Synthetic CBD: The Future Of The industry?

By Richard O’Halloran, CEO of Biosportart

Few naturally occurring compounds have generated as much interest – or shown as much therapeutic promise – as the cannabinoid CBD. The market size in Europe has been estimated to be as high as $555 million today, growing to up to over $1.4 billion by 2025.

More than 33% of individuals in the US and six million people in the UK are self-medicating with CBD products to help with diverse problems, including anxiety, insomnia. and chronic pain. And while Holland Barrett, Boots, and others have started to make major plays in this area, you may still be left wondering why these products are still not yet mainstream. 

Any new formulator of CBD products will soon discover that sourcing high-quality, consistently pure, and legal isolated CBD is extremely challenging and costly. In the words of the Home Office: “It is very difficult to isolate pure CBD…” and many products “do not fully disclose their contents or provide a full spectrum analysis”.  CBD isolate can vary dramatically in price, from as little as $1400 per Kg to $20,000, and yet the higher price CBD can still fall afoul of the nebulous UK guidelines of 0.2% (which actually applies to dry-weight hemp) or 1mg container.

To solve this problem, many formulators have had to leave the natural world behind and turn to the small but growing list of synthetic cannabinoid manufactures, such as PureForm Global and high-flying Cellular Goods. These companies synthesize product bio-identical CBD, either through organic chemistry or biosynthesis, such as yeast fermentation. They produce CBD that is exactly the same in structure as their naturally occurring counterparts and behave in the body in the same way, yet are delivered without impurities. It is important here to note that despite a disinformation campaign by some cannabis growers, synthetic bioidentical CBD is identical to CBD in every way, and has nothing to do with synesthetic cannabinoid analogs like Spice and K2 (which are THC analogues that do not occur in nature).

Formulators that make the jump to synthetic CBD don’t go back. While prices are at the high end of the scale for isolate, suddenly all third-party tests (and you should only buy 3rd party certified CBD) for heavy metals, poisons, mycotoxins, and THC come up zero. There are no concerns about cross-contamination or chain-of-custody concerns between grower and isolator. And while synthetic pathways to CBD can theoretically include THC as a by-product, we have never detected THC in synthetic isolate we’ve assessed, in any amount. It is because of synthetic CBD, our customers in the world of elite sports can take advantage of the benefits of CBD, without the risk of jeopardizing their careers. The same applies to doctors, police officers, the military, and any other tested individuals.

For the same reasons synthetic CBD appeals to formulators, so should it appeal to investors. Synthetic forms of naturally occurring compounds account for almost half of currently used human pharmaceuticals. Assuming the same holds true for the cannabinoid market, that means that only a few dozen companies are destined to capture half of the multibillion-dollar global market, with the other half shared by thousands of cannabis and hemp growers, in a wide range of environments and under different regulatory restrictions. Unlike cannabis-derived isolates, synthetic CBD is easy to import and export, with multi-kilo shipments safely below prohibited THC quantities. They have potentially infinite scale, without worrying about soil types and genetic drift in plants.

And finally, CBD, like THC are just the two most prevalent of over a hundred cannabinoids found in the cannabis Sativa plant. There are others already showing promise, such as CBG and CBN, that are even more challenging to produce and isolate in usable quantities. It is highly likely that these compounds will require synthesis to manufacture in quantity. 

The cannabis IPOs have demonstrated the enthusiasm for cannabis amongst both retail and institutional investors. But it will be the synthetic cannabinoid producers that will come to dominate the market in the long term.

Benzinga's Related Links: 

• USDA-Certified Organic CBD Isolate: This Company Has Pioneered A Process to Produce It
• Guide: How To Dab CBD | Benzinga

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