Charlotte's Web Secures Health Canada Approval to Bring its Proprietary CBD Cultivars to Canada

Rhea-AI Summary

Charlotte's Web Holdings announced the approval of three of its proprietary hemp cultivars for outdoor cultivation in Canada by Health Canada. This marks a significant step for the company as its CW1AS1 variety, among others, will enable the cultivation of CBD products within Canada's shorter growing season. Currently, CBD products from the U.S. face import restrictions into Canada. The approved cultivars aim to address the underdeveloped hemp CBD market in Canada, potentially opening access to Charlotte's Web products and expanding its growth opportunities.

Positive

• Approval of three proprietary hemp cultivars by Health Canada, facilitating outdoor cultivation.
• Enhancement of market access for Charlotte's Web products in Canada, addressing local demand for quality CBD.
• Opportunity to leverage early maturing cultivars suitable for Canada’s growing season.

Negative

• Limited availability of CBD products in Canada due to existing import restrictions.
• Current Canadian regulations treat hemp CBD similarly to more regulated THC cannabis, hindering market development.

Charlotte's Web added to Health Canada's List of Approved Cultivars (LOAC) for Cultivation in 2021

BOULDER, Colo., April 20, 2021 /PRNewswire/ - Charlotte's Web Holdings, Inc. ("Charlotte's Web" or the "Company") (TSX: CWEB) (OTCQX: CWBHF), a certified B Corporation and the market leader in  hemp CBD extract products, today announced that three of its proprietary hemp cultivars were approved for registration on Health Canada's List of Approved Cultivars ("LOAC") for outdoor cultivation in Canada.  These are among the first hemp CBD cultivars on the LOAC that are early flowering and early maturing for outdoor cultivation and harvesting within the shorter Canadian growing season. The approved cultivars include the Company's original "CW1AS1" U.S. patented genetics, clearing the way for Charlotte's Web to cultivate its leading CBD wellness products in Canada in 2021. Currently, Charlotte's Web Products are not easily available in Canada because laws do not allow for bulk importing of USA grown hemp CBD or related products into Canada.

"Today, Charlotte's Web is the leading hemp wellness company in the U.S. with the most recognized and trusted hemp CBD extract," said Deanie Elsner, Charlotte's Web president and CEO. "We aspire to be the world's leading botanicals wellness company, entering countries with an asset light model where federal laws permit hemp extracts for health and wellness. Israel and Canada are included in the first steps of our international expansion." 

In addition to the Company's CW1AS1 cultivar used for its leading Original Formula and other full-spectrum hemp extract products, Charlotte's Web is bringing two early maturing hemp varieties to Canada – named "Duchess" and "Ambassador" - developed for cultivation in shorter northern climate growing seasons. 

Charlotte's Web's approved cultivars are three of 15 added to the 2021 LOAC.  "The majority of approved cultivars on the LOAC to date have been for industrial hemp grown to produce food, fiber, and animal feed. Now our approved cultivars are paving the way for full-spectrum hemp CBD demand in Canada and most importantly, will provide access to Charlotte's Web products in Canada¹," explained Jared Stanley, co-founder and chief cultivation officer of Charlotte's Web.

Hemp-Derived CBD in Canada

Despite Canada being one of the first countries to federally legalize the sale of cannabis, the hemp CBD wellness category is underdeveloped in Canada, with limited offerings of quality full-spectrum hemp extract products¹.  Most CBD products in Canada are produced from cannabis with THC levels well above 0.3% which have an intoxicating effect. Charlotte's Web hemp cultivars are cultivated below 0.3% THC, resulting in full-spectrum extracts with wellness benefits, but without the intoxication from THC.

Currently, Health Canada treats hemp CBD under the same regulatory regime as cannabis THC. The Canadian hemp industry is lobbying the Canadian federal government to change the regulations for hemp CBD to a natural health supplement that could be added to food, drinks, cosmetics and other wellness products. Hemp CBD products could then be sold in all types of retailers across Canada, which would help meet demand for the product. In September 2020 a report prepared by the Institute of Fiscal Studies and Democracy¹ (IFSD) concluded that if Ottawa regulated CBD like regular health products it would open an annual market worth more than C$2 billion with immense potential for exporting CBD to other countries.  

About Charlotte's Web Holdings, Inc.
Charlotte's Web Holdings, Inc., a Certified B Corporation headquartered in Boulder, Colorado, is the market leader in the production and distribution of innovative hemp-derived cannabidiol ("CBD") wellness products under a family of brands which includes Charlotte's Web™, CBD Medic™, CBD Clinic™, and Harmony Hemp. The Company's premium quality products start with proprietary hemp genetics that are 100-percent American farm grown and manufactured into whole-plant hemp extracts containing a full spectrum of naturally occurring phytocannabinoids including CBD, CBC, CBG, terpenes, flavonoids and other beneficial hemp compounds. The Company's CW Labs R&D science division is located at the University at Buffalo in New York which is part of the State University of New York (SUNY) system of 64 universities. Charlotte's Web product categories include CBD oil tinctures (liquid products), CBD gummies (sleep, stress, inflammation recovery), CBD capsules, CBD topical creams and lotions, as well as CBD pet products for dogs. Charlotte's Web is the number one CBD brand in the USA and is distributed through more than 22,000 retail locations, select distributors and online through the Company's website at

www.CharlottesWeb.com.   

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^1. Institute of Fiscal Studies and Democracy (IFSD) at the University of Ottawa: "Assessing the Economic Impact of Regulating CBD Products as Health Products" September 14, 2020.

Forward-Looking Information
This news release contains forward-looking statements and information within the meaning of applicable securities legislation. Often, but not always, forward-looking statements and information can be identified by the use of words such as "plans", "expects" or "does not expect", "is expected", "estimates", "intends", "anticipates" or "does not anticipate", or "believes", or variations of such words and phrases or state that certain actions, events or results "may", "could", "would", "might" or "will" be taken, occur or be achieved. Forward-looking statements or information involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of Charlotte's Web to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements or information contained in this news release.

Risks, uncertainties and other factors involved with forward-looking information could cause actual events, results, performance, prospects and opportunities to differ materially from those expressed or implied by such forward-looking information, including assumptions as to the efficacy and results of research; and the adverse impact of the COVID-19 pandemic to the Company's operations. These foregoing lists are not exhaustive. Additional information on these and other factors which could affect the Company's operations or financial results are included in the Company's most recent annual information form and other public documents on file with the Canadian Securities regulatory authorities on www.sedar.com. 

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SOURCE Charlotte's Web Holdings, Inc.

FAQ

What cultivars did Charlotte's Web receive approval for from Health Canada?

Charlotte's Web received approval for three proprietary hemp cultivars, including CW1AS1, Duchess, and Ambassador.

How will the approval of cultivars impact Charlotte's Web's operations in Canada?

The approval allows Charlotte's Web to cultivate its CBD products in Canada, increasing market access and potentially enhancing sales.

What are the regulations surrounding hemp CBD in Canada?

Hemp CBD in Canada is currently regulated similarly to cannabis with THC, limiting its market development and availability.

What market potential exists for hemp CBD in Canada?

A report suggests that if regulated as a natural health supplement, the hemp CBD market in Canada could exceed C$2 billion annually.