The legal marijuana industry may still be in its infancy but it’s already big business, at least in terms of its perceived potential and the amount of investment the sector is attracting. Even if the bottom lines of companies earning their crust in the space still leave something to be desired. But as more territories legalise the cannabis plant in its different forms, either for medical use or recreational, the sector’s value is growing quickly. Arcview Market Research forecasts a market value of $22 billion by 2021.
The legal cannabis industry can be roughly broken down into three main sub-sectors – medical, recreational and cannabis-based products that are not ingested. The latter can include clothing and other products made from hemp fibres or products that use the oils that the plant is rich in. Those include products such as candles and soaps and a growing industry of cannabis-based cosmetics. And piggy-backing on the publicity and hype around the ‘miracle’ properties of the plant, cannabis cosmetics might just have the potential to match the scale of the markets for ingested medical and recreational marijuana.
Creams, lotions and potions that contain cannabis as an active ingredient typically use the strain of the plant used in medical marijuana – that which contains the cannabidiol CBD. It doesn’t contain THC, the psychoactive element associated with the ‘high’ of recreational use. One of the early leaders in the new market is MGC Derma, a daughter company on MGC Pharmaceuticals that develops cannabis-based medical treatments for a range of conditions including forms of autism and Alzheimer’s. MGC Derma was created to develop and market skincare products that exhibit the same anti-inflammatory properties of CBD the Pharma-focused parent bases its medicinal cannabis-based drugs.
MGC Pharma chief executive Roby Zomer explains:
“We developed skincare because we could see the benefits of the anti-inflammatory ingredients on our pharmaceutical side. Cannabis as a plant has so many different compounds — whether for skincare or to treat anxiety, you should have it on your bathroom shelf just like a vitamin B complex or zinc. The skin is the biggest organ, and faces the most harmful environment on a daily basis, so it needs to be able to fight pollution, sensitivity and itchiness.”
The science behind the benefit of CBD-rich cannabis in cosmetics is that the oil that comes from is ‘non-comedogenic’, which means it doesn’t block the skin’s pores.
It is also rich in antioxidants including vitamin E, fatty acids which help hydrate the skin and anti-inflammatory properties. However, scientists also caution that more research is required before definitive evidence of CBD oil’s cosmetic benefits can be claimed. Biochemists agree the make-up of CBD oil means it has potential as a key ingredient in cosmetics, particularly for skincare. But they also caution there is not yet enough research into products to determine whether benefits are derived from cannibidiols or from other ingredients they are combined with in individual products.
Before those investing online rush out to look for public companies with exposure to the cannabis cosmetics industry, it still faces challenges that are likely to temper its growth in the short term. While the trend around laws that restrict or prohibit marijuana is towards them being relaxed, there are still significant restrictions that make the distribution and sale of products that include CBD oil difficult in many territories. A significant section of the potential consumer market will still be put off buying cannabis-based products because of the historical stigma around the plant. Many will still feel that being seen to buy CBD-based cosmetics will lead to the automatic assumption they are a ‘stoner’.
But times are a’changin’. CBD oil and other cannabis-derived compounds look like carving out a reputation as the next ‘hip’ ‘super plant’. There’s money in them there fields!