A confluence of factors over the last couple of years has led to a surge in cannabis use in the US and beyond. For one, the cannabis market has been booming for the past several years, as individual states in the US (the largest geographic market for cannabis) have increasingly legalized adult-use and medical cannabis. In addition, the COVID-19 pandemic has boosted consumption of the drug in North America.
As of this writing, medical cannabis use has been legalized in 37 states, the District of Columbia, and four permanently inhabited US territories. Within that group, 18 states, the District of Columbia, the Northern Mariana Islands, and Guam have legalized cannabis for adult use. In the November 2020 election, every ballot measure calling for decriminalization or legalization of cannabis passed, reflecting the publicΓÇÖs growing acceptance of the substance (despite its remaining prohibited federally). In The State of Legal Cannabis Markets, 8th Edition (released in April 2020), Arcview Market Research and BDS Analytics (now BDSA), estimated 36.5% growth in the US cannabis market in 2019 to $12.4 billion and forecast 38% growth worldwide in 2020, with CAGR 2019ΓÇô2025 of 21.2%.
The COVID-19 pandemic began against the backdrop of this booming industry. In many US states and Canada, cannabis operations were considered essential businesses early in the pandemic, remaining open as establishments closed. A number of surveys have revealed that cannabis use has increased in Canada and the US, often to help relieve feelings of anxiety and isolation that have accompanied stay-at-home orders and other pandemic-related restrictions. Reflecting the surge in consumption, in February 2021, BDSA estimated 2020 legal cannabis sales in the US and globally to have grown 46% and 45%, respectively. BDSA’s September update projects a 41% jump in 2021 sales.
For the analytical instruments industry, these trends translate into considerable opportunity. Although regulations are not uniform across the US, the legal sale of cannabis and cannabis products requires testing for cannabinoids, foreign material, heavy metals, microbial impurities, moisture content, mycotoxins, residual pesticides, residual solvents and processing chemicals, terpenoids, and water activity, for example. As the cannabis market expands and testing regulations are established, the number and capacity of testing labs will increase as well. As the tests required vary by state, the technologies labs need will depend on location. For lab products more generally, testing will drive demand for chemicals, labware, and equipment. Some of this demand will also be fueled by production of cannabis products, which may require processes such as extraction and purification of cannabinoids.
Some of the technologies and their purposes used for cannabis analysis are as follows:
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- Evaporators, grinders, homogenizers, and mills for extraction;
- HPLC, UPLC, LC-MS, GC-MS: cannabinoid and terpene potency, mycotoxins, pesticides, and residual solvents;
- ICP-MS, atomic absorption;
- MALDI-MS, qPCR: microbes.
Although companies in the analytical instrument and lab products industries are well aware of the potential associated with the cannabis market, they might not yet appreciate the scale of the opportunity, particularly in light of the COVID-19 pandemic.