Dive Brief:
- Pabst Labs announced the initial launch of its Pabst Blue Ribbon Cannabis Infused Seltzer to customers in California at dispensaries and online, according to an emailed release. Pabst Labs is a licensed cannabis company founded by former Pabst Brewing Company employees and cannabis experts who were given the rights to develop a line of cannabis-infused beverages under the Pabst Blue Ribbon name.
- Each 12 oz nonalcoholic seltzer can contains 4 grams of sugar, 25 calories and 5 milligrams of THC. The lemon seltzer is the only flavor available now, but the company said additional flavors are in development.
- This is one of the first alcoholic beverage companies to allow its brand name on a cannabis drink. Mark Faicol, Pabst Labs brand manager, said in a statement that „the entry of an established brand can help kick-start the cannabis drinks category.”
Dive Insight:
Cannabis drinks are slowly entering the mainstream in the U.S. Although many are waiting for greater clarity in federal regulations, more companies could enter the space sooner if this launch of a THC drink touting the well-known PBR brand name does well.
Pabst Blue Ribbon has been moving beyond beer lately by launching into other drink categories, similar to other beer and alcohol giants who have turned to innovation as sales for traditional brews decline. Last year, Pabst Blue Ribbon launched a stronger hard seltzer onto the market and also market-tested a 5% ABV hard coffee made from fermented malted barley and coffee. Earlier this year, it launched a Pabst Blue Ribbon Hard Tea.
Now the company is licensing its name and signature blue ribbon to one of the upcoming trends in the space: cannabis beverages. But CNN reported that no money was involved in the licensing agreement and Pabst Brewing doesn’t have a stake in Pabst Labs, which is its way of avoiding any regulatory risk associated with the substance.
„Until the legal landscape changes, we can’t produce this in-house,” Seamus Gallagher, Pabst Blue Ribbon’s senior brand manager, told CNN Business.
Across the food and beverage category, big companies like Coca-Cola and Monster Beverage have expressed interest in CBD, but many are waiting for FDA approval. The 2018 Farm Bill allowed hemp and its derivatives to no longer be classified as controlled substances, but it is still federally illegal to add CBD to food and drink. It’s been well over a year since the FDA’s first public hearing on CBD, where manufacturers pushed for more clarity, and the FDA has since released an update saying it could not yet give the ingredient generally recognized as safe status. Although more states have developed their own regulation, allowing for more companies to market-test products, the FDA has continued to issue warning letters to companies improperly using or advertising CBD.
Interest in these products is growing though. An A.T. Kearney study found that 30% of Americans are willing to try a cannabis-infused nonalcoholic beverage. In Canada, where cannabis-infused food and beverage is now legal, Canopy Growth has sold more than 1.5 million cans of its THC-infused ready-to-drink beverages. Last week, Canopy announced it will be launching cannabis-infused beverages in California and Illinois next year through its partnership with Acreage Holdings. Constellation Brands has a 39% stake in Canopy Growth. Beer giants like Molson Coors and AB InBev have also made investments and formed partnerships to launch CBD drinks.
Other beverage companies have launched or are preparing to launch cannabis-infused drinks into their portfolios too, but with different names on their labels. CarryOn, a new brand launched out of Ocean Spray’s Lighthouse Innovation Incubator, recently released a line of sparkling CBD water in Colorado as its first test market. Arizona Beverages and cannabis company Dixie Brands entered into a partnership last year for the production, distribution and sale of THC-infused products. And Bolthouse Farms was planning to launch a line of CBD beverages this year that also used California as its test market, but the company delayed it because of the regulatory environment.