“We saw an opportunity,” Jim Kras, chief marketing officer of Inergetics, told NutraIngredients-USA. “Working in the dietary supplement business as I have, you see that over time there is not a lot of innovation. So it’s exciting when you have an opportunity like this that is new, and is something that can help people with a whole new range of conditions such as sleep disorders, glaucoma or pain.”
Barriers to market entry
Cannabidiol, or CBD, is a non-narcotic fraction of cannabis sativa that has been studied for its effects on a variety of conditions. The most well researched indication appears to be as an anti-seizure agent. None of those indications, however, seem amenable to the sort of claims that can be made on a dietary supplement product in the US. So what claims does Inergetics plan to make on the new supplement?
“None,” Kras replied. The supplement will communicate its CBD content, and let the customer infer what that that means for his or her health, similar to the way probiotics are now marketed in Europe.
“We are making no claims because we are very early in the ingredient’s life,” he said. “It will be like other ingredients like Garcinia cambogia where people are aware of the ingredient but aren’t really associating it with a brand.”
Then there is the question of the origin of the CBD itself. The US Drug Enforcement Agency has Cannabis sativa listed as a Schedule 1 substance, and some observers have opined this applies to the whole plant, not just THC, the narcotic fraction thereof. But industrial hemp, or Cannabis sativa cultivars that are very low in THC (less than 0.05% is the usual regulatory definition) is legal to import into the US, and is even being grown in some states on a pilot project basis. Inergetics derives its CBD from hemp imported from Europe and is comfortable with the product’s regulatory positioning at the moment, Kras said. Expansion of the market footprint beyond dispensaries will have to wait more clarity on the overarching regulatory picture for the plant, he said.
Inergetics, which already markets dietary supplement lines such as Martha Stewart Essentials and Bikini Ready, has an intimate relationship with a number of supply and manufacturing partners that have cooperated to bring the new supplement to market, Kras said. This relationship is more entwined than the usual contract manufacturing situation, he said.
“There is a lot more involved here than just going to a powder plant and giving them a supplements facts panel and saying this is what we want. For example, we made an investment that helped make a supercritical CO2 machine possible,” Kras said.
That buildup work on the formulation helped make a powdered, encapsulated supplement product possible, Kras said. Inergetics is packing the new supplement in 10-capsule blister packs. CBD products available on the market up to now have been in liquid form, and frankly required a lot of willpower on the part of the consumer to take. The extracted ingredient, without further processing, is a strongly smelling, tar-like substance. Even with the processing that allows Inergetics to get the ingredient into a powder form for capsules, that’s where the CBD buck stops for now, Kras said.
“I love the functional food aspect of our business but right now, to be honest with you, I’m not sure how you could mask that taste and smell,” he said.