CV Sciences eyes plant-based food market, opening door for European and US distribution

24 Jan 2024 --- CV Sciences, a consumer wellness company specializing in hemp extracts, completed its purchase of Cultured Foods, a manufacturer and distributor of alternative plant-based foods, late last year. The acquisition aligns with CV Sciences’ strategy to become a much larger and more prominent health and wellness company amid rising interest in plant-based proteins.

The new synergies will allow CV Sciences to leverage its key assets, including US distribution and B2B expertise, to drive long-term growth and shareholder value.

“Our immediate plan is to leverage our B2B distribution network and bring convenient and sustainable plant-based foods into the US natural product channel while working with Cultured Foods to grow their business in the European market,” Joseph Dowling, CEO of CV Sciences, explains, adding that “the global vegan food market is expected to grow five times by 2030 with Millennials and flexitarians as the driving force behind soaring vegan food sales.” 

“In addition, we plan to leverage the Cultured Foods infrastructure to introduce select products from our flagship brand PlusCBD across all of Europe as laws allow, providing for significant expansion and opportunity to grow our company mindshare.”

Bolstering plant-based reach 
Dowling explains that plant-based protein alternatives “fit squarely into our global ‘health and wellness’ consumer products strategy.”

“The Cultured Foods acquisition will allow us to leverage many of our key strengths, including our US distribution, sales and marketing expertise, processes and infrastructure,” he tells Food Ingredients First. 

The acquisition, which both companies had been working on for six months, was structured as an equity purchase, where CV Sciences will operate Cultured Foods as its wholly-owned subsidiary. 

CBD and more
Cultured Foods produces a variety of curated plant-based products, currently sold in 15 different European countries, with its base of operations in Warsaw, Poland.  

The acquisition creates an opportunity for the importation of these specialty foods to the US and establishes a European base of operations for the sale and distribution of +PlusCBD products, opening doors to new retail and distributor partners.  

“Hemp-derived products are primarily focused on nutritional supplements, while the current focus of Cultured Foods is on plant-based protein alternatives — especially as an alternative to animal-based eggs, cheese and meat,” explains Dowling.   

“The market for hemp-based ingredients and products has been greatly impacted by the COVID-19 pandemic, brand saturation and uncertain regulation,” he outlines. “The pandemic issues are behind us, we are seeing significant brand contraction, and M&A consolidation will help strengthen the industry as well.”

Dowling goes on to say: “We are at the very beginning of understanding the potential of all cannabinoids, including CBD.”

The market for hemp-based ingredients and products has been greatly impacted by the COVID-19 pandemic.“We need more clarity on the regulatory front to further legitimize the category, provide consumers with greater confidence, and provide investors with confidence to re-engage with the industry. Further investment, especially in better understanding the science and potential benefit of CBD and other cannabinoids, will be a significant inflection point for industry growth.”

He adds that the market continues to develop and evolve with potential growth in the future. “Investment in the science to better understand the potential benefits will create huge opportunities to expand hemp-derived ingredients and products.”

Tapping into health and nutrition 
CV Sciences is evaluating new health and nutrition areas to pursue and leverage core assets, “including new ingredients that are focused on the health, nutrition and wellness of our current and new customers.”  

“We look for emerging science and unique ingredients that show promise in enhancing the daily lives and general well-being of our customers,” Dowling asserts. 

“As the modern needs of humanity evolve, providing synergistic products that link diet, supplementation and physical activity will be more prevalent and important in the coming years.”

2024 represents the company’s ten-year anniversary in the hemp-derived consumer packaged goods industry and Dowling says the company will be exploring new technologies, ingredients and the evidence-based science supporting each of these areas.

“We are also very open to all new technologies and methods, including precision fermentation. However, we have not yet invested in or developed new products using precision fermentation,” he concludes.

By Elizabeth Green