI completes the last mile via direct selling, as well as extensive distribution in the cruise line industry and through a variety of private labels that the company produces for major national chains.

As Goes Coffee, So Goes Cannabis

Just to showcase the kind of scale and sophistication of the company’s closed-loop approach to delivering premium organic coffees, it is worth noting how the company recently secured a five-year contract to sell and process more than 41 million pounds per year. This was a huge deal for the full-sized coffee roaster, executed with a purchaser that has more than seven decades in the business and is a major coffee importer and exporter for some of the biggest brands in the industry today.

It is this same kind of full-spectrum approach to cultivation, production and distribution (emphasizing tight quality control as the main objective) that the company is now bringing to the hemp-based CBD business with its “field-to-finish” strategy. The HempFX line of three initial products was described as “just the beginning” when it comes to Youngevity’s move into CBD, during a recent interview with Wallach and Youngevity president and CFO Dave Briskie.

HempFX products currently include a topical muscle restoration and relief product packed with antioxidant rich botanicals called Soothe^™, a mood and cognitive performance enhancement product with St. John’s Wort called Uplift™, and a sleep aid called Relax^™ that contains melatonin and other relaxing herbs including chamomile and valerian root. Youngevity anticipates emergent revenue opportunities across the vertical as it implements a model similar to what the company has done in coffee. Wallach was keen to point out during the HempFX launch that this process would offer “tremendous advantage” to the company’s many distributors around the world.

Youngevity’s management anticipates that hemp-based CBD will become one of the fastest growing and largest supplemental ingredients moving forward, and the company is not alone in recognizing just how far the CBD market has yet to go.

CBD Market Solid Move for Future Success

GW Pharmaceuticals Plc (NASDAQ: GWPH) has been posting solid price performance since the company’s announcement in late June that the FDA approved its CBD-based oral indication Epidiolex for two forms of severe childhood epilepsy. According to the latest quarterly report, GWPH and its U.S. subsidiary Greenwich Biosciences are primed for commercial success, with a fully recruited sales organization and active engagement via clinical presentations to plans which cover more than 80 percent of the U.S. market.

Aphria, Inc. (OTC: APHQF) (TSX: APH) is gearing up for Canadian legalization big time, signing supply agreements with official distributors throughout all ten provinces and one territory this month to provide high-quality, branded cannabis for the adult-use market. Aphria also recently announced a key MOU with Canadian biotech Rapid Dose Therapeutics, the developer of the oral, fast-dissolving drug delivery system QuickStrip.

Cara Therapeutics, Inc. (NASDAQ: CARA) is a clinical-stage biotechnology company focused on developing new chemical entities designed to fundamentally change the way acute pain, chronic pain and pruritus (severe itching) are managed. Cara does this by developing new products that selectively target the body’s peripheral kappa opioid receptors. In the cannabis space, Cara has a cannabinoid receptor agonist, CR701, in preclinical development.

Cronos Group (NASDAQ: CRON) recently announced commencement of a joint medical cannabis study alongside Aleafia Health Inc., which will utilize Aleafia’s Canabo Medical Clinic network to investigate insomnia and daytime sleepiness. The primary goal of the study is to help develop nonaddicting and natural sleep aids that many consumers have been longing for, especially given more recently identified risks associated with prescription sleeping aids, such as worsening mental health and an increased prevalence of dementia. CBD and THC may become powerful tools in the fight against insomnia.

The End of Prohibition, Unprecedented Market Dynamics

It seems that consumers may have put legs under the market as the historic prohibition of the humble cannabis plant nears an end. A plant that turns out to be packed with phytocannabinoids and that may help naturally regulate a vast cell receptor network throughout numerous tissue systems in the human body seems poised to fuel an industry with untold possibilities.

For more information on Marijuana Company of America, visit Youngevity International, Inc. (NASDAQ: YGYI)

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CBD Contributes to Continued Growth for Nutraceutical, Pharmaceutical and Cannabis Key Players

CannabisNewsWire Editorial Coverage: Cannabis companies are seeing substantial growth, with the popularity of cannabidiol (CBD) playing a significant part in their positive outlook.

CBD is an active ingredient in cannabis.
It can provide health benefits without the psychotropic effects of other cannabis chemicals.
This has led to a growth in companies selling CBD treatments, sometimes alongside more conventional wellness products.

Youngevity International, Inc. (NASDAQ: YGYI) (YGYI Profile) is one of these companies, having recently expanded its range of products to include CBD therapies for muscle pain, sleeplessness and mood improvement. GW Pharmaceuticals Plc (NASDAQ: GWPH) has created a CBD treatment for child-onset epilepsy and received approval from the U.S. Food and Drug Administration for its sale as a medicinal product. Tilray, Inc. (NASDAQ: TLRY) has also developed a cannabis-derived epilepsy treatment, even as it makes deals to expand its distribution network in Canada. Aphria, Inc. (OTC: APHQF) (TSX: APH) has seen a steady rise in profits based on its cannabis work and is now working with branding specialists to capitalize on its opportunities. Isodiol International, Inc. (OTC: ISOLF) (CSE: ISOL) is providing not only a range of CBD products but also a platform for patients to connect with doctors to help manage cannabis-based medical treatment.

Cannabis Growth Continues

The past few years have seen substantial growth in the cannabis industry. As the plant’s legalization spreads, an increasingly diverse range of businesses have appeared to fill the needs of a growing wellness market. From hydroponic supply companies to seed providers, the industry is expanding at a rapid pace, and at its heart are the cannabis companies themselves, several of which have seen their stocks soar.

One of the reasons for recent growth is the development of a market in cannabidiol (CBD) drugs and wellness products. One of the active ingredients in cannabis, CBD is being used in a wide range of treatments to help with everything from epilepsy to mental alertness. A growing body of research and increasing range of uses have seen CBD oil become a significant part of the cannabis market, distinct from recreational marijuana. For companies invested in CBD, this trend is providing a fresh surge of growth.

The Power of Cannabidiol

A growing number of companies are producing and supplying CBD products — not just specialist firms, but other suppliers such as lifestyle company Youngevity International, Inc. (NASDAQ: YGYI). So what’s the fuss about?

CBD is one of the most prominent active ingredients in cannabis plants. Unlike tetrahydrocannabinol (THC), CBD does not cause users to get high, but it can have other effects on the body and mind. Those beneficial effects have led to CBD’s rising popularity for use in a variety of medicines and wellness products as researchers have learned more about it.

The distinction between CBD and THC is an important one. In some jurisdictions, industrial hemp, a type of cannabis plant that includes CBD but non-noteworthy amounts of THC, can be grown in circumstances where marijuana can’t. The legality of CBD products is different from that of cannabis cultivation itself in some places. Even in places where cannabis is legal for both medical and recreational uses, CBD is preferable to many health-conscious consumers who want its health effects without getting high.

It’s this potential that has drawn companies such as Youngevity to CBD. This market is expected to see tremendous growth based on forecasts for a range of uses beyond oils, such as CBD’s inclusion in food, drink, cosmetics and emerging health products. That’s a pretty impressive reason for companies to take an interest in CBD, whether they’re experienced cannabis insiders or newcomers such as Youngevity.

Wider Market Growth

Medical cannabis is now legal in more than half of North America. Legal recreational use has been enacted within nine states and the District of Columbia in the United States, and it will premiere nationwide in Canada in October. The cannabis plant’s ardent fan base is increasing public awareness and a growing acceptance of the potential benefits of products derived from it. Companies are moving to make the most of the opportunity as a previously frowned-on and illegal industry shifts into the mainstream.

This means that Youngevity’s cannabis-derived products will benefit from a wave of public awareness, publicity and market growth. The global value of this market was estimated at $7.7 billion in 2017, and it’s been predicted to reach $34.1 billion by 2021.

That growing market means that there’s now space for CBD products both on the shelves of high street stores and in the inventory of companies such as Youngevity.

Youngevity’s first entry into this market is the HempFX™ product line, introduced at the company’s 2018 convention in San Diego, Calif. A set of three distinct hemp-derived CBD oil products under the HempFX banner use organically grown products in proprietary formulas to help users through their day. The products include Soothe™, a blend of botanicals designed to relieve muscles by calming aches and pains; Uplift™, which combines CBD with St. John’s Wort to improve cognitive performance and mood; and Relax™, which combines CBD with a variety of herbs and melatonin to bring relaxation and a better night’s sleep.

This diverse range of uses shows why CBD is becoming so popular. By applying it to a variety of wellness issues, companies are able to market their products to a broad range of consumers, increasing sales and awareness.

Youngevity CEO Steve Wallach highlighted the strong potential link between CBD and broader trends in healthy living. “We firmly believe in plant-based nutrition, and hemp-derived (CBD) oil perfectly complements our product development philosophy. Entering this market, which is growing almost exponentially, also should offer a tremendous advantage to our many distributors around the world,” he stated in the company’s news release announcing the HempFX line.

The Power of Existing Pipelines

Wallach’s reference to distributors highlights why a company such as Youngevity is so well-positioned to benefit from the surge in CBD. New companies set up to cater to the CBD market have to build their sales pipelines from scratch, whereas established operators already have those pipelines in place. Youngevity’s massive network of direct sellers means that it has an immediate way of getting new products into the hands of consumers. Experience derived from 21 years of development has provided the company with the tools it needs to carve out its place in the market.

Being on-brand is important to such a move. Not just any company can jump into CBD and expect customers and distributors to come along with it. But according to Wallach, this isn’t a problem for Youngevity.

“Hemp-derived cannabidiol aligns with what we do very well,” he stated. “We’ve taken what we know about essential nutrients, along with decades of knowledge specializing in natural, plant-based nutrition and their most beneficial nutrients, and put that knowledge to work to develop high-end cannabidiol products.”

More Companies Take Up CBD

While CBD is often used in over-the-counter medicines and wellness products, it is also finding use in prescription medicines. GW Pharmaceuticals Plc (NASDAQ: GWPH) has created a CBD-based medicine to tackle child-onset epilepsy, a condition that can make a normal life almost unmanageable for the children it affects. This treatment has been approved by the FDA, making it the first cannabis plant-based prescription medicine to be legalized by the U.S. federal government (once the Drug Enforcement Administration reclassifies CBD, as expected this month in response to the FDA’s decision).

A global leader in the medical cannabis market, Tilray, Inc. (NASDAQ: TLRY) works in research, cultivation, processing and distribution, providing cannabis extracts and flowers to patients, researchers and medical professionals on five continents. As Canada prepares for growth in the cannabis market following legalization, the company has made deals with Canadian partners to sell its products into that market. It has also developed a CBD and THC oil that has shown promising results in tackling drug-resistant epilepsy.

One of the more successful companies in the cannabis sector, Aphria, Inc. (OTC: APHQF) (TSX: APH) saw its profits and revenues rise steadily through 2016 and 2017. Aphria recently signed a letter of intent to form a joint venture with Perennial, Inc., in which the companies will collaborate on developing products for the Canadian cannabis market. Perennial’s expertise in strategic brand development will help Aphria reach more customers with its leading cannabis-based products, expanding its presence in one of the world’s most important cannabis markets.

Isodiol International, Inc. (OTC: ISOLF) (CSE: ISOL) is focused on CBD product development, with a range of offerings that includes skin cream, pain management and help with sleeping. It has recently expanded beyond its core products into support for those using cannabis-derived medicines through the creation of ISOCare. This secure platform will help to connect patients, their family doctors and physicians working with cannabis to ensure that patients receive the best possible longitudinal care.

The health benefits of cannabis and its derivatives are increasingly widely recognized. With huge potential for growth over the next few years, CBD and cannabis are drawing customers and companies like never before.

For more information on Marijuana Company of America, visit Youngevity International, Inc. (NASDAQ: YGYI)

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Canadian Cannabis Sector Thriving Despite Slow Legalization Process

CannabisNewsWire Editorial Coverage: Despite legislative delays, the legalization of recreational cannabis will take place in Canada, likely by the end of summer at the latest. Companies are coming to grips with the licensing process and are ready to reach this new market. One of the leaders in the new industry is Choom Holdings, Inc. (CSE: CHOO) (OTCQB: CHOOF) (CHOOF Profile), which has gained licensing experience and developed a slick brand designed to appeal to the recreational market. Grower and seller Cronos Group, Inc. (TSX: CRON) (NASDAQ: CRON) is eyeing the international market through a cross-border deal with MedMen. Canopy Growth Corporation (TSX: WEED) (OTC: TWMJF) has been focusing on retail licenses and is now an approved supplier for every province that has gone through an approval process. Aphria, Inc. (TSX: APH) (OTCQB: APHQF) is moving from medical into recreational cannabis though an expansion strategy that has seen growth in profits and revenue. Hiku Brands Company. Ltd. (CSE: HIKU) (OTC: DJACF) has gained an early sales license for its subsidiary company and is setting up state-of-the-art growing facilities ready for the legal change.

A Matter of Time

Ever since Justin Trudeau and the Liberal party were elected on a pro-legalization platform, Canada has been heading towards an in-plain-view cannabis market. Bill C-45, legalizing the trade, was passed in the House of Commons by a two-thirds majority last November and is making its way through the Senate. The passage of the bill has taken longer than expected, but even the Conservatives are not trying to block its passage. A whole new consumer sector is coming to Canada.

The delays have largely been caused by concerns about practicalities. The recreational cannabis market will be tightly regulated, just as the medical market is now. Conservatives and Liberals alike want to ensure that the police and local authorities have time to prepare. Though this concern is causing delays, it also creates an opportunity for companies that are well prepared. A company that can show it is organized, responsible and compliant with government regulations will have an edge in getting licensed and started in the new market. Balancing that with a consumer-facing image of a fun, relaxing product may be key to early success.

Responsible Groundwork

One of the companies leading the way in this is Choom Holdings (CSE: CHOO) (OTCQB: CHOOF). A purpose-built recreational brand, Choom is led by an experienced management and leadership team that understands the complexities of the market it is entering. President and CEO Chris Bogart has more than twenty years of experience in international capital markets and was a co-founder of InMed Pharmaceuticals and Magnum Uranium. He has structured complex equity financing transactions in the United States, Europe and Canada.

The team has been preparing for the coming change in the cannabis market for more than four years. Choom has been going through the process of applying for an ACMPR (Access to Cannabis for Medical Purposes Regulations) license in Vernon, B.C. In 2017, it has offers to acquire three additional applicants, including one already involved in the process in Vancouver Island, B.C. The company is working diligently to be ready to sell cannabis as soon as legalization comes.

Going through the cannabis licensing process could provide Choom with another advantage. Its staff has developed the skills and experience to quickly navigate the regulatory process and has proven to authorities its ability be become a responsible cannabis grower. The company has been working for future retail growth and distribution. With Alberta alone expecting to license 250 stores in the first year (http://cnw.fm/Wgt5F), regulators are clearly going to be busy working through all the applications. Companies such as Choom that have experience, a good reputation and a well-presented application may have a critical edge in successful retail licensing.

Effective Supply Chain

The Canadian cannabis industry is estimated to be huge. Deloitte notes that it could be worth as much as $22.6 billion per year (http://cnw.fm/eOkR5). Even the more conservative estimates predict a market larger than spirits and nearly as large as wine. That’s a lot of profit available to companies that can move in quickly and provide a reliable retail experience.

Choom could provide that through its fully integrated seed-to-sale supply chain. The company will be growing its own cannabis in ACMPR-licensed facilities. The company has four ACMPR licenses in late-stage review: one applicant has been acquired with three others under offer, as well as its first applicant expecting to receive a cultivation license from Health Canada in the next few weeks. There is approximately 68,000 square feet of facilities being retrofitted to increase growing capacity in time for legalization, with a further phase of expansion planned for later in the year, thereby building production capacity to produce a steady supply of cannabis.

This cannabis will be packaged as Choom brand products and sold through a series of Choom stores. The company will run corporate stores, with other stores being operated across Canada by independent retail investor/owners. This plan is designed to ensure that Choom products have a prominent place in the Canadian retail market and can be found easily by consumers.

Great Branding

While an efficient supply chain is important to placing products in front of customers, it’s the presentation of the product that will draw consumers in. Again, Choom appears to be well prepared.

With tight marketing restrictions in place, cannabis companies won’t be able to rely on mass advertising to raise customer awareness. Instead, they’ll need appealing brands that quickly attract consumers and lead to word-of-mouth recommendations.

Choom’s brand is built around a fun, relaxed style that draws on Hawaii’s mellow atmosphere and the cannabis culture on the island in the 1970s. The name of the company itself comes from island slang, including “the Choom gang,” a well-known group from that era that famously included the hippest president in American history, Barack Obama. It’s a strong, clearly identifiable brand style, firmly established to attract the recreational market.

The strength of the brand is supported by the design of the company’s retail stores. Designed by the team behind some of the most recognizable retail spaces around, Choom stores are designed with a cool and modern layout and are designed to appeal to serving everyone, from current users to “curious customers.”

The combination of clean white space and open concept creates a comfortable, familiar atmosphere that is meant to make the stores accessible to both existing cannabis consumers and new customers. Plants and sofas signal that this is not just a shop but a place to hang out, a part of that relaxing Hawaiian vibe.

Cannabis Companies Prepare for Growth

Other Canadian cannabis companies are also preparing for an era of huge growth.

Toronto-based cannabis grower and seller Cronos Group, Inc. (TSX: CRON) (NASDAQ: CRON) has become the first pure play cannabis company to be traded on Wall Street (http://cnw.fm/BQk4n). This shows the growing acceptance of the cannabis market not just in countries where the drug has been licensed but in the broader investment community. Investors see growth ahead for these companies and are taking the opportunity to invest before prices rise. As a cannabis company with international ambitions, Cronos is also distinctive. Its corporate goals include becoming a global force, and it has created a first-of-its-kind cross-border venture with Los Angeles-based cannabis retail brand MedMen (http://cnw.fm/wLhX4).

Canopy Growth Corporation (TSX: WEED) (OTC: TWMJF) is establishing its retail presence. The company has been chosen by the government of Manitoba (http://cnw.fm/fEb9K) as one of the first companies to set up licensed cannabis retail stores in the province. Of the four Canadian provinces that have established retail and supply frameworks, all have now chosen Canopy Growth as a trusted supplier, giving the company a strong place in the retail market.

Aphria, Inc. (TSX: APH) (OTCQB: APHQF) is a successful company in the medical cannabis market, with both profits and revenues consistently rising throughout 2016 and 2017. The company is looking to continue this expansion, with further growth in the medical sector alongside expansion into the recreational cannabis market. It has signed a deal to buy Nuuvera Inc. (http://cnw.fm/O3oHY) and shows no sign of slowing down.

Like Canopy Growth, Hiku Brands Company, Ltd. (CSE: HIKU) (OTC: DJACF) has gained one of the early licenses to set up cannabis retail stores through selection by the Manitoba government (http://cnw.fm/1EdHP). This license for its subsidiary Tokyo Smoke will put Hiku in a strong position to sell to a new customer base once Bill C-45 reaches its expected passage. The company is near the end of the ACMPR application process and has a state-of-the-art growing facility, with another set to be completed by the end of the second quarter of 2018. It should, therefore, have a vertically integrated business, with a complete supply chain from growth to sales.

Delays in the passage of Bill C-45 have caused no slowing in the growth of the Canadian cannabis market. If anything, the extra time has allowed companies to better prepare. When the recreational market opens later this summer, several strong businesses appear to be ready to step up and play their part.

For more information on Choom Holdings, please visit Choom Holdings (CSE: CHOO) (OTCQB: CHOOF).

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Pliability of Canadian Cannabis Industry Triggers New Business Development

CannabisNewsWire Editorial Coverage: The Canadian cannabis industry is pliable, changing shape amid mounting public support, favorable legislative action, an influx in capital, and the integration of alcohol and tobacco. For years, this massive industry was entirely illegal; its potential unavailable to legitimate investors. As Canada heads toward legalizing recreational cannabis later this year, however, the continuous sculpting of the industry provides investors a wealth of consumer-driven investment opportunities. Choom Holdings, Inc. (CSE: CHOO) (OTCQB: CHOOF) (CHOOF Profile) is targeting the recreational user via its own brand of high-grade handcrafted cannabis. Cannabis lifestyle brand Hiku Brands Co. Ltd. (CSE: HIKU) (OTC: DJACF) (DJACF Profile) recently received a $10 million equity investment from Aphria, Inc. (TSX: APH) (OTC: APHQF), denoting high expectations for recreational cannabis. Canopy Growth Corp.’s (TSX: WEED) (OTC: TWMJF) recent investment from a big alcohol brand reveals a glimpse of how separate sectors of recreational consumables are interwoven. This strategic blending means big business for cultivators such as ABcann Global (TSX.V: ABCN) (OTCQB: ABCCF) (ABCCF Profile), a recognizable licensed producer and seller of pharmaceutical-grade cannabis products.

Canada Heads for New Highs

An estimated 5 million Canadians already smoke cannabis once a month, with another 900,000 expected to join them after legalization. In 2015, the country was already spending nearly as much money on cannabis as on wine, indicating the huge business potential of this sector. The question is, how will companies tap into that wealth?

One of the big changes expected over the next few years is the integration of recreational cannabis with the alcohol and tobacco industries. With their experience of producing, distributing, and marketing recreational consumables, these businesses have the most relevant experience to shape the marketplace. Their investment and expertise will help cannabis companies find creative ways to cater to consumer demand, not just medical users.

Brand Identity

Among the companies preparing to make the most of this opportunity is Choom (CSE: CHOO) (OTCQB: CHOOF). Based in the Okanagan region of British Columbia, the company is well-placed to make the most of the production, sales and marketing opportunities offered by the impending retail market, which has a forecast value of $4.9 billion – nearly $9 billion (http://cnw.fm/xch0D).

With its relaxed, youthful brand, Choom is positioning itself to reach the ideal growth market of cannabis users. Consumers in their 20s tend to be more socially liberal than their elders. They have substantial disposable incomes and are used to spending a large part of them on consumables such as food, drink and tobacco, and are therefore likely to make up a large part of the recreational cannabis market.

To connect with these consumers, Choom has created a hip and modern brand inspired by Hawaii’s culture and relaxed atmosphere. The brand’s story taps into the history of the 1970s “Choom Gang,” a group of buddies in Honolulu (including former President Barack Obama) who knew how to relax with “choom,” the local’s term for marijuana. Choom’s trademark slogans pivot off another unconventional phrase, “Say Hello to…”, bringing a heady dose of good times and good friends together as the company invites investors to “Say Hello to Choom™” as it lights up the adult recreational cannabis market in Canada.

Reaching Out to Customers

This aesthetic extends to the design for Choom’s “Aloha”-style dispensaries. It’s a clean, modern, stylish look, crafted by the designers behind some of the world’s most recognizable retail environments. Couches, pale wood and carefully chosen banner fonts create a relaxed atmosphere. Clean white shelving and neat presentation make a space reminiscent of Apple stores — another well-recognized brand with a strong hold on the disposable income of millennials.

One of the most important factors in marketing recreational cannabis is going to be establishing such an aesthetic. Brand specialists will want to leave the cold formality of medical use and the seedy criminal associations behind, while retaining hip association with cannabis. Choom’s branding is ideally designed to make this shift, while establishing prestige brands for the discerning consumer.

The stores are designed to appeal to the widest possible market. Choom is aware that its core business will rely on existing users looking to obtain their cannabis legally, and their stores will make a comfortable shopping environment for these consumers. But there are also the “curious customers” — those without a medical need for cannabis and who did not want to consume it illegally. They’re expected to fuel a 19 percent increase in the number of cannabis users in Canada. By creating a familiar shopping space, Choom will make it easier for them to enter the market.

Experience and Integration

Choom’s business proposition extends beyond the retail face of the cannabis industry. It is also looking to place itself within the ancillary markets that will support the consumer business. Testing labs, security, infused products, consumption paraphernalia and crop cultivation will all be part of an expanding industry. Choom is looking to establish a vertically integrated enterprise, from cultivation through to sales, all under a single hip consumer brand.

Choom’s application with ACMPR (Access to Cannabis for Medical Purposes Regulations) has received security clearance and is now in the detailed review stage. The company has also submitted a second late-stage ACMPR application, which is in its confirmation of readiness stage. Aggressively preparing to reap the benefits of this license, Choom has retained Cannabis Compliance Inc. to help expedite Choom’s initial license applications and ready the company for legalization of recreational marijuana.

One of Choom’s greatest strengths is its experience. The managers and directors have decades of experience covering investment, entrepreneurship, business development and pharmaceuticals. Their knowledge of the existing Canadian medical cannabis market ensures that strategic decisions are backed up by real expertise and analytical insight. The company has over five years of experience in the cannabis sector. It knows how to produce naturally grown premium cannabis. Existing license and production assets mean that Choom is well positioned to scale-up rapidly once legalization takes effect, to meet the anticipated Canadian market. This will put it ahead of companies set up in response to the legal change and provide an accelerated path for rapid market growth.

This is exemplified by the company’s existing cultivation facilities at Vernon and Chemainus. Both are receiving a state-of-the-art retrofit, with expectations that Vernon will be completed by July, the same month Canada legalizes recreational cannabis use.

The Vernon property will boast 6,800 square feet of growing space, capable of producing 660 kg/year of cannabis for an estimated revenue of $6.6 million, excluding oils. A potential phase 2 of this facility would double the size and enable additional growing capacity of 1,500 kg/year, also doubling the facility’s revenue.

While the second facility, on Vancouver Island, is smaller – 4,500 square feet – its retrofit is also slated to be completed by July 2018. Plans include doubling this space, which would add about $9 million in annual revenue, excluding cannabis oils.

It’s this sort of established enterprise that will allow Choom to build brand loyalty and position cannabis as another popular consumable, enjoyed in the same way as alcohol and tobacco.

A Growth Sector

A similar approach is being taken by Hiku (CSE: HIKU) (OTC: DJACF), premium cannabis lifestyle brand growing high-quality handcrafted cannabis flower. Hiku’s wholly owned subsidiary is a licensed producer of cannabis under the ACMPR that has requested its Pre-Sales License Inspection, the last step prior to receiving a license to sell cannabis under the ACMPR. Hiku’s Dominion Facility is a state-of-the-art ACMPR licensed production facility capable of producing approximately 660 kg year of dried cannabis flower. Phase one of its “FUTURE LAB” production complex is slated for completion in the second quarter of 2018, in time for legalization. Utilizing an industry-leading multi-tier system powered by LED lighting provided by Fluence BioEngineering, Hiku’s annual production capacity is expected to be in excess of 5,000 kgs, letting it cater to a large part of the cannabis consumer market. The company’s merger with Tokyo Smoke is expected to create the first brand and retail-focused craft cannabis producer.

This development is backed up by a $10 million investment from Aphria (TSX: APH) (OTC: APHQF), a leading Canadian medical cannabis company. With an expansion strategy based on targeted investment and collaboration with other companies, Aphria has been working to advance growth in the U.S. medical cannabis market. This provides the company with the production and distribution facilities needed to enter the market for recreational cannabis.

While the involvement of medical marijuana companies will be important in the growth of Canada’s cannabis sector, the real test for commercial cannabis will be the involvement of consumer brand-based businesses. Their entry into the market will signal faith in the future of recreational cannabis, as well as bringing consumer branding expertise to the sector. One of the first examples of this is the investment in Canopy Growth (TSX: WEED) (OTC: TWMJF) by Constellation Brands. The $42 billion company behind Corona, Modelo and Svedka Constellation Brands has taken a stake in Canopy Growth worth about $191 million, with the option of purchasing additional stakes. It will use this investment to create cannabis-infused drinks, using Canada as a market in which to innovate in anticipation of markets emerging elsewhere.

The growing Canadian cannabis market bodes well for ABcann (TSX.V: ABCN) (OTCQB: ABCCF), a globally licensed, cost-efficient producer of premium quality organic standardized medicinal cannabis. One of the earliest licensed Canadian medical marijuana producers under Canada’s federally controlled ACMPR, ABcann has five years of operating experience in the burgeoning medical marijuana space. The company currently owns and operates a fully functioning 14,500-square-foot facility in Ontario, as well as 65 acres of real estate with proper zoning and existing infrastructure in place to support the construction of another production facility of up to 1 million square feet. Along with this growth capacity, ABcann has a healthy cash balance, steady sales growth, an established operations team and global expansion plans, making it well positioned to compete in the rapidly expanding Canadian cannabis industry.

Though it’s still several months away from fulfillment, Canada’s recreational cannabis market is already providing a diverse range of businesses and investment opportunities. Building on the techniques of medical marijuana companies, the market appears set to diversify into drinks, retail outlets and premium products. This will establish cannabis as part of the existing market for recreational consumables.

For more information on Choom, please visit Choom (CSE: CHOO) (OTCQB: CHOOF)

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Key Companies That Will Remap Canada’s Cannabis Retail Industry

CannabisNewsWire Editorial Coverage: Out of 120 applicants, Manitoba recently awarded four master retail licenses, a monumental action as Canada prepares to legalize cannabis for recreational use this summer. The entities that now hold prized licenses to retail pot and its associated paraphernalia in the province are: Tokyo Smoke, a subsidiary of HIKU Brands (CSE:HIKU; OTCBB: DJACF) (DJACF Profile); a consortium of Delta 9 Cannabis Inc. and Canopy Growth Corp. (TSX: WEED) (OTC: TWMJF); National Access Cannabis (CSE: NAC) (OTC: NACNF); and 10552763 Canada Corporation. One key industry player that missed out on this licensing opportunity is MedReleaf (TSE: LEAF) (OTC: MEDFF). These licenses open the doors to considerable recreational retail revenue potential, and investors with foresight were quick to take action, with Aphria (TSX: APH) (OTC: APHQF) and Koicha Partners LP investing millions into the big four’s newest presence, HIKU.

New name, established brand

Although the name HIKU is new, the brands behind it are well-known and have interesting back stories. Tokyo Smoke was named “best brand” at the inaugural Cannabis Industry Awards in December 2017, and in January 2018 the company joined forces with Doja Cannabis Company to create HIKU. HIKU is led by CEO Alan Gertner and President Trent Kitsch, who founded the best-selling men’s brand, SAXX Underwear.

Gertner ran a $100 million business as head of an Asia-Pacific-wide sales team during his tenure in corporate strategy at Google. When he found that what he thought was his dream job was less than fulfilling, he shifted gears and co-founded Tokyo Smoke with his father Lorne Gertner, formerly PharmaCan chairman (now Cronos Group), who was dubbed the ‘Godfather of Canadian Cannabis’.

Tokyo Smoke is a seasoned retailer, already running stores online and several successful brick-and -mortar shops, selling a range of experiential products that feature the creative use of cannabis. Established already in key markets like Toronto and Calgary, Tokyo Smoke’s cannabis will soon be on shelves in legal recreational dispensaries in the United States.

East meets West in merging of cannabis retail and production minds

Partnering with Doja Cannabis, a seasoned Kelowna-based pot producer, was Gertner’s first foray into production. The strategy of merging minds with industry expertise in producing and retailing pot brought Gertner, based in the east, and Kitsch, based in the west, to a new market in the Manitoban middle ground.

The cannabis industry is growing at a rapid pace. While powerful players are teaming up to establish brand presence and formulate creative ways to differentiate themselves, the smaller contenders will begin to get weeded out. With Manitoba’s major retail cannabis players now clear, the stage is set for companies to continue their push toward becoming Canada’s first dominant cannabis retailers. HIKU, with shares trading over $2.50 and an estimated market cap topping $300 million, is definitely one to watch.

Comparables:

Aphria (NASDAQ: APHQF) (TSE: APH) was founded in 2011 and is headquartered in Leamington, Ontario. The company calls itself one of the lowest-cost producers of marijuana, and produces dry cannabis, as well as cannabis oil of varying qualities and strength. Its cannabis is 100 percent greenhouse grown. Aphria’s estimated market cap is over $2 billion.

Canada’s largest producer, Canopy Growth (OTC: TWMJF) (TSE: WEED), has a market cap of more than $4 billion, with shares currently trading over $22, a 61.3% increase over the last three months. Formerly known as Tweed Marijuana Inc., Canopy Growth was founded by Bruce Linton in 2014, and is based in Smiths Falls, Ontario. Canopy Growth is the first federally regulated, publicly traded cannabis producer in North America. It operates numerous production facilities across Canada and around the world with over 700,000 square feet of production licensed under Canada’s medical cannabis framework.

National Access Cannabis (OTC: NACNF) (CSE: NAC) National Access Cannabis’ market cap is over $135 million; stock is trading over $1. The company operates medical cannabis care centers across Canada, National Access is adapting its established medical clinic model to meet the needs of the Manitoba retail market. National Access works alongside Health Canada and Licensed Producers to help qualifying patients gain access to their license. After receiving the Manitoba retail National Access announced it intends to deepen its relationships with CannaRoyalty Corp. and Cannabis Wheaton Income Corp.

MedReleaf (TSE: LEAF) (OTC: MEDFF) was voted Top Licensed Producer at the Lift Canadian Cannabis Awards. MedReleaf is an Ontario- based, R&D-driven company dedicated to innovation, and delivering products to the global medical market, and providing brands and product assortment for the recreational consumer market. MedReleaf’s market cap is currently over $2.26 billion.

For a more in-depth look into HIKU Brands, visit HIKU Brands (CSE:HIKU; OTCBB: DJACF) or read the FULL Report: Cannabis Investors Need Three M’s To Success: Money, Moxie, and Management

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