Although cannabis legalization is new to many countries and elusive to many more, the cannabis market is growing at an astounding rate. In the U.S. alone, approximately 7 per cent of Americans are using cannabidiol (CBD) for many purposes, which leaves room for the industry to grow to $16 billion by 2025.
Across the pond in the U.K., the CBD market is predicted to expand by 700 per cent by 2020. The trick to many of its sales are touting its medicinal uses, as recreational use faces much more pushback in legalization and socio-cultural acceptability. However, emerging world markets make CBD production and distribution one of the biggest potential industries of the next few years.
Prioritizing sustainable practices
With the increasing popularity of cannabis, concerns over sustainable practices are set to be a big-ticket item going forward. As the production of cannabis increases, the focus turns to how companies‚Äô extraction and farming methods affect local economies through environmental sustainability and job creation.
As with the development of an industry that requires constant use of resources, business practices must be environmentally and economically stable to survive in the years to come.
When a crop has been illegal for decades, rules and regulations surrounding its growth and agricultural practices are sure to be outdated, and unstandardized, for that matter. There hasn‚Äôt been much research done into how to grow cannabis in the most sustainable way, especially when it comes to energy usage, but on the bright side, many companies are taking matters into their own hands.
Biome Grow Inc (CSE: BIO) is one such company that is conscious and proud of its roots and seeks to embrace sustainable local ecosystems and environments. They seek to target underserved areas, both in Canada and in the global market. This includes job creation, educational programs, and improving health initiatives. As CBD harvesting practices grow and evolve, Biome strives to adapt and grow with the industry to identify and adopt new and better business practices.
For instance, the company reuses excess nutrient-rich water, uses full spectrum LED lights, which are more energy efficient than standard lighting, and has irrigation systems that are designed to capture and recirculate/reuse the moisture in the air when it condenses, which minimizes water use.
Scaling to an international industry
As cannabis is a recently legal product, much of the focus from companies has been on developing an efficient model that encompasses scalability to a global industry. A big part of this will come from the medical cannabis market, considered by most analysts to be much bigger and more expansive long term than the recreational market.
To establish a foothold in this ever-evolving sector as a global leader, Biome recognized the need for credible medical advisory teams with strong pedigree in the health and pharmaceutical industries, both from the public and private sector.
Biome‚Äôs board includes Mark Lievonen, former President of multi-national pharmaceutical giant, Sanofi Pasteur, as well as George Smitherman, former Minister of Health for the Province of Ontario.¬†¬†
While science is just one aspect of the intricate cannabis web, the legality behind the industry is also something new that companies need to consider. ¬†
Malik explains, ‚ÄúThe regulations for hemp in Canada are very different under the Hemp Act than the regulations under the Cannabis Act. Plus, there are currently more uses for CBD than other cannabinoids like THC, so the market will also be larger in most jurisdictions.‚ÄĚ
He continues, ‚ÄúThe biggest misconception is that cannabis is a dangerous substance on par with alcohol, tobacco, or illicit drugs like heroin. Once that stigma is properly removed regulations become easier to navigate, and a wide variety of uses become commonplace.‚ÄĚ
‚ÄĒ Khurram Malik, CEO, Biome Grow.
Harnessing the use of CBD as an alternative treatment for a wide variety of health concerns is gaining traction over conventional painkillers and potentially addictive substances, including opioids.
Studies have shown that CBD plays a large role in decreasing one‚Äôs chronic pain, but common knowledge from scientists is that more research needs to be done to understand the full effects that CBD may have on certain conditions including arthritis, epilepsy, anxiety, and more.
Where does Biome Grow go from here? ¬†
With Biome Grow‚Äôs focus on sustainable business practices, paired with its mission to provide consumers with quality and consistent products, the company has created a fresh approach to cannabis.
So, where does the company go from here? Biome has secured many successful acquisitions under its belt including Highland Grow, Back Home, Red Sands, and more. And as one of a handful of vertically integrated cannabis companies in Canada, Biome can fully optimize the value of these brands like very few other LPs in the sector.
However, when it comes to growing its brand, Biome is looking at the big picture. That means identifying markets and knowing the limitations and strengths within each one.
The company seeks to be a large-scale provider of cannabis products internationally. This means that in Canada, they let others do the growing to avoid being large-scale farmers so that they can focus on developing research and providing CBD to international markets on several continents, with populations totalling 4 billion people and a total GDP over USD$11 trillion.
‚ÄúThe other issue is convincing multigenerational industry participants that ‚Äėbig business‚Äô is not a bad place to go work and transfer this very valuable knowledge,‚ÄĚ says Malik. ‚ÄúIt is the way forward if the grey market transitions over early enough because these long-standing advocates/participants can have a great deal of influence in how the new ‚Äėlegal‚Äô market is shaped.‚ÄĚ
The company‚Äôs success couldn‚Äôt have been achieved without a strong and knowledgeable leadership team steering the company in the right direction.
The company was founded by cannabis industry experts who helped fund many of Canada‚Äôs best-known cannabis companies. The leadership team consists of professionals with expertise in both medicinal and recreational cannabis as well as hemp-derived CBD.
Director Steven Poirier is the former President of Moosehead Breweries and SVP of Constellations Brands. He brings his 25 years of experience in the highly regulated wine, beer and spirits industry and success in building a small provincial beer brand into a major national player to the Biome Grow team as they look to replicate that same success on with consumer brands like Nova Scotia’s Highland Grow and Newfoundland-Labrador’s Back Home.
Malik elaborates, ‚ÄúBiome‚Äôs team also has the local contacts that others don‚Äôt to move projects forward in many countries in the developing world where populations greatly exceed the 36 million people in Canada.‚ÄĚ
A model for the future
Targeting specific medical conditions and then building a pharmaceutical and clinical infrastructure around that is how Biome Grow seeks to provide accessible cannabinoid therapies on large international scales.
Efficiency concerning sustainable practices is also a large part of Biome‚Äôs model. This comes from identifying partners across various countries that can add to the company‚Äôs global cannabis supply chain. Filling these gaps and creating strong links will improve industry exposure and presence in an increasingly competitive market.
Want to learn more about Biome Grow? Khurram Malik discusses the importance of considering international avenues for Canadian cannabis companies in this thought leadership video below.¬†