For the last few years, products containing cannabidiol—the cannabis-derived compound commonly known as CBD—have proliferated, from vape pens to face creams, tinctures to dog treats.
But while CBD companies seem countless, a new one is likely to make a splash in the US market. On Tuesday, Canadian business news network BNN Bloomberg reported Canopy Growth—the world’s largest legal cannabis company, worth about $6.4 billion—quietly launched its new CBD brand, called First & Free. On its website, the brand is selling capsules and tinctures for prices ranging from $14.99 to $64.99 to customers in 31 US states, and says a cream will be coming soon. (Martha Stewart has also been tapped to consult on Canopy’s CBD-enhanced pet products.) A Canopy representative told BNN Bloomberg the site is in a testing phase and “early signs are positive.”
First & Free represents the Ontario, Canada-based producer’s first foray into the US market. In Canada, Canopy operates well-known cannabis brands and retailers including Tweed and Tokyo Smoke, and in November announced new cannabis-infused chocolates, beverages, and vapes—all newly legal categories for the Canadian market.
Because cannabis containing more than 0.3% THC by dry weight is still federally illegal in the US, hemp-derived CBD is something of a Trojan horse for Canadian producers who want to access the US market without breaking any laws. In January, Canopy announced a $100-150 million investment in a New York state “hemp industrial park” in a former vacuum-cleaner plant and then-CEO Bruce Linton said he expected to have CBD products on the US market by the end of 2019. (Canopy did not answer Quartz’s question about where the hemp for First & Free’s CBD is grown. The company only broke ground on the New York facility in late July.)
The analysts at Cowen and Company estimate that US hemp-derived CBD sales in 2018 were worth somewhere between $600 million and $2 billion. That’s a fraction of the legal US cannabis market—THC included—which analysts at New Frontier Data estimated was worth about $10.4 billion. Canopy is ready for that market too. In April, Canopy made a deal to buy the New York-based cannabis producer Acreage Holdings for $3.4 billion, contingent upon federal legalization in the US. In the meantime, they’ve got some CBD to sell.