Moosehead expanding into cannabis

Moosehead Breweries is getting into the cannabis business, developing non-alcoholic cannabis infused beverages.

The unnamed 50/50 joint venture with Sproutly will use the latter’s technology to develop products using water soluble cannabinoids, a significant development in the production of drinkable cannabis it says will produce a “rapid onset and offset effect unique to the category.”

Moosehead is one of the oldest and largest independent beer brewers in the country, selling more than 140 million beers annually throughout Canada, the U.S. and abroad.

Taking the historic Canadian brand into cannabis is simply a response to consumer tastes said Matthew Oland, a sixth generation member of Moosehead’s founding family, and CEO of the new venture.

“There has been a change in consumer perceptions about cannabis,” he said. “It is very much the same process that you go through when the [beer] market switches from ales to lagers,” he said. “It is that type of process; it is listening to that consumer and figuring out how to satisfy them.”

While a new category, cannabis beverages already have a number of players preparing for the Oct. 17 legalization of edible and drinkable cannabis. Constellation Brands with Canopy, and MolsonCoors with Hexo are two prominent examples, while a handful of other startups have been getting ready.

Sproutly and Moosehead say their “technology enabled cannabis beverage platform” will give them an advantage.

The technology is Sproutly’s water soluble system, called Infuz20, which makes the cannabinoids tasteless and odorless, and effective within just a few minutes of consuming.

“This process allows you to have a much better taste profile,” said Oland, who was most recently VP of supply chain at Moosehead. Most of the manufacturers in the U.S., for example, have to take steps to mask the taste of the cannabis. The water soluble Sproutly process means that won’t be an issue for Moosehead. “Our experience in the beverage market in Canada is it all begins and ends with taste,” said Oland.

With the legalization date less than six months away, the new JV has a lot of work to do. The products (Oland wouldn’t say how many) are in development and a production site has yet to be located.

Because Health Canada regulations prohibit THC beverages from being produced in the same location as other food or drink products, Moosehead will not be able to produce the beverages in its St. John brewery.

And of course, Moosehead and Sproutly still have to figure out how to market their product in highly restrictive marketing environment. Moosehead can’t use its brand to sell the new drinks, so new names and branding are in development.

“We are focused on being as careful as we can about what we can and cannot say to Canadians and then making sure that all of our marketing activities are falling in line with that,” Oland said.

David Brown