The great growth opportunity in the cannabis space boasts expected sales of nearly $2B in hemp products and $12.8B in sales of marijuana in 2019 alone. With this wonderful growth happening in this space, how does one figure out whether or not to enter the market, and if so, HOW?
Start at the Beginning
First, it’s important to understand that there is a difference between marijuana and hemp. The 2018 Farm Bill made it clear what that difference is: hemp is a variety of the cannabis plant that contains less than 0.3% THC (tetrahydrocannabinol or Δ-9 tetrahydrocannabinol) on a dry weight basis, and marijuana is the variety that has more THC than 0.3%. The federal government will not allow the sale of marijuana, including concentrates and extracts (products over 0.3% THC).
However, hemp-derived cannabinoids are legal and you most likely have come across CBD (cannabidiol) products in all sorts of places such as a supermarket or pharmacy, as something that is added to a food, beverage, or topical product. In order to be legally sold across the US at this time, CBD must be hemp-derived.
For this article to be relevant to the widest audience, we’ll focus on how to create and develop your products with hemp-derived CBD, as this is something that should be acceptable in most, if not all of the US.
Get to Know Your Market
Always start with a good understanding of your market when developing your product. There are some people out there that enjoy the taste and aroma of cannabis, and there are others that may be curious as to what a hemp-derived product can do for them, but don’t want the associated flavor or smell. If you feel that your audience will be comfortable with the flavors and aromas (the terpenes and terpenoids) of a hemp product, then consider using a full-or broad-spectrum CBD. With a full- or broad-spectrum CBD, the terpenes and the terpenoids have not been stripped from the hemp extract, therefore the expected hemp/cannabis flavor and aroma will be present with the product. There is a CBD isolate available for those that wish to develop products without any hemp/cannabis aromas or taste.
TAKEAWAY: Learn about CBD product options and determine which one you’d like to focus on, and who it will benefit the most.
Next, determine if you want to make any types of claims as to how much CBD is in your product, and if so, how much per serving. Remember that the products on the market that do make claims of CBD content are usually in the milligrams per serving range, and you should implement quality systems that include testing for CBD against claims. After testing some companies, the FDA has issued warning letters to companies that have less (or no) CBD than their label claims. Even if you aren’t going to make claims, confirm that the total amount isn’t exorbitant and is still in line with what the majority of the market is selling in mg per serving.
TAKEAWAY: Discuss and confirm dosing options and focus on quality and safety when it comes to your product and customer.
Source the Best Possible Extract
Now that you have an idea of how many milligrams per serving you’ll need, it is time to source your hemp-derived CBD extract. One thing to keep in mind is that you’ll need to confirm it is compatible with food and beverage (or even topical product) laws and regulations for safety, so check that the extracts comply with those laws. Talk with your supplier to find out what types of risks (physical, chemical, microbial) could be associated with the extract, and check to see if they are reducing the risk of those problems happening with your product. Do a risk analysis on the extract, just like you would for any other raw material coming into your facility. For CBD extracts, consider ’the risks’: pesticide residue, heavy metal uptake, microbial, residual solvents, and possibly, mycotoxin. Check to see if the supplier offers a COA (Certificate of Analysis) for the extract tests for any of these risks along with the potency of the CBD extract. You’re going to need to know how much to add to your product to meet the claim or the expected amount in the final product.
TAKEAWAY: Not all extracts are equal. Find a supplier that meets safety, quality, and regulatory standards.
Identify the Best Way to Combine Ingredients
CBD extracts, from full-spectrum to isolate, are oil soluble. If you are planning on a food, beverage, or a topical product that is oil-based, the incorporation into the product should be straightforward. Mix in such a way that the CBD is dispersed evenly throughout the entire product before packaging so there aren’t any “hot spots” of CBD in the finished product. This can take away from the efficacy of the CBD and could lead to an increase of customer dissatisfaction with your product.
If your product is water-based or the majority of your product is water, then you will need to consider taking the extra step in making the oil and water mix. This can be done by dispersing the oil into the water through the use of a homogenizer or working the CBD into the water phase using emulsifiers to help prevent separation. Again, the main goal is to maintain stability and disperse the oil evenly into the product so that it doesn’t separate or float to the surface like an Italian salad dressing.
TAKEAWAY: Find the best approach for mixing CBD into your product. Consider water-soluble options.
Create a Great Flavor Profile
Once you’re able to get the CBD into the product, keep in mind of the flavor profile. If you think your audience will like the full-spectrum flavor/aroma, then celebrate the fact that the full-spectrum CBD is in there and let the taste and smell of the product shine through. If you don’t feel that your audience would like it, then your isolate should be of such a low flavor and aroma profile that you shouldn’t have to do much to mask it. However, if you want to be able to do a bit of masking of the flavor/aroma, try using some flavors such as citrus, cheese, berry, or sweet brown flavors. Work with your flavor supplier to get an understanding of what you can do with your product.
TAKEAWAY: Work with a good supplier to understand your options for a high quality flavor profile.
Taking a product from concept to commercialization involves a lot of work, especially for companies with less bandwidth or resources to handle everything from start to finish internally. Tackling sourcing, applying food science, conducting safety and regulation checks, and beyond are daunting without the right partners. It can be convenient to off-load a lot of these needs to a supplier that has already taken many of the issues into account and made the CBD extract into an easily dispersible, water-soluble, food and beverage safe format. You can leverage the knowledge of that supplier to help calculate usage rates and even work through where it may be most appropriate to add in your process.
It may seem daunting to go through a new product development cycle with CBD in the mix; the sourcing, the regulatory environment, the food science, and even deciding the product claims can be overwhelming. However, this is an exciting new category with enormous growth potential and countless big brands are racing to be a part of the CBD scene. While much of the product development space can seem complex, we can expect one thing to be clear: there are many more new CBD-infused products on the horizon.
Michael Schmitt, Technical Project Manager at SōRSE Technology