How the cannabis industry supply chain may be disrupted.

David Kideckel, PhD

Synthetic and Biosynthetic cannabinoid production presents potential to disrupt the cannabis industry supply chain
With the expected shift in consumer preferences for derivative cannabis product formats, and the applications for cannabinoids in the pharmaceutical space, the demand for cannabinoid extracts and isolates is expected to grow exponentially in the coming years. We see the immense potential for chemical synthetic and biosynthetic production methods to be a disruptive force the supply chain for cannabinoids.

Key differences between the processes
The process of chemical synthesis involves the use of two or more chemical inputs, including catalysts, in a controlled chemical reaction to produce a more complex molecule, which is the desired output. Biosynthesis is a similar process, however, the “engine” for the chemical reaction is a genetically modified biological (living) organism, which is designed to produce the necessary enzymes to create the desired output, in this case, cannabinoids. 

Both processes offer unique advantages
The repeatability of the chemical and biosynthetic processes ensures that each batch is consistent in terms of its content and purity. Both approaches also offer the potential to create larger quantities of rare cannabinoids that occur only in small quantities within the cannabis plant. Biosynthetic production, in particular, offers potentially significant cost advantages when commercially scaled, with estimates typically under $1,000 per kg of pure cannabinoids.

Will plant-derived extraction be replaced by synthetic methods?
We do not see these synthetic processes as a replacement for plant-derived cannabinoid extraction due to different benefits offered by each methodology. In addition, most estimates forecast at least an 18-24 month lead time before the commercialization of biosynthetic cannabinoid production.

Numerous cannabis and biotech companies have begun pursuing the commercialization of these methods
In the full report, we highlight the numerous biotech companies pursuing chemical synthetic and biosynthetic production of cannabinoids as well as some of the cannabis companies which have chosen to partner with them.