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Photos courtesy Prūf Cultivar

Best of 2019: Cannabis Manufacturing

by Eric Peterson on December 19, 2019, 07:51 am MST

States that reformed cannabis laws simultaneously opened a whole new frontier in manufacturing. As the black market for cannabis comes into the light, a backlog of innovation has spilled out in the form of a seemingly endless line of innovators manufacturing with cannabis and hemp.

From genetically engineered yeast that produce THC to industrial-capacity extraction powerhouses, the following companies are the 10 manufacturers that captured the attention of the CompanyWeek Cannabis Manufacturing Report in its first year of publication.

CB Therapeutics

The San Diego company is breaking new ground: Using bioengineered microorganisms, CB Therapeutics can synthesize THC, CBD, and other cannabinoids in a lab instead of a grow house.

After moving into a 7,000-square-foot facility in March 2019, the company subsequently closed on $7.5 million in equity funding to take the platform to the next level. 

CEO Sher Butt likens production to brewing beer. "There's a lot of fermentation and analytical testing equipment. It's like a high-tech brewery," he explains.

Next up: CB Therapeutics' platform can be used to produce psilocybin and other psychedelics, opening up another potential market for the company.

Boulder Botanical & Bioscience Labs

CompanyWeek contributor Gregory Daurer's January profile of the Golden, Colorado-based manufacturer highlighted an ongoing trend: As CBD takes off nationally, manufacturers are scaling up in a big way to meet demand.

Co-founder and COO Maruchy Lachance says BBB Labs attracted an angel investor -- a billionaire whose name Lachance will not reveal -- who saw CBD's effectiveness within his own family, and his own life. "Whatever you guys are doing I want in on," he told them. Now BBB Labs is leasing a 27,000-square-foot, $6 million facility in Golden previously owned by GE Healthcare.

The company currently produces 150 SKUs of CBD products, ranging from nutraceuticals to tinctures to pet products.

PurePressure

Daurer's May profile of the Denver-based extraction equipment manufacturer illuminates a road less taken: solventless extraction that's accomplished by way of heat and pressure instead of butane or carbon dioxide. PurePressure makes rosin presses that can deliver eight tons of force and 300 degrees F of heat to mechanically push the oils out of flower and hash.

To create hydrocarbon extractions, founder Ben Britton points out that there's more complicated and expensive equipment needed, and the hydrocarbon-extraction makers needs to work within ventilated, specially-designed, explosion-proof rooms that meet government safety codes. 

Using PurePressure machines, Britton adds, "You might save $250,000 to $1 million just in licensing alone, because you're not dealing with those higher [regulatory] standards."

Mile High Labs

As for the scaling trend, it's impossible to ignore Mile High Lab's $65 million buy of CBD-rich hemp. 

That's more than 800 tons, according to Daurer's July profile of the Boulder, Colorado-based companuy, and the mountain of biomass needs a similarly beefy extraction solution. Founder and CTO Stephen Mueller is the mastermind behind the Mile High Monster, a "modular extraction facility" that converts hemp into CBD extract. 

Mueller says that each machine can extract the CBD for 100 million products a year, adding, "Our [isolate] product goes into hundreds of different brands out there." He also told Marijuana Venture that Mile High Labs "supplies about 25 percent of the wholesale CBD market" as of May 2019.

Lab Effects

Daurer interviewed founder and CEO Scott Holden as the company emerged from under the radar to promote its catalog of terpenes, the aroma molecules within plants. 

By way of steam distillation, Golden, Colorado-based Lab Effects separates these compounds from biomass and distills them into a purer form, preparing them afterward in a variety of ways so that they can be added to different types of products from THC and CBD manufacturers as well as distilleries and breweries.

Shift Cannabis

CompanyWeek contributor Jan Evans' looked at Shift's vertically integrated operation, with a cannabis farm in Ridgway, Colorado; manufacturing in Commerce City; and the HQ in Boulder.

After a stint as a cannabis consultant, founder Travis Howard pivoted Shift to manufacturer vape cartridges, cannabis extracts and concentrates (including bulk oil to edibles manufacturers), and packaged flower.

Shift's culture is a focal point for Howard: "We wanted the professionalism that Wall Street brought -- as well as the capital -- but we didn't want to lose the culture, and the heart and the soul of what makes the cannabis industry special. It's gone from 420 as an act of defiance to now an act of celebration. We don't want to forget where that came from."

Prūf Cultivar

Daurer looked at one of the most innovative grows in the country when he interviewed Prūf Director of Production Science Jeremy Plumb in Portland, Oregon, in September. 

The operation leverages technology ranging from robotics to AI: A Plumb-designed system called PrūfOS is an environmental control system that uses high-density sensors in a network to track "all variables in the growing environment that we can measure," he says.

The approach is paying off: Since starting at Prūf in 2017, Plumb says, "Our cost of production has gone down tremendously; our product yield -- and useful part of the product yield, which is flower versus trim -- has gone up tremendously; our quality has gone up . . . in every measurable regard; and our labor has actually gone down."

iUNU

Founder and CEO Adam Greenberg grew up in an orchid-growing family, so he's essentially been in R&D for iUNU his entire life. 

The Seattle-based company's LUNA system uses autonomous robotic cameras mounted on rails to monitor greenhouses 24/7 with AI-driven computer vision. 

LUNA take cues from manufacturing, says Greenberg. "There's a lot to be learned from manufacturing. To ignore that would be foolish," says Greenberg. Farmers recently "went from handwritten on tablets to handwritten on paper. Then with the advent of Xcel, it added some value, but now it's time to move entirely off papyrus and paper."

Paragon Processing

The macro view was the true catalyst for Paragon's founding in 2018: Due to less barrier to entry, hemp farming has spiked across the country. "You could see a lot of farms coming online each year," says Matt Evans, Paragon's co-president. "The amount of acreage coming online for hemp is far outpacing what the processing capacities are." 

Those trendlines led Paragon to take over a 250,000-square-foot facility once used by Columbia House for compact disc storage in Colorado City, Colorado, about 20 miles south of Pueblo. A more recent incarnation as an FDA-registered food manufacturing facility meant it had infrastructure that would translate to hemp. "They built a beautiful storage facility. It's fully climate-controlled, fully fire-sprinklered," says Evans. "It's got a massive firewall between the storage area and the manufacturing side, and the floors are 18-inch-thick concrete."

Periodic Edibles

Daurer spoke with Wayne Schwind, founder of the Portland, Oregon-based cannabis caramels manufacturer for a November profile. The first mover has sold about 350,000 caramels through more than 200 dispensaries in its first five years.

In an age of high-tech extraction, Periodic Edibles takes an old-fashioned approach: The company's crew infuses cannabis into heated butter, which leads to a full-spectrum product in which the plant's terpenes and cannabinoids haven't been stripped away during the extraction process. "That's the key piece that consumers are really just starting to figure out: It's that synergistic effects of multiple compounds from that strain [that enhance the benefits], not just the singular [molecules] THC or CBD."

Eric Peterson is editor of the CompanyWeek Cannabis Manufacturing Report. Contact him at rambleusa@gmail.com.

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