Market Overview

CBD Demand Soars With a Growing Number of Uses

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NEW YORK, Oct. 15, 2019 /PRNewswire/ -- As the medical industry continues to evolve, researchers are actively looking for innovative remedies and treatments for patients. Notably, cannabis has become the topic of discussion after numerous researchers and institutions highlighted its therapeutic benefits. However, despite medical advancements throughout the cannabis industry, most federal regulators around the world have not yet moved to fully legalize cannabis for medical applications because of the psychotropic effects associated with it. Nevertheless, several regulators have decided to legalize cannabidiol, or CBD, a compound found within cannabis. CBD is a derivative found within the cannabis plant, however, unlike its tetrahydrocannabinol, or THC, counterpart, it does not induce psychoactive effects. Consequently, regulators became more inclined to legalize CBD. Primarily, the CBD industry is being accelerated by the healthcare segment. Specifically, countries such as Australia, Canada, France, Germany, Italy, the U.K. and the U.S. have all adopted CBD-related legislation. Overall, the therapeutic grade segment dominates that overall CBD market because of increasing demand from innumerable applications. The segment accounted for 58.6% of the overall CBD market share and is expected to continue its dominance. In particular, the healthcare segment is expected to account for a total of USD 10.28 Billion of the CBD market by 2026. Moreover, the food and beverage industry is also expected to witness exponential growth. And while the U.S. and Canada are the primary drivers for the global CBD market, other international markets are also expected to greatly contribute. For instance, the Asia Pacific market is anticipated to reach USD 3.1 Billion by 2026 and exhibit a CAGR of 29.5%, while the European market is projected to grow at a CAGR of 28.9%. As a result, the global cannabidiol market is expected to grow from USD 1.04 Billion in 2018 to USD 16.32 Billion by 2026 while registering a CAGR of 27.7% during the forecast period, according to data compiled by Reports and Data. Newleaf Brands Inc. (OTC:NLBIF) (CSE:NLB), Organigram Holdings Inc. (NASDAQ:OGI) (TSX:OGI), The Green Organic Dutchman Holdings Ltd. (OTC:TGODF) (TSX:TGOD), The Supreme Cannabis Company, Inc. (OTC:SPRWF) (TSX:FIRE), Aleafia Health Inc. (OTC:ALEAF) (TSX:ALEF)

The pharmaceutical segment of the CBD industry is expected to witness significant R&D investments to accelerate deployment and meet the medical needs of a number of diseases. Specifically, researchers have uncovered that CBD can treat a variety of diseases such as chronic pain, anxiety, depression, and cancer. And while most of these conditions would likely require a prescription from a medical practitioner, there are over-the-counter or OTC products that consumers can easily purchase at their local convenience stores in the U.S. or Canada. Consumers can purchase CBD-based products such as tinctures, topicals, patches, capsules, foods, and beverages. Typically, most OTC products are marketed as health and wellness products that are aimed to relieve minor ailments. For instance, many health and wellness retailers promote CBD as a way to stimulate relaxation or relieve small headaches. Notably, major pharmaceutical retailers such as CVS or Walgreens have also decided to add CBD products to their shelves. The two corporations added CBD products in order to provide consumers with cheaper and alternative care products. "It really does help normalize this. If Grandma can go to the store and get it, now the conversation about cannabis is going to be very different," said Michele Ross, PhD, MBA, Research Director at Decriminalize California. "CBD business is already huge. But normalizing the culture around taking these products is going to open the door for more people to feel comfortable investing in these types of businesses. It opens up the possibility for them to be sold in more stores."

Newleaf Brands Inc. (OTC:NLBIF) (CSE:NLB) is also listed on the Canadian Securities Exchange under the ticker (CSE:NLB). Today, the Company's wholly owned subsidiary We Are Kured, LLC ("Kured") announced that, "it has successfully manufactured and fulfilled its first large white label 510 thread refill cartridge order for Indiana based distribution company, Must Haves, LLC ("Must Haves"). Must Haves is a well-established CBD distributor within the CBD community and has built strong relationships with CBD retailers around the greater Chicago, USA area.

As previously announced on September 5, 2019, Kured entered into a white label agreement with Must Haves, whereby Must Haves has agreed to purchase Kured's white label 510 thread CBD cartridges for distribution under Must Haves brand. The Must Haves branded 510 thread CBD cartridges include terpene profiles such as Trainwreck and Blueberry Cookies.

Benjamin Martch CEO of Kured and CMO of NewLeaf Brands Inc. commented, 'These white label agreements have proven to be a great move for Kured and the clients that we work with. Kured's white label division offers custom vaporizer products of all different types utilizing our cutting-edge processes and formulations while keeping the ability for custom terpene profiles, look and feel open to the customer's desires. We are able to fill orders of any size or liking in an incredibly short amount of time due to our large in-house manufacturing capacity. We look forward to not only working with existing clients, but also assisting a number of future clients to fulfil their CBD needs.'

About NewLeaf Brands: NewLeaf Brands, Inc. is an innovative Cannabidiol ("CBD") lifestyle Company. Through the Company's wholly-owned subsidiaries We are Kured, LLC, Drink Fresh Water, LLC, ReLyfe Brand, LLC and TeaLief Brand, LLC the Company's main business activities encompass the development, marketing, and distribution of CBD products (including vaporizer pens/cartridges, hot/cold tea, softgel capsules and beverages) throughout North America, South America, and Europe. In addition, NewLeaf Brands, Inc. has extensive retail and cultivation land investments in Oregon, USA."

For our latest "Buzz on the Street" Show featuring Newleaf Brands Inc. recent corporate news, please head over to: https://youtu.be/fZkXaFbCnr8

Organigram Holdings Inc. (NASDAQ:OGI) (TSX:OGI) is a NASDAQ Global Select and TSX listed company whose wholly-owned subsidiary, Organigram Inc., is a licensed producer of cannabis and cannabis-derived products in Canada. Organigram Holdings Inc. the parent company of Organigram Inc. recently announced that it has entered into an advance payment and purchase agreement with 703454 N.B. Inc. (carrying on business as 1812 Hemp,) under which the Company will pre-fund hemp purchases to receive access to as much as 60,000 kilograms of dried hemp flower to be harvested in calendar 2019 for extraction into cannabidiol isolate. "Access to a large, consistent volume of CBD-producing hemp has become increasingly important as Canadians express their demand for CBD-rich products for use in both recreational and medical capacities," said Greg Engel, Chief Executive Officer, Organigram. "We've heard the call for CBD in the market and this agreement positions Organigram to meet that demand."

The Green Organic Dutchman Holdings Ltd. (OTCQX:TGODF) (TSX:TGOD) is a publicly traded, premium global organic cannabis company, with operations focused on medical cannabis markets in Canada, Europe, the Caribbean and Latin America, as well as the Canadian adult-use market. The Green Organic Dutchman Holdings Ltd. recently announced that its wholly-owned subsidiary, HemPoland, has entered into an agreement with Mediakos UG haftungsbeschraenkt (Mediakos) to be the exclusive distributor of CannabiGold, its premium hemp CBD brand, for the German pharmacy market. Mediakos UG spun out of Aponeo.de, a leading German online pharmacy, and is managed by a team of seasoned industry executives with demonstrated expertise in marketing and distribution of health and wellness products. It currently distributes a broad portfolio of products to a network of more than 15,000 pharmacies and can capitalize on over 10 million customers. "With a population of over 82 million, Germany plays a pivotal role in TGOD's international expansion strategy," commented Brian Athaide, Chief Executive Officer of TGOD. "We are thrilled to be working with Mediakos' experienced team as we continue to solidify CannabiGold's position as a leading brand within the European market."

The Supreme Cannabis Company, Inc. (OTCQX:SPRWF) (TSX:FIRE) is a global diversified portfolio of distinct cannabis companies, products and brands. The Supreme Cannabis Company, Inc. recently announced that Blissco Cannabis Corp., Supreme Cannabis' premium wellness brand and a multi-licensed processor and distributor, has received licensing approval from Health Canada for the sale of cannabis oils from its facility in Langley, British Columbia. The cannabis oil sales license granted by Health Canada allows Blissco to sell full-spectrum cannabidiol (CBD) oil products. As previously announced, Supreme Cannabis closed its acquisition of Blissco in the first quarter of fiscal 2020. The Company has since integrated, focused and advanced Blissco's business, initiating construction on a large-scale ethanol-based extraction lab to expand upon Blissco's existing CO2-based extraction capability. By the end of calendar year 2019, Supreme Cannabis expects that the Facility will have the capacity to produce over 7,000,000 tincture bottles annually. Supreme Cannabis also expects the Blissco brand to meaningfully contribute to projected revenue in fiscal 2020. "With the receipt of the License and expanded extraction capacity, Blissco will be positioned to address the growing unmet demand for high-quality CBD oil products across Canada," said Navdeep Dhaliwal, Chief Executive Officer of Supreme Cannabis. "Blissco's legacy of premium whole flower products established a brand that represents quality and authenticity to wellness consumers. For over a year, Blissco's team developed advanced oil processing and formulation capabilities based on the same ethos. Consumers will soon be able to experience high-quality CBD oil products from a premium wellness brand they have come to trust. The team at Blissco has developed sophisticated expertise and diligently executed against ambitious business objectives, their hard work and vision has led to this significant milestone."

Aleafia Health Inc. (OTCQX:ALEAF) (TSX:ALEF) is a leading, vertically integrated cannabis health and wellness company with four primary business units. Aleafia Health Inc. recently completed the construction of its Paris Processing facility's Phase II expansion and secured full site occupancy on October 4, 2019, following the successful completion of County of Brant inspections. The Paris Phase II expansion is a 30,000 sq. ft. facility entirely dedicated to the extraction, production, packaging and distribution of high-margin, value-added cannabis health and wellness products. The expansion builds upon the current, licensed and operational Paris facility, which features cultivation rooms and handles all extraction, packaging and order fulfillment for Aleafia Health's medical, adult-use and international sales. "The Paris expansion represents the crown jewel of Aleafia Health's cannabis ecosystem. This facility will allow us to rapidly expand the production of high-margin derivative products, while adding new, differentiated formats that are grown, processed, packaged and exported by Aleafia Health," said Chief Executive Officer Geoffrey Benic. "We look forward to bringing the next generation of cannabis products to market, while greatly expanding our international footprint in Germany, Australia and beyond."

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