CBD’s benefits may never match the hype, but its future is likely bright
Globe and Mail, 2019
To celebrate the recent birth of her fourth child, mega-celebrity Kim Kardashian held a baby shower at which cannabidiol played a starring role. Guests were treated to CBD-infused body oil and were invited to visit a CBD bar, where they could make bath salts infused with the compound.
The event reflected the incredible popularity of CBD, which has burst onto the scene like a supernova in the past year, capturing the imagination of consumers in Canada and the United States.
But if history is any indication, its sudden radiance cannot endure. CBD is bound to recede from the headlines. Still, experts predict the CBD market will remain robust.
There is relatively little scientific data on the possible therapeutic value of CBD because cannabis research was restricted for so many years. But that hasn’t stopped retailers, producers and others from promoting it as a treatment for a plethora of conditions ranging from cancer and Alzheimer’s disease to addiction, acne and insomnia.
In U.S. jurisdictions where recreational cannabis is legal, store shelves are crammed with CBD products ranging from oils and candies to ointments and creams. Consumers are buying CBD- infused cosmetics, and massage therapists are using CBD-infused oil and cremes in treatment sessions.
Almost 7 per cent (17.5 million) of American adults are now using CBD, according to Cowen & Company, a New York-based investment bank. Analysts there estimate that the U.S. market for CBD will soar from $1- or $2-billion now to $16-billion by 2025.
In Canada, where CBD is available on the legal market in weed and oil only, producers and retailers are scrambling to keep up with soaring demand.
The buzz about CBD has heightened in both countries since December, when the U.S. Congress passed the 2018 Farm Bill, which ended a ban on growing hemp, one of two plants from which CBD can be derived (cannabis is the other one). The bill descheduled industrial hemp as a controlled substance and placed under the auspices of the U.S. Food and Drug Agency (FDA).
Medicines, supplements wax and wane in popularity
Almost 50 years ago, scientist Linus Pauling wrote a book extolling the virtues of Vitamin C. In Vitamin C and the Common Cold, he encouraged readers to take mega doses (more than 2,000 milligrams daily) of the vitamin to treat colds. In subsequent years, he wrote books that promoted high doses of Vitamin C as a way to combat cancer and other diseases. Sales of the supplement quadrupled in the 1970s.
Ultimately, Vitamin C did not live up to the hype. Scientific studies have shown that Vitamin C is not an effective treatment for cancer not does it cure the common cold. In fact, some studies have shown that mega doses of Vitamin C can cause stomach cramps, nausea and diarrhea. In one Swedish study, men taking the supplement were twice as likely to develop kidney stones.
Today, few consumers view Vitamin C as a panacea. Still, it continues to be a popular product. Consumers are aware that it has some therapeutic value. It’s essential to the growth of tissues such as skin, blood vessels and bone and it plays a critical role in the synthesis of collagen. Also, it has proven to be marginally helpful in dealing with colds.
Vitamin C is one of many supplements and medications whose popularity has waxed and waned over the years. Barbiturates also fit into that category.
Use of these depressants of the central nervous system were widespread in the 1960s, when they were considered the go-to treatment for anxiety and sleep disorders. But their popularity waned amid concerns about possible side effects such as addiction, and benzodiazepines became more popular as a treatment for those two conditions. But barbiturates are still on the market. They are used for the induction of anesthesia, as treatment for seizures that are unresponsive to other medication, and extreme cases of insomnia. Also, they are sometimes used in combination with acetaminophen and caffeine to relieve tension headaches
The CBD story could very well unfold in a similar way.
Few industry observers expect CBD to live up to the current hype. “Any drug that is hyped to this extent is going to be rolled back, either because it has bad side effects or because rival products are going to be promoted as superior,” says Professor Edward Shorter, a social historian of medicine at the University of Toronto who believes manufacturers of benzodiazepines fanned the flames of concern about the possible side effects of barbiturates.
“There is a simple graph in the case of a new drug for conditions that are not well-treated,” adds Professor Peter Wells of the Department of Pharmaceutical Sciences at the University of Toronto. “There is huge interest initially and the curve goes up. Information is then accumulated over the years and interest wanes because some side effects are discovered. Ultimately, drugs are never as effective as advertised.” Interest wanes a little or a lot, he says, depending on the severity of the side effects.
However, experts don’t expect the CBD market to implode because, as with Vitamin C and barbiturates, science has already proven CBD has some value. Medical research has confirmed that it is effective in treating seizures in children with particular forms of epilepsy. Also, clinical trials indicate that CBD could help treat anxiety and some other conditions. Increasingly, CBD is part of the discussion around chronic pain management.
“CBD has been cast as a panacea and it isn’t,” says PI financial analyst Jason Zandberg. “We know that intuitively. But research has already shown that it has some therapeutic value. The market is looking at CBD as something that has an underlying benefit to humans.”
His views are echoed by David Abernathy, a vice-president at The Arcview Group, a San Francisco-based investment company. “It looks likely CBD won’t fulfill all the promises being made about it but it will likely fulfill some – and the market will thrive.”
Consumer belief not always rooted in evidence
In fact, Mr. Abernathy believes CBD would continue to be a moneymaker even if science proved it was worthless. He points to colloidal silver as a case in point. The supplement, a solution that consists of silver particles suspended in liquid, has no proven benefits to the human body and it is not considered an essential mineral. In fact, health officials have deemed it unsafe because of the possible side effects, which include an inability to absorb medications and even fatal poisoning.
Still, colloidal silver products are popular homeopathic remedies and dietary supplements. Many people buy it, convinced that it cleanses the gut, boosts the immune system and fights inflammation.
“The key to consumer behaviour is belief. I wish that belief was always rooted in scientific evidence but it’s not,” says Abernathy.
“The general public will believe something despite scientific evidence,” adds Shorter. “Just look at the anti-vaxxer movement.”
Strategies include cameras, more bouncers and a meeting with police this week
TORONTO - On the sidewalk, a handful of tall, muscular men dressed entirely in black position metal posts and a thick velvet rope around the Adelaide Street entrance to Afterlife, one of the biggest venues in the club district.
The doormen speak to each other in hushed, serious tones as they form a perimeter around the front door of the club. It looks like business as usual at Afterlife tonight, but subtle differences are creeping into the way nightclubs are doing business these days, and this venue is no exception.
Co-owner Domenic Cianciusi is shopping for security cameras. He has also hired three more doormen, raising the total to 24 for the three-storey venue, which can hold as many as 1,150 revellers on a busy night. And when they start their shift, more of them may take advantage of the bulletproof vests the club's management provides.
"We're taking [security] more seriously now," says Mr. Cianciusi, whose club has seen gunfire. In March, a doorman was wounded in the leg when shots rang out during a fight on the dance floor.
Similar outbursts at other Toronto clubs in recent months, including last week's fatal shooting at Paradise Palace in North York and another incident that left a doorman wounded at a Dundas Street club, are causing owners and staff to beef up their security measures.
The wave of heightened violence has also prompted police to call for action: About 30 club owners met with officers this week to discuss security issues. The meeting, held Thursday, had been in the works since January, but took on added significance coming just five days after the shooting in North York that killed Livette Miller, a 26-year-old mother of four and a recent widow.
"At this point, violence is more a matter of concern than action among the clubs," says Detective Sergeant Gordon Sneddon of 52 Division, which oversees the downtown entertainment district.
But given that the area saw what Det. Sgt. Sneddon describes as a sharp increase in assaults from December to February, many clubs are already doing more than talking when it comes to security.
"Clubs are now starting to respond," Sgt. Sneddon says.
Another meeting with club owners is planned for the summer.
Fluid Lounge, on Richmond Street, now brings in extra doormen on most nights, making the doorman-patron ratio one to 50 rather than the previous one to 75.
Lucid, on John Street, has hired six pay-duty police officers monitoring activity in the front of the club, where patrons line up. In addition to providing a valuable service, the uniformed officers also improve the club's image.
"There's no question," says John Fisher, director of sales and marketing, "patrons feel more comfortable coming here when they see police out front." Lucid has also hired a security firm, Metropolitan Investigations and Security Services, to search each patron as they enter.
"They're trained to touch you where you could conceal a weapon," explains Mr. Fisher, who says the club has hired male and female searchers to avoid indelicate situations.
Before opening on a given night, the club's operations manager meets with the pay-duty police officers and security personnel. "They look at what's happening around town and determine how security might be affected," says Mr. Fisher, who cites Caribana as one example.
Lucid has also implemented security measures that are more common among Toronto-area clubs. A dress code prohibits patrons from wearing baggy pants, oversized athletic jerseys and running shoes. In those clothes, which are de rigueur in hip-hop circles, a patron could conceal a weapon.
"Patrons have to leave the banned [clothing] at the coat check or just leave," Fisher says. The dress code, he says, is for image and security, but primarily the latter.
Other clubs have a similar code "to clean up the crowd," according to Mr. Cianciusi at Afterlife.
"By having a style code, we're telling patrons to leave their attitude at home," says the manager at Fluid, who goes by the name Vito B.
On busy nights, doormen at Afterlife wear bulletproof vests while working in front of the club, but Fluid management hesitates to implement the same policy. "I think that if you start going that route, you're going to deter a lot of people from coming to the club. People are going to look at all the levels of security and say, 'What kind of place is this?' They're going to have second thoughts."
"Clubbing is a different experience now than it was 10 years ago," Mr. Cianciusi says, sitting at a desk in a small area off the dance floor. "The music was upbeat then. But it's different now. Hip-hop is aggressive. People think it's cool to walk around like gangsters. Listen to the music. Watch television. Everything is 'bang, bang, bang.' "
Sometimes, that gunfire hits nightclub staff. On the night Ms. Miller was killed, a doorman was shot and wounded standing outside the Film Lounge on Dundas Street.
It was the second shooting at the club in a year. And earlier this month, a doorman at Krystal Nightclub on Albion Road was shot in the chest after an altercation with a patron outside the club. He was rushed to hospital with serious injuries, but is expected to recover.
As for club-goers, many say they're concerned about security, but not enough to put a dint in social plans. Having just finished her exams, York University student Christine Kim was eager to hit the entertainment district this week.
"I usually go to clubs that do body searches," she says, standing in line outside Crocodile Rock on Adelaide Street. "I don't know if they do those searches here. If not, I guess we'll be taking a chance." Ms. Kim looks at the front of the line and smiles. The doorman has let in three more people. She's almost in.
TORONTO - The letter came out of the blue and filled her with anxiety. Gayle Dyke assumed that the legal notice had something to do with her divorce, but was stunned to discover it related to her daughter, Nikki.
This year, the Grade 10 student tried to steal a tube of lip gloss and some school supplies from a Zellers store near their Brampton home. Nikki was caught and the goods were returned before police reprimanded her and drove her home.
Now, four months later, a lawyer representing Zellers was demanding Ms. Dyke pay $379 to help defray the cost of shoplifting or face the consequences, threatening a civil lawsuit for as much as $900.
Instead of paying up, she took the letter to the Community and Legal Aid Services Program at Osgoode Hall Law School where she works as a clerk, and lawyer Sil Salvatarra told her the threats were hollow.
"Until I spoke to him, I thought I would have to pay for this," the single mother of two daughters says.
That's how Ms. Dyke learned about civil recovery. It's not against the law, but many lawyers think that its unethical to target accused shoplifters in this way -- often after the stolen goods have been returned and the matter resolved.
Retailers such as Zellers and Loblaws say they use it to deter shoplifting and recoup costs, but Ms. Dyke says it has another result. "It's extortion," she says, "no matter how you paint it."
And she's not alone. Mr. Salvatarra showed her a file folder several inches thick containing dozens of similar legal letters brought to the York University legal clinic.
In some situations, the people named in the letters are also facing criminal charges. In others, they have only been reprimanded by security or police and ordered not to return to the store. In all cases, the recipient is threatened with a civil lawsuit if they don't send a cheque or money order -- for amounts most often in the $200 to $500 range.
"These lawyers aren't asking for the money in court because they know that, in court, they couldn't justify asking for that kind of money," says Karen Andrews, a staff lawyer at the Rexdale Community Legal Clinic, which often deals with questions related to civil-recovery letters. "It breaks my heart to see people being taken advantage of."
Many of her peers in the legal community share her concerns.
"There will always be those people who are vulnerable and those who prey on the vulnerable," Mr. Salvatarra says. "One would hope that in the legal profession, which holds itself as being honourable, lawyers would take the honourable course and not engage in this predatory practice."
In many cases, lawyers say, the families being asked to pay for their children's mistakes have little money to spare. When a Grade 10 student at Don Bosco Catholic Secondary School in Etobicoke, who can't be named under the Youth Criminal Justice Act, received her civil-recovery letter, she knew her parents could ill afford to offer up such cash.
The student had stolen some mascara and two tubes of lipstick from a Loblaws in Rexdale, acting on a friend's dare. Security guards caught the teens and they were charged with theft under $5,000.
She appeared in court in February, received a conditional sentence and was ordered to write an essay about what had happened. "I went home and wrote it immediately," she says. "I was so relieved to have this whole thing off my shoulders." But her troubles weren't over.
The letter she later received from a Newmarket-based lawyer representing National Grocers Co. Ltd., the wholesaling arm of Loblaws, stated, "The retailer is prepared to settle its claim for civil damages in this regard in return for payment of $276.23 ... If this amount is not paid, we have been instructed to commence legal proceedings before a civil court."
The student burst into tears. Since emigrating from Central America in 1983, her working-class parents had struggled to support the family.
Her father said he would write the cheque and be done with it, but her mother took the letter to the Rexdale Legal Clinic, where Ms. Andrews told her to ignore it.
"It was unfair," the student says. "We're not rich. Paying that money would have put a huge financial strain on my family."
Diane Brisebois, president and CEO of the Retail Council of Canada, defends the practice, saying that "shop theft costs Canadian retail stores $3-billion annually" and they need to recoup the loss.
When asked about the discrepancy between the cost of the items stolen and the amount of money requested in civil-recovery letters, Ms. Brisebois suggests speaking to the retailers involved.
The retailers, however, are circumspect. Jeff Wilson, vice-president of industry and investor relations at Loblaw Cos. Ltd., refused to comment "on specifics" when asked about the sums requested. He said only that the company relies on lawyers to "use their judgment."
The Hudson's Bay Co., the parent company of Zellers, said in a written statement that "to minimize increased costs to our customers, Hudson's Bay Company implemented civil recovery" and describes the program as a "successful deterrent."
The Law Society of Upper Canada, which governs lawyers in Ontario, says the courts "have yet to resolve the legality" of the practice. It acknowledges, however, that it has investigated roughly 10 separate complaints regarding civil recovery in the past three years. But it can't discuss any investigation until there has been a hearing. "At this time," the organization says, "there have been no public proceedings involving this issue."
But Ms. Andrews says she knows of two lawyers who stopped sending civil-recovery letters after being called in by the society.
"There is no lawful claim for this kind of money. I mean, if a store asks for $500 in response to a stolen tube of lipstick, is that extortion? You figure it out. I have clients who will say these lawyers are mobsters."
PRAGUE – When Canstar Sports Inc. decided to set up shop in the Czech Republic two years ago, company executives expected their new business venture to take off as smoothly as any other. That was their first mistake.
"It went as well as I should have expected," says Gordon Halliday, vice-president, of Montreal-based Canstar, "But we all expected it to go a little smoother, than it did."
Like so many other companies that have launched operations in this fledgling democracy, Canstar, a manufacturer of skates and hockey equipment, hit many obstacles.
The first came when the company – eager to simplify the process of exporting to its Western European markets and anxious to tap emerging markets in Eastern Europe – tried to establish a joint venture with Czech company Botana, a manufacturer of athletic footwear and skate boots. Canstar executives wanted to manufacture their skates in Botana's factories. But the negotiations turned into a nightmare.
"There was good intent on both sides. We were two groups that understood how to make skates and how to do business." Mr. Halliday said.
But there was no controlling group of shareholders, so negotiators had to confer with up to 30 or 40 people.
"We were dealing with everyone from trust companies to grandchildren and grandparents," he recalls with a trace of exasperation. "We were negotiating through translators, and the shareholders lacked familiarity with how business is done. After a year of long and arduous negotiations, we decided that we wouldn't make much headway. So we decided to do it on our own."
To circumvent a law that prohibits foreign companies from owning land in the Czech Republic, Canstar used its Dutch holding company Jacmal to set up another company called Greenfield Investment.
With Greenfield registered as a Czech company, it purchased land for a factory. Company officials then faced strict environmental laws.
"We worked very hard to find an acceptable way to liquidate our hazardous chemical waste and to dispose of our raw material," said Miroslav Pospisil, head of Canstar's Czech operations.
Canstar officials were operating in an unsettled political landscape – property had been nationalized under the former communist regime and was being returned gradually to its original owners.
When officials found suitable land in Zdar nad Sazavou, a small town in southern Moravia, they enlisted the support of the local mayor in acquiring it.
"The way we resolved the issue was by having him take charge," Mr. Halliday said.
When it came time to build the plant, there was another problem – explaining what kind of building Canstar wanted. Canstar showed the Czechs pictures of its plants in Cambridge, Ontario and in St. Jerome, Quebec, Mr. Halliday said.
"We said to them 'This is all we want. We want a box and a cement floor. You put steel beams up, you put steel siding on the thing and then a roof. And that's all we need.' "
Despite all the difficulties, Mr. Halliday says it was worth the effort.
The manufacturing plant under construction is scheduled to open by late fall. It will employ about 225 people and Canstar expects to invest $6-million to $10-million in the plant.
Currently, Canstar employees in the Czech Republic are producing approximately 550 pairs of skates a day, working in rented facilities. And Mr. Halliday expects the company's entire line of products to be produced in Zdar nad Sazavou within three years.
This is good news for Canstar's distributor. In the past, it has had to wait three or four months to receive merchandise from Canada. Now, the waiting period is much shorter.
Mr. Halliday said one of the main advantages of manufacturing in the Czech Republic is the relatively low labor rates. The average monthly wage of a Czech worker in a foreign-owned manufacturing plant is equivalent to about $556.
Czech company Botana doesn't appear to be bothered by Canstar's move into its markets.
"There is an established network of retailers in the country," selling Botana skates, said Ales Navritil, director-general of Botana, which manufacturers skates for several sporting goods companies. "We will be fine as long as we continue to produce high-quality skates at reasonable prices so that our clients can compete."
Mr. Halliday thinks there are "great opportunities" for Canadian companies.
"It's critical to be patient and flexible. It's going to get done. It's just not going to get done at the speed one would normally expect," Mr. Halliday said.
One company operating in the Czech Republic, for example, needed 900 different government approvals before it was allowed to build a glass factory.
Mr. Halliday adds that it's necessary to have a fully bilingual senior person such as Mr. Pospisil on the payroll to act as an interpreter.
"As North Americans we tend to be impatient and we tend to think that our way is the right way," Mr. Halliday said. "The Czech ways are not similar to ours. They're not better or worse. They're just different. Once you've come through that, it's easy."
KLADNO, The Czech Republic – Had he returned to the Czech Republic this past weekend, a thousand-odd years after his death, Good King Wenceslas would not have created as much excitement as Jaromir Jagr did playing his first game for Kladno in four years.
Czech hockey fans had been anticipating his return for weeks. They were encouraged by reports that he had been working out details with his lawyer, then excited about the photographs of him boarding a plane in Pittsburgh. But they were ecstatic when he stepped on to the ice in warm-up before Kladno's game against Olomouc on Friday. Olomouc competes in the 12-team Elite league.
Clapping, whistling and chanting his name, the capacity crowd welcomed Jagr home. His fans expected a performance befitting this country's crown prince of hockey. And they were not disappointed.
On Thursday, newspapers across the country quoted the Pittsburgh Penguins' forward as saying he was nervous about the game. He hadn't skated for weeks, he said, because of the NHL lockout. And he was worried that he wouldn't meet his fans' expectations. He must have been relieved, then, when he scored seven minutes into the first period of the game, and brought the spectators to their feet for a standing ovation.
He scored from the faceoff circle a split second after the puck had been dropped, and caught Olomouc goalie Pavel Cagas off guard. "I didn't realize the puck was in the net until the fans did," said Cagas, who was recently chosen to the Czech Republic national team. "I underestimated Jagr. He has incredible power and strength."
Jagr assisted on Kladno's next goal, and played an instrumental role in its penalty killing and power-play efforts. Inspired by his raucous fans, he helped the team overcome a two-goal disadvantage and tie the game 5-5 in the third period. The game ended after a scoreless five-minute overtime. But the fans applauded appreciatively as Jagr skated off the ice. He had played a part in four goals, scoring one and assisting on three others.
"Unbelievable" exclaimed 70-year old Zdenek Kulhanek after the game. "I've been coming to Kladno games for years, and I've never seen anything like this. There was no room to park my car outside. And there was no room in here," he said about the arena. "There were much more people here than usual." Almost 8,000 people crowded into the arena, and many had to stand because of limited seating.
"I was nervous because I knew the people were here to see me," Jagr said. "But they were terrific. I was surprised that they were so supportive when we were down two goals. In Pittsburgh, they would have razzed us, or just left."
The consensus in the stands and in the press box was that Jagr played brilliantly. But he said he "didn't feel that great because the legs were really stiff." Also, he had to readjust to the European game.
"The National Hockey League is a better league [than the Elite League] because the best players in the world go there. But the hockey there is very different," he said. "The ice surface is much smaller, and it's one-on-one. Here, there is more emphasis on teamwork, on passing plays."
His new teammates have not responded negatively to his celebrity status, said Jagr. "Hockey is governed by the law of the jungle. The strongest survive. When you prove you're good, others accept you."
Jagr has inspired his countrymen in more ways than one. Many of them are impressed that he is playing for Kladno free of charge, and that he hasn't asked the club to absorb his insurance costs. (He paid $15,000 for a $2-million personal-injury policy that's valid until the end of the year).
"He was thinking about going to Pilzen [another Elite league club] to play with [Penguins' teammate] Martin Straka," said his father, Jaromir, the club president. "And he was also considering Finland. But I encouraged him to come home. When I told him how much our players earn, he said not to bother [giving him a salary]. He hasn't asked for anything. He even paid for his plane ticket."
His famous son will likely be his house guest and his star player until NHL action resumes. "I hope the lockout ends soon," the younger Jagr said. "But if it doesn't, I know I can play here."
That would please many Czechs, including 5-year old Jan Keberle. "This was my first game," he said, holding his father's hand. "I came with my father to see Jaromir Jagr. I've never seen him play before. But I know his name, and I like his hair."