CVS Distribution of CBD Products Sends Curaleaf Shares Soarin
By Craig Giammona
March 20, 2019, 2:33 PM PDT
Updated on March 21, 2019, 6:41 AM PDT
CVS Health Corp.this week will begin selling products infused with the trendy, non-intoxicating hemp component at more than 800 of its stores as part of a distribution deal with marijuana companyCuraleaf Holdings Inc., Curaleaf said Wednesday.
Curaleaf announced the agreement during an earnings conference call on Wednesday. The company’s CBD products will be available in about 800 stores to start, Curaleaf said on the call, and hopes to expand to more.
Curaleaf jumped as much as 17 percent on Thursday in Toronto, giving the company a market value of more than $2.6 billion. The stock had already gained 41 percent this year, though it has yet to reach the level where shares were sold in an October private placement that brought the company public through a reverse takeover in Canada.
“We’ve been having dialogue with national retailers for many months now,” Curaleaf Chief Executive Officer Joseph Lusardi said on the call Wednesday. “We’ve got a number of potentially exciting partnerships in the pipeline.”
CVS confirmed that it has started selling CBD creams, sprays and lotions in eight states, including California, Illinois, Colorado and Alabama. The products will be sold in store aisles, and drugstore chain isn’t offering any supplements or food additives containing CBD, a company spokesman said in an email. CVS has almost 10,000 pharmacies worldwide.
The company, which operates more than 40 marijuana dispensaries across 12 states and recently pushed into Nevada and California through acquisitions, has developed a slate of hemp-derived products including lotions, tinctures, vape pens and patches.
CBD, or cannabidiol, which doesn’t get you high, has become a trendy wellness ingredient, gaining popularity as regulations are eased across the U.S. The farm bill passed in December legalized the cannabis compound, opening up a potentially massive market for products made with it.
So far, the U.S. Food and Drug Administration has not approved CBD’s use in food or beverages. But tinctures and other products are sold widely.