Growing Cannabidiol

25 April 2016 The German company nova-Institute and another German company, HempConsult, conducted a study on emerging markets and companies related to the non-psychotropic cannabinoid molecule cannabidiol (CBD ).

The areas of application covered were food supplements, pharmaceutical delivery, and related therapies.

Industrial hemp – the source of CBD (cannabidiol)

Industrial hemp plants belong to the genus Cannabis, the use of which was first reported around 10 000 years ago. Throughout our history, this versatile object has been used as a source of fiber, building materials, food, textiles, and even medicines. It produces CBD, a non-psychotropic molecule that can neutralize and mitigate the effects of tetrahydrocannabinol (THC).

According to German teams, around 25 000 hectares were used to grow industrial hemp in the EU in 2015. Cannabidiol as a therapeutic alternative The analysis shows that around 87.5% of the survey participants believe that the CBD industry will soon become a major source of economic growth in Europe and North America, as cannabidiol has not yet been tested.

The potential in Europe is estimated at €2 billion.

This money will be allocated to the following 4 main investment sub-sectors:

  • cultivation
  •  processing
  •  research
  •  retail

Therefore, they also argue that information and education about this plant are vital for the growth of this industry, and the negative connotation that surrounded this plant genus a few years ago is changing every day.

Experts believe that among the diseases for which CBD has the greatest potential as a therapeutic alternative are: childhood epilepsy, cancer, anxiety disorders, chronic inflammation, pain, schizophrenia, and arthritis.

A watchful eye of investors

This potential to generate dividends has not escaped the gaze of cannabis investors. They are in constant talks with various related companies in the sector but are more focused on companies that can harness the properties of cannabinoids and turn them into therapeutic alternatives.

Biotechnology, bioinformatics, synthetic biology, and pharmaceuticals are the industries of most interest to these investors. It should also be noted that this is one of the best times to invest in these companies, because once the market is regulated (in about five years’ time), conglomerates such as tobacco companies or large pharmaceutical companies will also have free access to this market, thus crowding out smaller competitors.

Factors to consider in the cannabidiol market

  • Pro-medical cannabis regulation

The political and economic connotations relating to prices, taxes, and methods of regulating cannabis products are factors that should be taken into account in creating a regulated and competent market. Low tax rates are essential for any company seeking to enter this industry in order to be able to reproduce and also displace the illegal trade in cannabinoid products.

Europe can learn a great deal from the examples we see day in, day out, in the American territory, where there is a constant encouragement of the creation of companies marketing CBD-based products for the treatment of various pathologies or diseases and, above all, of joint work with regulatory bodies such as the FDA and the DEA (Food and Drug Enforcement Administration).