BUSINESS Bloomberg Businessweek July 22, 2019BigWeedHasa
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GROUP theirTHEBOTTOMefficacy,CBDLINEproductsDespiteforthepetspaucitycouldofaccountformalresearchfor7%ofaboutthe
$24billionin annualsalesforecastforCBDgoodswithinfouryears.
Nadia Knight, a health-care worker from Portland,
Ore., says vets in her area refused to talk about CBD,
so she consulted “Dr. Google” before beginning to
give her poodle mix CBD oil twice a day earlier this
year. The dog’s near-daily vomiting episodes have
all but stopped. Akanah Fallanassi, an animal care-
taker in Germany, gives both his Goffin’s cocka-
toos CBD to ease anxiety that would normally have
them chewing their feathers. For Karen Hayton of
Vancouver, the hemp extract is a better alternative
for her Havapoo than sedatives to calm the stress of
going to the groomer. “It seems to relax him with-
out making him spaced-out,” she says.
In recent years, growth in the $130 billion global
pet market has been fueled by dog and cat own-
ers’ willingness to spend heavily on premium prod-
ucts, such as grain-free foods or organic treats.
Companies are wagering that CBD will become the
next profit-boosting premium ingredient.
The $400 million pet CBD market is fragmented:
Startups are finding customers online and getting
their products into some stores, while the large com-
panies that dominate the pet market are waiting for
the regulatory situation to be clarified. For example,
at one of the larger U.S. brands, Therabis, a unit of
the Denver-based marijuana company Dixie Brands
Inc., co-founder Chuck Smith partnered with a vet-
erinarian to create dog CBD products. The compa-
ny’s Calm and Quiet, Up and Moving, and Stop the
Itch have been on the market since 2017 and are sold
in more than 100 stores.
Small brands could become buyout targets
for the world’s biggest pet food sellers, includ-
ing Mars, Nestlé, General Mills, and J.M. Smucker.
Canopy Growth Corp., the world’s largest mar-
ijuana company, has partnered with Martha
Stewart to develop CBD pet products. “Once the
Purinas enter the space, they’re going to buy these
guys out or take over major retail channels,” pre-
dicts Jamie Schau, a CBD research manager at
Brightfield Group. Nestlé, the No. 2 pet-care com-
pany behind Mars, started selling a line of CBD
products in April, offering capsules, oils, and
sprays under its Garden of Life brand, which it
acquired in 2017. One product, a 1-ounce bottle of
peanut butter-flavored drops, sells for $35.99 on
its website. Purina, Nestlé’s top pet brand, says it’s
considering making CBD dog food.
Vets are prohibited by law from recommend-
ing CBD, according to Jim Penrod, executive direc-
tor of the American Association of Veterinary State
Boards. Absent formal advice, pet owners are devel-
oping do-it-yourself cannabis dosing programs, fall-
ing back on a basic premise: It seems like the stuff
works, and there’s little risk of harm.Anecdotal results are promising, but more
research is needed to figure out if CBD can truly
treat such things as pain and seizures in dogs, says
Stephanie McGrath, a professor at Colorado State
University’s veterinary teaching hospital who’s
doing a clinical study on CBD. McGrath is relatively
comfortable that the substance is safe for dogs,
at least in the short term. But that assumes the
hemp extract is free of contaminants and THC, the
compound in hemp and marijuana that produces
a high and is known to be harmful for dogs. She’s
also skeptical of marketing that’s positioned CBD
as a wellness panacea for pets. “The owners want
to believe that it’s helping,” she says. “There’s a
huge placebo effect.”
Such skepticism isn’t likely to slow CBD’s march
into pet stores. Gregory Baumel, a chef who founded
Cozy Bones, a line of CBD dog treats ($22 for a dozen)
made in Brooklyn, N.Y., is sanguine about the poten-
tial downsides of giving cannabis to a canine: “The
worst thing that can happen? It will get the best nap
of its life.” —Corinne Gretler and Craig Giammona○ As VCs and corporate money move in, women
say they’re being pushed asideWhen Nancy Whiteman, 61, founded her marijuana
edibles company, Wana Brands, almost a decade
ago in Boulder, Colo., the legal industry was rel-
atively diverse and dominated by local startups.
It helped that Wall Street banks and institutional
investors took a hands-off approach to cannabis,
leery of getting involved with a drug that’s still
banned by the federal government. “It was a pretty
even playing field for everybody—men, women,
anybody who was interested,” Whiteman says.
These days, however, the industry is increas-
ingly dominated by men. The influx of venture
money and Wall Street dollars, in addition to the
rise of larger companies operating in several states,
has made things harder for startups and, by exten-
sion, female-led businesses. In 2015, 36% of pot○ Whiteman○ Estimated size of
the pet CBD market2018
2019
2023
$1.7b