CBD Industry set to Explode as New Products, Consumers Enter Market

DENVER, April 3, 2019 /CNW/ -- The U.S. Farm Bill that recently passed into law is a game-changer for the CBD space. While it is unknown when nationwide cannabis legalization may occur, incredible opportunities exist right now for CBD-focused companies that can deliver products to the marketplace.

• Demand is growing for organic CBD products in markets where such products are legal.
• Youngevity has made a series of strategic acquisitions to help establish the company's position
• Companies ready to deliver CBD products to market at scale are in ideal position to capitalize on growing demand.

Passage of the latest U.S. Farm Bill marked a watershed moment for CBD producers in the United States. Not only does the new body of law allow these producers to commercialize existing CBD products, the door is now open for a new generation of research into what CBD can do for consumers. Youngevity International Inc. (NASDAQ:YGYI) (YGYI Profile) is a leading producer of consumer-focused CBD products that is expanding its reach into other areas of the CBD supply chain. It joins companies such as CV Sciences Inc. (OTC:CVSI), Isodiol International Inc. (CSE:ISOL) (OTC:ISOLF), GW Pharmaceuticals plc (NASDAQ:GWPH) (OTC:GWPRF), and Curaleaf Holdings Inc. (OTC:CURLF) (CSE:CURA), which are all working to commercialize CBD products in both the consumer and pharmaceutical sectors.

To view an infographic of this editorial, click here.

CBD Offers New Opportunities for Bold Thinkers

The market for CBD products is exploding and likely will continue to grow as these products become more available. Because CBD can be made in a laboratory, an increasing amount of synthetically produced CBD has been entering the market. However, many CBD proponents contend that organic CBD (CBD extracted from hemp plants) is superior to synthetic CBD.

Youngevity International Inc. (NASDAQ:YGYI) produces a range of consumer-focused CBD products, but the company is growing its reach via strategic acquisitions. Sourcing organic CBD has been an issue for many manufacturers, which may be why Youngevity recently acquired Khrysos Global — a CBD producer based in Florida.

Following the announcement of this acquisition to the public, YGYI president and CFO Dave Briskie commented, "We set out a plan to create a vertical opportunity in the hemp space. This is a significant step as it relates to the production, cultivation, and extraction of hemp, CBD oil, as well as other CBs (cannabinoids). . . . We proudly welcome Dwayne Dundore, as the President of newly formed Khyrsos (sic) Industries along with his entire and very capable team at Khrysos and INX Labs."

Dundore was equally enthusiastic about the announcement, saying, "I am really excited to be a YGYI shareholder and part of the Youngevity Family. I look forward to making a meaningful contribution to both the top and bottom line of the company and feel strongly that our capabilities and plans for expansion should create additional value for myself and all shareholders."

CBD Ready to Take the Market by Storm

Unlike THC, which is a highly psychoactive alkaloid found in cannabis, CBD has a calming effect in most people. In addition, CBD can be legally sold without a prescription and is being integrated into many consumer products.

CBD companies that can create good connections with their client bases should be able to grow into this burgeoning market. Recognizing this, Youngevity has made a series of strategic acquisitions that could help establish the company's position as a leader in 21^st-century cannabis development. The company's takeover of Khrysos Global netted it a solid supply of organic CBD, as Khrysos has both cannabis cultivation property and facilities to refine CBD oil.

With that backdrop, Youngevity recently launched HempFX to sell its products directly to consumers. For the moment, the company is offering hemp oils. Its product line may increase as additional research and development brings more ideas to market.

A Coffee Door Opener

Youngevity is also ready to bring a CBD-infused coffee to market. Its recent acquisition of Khrysos Global brought CBD-testing laboratories to the company, looking to leave Youngevity in a position to take full advantage of the new U.S. CBD laws. One of the biggest hurdles for manufacturers of CBD products is making sure the products contain a repeatable dose of CBD. Through careful testing, Youngevity has overcome this obstacle in its coffee, which reliably delivers 10mg of CBD in every cup.

he new coffee will be made by Youngevity's wholly owned subsidiary CLR Roasters. According to the company, the new product will be sold in four flavors and will be available to consumers later this year.

CLR Roasters president Ernesto Aguila commented, "We are extremely pleased with the taste of the product, and the samples that we have provided to a host of retailers have led to strong reviews as well. It is very exciting to bring a new product to market that has so much interest within the coffee beverage category. I have not seen a door opener like this since Javalution Coffee Company created the first fortified coffees."

Market Viability Looks Strong

CBD has essentially been illegal since modern medicine began. Now that it is legal to produce and distribute CBD in the United States, early movers in the space are setting themselves up for potentially massive profits. Numerous companies are focusing on developing better CBD-infused products, creating new forms of consumer-focused CBD consumables and getting those products to consumers as quickly and easily as possible.

CV Sciences Inc. (OTCQB:CVSI) is working to commercialize CBD products for both consumers and the medical community. Its pharmaceutical division is looking to create a CBD-based medicine that can be approved by the U.S. Food and Drug Administration. Now that CBD is 100 percent legal at a federal level in the United States, the company should be able to make progress on this project. Its consumer division is developing a range of products that can be sold to health food stores or directly to its customers. As CBD use has become more widespread, there is a growing amount of feedback from users to support its continued development.

Isodiol International Inc. (CSE:ISOL) (OTCQB:ISOLF) has built a CBD-focused business with operations in the United States, the United Kingdom, and other countries. Kevin Swadish, the company's chief revenue officer, commented, "The legalities of hemp-based CBD are becoming more favorable, and consumer awareness of CBD is rapidly rising. As a result, we believe the greatest growth opportunities in the industry, and for Isodiol, lie in the consumer packaged goods marketplace." The company has built up an operation with more than 200 employees and consultants globally, which demonstrates the interest CBD has generated in recent years.

GW Pharmaceuticals plc (NASDAQ:GWPH) (OTC:GWPRF) developed the first marijuana-derived pharmaceutical to be approved by the FDA. Epidiolex, which contains CBD, was designed to treat Dravet syndrome and was the first drug ever approved to treat this rare form of epilepsy in the U.S. Sales of the drug began last November, and according to recent financial results posted by the company, Epidiolex has garnered substantial interest. Epidiolex sales totaled around $4.7 million in the last quarter, with more than 4,500 new patient enrollment forms during the first two months the drug was available. The positive results from Epidiolex sales were well received, and investors bid the company's shares higher after they were announced.

Getting CBD products into the hands of consumers is also a focus for savvy companies looking to the future. Curaleaf Holdings Inc. (OTCQX:CURLF) (CSE:CURA) recently announced a distribution deal with CVS Health Corp. Under the new deal, the retail pharmacy and healthcare company will begin selling products infused with the trendy, nonintoxicating hemp component at more than 800 of its stores nationwide. CVS confirmed that it has started selling CBD creams, sprays and lotions in eight states, including California, Illinois, Colorado and Alabama. The products will be sold in store aisles. "We've been having dialogue with national retailers for many months now," said Curaleaf chief executive officer Joseph Lusardi. "We've got a number of potentially exciting partnerships in the pipeline."

Growing hemp and refining it into CBD could become profitable for companies that can do it efficiently, especially if public demand grows faster than production capacity. Youngevity may be picking up on this emerging market dynamic and securing its supplies of organic CBD while the industry is still in its infancy.

For more information about Youngevity International, please visit Youngevity International Inc. (NASDAQ:YGYI).

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