Illinois Ag Connection - Regulatory Reform Could Mean Big Days for CBD Industry

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Regulatory Reform Could Mean Big Days for CBD Industry
Illinois Ag Connection - 02/24/2021

After finding themselves down for much of last year, cannabis and CBD stocks are once again seeing intense momentum. In the short term, we have Reddit's WallStreetBets to thank for some of the industry's recent surge, as the notorious investing forum set its sights on cannabis stocks after promoting AMC and Gamestop. However, there are more sustainable factors behind cannabis's recent momentum that could see these stocks staying on a run in the longer term. In the United States, a democratic White House and congress has reignited hopes of major reform to cannabis laws and regulations and positive financial results from cannabis giants. Meanwhile, international markets are following North America's lead and opening up to the cannabis market. In the midst of this newfound optimism, cannabis and CBD companies like HempFusion Wellness Inc., Tilray Inc., Village Farms International, Neptune Wellness Solutions, and Curaleaf Holdings Inc. see big days ahead.

Among the companies that stand to benefit from cannabis's recent surge is Denver, Colo.-based HempFusion Wellness Inc. HempFusion is a premium health and wellness company specializing in hemp-derived panoramic spectrum CBD products and scientifically validated delivery systems. The company has endeavored to build to the highest standards of health and safety regulatory compliance in the CBD and Probiotic market, allowing it to thrive in a unified regulatory environment.

On Jan. 12, HempFusion announced it had received USDA Organic Certification for its HempFusion CBD tinctures ranging in potency from 150mg to 1500mg of CBD per bottle. HempFusion is now one of the first publicly traded CBD companies to receive this certification. The USDA Organic certification process is rigorous and comprehensive, requiring detailed documentation for every step in the growth, production, and manufacturing process. With this certification, HempFusion products will now be able to display the coveted USDA Organic seal.

"Our team has worked meticulously to earn USDA Organic Certification, which supports our commitment to providing consumers with premium and differentiated CBD products as well as new potential distribution points," HempFusion Co-founder and CEO Jason Mitchell said in the company's release. "This prestigious certification joins our many other compliance markers, further establishing HempFusion as a leader in the premium CBD category," continued Dr. Mitchell.

Also in January, HempFusion announced that the company will be expanding its footprint into the European market with an exclusive distribution agreement with a major European distributor. HempFusion's European expansion will start in the Irish market with EU compliant labeling, as well as full acknowledgement with the Food Safety Authority of Ireland.

"We are incredibly excited to launch sales into Europe, starting with Ireland, through an exclusive distribution agreement with a consumer goods distributor whose deep and established relationships include nearly every major European retail chain," Dr. Mitchell said. "This launch establishes HempFusion's European presence and represents the initial phase of the Company's broader European expansion plans."

Tilray Inc. was one of the biggest benefactors from Reddit's cannabis stock push. Tilray announced on Feb. 9 that the company has entered into an agreement with Grow Pharma to import and distribute medical cannabis products into the United Kingdom. The company expects to have GMP-certified products available to authorized UK patients by March this year.

Canadian greenhouse agriculture company Village Farms International has been expanding into cultivation for CBD production since 2019. On Feb. 8, the company announced that it has exercised its option to increase its ownership of its Asia-Pacific partner Altum International. The company says that this move is part of the company's strategy to access emerging CBD markets.

Diversified cannabis health and wellness company Neptune Wellness Solutions released its third quarter results on Feb. 15. While the company reported a decrease in revenue over the previous third quarter, Neptune noted in the release comments by U.S. Senate Democrats that cannabis reform will be a priority for congress going forward as reason for optimism for the company.

As the cannabis market surges, Curaleaf Holdings Inc. has been rapidly expanding its cannabis retail footprint. On Feb. 10, the company opened its 100th U.S. dispensary in Jacksonville, Fla. The company also says that it plans to significantly expand its cultivation capacity to meet increased demand.

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