CVS Health Corporation is one of the world’s largest retail pharmacies and health care companies. Consumer Value Stores was founded by the Goldstein brothers, Stanley and Sidney, and Ralph Hoagland in 1963. After joining the Melville Corporation, CVS spun off from it in 1996 and became its own organization, trading on the New York Stock Exchange.
Today, CVS Health is one of the top ten companies on the Fortune 500 with over $180 billion in annual revenue. It was only a matter of time before the corporate giant got involved in CBD and it recently announced details of its plans to stock CBD topicals in eight of its American stores.
Jumping on the Bandwagon
Soon after CVS’ announcement, one of its main rivals, Walgreens, also stated its intention to sell CBD products in its stores. Obviously, it is fantastic news for the cannabidiol sector that enormous pharmacies are allowing it to be sold in their stores. It is a sure sign that CBD has entered the mainstream; just a few years after it was dismissed as nothing more than a fad and a novelty item.
Like Walgreens, CVS is somewhat cautious in its initial foray into the CBD sphere. It has over 10,000 locations in the U.S. alone, but CBD will only be available from a relatively small percentage of CVS stores in the following eight states: Illinois, Colorado, Alabama, California, Kentucky, Tennessee, Maryland, and Indiana.
It is also important to note that neither edibles nor CBD-derived supplements will be available. However, customers can purchase lotions, roll-ons, sprays, salves, and creams. In many ways, it is not a surprise that major pharmacies are getting involved in CBD in 2019. At the end of 2018, the Farm Bill made it legal for Americans to grow industrial hemp.
Since CBD can be extracted from hemp, it is easier than ever for suppliers to get hold of premium-grade cannabidiol. The CBD market itself could be worth as much as $22 billion within three years. CVS has joined other renowned health and beauty companies such as DSW, Free People, Authentic Brands Group, Neiman Marcus, and Sephora, who have all become involved in CBD.
What CBD Brands is CVD Selling?
Once CVS unveiled its plans to sell CBD products, suppliers of the cannabinoid knew that being named as a partner was akin to finding the golden ticket in Willy Wonka and the Chocolate Factory. Elevate CBD is one of the biggest beneficiaries of the news as the firm’s CBD-infused pain relief cream will be sold in over 1,500 CVS stores.
The cream is full-spectrum, which means it contains several cannabinoids including CBD, but crucially, it contains less than 0.3% THC, the maximum legal limit. Each 4oz tub contains 140mg of cannabinoids and is available for $39.99. It is designed for pain relief, and proponents say it does an excellent job of treating their aching muscles and joint pain. Choose between Cooling or Warming cream.
Medterra is another big winner, as CVS announced that it would be selling the California-based brand’s topical cooling cream. According to the CEO of Medterra, Jay Hartenbach, an alliance with a huge drugstore chain will help familiarize Americans with natural alternatives to painkillers.
Medterra is a relatively new company, having only been formed in 2017, but it already has more than 70 employees. The cooling cream that will be available in CVS is a combination of CBD and other certified organic ingredients. The brand claims that its cream provides users with a cooling feeling which makes it ideal for sore joints and muscles.
There are well over 20 ingredients in the cream including sunflower seed oil, cetyl alcohol, grapefruit seed extract, xanthan gum, and Arnica flower oil. According to Medterra, the cream contains 99.6% pure CBD. Choose between the 250mg tub for $49.95 or the 750mg tub for $89.95.
Hartenbach is excited by the prospect and is thrilled that Medterra was chosen because he knew CVS was looking for industry leaders. Obviously, a huge brand such as CVS is not going to be affiliated with low-grade CBD products, so being selected to stock products in CVS stores is a huge boost for any company.
As part of the deal, Medterra’s CBD products will be placed in the front of the store on end caps; a tactic designed to ensure the cream is highly visible to customers. Medterra is planning a major digital advertising campaign to help increase custom. It is the first time the brand has used ads to target customers anywhere outside of its website. Medterra is working with Cluep, a mobile ad platform, to geo target anyone within three miles of a CVS store potentially interested in a special limited offer coupon.
To get an idea of how big a deal it is to be selected, Medterra is likely to increase its annual revenue from $4 million to $92 million in a year!
Curaleaf is yet another CBD brand that will have its products stocked in CVS stores. According to Joseph Lusardi, the CEO of the company, Curaleaf products will be available in 800 stores at first, with the expectation of the number increasing. CVS is selling Curaleaf patches and hemp lotions.
It is more good news for the company which has expanded into the lucrative Nevada and California markets after acquisitions. It now operates 40 dispensaries in 12 states, and the exciting news caused Curaleaf’s share price to rise sharply. Revenue for the quarter was $32 million; a startling increase on the $6.3 million figure from the previous year. In the last three months, its stock has risen by over 50%.
Overall, the news is yet another boon for an industry that appears to have the momentum of a runaway train. For all the hype, CBD is a nascent industry, and the general public remains relatively uneducated as to what cannabidiol can do for them. In the United States, CBD brands are unable to advertise on social media even though it is now okay to grow industrial hemp.
We hope that having colossal corporations such as Walgreens and CVS throwing their weight behind CBD will help the industry move forward. CVS is a brand that takes pride in its status as a health care heavyweight. In 2014, it was the first national pharmacy to stop selling tobacco products.
Its latest venture could provide the seal of approval that the industry desperately needs. It is a crucial period for CBD sector, not least because of the FDA’s first public hearing on cannabidiol scheduled to take place in April 2019. As Hartenbach says, placing CBD under the microscope is in some ways a huge risk to the industry; but it could be the very thing to help it completely take off.