This Week in CBD: October 4, 2019

GW Pharmaceuticals created the first FDA-approved CBD-based drug, Epidiolex. Now, the company is turning its attention from seizure disorders to autism. The cannabis pharmaceutical company is currently conducting a new clinical trial at Montefiore Medical Center in New York which will examine the effects of CBDV, or cannabidivarin, on autism spectrum disorders.

CBDV is molecularly distinct from CBD, though the two are closely related. And the success of Epidiolex for seizures has inspired researchers to wonder about using cannabinoids for autism. 

According to Dr. Eric Hollander, director of the Autism and Obsessive Compulsive Spectrum Program at Montefiore Hospital:

In some of the animal models that are similar to autism, it was found that CBDV had important effects on social functioning, on decreasing seizures, on increasing cognitive function, and in reducing compulsive or repetitive behavior. So for that reason, we wanted to apply that to autism.

There is cautious optimism in the medical community about cannabis-based medicine treating autism behavior. CNN’s recent report on the subject cites Dr. Alexander Klevzon, clinical director of the Seaver Autism Center at Mount Sinai: 

CBD may be helpful for only a subset of people and it may benefit different people in different ways. The challenge is to figure out which patients are likely to respond, and which symptoms are most likely to improve.

We’ve probably all heard by now that the CBD industry is the new “wild west.” It’s hard to know what’s in a given CBD product, especially if a company isn’t diligent about providing third-party lab tests to prove the contents of their products.

That may be about to change for residents of Illinois.  A new bill, proposed by Rep. Bob Morgan, would require all CBD products sold in the state to meet standard testing requirements that would be developed by the Illinois Department of Agriculture.

“This legislation would give the Department of Agriculture the ability to step in to make sure we are selling products that are safe for people to use,” Morgan said.

If the bill is passed, any untested products would have to be removed from store shelves and online shops. Potential fines could start at $1,000 and would go to a newly created CBD Safety Fund, which would be used for enforcement.

The so-called “green rush” is in full swing and more companies are jumping onto the hemp-derived CBD bandwagon every day. But with that explosive growth, growing pains are inevitable, and the industry’s lack of adequate processing infrastructure is becoming evident. 

Crain’s Chicago Business recently reported on the lack of processing equipment which is causing a major bottleneck of raw hemp plants waiting to be processed and turned into extracts. The dearth of processing infrastructure could mean huge losses for farmers, some of whom will have to watch their crops rot in the field. 

With banks showing reluctance to finance hemp and CBD companies, supply chain issues are rampant in the fledging hemp industry. According to the article, California-based extraction machine manufacturer Delta Separations estimates the industry could see $7.5 billion worth of hemp rot in the fields this year.

One of the major issues currently facing CBD companies is landing a payment processor for their shop or website. Payment processors are the go-betweens that handle the movement of money from consumers to businesses. They are essential to running a business that accepts debit or credit cards – and they have been notoriously skittish of the CBD industry.

Square, however, is one payment processor that has been dipping its toes into the industry on an invite-only basis since May. And this week the company announced that they are willing to expand further. 

“We believe everyone should be able to participate and thrive in the economy,” Square said in a blog post. “Today, we’re thrilled to launch our CBD early-access program, which allows businesses in the US to sell CBD products on Square quickly, easily, and securely.”

Access to a domestic payment processor could prove to be a boon to the CBD industry, allowing companies to avoid the high fees of overseas processors.

Oregon State University’s Global Hemp Innovation Center is already the largest of its kind in the nation, and the center just received a hefty gift of $1 million that will help it continue to grow. 

On Tuesday the university announced that brothers Seth and Eric Crawford have decided to invest in hemp research. Their company, Oregon CBD, supplies tens of millions of hemp seeds to the CBD industry.

In a statement, the Crawfords explained their decision: 

There is a tremendous amount of possibility with hemp, and understanding the genetics is key. Philosophically, we believe the public land grant university needs to be the epicenter of that research so that all can benefit from the findings. We believe OSU is the right place to lead this research.

As an illustration of the importance of understanding hemp seed genetics, things went very wrong for a Kentucky-based CBD company this year. After planting a crop of six million hemp seeds, Elemental Processing discovered that what they were seeing coming out of the ground were mostly male hemp plants.

Male hemp plants are not only virtually useless for the purposes of CBD extraction, but they can also ruin a crop of feminized plants by preventing them from flowering. Because of this problem, some experts have proposed that male hemp plants should not be allowed to grow outside.

Those six million seeds that Elemental Procession bought resulted in the total loss their crop, and the company is now suing Oregon-based HP Farms for $44 million dollars to recoup the loss. 

Male hemp seeds generally sell for less than a cent each, while feminized seeds which produce CBD-rich plants, generally sell for a dollar or more. The suit was filed Wednesday in Multnomah County Circuit Court.