In a recent article, we noted that beverage industry giants have announced future plans to explore the CBD beverage market — a market that has an expected valuation of $1.4 billion by 2023.
Since then, one industry giant, PepsiCo, announced a move toward (but not quite into) the CBD-beverage market. Pepsi, which owns Rockstar Energy, announced the launch of its new “Rockstar Unplugged” drink, a hempseed-infused energy drink designed to give its consumers “a new kind of energy.” While not a CBD beverage, Rockstar Unplugged advertises itself in a similar manner (and likely to similar target consumers) as a caffeinated mood booster containing hemp seed.
So, what is the difference between CBD beverages and hemp seed beverages? And why is PepsiCo entering the market with a hemp seed, rather than CBD, beverage? A likely answer is that the demand for CBD-beverages is there, but the legal and regulatory landscape is a minefield. The FDA reiterated its opinion that it needs additional CBD research and safety data before it will consider CBD for uses beyond prescription drugs, including usage as a beverage additive. Hemp seed, however, provides much more legal certainty for beverage manufacturers. The FDA issued a response in three Generally Recognized as Safe (GRAS) notices for hulled hemp seed, hemp seed protein powder, and hemp seed oil, meaning the three ingredients, so long as they meet the specifications in the GRAS notices, can be used as a source of protein, carbohydrates, oil, and other nutrients in beverages, soups, dips, spreads, sauces, dressing, plant-based meat-like products, desserts, baked goods, cereal, snacks, and nutrition bars. In other words, hemp seed beverages such as Rockstar Unplugged may be able to appease, for now, customer demand for cannabis-infused or cannabis-adjacent beverages while skirting the legal and regulatory uncertainty of traditional CBD beverages.
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Bradley's Food, Beverage and Hospitality team understands the unique challenges and needs of these dynamic and competitive industries. From national restaurant chains to craft breweries and from wine and beer distributors to hotel, resort, and club properties, our multidisciplinary team counsels food, beverage and hospitality industry clients on all aspects of the hospitality industry.
Bradley’s Cannabis Industry team is a leading voice in the cannabis sector. The National Law Review recognized our team as a “Go-To Thought Leader” for Cannabis Industry Regulation in 2021. Our attorneys have presented on cannabis issues at conferences around the country and have been quoted in an array of legal and mainstream publications, from Law360 and Westlaw Journal to the Atlanta Journal-Constitution, the Associated Press, and ABC News.