Coca-Cola, which started out in 1886 offering a cocaine-infused tonic for medicinal purposes, may become the latest major brand to enter the marijuana market, after Bloomberg reports that the Atlanta-based company has been monitoring the cannabis industry for potential partnerships.
In particular, the company is said to be looking at drinks infused with CBD - the non-psychoactive cannabis compound that treats everything from pain and inflammation to epilepsy, but doesn't get you stoned.
The Atlanta-based soft drinks maker is in talks with Canadian marijuana producer Aurora Cannabis to develop the beverages, according to a report from BNN Bloomberg Television. -Bloomberg
"We are closely watching the growth of non-psychoactive CBD as an ingredient in functional wellness beverages around the world," said Coca-Cola spokesman Kent Landers. "The space is evolving quickly. No decisions have been made at this time."
The discussions with Aurora are focused on CBD-infused drinks to ease inflammation, pain and cramping, according to the BNN Bloomberg report. CBD, or cannabidiol, is the chemical in the pot plant often used for medicinal purposes, and doesn’t produce the high that comes from THC, or tetrahydrocannabinol. There are no guarantees of any deal between Aurora and Coca-Cola, according to the report. -Bloomberg
News of the potential partnership with Aurora sent shares skyrocketing as high as 23% on Monday, while other pot-stocks felt the good vibes as well. Canada's Tilray was among the winners, after recently getting hammered after Politico reported on Thursday that Canadians may face a lifetime ban from the United States for admitting to pot use.
Getting in on the liquid green gold rush
Coke joins several other beverage makers trying to capitalize on cannabis as their traditional businesses slow.
Last month, Corona beer brewer Constellation Brands Inc. announced it will spend $3.8 billion to increase its stake in Canopy Growth Corp., the Canadian marijuana producer with a value that exceeds C$13 billion ($10 billion).
Molson Coors Brewing Co. is starting a joint venture with Quebec’s Hexo’s Corp., formerly known as Hydropothecary Corp., to develop cannabis drinks in Canada. Diageo PLC, maker of Guinness beer, is holding discussions with at least three Canadian cannabis producers about a possible deal, BNN Bloomberg reported last month. Heineken NV’s Lagunitas craft-brewing label has launched a brand specializing in non-alcoholic drinks infused with THC, marijuana’s active ingredient. -Bloomberg
Aurora spokeswoman Heather MacGregor tells Bloomberg that the cannabis producer has expressed "specific interest in the infused-beverage space, and intends to enter the market," as Bloomberg's David George-Cosh reported.
Despite marijuana remaining illegal at the federal level, there is a growing acceptance of CBD-based treatments, as legitimate treatments for everything from pain management to epilepsy have garnered broad support, as well as healthy investments in the pharma space.