The Exciting Future of Cannabis with Keith Bushfield

Marge (00:00:05) - In this episode, I have the opportunity to speak with Keith Bushfield of Rexis Biotech for an illuminating conversation about the future of cannabis. Welcome to Bite Me, the show about edibles, where I help you take control of your life. I'm your host and certified Ganjier. And I love helping cooks make safe and effective edibles at home. I'm so glad you're here. And thank you for joining me today. Welcome back, friends. This episode is a good one. If you want to learn about the science behind those cannabis beverages that you see in the dispensaries. We dive into how bioavailability and degradation can affect those drinks in store and what it means for you as a consumer, how things are changing in the cannabis space and how edibles and beverages have become the entry point for the kind of curious what he thinks of high dose beverages and what fascinating projects Keith and Rexis Biotech are working on next. I should warn you that there are a couple of spots where the audio is a little choppy. The Internet connection became unstable.

Marge (00:01:07) - The only drawback to recording with people a couple of time zones away. But the information in this episode makes up for it. And wow, what a time to be alive. So without further ado, please enjoy this conversation with Keith of Rexis Biotech. All right, everyone, we are live. This is Marge of Bite Me, the show about edibles. And I am really thrilled to be joined today by Keith from Rexis Biotech. And I was just hoping you could take a second, Keith, and introduce yourself and let the listeners of Bite Me know what it is that you do.

Keith (00:01:38) - Sure. Well, I appreciate you having me on here. I know we had some obstacles in getting this set up, so I really appreciate your patience on getting me on here. We've been so busy. Um, Rexis Biotech firm. We are, I guess, most known for our water soluble product. So we have some patents, trade secrets on a process that we call polymorph nano fiber. So what that means is we produce a product from a distillate or a many different kinds of input materials into a truly water soluble component.

Keith (00:02:15) - So one of the biggest problems in cannabis if we refer to that. Specific molecule TC, CBD and so forth. It's very hydrophobic, does not like to mix with water. In fact, it hates water which that property allows it to not mix with the human body very well. So we have a process which turns it into a hydrophobic molecule, into a hydraulic molecule, and the hydraulic molecule is just one that assimilates with water. So that's what we're most known for. And this has been going on for about a year, year and a half. But our true course and parent that I founded years ago of 2009. So we've been a long process to get here and now we've just started making it commercially available about 12 months ago.

Marge (00:03:01) - Right? So this, this, this, the polymorph nano fiber that you speak of, I've heard of it called co crystallization. Is that sort of another term for it as well?

Keith (00:03:12) - Yeah. So co crystallization, there's different ways to manufacture that. Ours is a much different model than that.

Keith (00:03:19) - Even so it's basically our secret sauce, our secret recipe on how we make those polymer crystals. So those co crystals are multi molecules or multi layer molecules stuck on one, usually like a lipid, so around molecule will hold it. What is very unique to us is we make a fiber shape, so our molecule shape is fiber and now we attach multiple molecules on that single fiber, that single fiber in a that layout allows for much faster absorption. So that's one of the biggest pieces that it does is because we can control that fiber length depending on offset and offset things like that. It gives you different properties so you get different responses, which allows you to go into different foods or beverages or so forth and get different effects on set and offset time can be adjusted, things like that.

Marge (00:04:14) - Right. Okay. Before we move on, I am going to ask Keith, maybe you just turn your camera off. I'm going to turn mine off, too, because you're still a little glitchy. And I just want to make sure that the the audio is good.

Marge (00:04:25) - Absolutely. I'll turn mine off to to conserve. Now, I mean, that's a that what you're describing is obviously very science based. Most people know that THC is typically, you know, fat soluble. So this is totally putting all of that on its head and making it more easily assimilated. I guess when you're able to dissolve in water. What brought you to the cannabis industry? Like what? What what brought you here?

Keith (00:04:52) - Um, great question. Um, you know, originally we had started playing with a bunch of different molecules. I got asked to head up a company that was working on a male erectile dysfunction drug prodrug at the time, prescription based. I wasn't really interested in running a company for someone, so I liked it so much I ended up purchasing it. I bought that molecule. We started to develop it and grew it fairly large. That was quite a few years ago. Took that company public and we started to grow. We realized that there was maybe applications for that molecule or the way that that molecule is developed with different ways.

Keith (00:05:36) - We partnered with another company on the Nasdaq years ago and we use some of their technology and basically we just started experimenting with things as it went along. And then we were approached by a company in 2016 in Canada, that said, Hey, would the technology work for cannabis? So we started to experiment, see if what we had would work. What we do now is really nothing based on what we do then. So the past system is much different. It's not even remotely the same. So after the fact, when we realized that that wasn't the direction that we wanted to go, I founded another company about six seven years ago, and that company we started to really explore the cannabis side. It was just becoming legal in places like Canada, California on a major scale. So we started to jump in and kind of developed a different offshoot technology, which is what partially we use today. We're always morphing, we're always getting better. You know, we like the saying in my office that there's always room for improvement.

Keith (00:06:43) - And in all my career I've never rested on what I did yesterday because someone's going to pass me if I rest on that. So we're always looking for something better. And if you were to look at the technology that we develop two years ago, let alone six years ago, it hardly looks the same. So the development and the growth potential has been, um, it even surprises us is how much it's gone. So in that original question of how we got into this, it was could we do this in the old technology we had? Not really, but we really started to evolve it to where it is today.

Marge (00:07:16) - So you were looking for a new challenge, it sounds like, in the cannabis industry. We provided that for you in a pretty direct way. Now, for anybody who's sort of been following the cannabis industry, who has some interest in the beverages that are out on the market, they've probably heard the term of nanoemulsion because I've worked in a dispensary and and all that kind of thing.

Marge (00:07:36) - And Nanoemulsion was talked a lot about in the beverages space. What's the difference between Nanoemulsion and this fused polymorph nano fiber that you're talking about?

Keith (00:07:46) - Excellent. One is an apple and one is an orangutan. They are complete, completely different. And I get asked this exact same question every day or every other day because people that don't really understand it think the only way to do it is with an emulsion and a traditional surfactant based emulsion. So in an emulsion, to give a little bit of an overview, an emulsion is where you take a molecule like THC and you will usually use some kind of process to shear that molecule or change it. So you'll use a high pressure shear, basically a glorified blender, or you will use sonification. So ultrasonic waves. So you use something like that to disrupt the outer shell of the molecule. When you do that, you then need to attach it to something or stick it to something, and that is usually water if we're going to talk a beverage. But they still don't go together.

Keith (00:08:46) - So what companies will use is a surfactant. So they use a polysorbate or I mean, there's a ton of different, more advanced surfactants than that these days. But all that surfactant is is a chemical that joins the water. And together the problem is, no matter how well you do that, that molecule is going to come apart. Surfactant is just glue. So it's just a really rudimentary crude version of glue. Everybody said in science class years ago, you can't mix oil and water. Well, that's true. The way to get around it is put a surfactant to it and they stick them together. The problem is you put them in that drink, has said, leave it for a little while and it doesn't have to wait very long and you're going to have separation. So we've all seen that in the cannabis drink where oil is floating on top. It looks terrible. It has an oily residue. And now I will give credit to emulsions. They're much better than they used to be, but they're still the same, same principle, same background.

Keith (00:09:45) - And the problem with it, too, is surfactants taste bad and they're not good for you and all the rest of it. So that's an emulsion. What we do is much different. We do not use surfactants. That's probably the number one difference in what we do. We do not use their accents and we have a very proprietary way that we fuse those together. So we make a fusion of the carrier and carrier molecule. So we use a molecule to carry the THC molecule and then we fuse it to the THC molecule and we introduce a water molecule to it. So it's a hydro molecule that we introduce that becomes this co crystal. That's a permanent bond. So the big difference is no surfactants. So we eliminate taste issues when we do the process of ours and we shatter or we reconfirm or rebuild, I guess that molecule and we attach it and fuse it to the fiber and make the fiber. That fiber then has a lot of the flavor profiles that we can remove. We can keep them, we can remove them, we can really adjust them.

Keith (00:10:53) - So then that that molecule, that polymorph molecule is suspended in water and it stays there. So it's no different than if you put sugar in there. It stays suspended like that. You don't have fallout. That's that's the big difference.

Marge (00:11:08) - Yeah. And you mentioned a couple of things I'll probably come back to, but the one that you mentioned is the taste. Like the surfactants taste bad and I've had cannabis drinks that have like that bitter aftertaste. Is that the surfactants or is that the distillate that I'm probably tasting?

Keith (00:11:22) - Yeah, I think you're probably tasting both. No, I mean I'm not to beat up on any cannabis drinks that are in the market. I mean we have what we had five years ago. The problem is we're not evolving. Well, we are following, but a lot of companies are not evolving. I get it. They're selling. It's used to it and they put it out there, but they've had to come up with very funky flavors to hide them, like, you know, rosemary, hibiscus, lavender, whatever.

Keith (00:11:51) - You know, they they need all those things to kind of hide that bitterness that you're tasting. And that bitterness is not just a surfactant. It's absolutely the distillate, too, right? The better we get at making distillate, we can get rid of it. But if you can eliminate the surfactant and eliminate the outer shell on the distillate that's giving it that bitter tone, then you can hide it without having to put it in exotic kind of odd tasting flavors.

Marge (00:12:15) - Right? Because I do find there's certain drinks. It seems like it just has. That bitter aftertaste. And it kind of, well, literally leaves a bad taste in your mouth. Yes. So, yeah, a lot of those have that. Yeah. But yeah.

Keith (00:12:29) - Yeah. And I think most of them are, you know, and a full credit to all, all the groups that are they're getting better and I'm in full favor of everybody producing a better product in this industry and you'll get more conversion. We look at it this way we developed this polymorph a long time ago and we've made it better and better and better.

Keith (00:12:49) - Recently we went in that High Spirit Awards. We put a whole bunch of products. I think we meddled in one in every category. The one we put in that was one of the platinum winners was a thing we called H n H2O. It's basically MG H2O. So it's a water that has this polymer or fused polymorph nano fiber in it. So basically we submitted a water that had THC in it. No flavor, no taste and no smell and perfectly crystal clear. So really you have. Yeah, it won platinum medal. You you can't see it, you can't taste it and you can't smell it. And it looks completely like crystal clear water. And you drink it and you will be high. So we looked at it that way. If you can produce a water that tastes like water, nothing else but a really good spring distilled water. Right? Flavorings. Easy. You can put anything or nothing so you don't have to try and hide the bad thing you started with when you have that to start with.

Marge (00:13:54) - Right? Yeah, that's pretty interesting and difficult to do, I would imagine.

Keith (00:13:59) - Yeah. I mean it's, it's it's taken years and years and years, but now that we're here, you know, we've been able to produce it on a, on a large commercial scale which is dramatically reduced costs. When we first entered the market, we were expensive. We always said, you know you want to buy a Ferrari, you have to pay for it. We've now been able to make a Ferrari and charge a high end luxury import car price. So it's if we're going to use that analogy, but we've come a long way and the industry has come. And my favorite line in business my whole career is competition breeds originality and the more people we have pushing us to develop something better, not just what the clients want, the consumers, but, you know, the people we have trying to take our position at the top. We will always get better. So I think that's a benefit for all of us.

Marge (00:14:47) - Well, that's the constant never ending improvement too. Right? So that you mentioned earlier. Now, as far as the cannabis market goes, is this technology used primarily in the beverages space or is it used in other areas as well?

Keith (00:14:59) - No. So we have multiple divisions. We license the technologies to a bunch of our THC partners. We have THC partners in nine states. I think currently we have them making chocolates, gummies, shots, drinks, drink packs, stick packs. It's used for a ton of different applications. So it's really not just for beverages and we produced it in two grades. The beverage grade is more expensive and then the food grade is a little cheaper because you don't need it to be crystal clear. You don't need it to have all the properties. If you're going to put it in a gummy with a bunch of sugar and or chocolate and so forth. So it really is is universal in how we can use it.

Marge (00:15:46) - Right? Okay. So it's pretty much all across the edible space.

Marge (00:15:49) - Generally speaking, people can.

Keith (00:15:51) - Yeah, yeah. I mean so Happy Valley, which is one of our clients in Massachusetts. They use our product exclusively for their gummies and not only for flavor and taste, but fast acting. And I think they're the number one gummy selling gummy brand there. It's in Michigan. I think it's either the first or second gummy brand there. So it's definitely has a lot of interest in in the edible space, not just the beverage space right now.

Marge (00:16:18) - You mentioned the fast acting. If someone's consuming an edibles product or a beverage with this technology used, how what's the onset time like?

Keith (00:16:29) - Sure. That's a great question. And it's one of the things I'm most proud about. I mean, obviously flavor is key, but fast acting. So I've used this analogy since I got in this business that, you know, everybody's had an edible and at some point in their life, probably in the especially in the earlier days and you try it and it didn't work. And 45 minutes later, I'm going to take another one.

Keith (00:16:51) - And, you know, half an hour, 45 minutes later, you're on the floor looking at purple dinosaurs and wondering what happens. Right. So, you know, that to me from day one was a a limiting factor for the growth of the industry. So, you know, we worked with our groups and our scientists and said, look, we need to improve that. And that is one of our mandates is to figure out a way to make this onset adjustable. So we had a breakthrough about a year ago, year and a half ago. With the fiber link that we're talking about so we can increase and decrease fiber length of that polymorph molecule by increasing, decreasing and is not a linear equation, but by increasing or decreasing that we can increase reaction time, uplift time, and then we can decrease offset time. So obviously we usually try to make it as fast as possible and we have it down to science basically 10 to 15 minutes, you're feeling it. We have clinical university trials showing that it's in your bloodstream in 5.8 minutes and we argue it was in your bloodstream faster than five minutes.

Keith (00:18:00) - But we didn't draw the first blood until five minutes, so we didn't really think it would work that fast. But by the time we drew it and tested it, it was already in the bloodstream. So 5.8 minutes reaction time. We can definitely say it's a five minute uptime and then the off time. So we have been working with some of the biggest beverage makers on the planet, you know, and a lot of their concerns were we need it to turn off. So as an example, Anheuser or Pepsi or whoever it is that's coming to the table that's in the big player has said, Well, it does me no good. If they're high for three hours, I can't sell them 3 or 4 more drinks. And I completely agree with that. And for a consumer, if I'm going to consume it, I don't want to consume it and then think that I'm going to be incapacitated for three hours. So we mimic this to act like alcohol as close as possible. So if you take one of our beverages, like one of our, say, our in-house squared beverages, we've really tweaked the molecule so that you feel it in about 10 to 15 minutes and primarily offset will happen 45 minutes to an hour.

Keith (00:19:03) - And within that one hour, an hour and ten minutes, it's usually gone out of your system by then and it's not out of your system. I should rephrase that. It is. You're not feeling it. So you're getting less compounding problems by being able to turn it off. So and the second thing is the dose size. So we make that dose size smaller so that if I have an uptake and I can feel it and a lot of people will say, you can't feel five milligrams, but ours is so much more effective and efficient. Our bioavailability is 500% higher than a standard CBD. Again, clinical trial data that we did. So it's so much more advanced and you get more so much more in your system that a five milligram is just more efficient. So if I take five milligrams at noon than by one, 12, ten, 12, 15, it's working and by 1:00 it's mostly gone and I can have enough. And if I'm a beverage maker manufacturer, I can sell 3 or 4 in a night instead of selling one.

Marge (00:20:06) - Right? Yeah, that'll make sense. And there's a lot of things you mentioned there that we'll come back to. But you also touched on the bioavailability piece, and I think bile bioavailability and degradation are kind of two concepts that consumers don't think about when they're shopping for beverages or edibles, generally speaking. And can you talk about how your process can improve the experience from these two vantage points? Yeah, you already touched on the bioavailability, whereas five milligrams feels like five milligrams.

Keith (00:20:34) - But yeah, again, great question. So those are kind of our big three taste on set and offset by availability and then obviously potency over time. So but in terms of bioavailability, we did a trial with Dr. El Sol El Sol Labs and we tested a CBD molecule in our delivery format method with animals, and we did it head to head against Epidiolex. And what their research showed, their research and their FDA submissions were about 9% bioavailable, nine and a half, ten When ours came out in multiple animal trials, we did or in multiple animals, we did a 48.15% on average for our bioavailability percentage.

Keith (00:21:26) - And compared to the nine, that is kind of the standard. So that worked out to 523% more bioavailable. So basically, if I'm taking 100mg of vitamin C, you'd get nine in our method, you would get 48mg. So it's that makes the system much more efficient. You don't you're not wasting so much more product. You're not having to have a 20mg dose hoping to get four milligrams or three, whatever it happens to be. So when we give you five, people do say, Holy man, you know, that was a true five. And. Right. So that's a big piece of it. And I think part of that goes to the age old problems of beverages that they did put five milligrams in it or they put 20mg or whatever it was they put in that can. But. The problem with the surfactant or the problem with a lot of that technology that exist today that most of the classic beverages might have been made with was they used emulsion that was sticky. So the molecule itself is sticky.

Keith (00:22:35) - When you put it into a certification system or an ultra sheer, you're making the molecule even more sticky. You're removing some of that coating that it is it is a bigger mess than when you started. So what is happening is they're putting it in a can, they're putting the can lid on, and then a large portion of that active ingredient is sticking to the liner of the can. So you pour your drink out and you put 20 in there, you pour it out and test it and you've got six in there. You got three in there. So I know of I know of a very large producer that had made a very large production run and had to throw it away because they missed a testing date, had to go back and test it over again and it didn't test right. And that was only like four days later. So great. They they figured out a way to quote unquote, scan the testing system. But it sure didn't do any good for the client, the consumer that got it.

Keith (00:23:38) - It's all you know. And that's just unfortunate because then people start thinking, oh, that drink isn't very strong, or they go have a drink or squared or 3G or whatever we build. And then all of a sudden, wow, that was so much stronger. So, you know, we're we see that a lot. That's one of the biggest advantages that we have. We have we have a now a one year stability study where we lose about 8% over a one year study. So we're losing very, very little potency. We have had product built and in our stability stable within our product line. So what I'm trying to say for three years and it's still active, still works If you take a distillate and don't do anything with it, you're losing 14, 15% quarterly within. It's exposed to any light, you're going to have half of its potency in no time. So with this, we turn it into this powder. When we do the polymorph nanofibers, it turns it into a very fine powder, right? Like a sugar or an icing sugar or a flour.

Keith (00:24:46) - And that powder, we put it in a bag. And as long as it's not exposed to sunlight on a regular basis, it will last indefinitely.

Marge (00:24:56) - Wow. Okay. So when somebody is going into a dispensary then and they're buying a drink out of the fridge, that could be there, it's been sitting there for six months. What you're saying is there's a good chance that that five milligram drink is no longer five milligrams.

Keith (00:25:11) - I will guarantee. Guarantee. And any of your listeners could call me up. I will bet any amount of money on the planet they want to. If it's not if it's not a excess product, I guarantee it is not what it says on the can guaranteed, because it's just the nature of that molecule. It's and it's not against the manufacturer who built it. It's just that there's a huge issue with this molecule. So you you have to start all in, but it just becomes something that's very hard to work with. And, you know, the idea is hopefully we don't make cans.

Keith (00:25:48) - We don't have two year expiration dates on them. So we understand that if they bought it, they should do it. But I know for a fact that, you know, in 30 days you've lost 30%, 40% potentially. So you started with five, but you've got maybe three, right.

Marge (00:26:10) - Which is kind of kind of crazy. I mean, that really does affect the experience of somebody who's consuming these beverages. And does this apply mostly to beverages or does it apply to edibles as well?

Keith (00:26:19) - No, we don't see it in edibles, you know, because it's a solid it's inside the let's take a gummy. It's in the gummy. It's not going to get out of the gummy. So a lot of companies that will use an emulsion based to make a gummy and not everybody will use an emulsion, but let's just say used emulsion or not, it's not going anywhere. It can't escape the gummy. The biggest problem is with the can the liners. And even if you use a bottle, it sticks to the edge of the bottle.

Keith (00:26:46) - Like the companies are way better at this now. But some of the companies that do sell emulsions today, they'll tell the clients aren't. I mean menu the the company making the can isn't going to tell the consumers this but you know the companies that are making the emulsion for them or telling them that there is loss and then they do manufacture it and they know that if they do not have that thing tested in X amount of window, you know, I'm not beating around the bush and saying anything that a lot of people don't. Understand. But I know several companies that overdose the product. So if it says ten on the container, they put 13 in there, they wait four days, have it tested so that it comes out compliant at ten.

Marge (00:27:32) - Right. But then by the by the time the consumer picks it up, it could be at seven or something. Correct. Which is pretty interesting because that doesn't mean one of the reasons for legalization was to offer these like lab tested products so that consumers could be certain of what they were buying.

Marge (00:27:48) - So they had a a, you know, a regular, repeatable experience. And this isn't really what's happening, it sounds like.

Keith (00:27:56) - No, no. And in the you know, it's not so bad. And it doesn't exist in flower or in edibles or exist, but in beverages. Again, I claim that that's a very big reason beverages take off and now is you had issues like that. You know, the consistency was terrible that you weren't getting the same taste. You leave it out. He was changing things if it wasn't cool. There's a lot of those emulsions that need to be refrigerated so you haven't refrigerated. You have to. Um, and we looked at all of that when we were early stages to developing. You know, you put on board, we have a wish that none of that stuff exists and we just worked backwards from there saying, how could we produce a product that was able to eliminate all of these? And if not all of these, definitely less than all of these.

Keith (00:28:52) - So it's I'm excited because the industry is going in the right direction. I think there's a couple companies that are better at it and, you know, think we're really good at it now and we want to company. So, you know, we were at a I was speaking at a show a few months ago and New York was having some issues with their compliance and what they were going to allow. And I had offered other companies that were using them to say, Look, come to us and we'll help you do that. Don't and these other manufacturers don't lose. Your clients will help you keep them because we want as many people in this industry growing the industry and moving it forward, that there's lots of space for all of us. And if we can fix things like you're talking about is a better experience for everybody. And that that bodes well for us.

Marge (00:29:43) - Right? Yeah, of course. So if someone like myself is walking into a dispensary, is there anything I should be looking for in particular? If I'm looking for drinks, because I have found that I really enjoy the drinks actually, partly because of the quick onset and offset time like you mentioned.

Keith (00:29:59) - Um, well, you'll find a drinks like ours, they'll say powered by on the back. Now we have only recently really started making ours commercially available. Um, we, we don't do too much in the THC space at the moment. You know we have half a dozen big multi big companies that are working with it and trying to figure out how to roll it out in their factories and things like that. We've been specializing in the hemp space at the moment. I think we're the largest now hemp manufacturer and distributor in the country. So it grew overnight from people like yourself that walked into a dispensary saying, What can I get? Or now saying we offer these products in in hemp 9D9 compliant in liquor stores across the country. And I think when you're walking in there, you want to see basically brand. It's not hard to figure out who made the brand. And just because it's a big brand, it it. I think you're going to have to go by experience to find out because unless it says Power bi reactions on the back, it will be an emulsion.

Keith (00:31:13) - I can say that. So unless it unless it says power bi reactors on the back, it is an emulsion.

Marge (00:31:18) - So most of the technology out there right now is either your technology or this nanoemulsion. That's sort of the current standard.

Keith (00:31:25) - I guess that's really all there is. I mean, if you just try and put a. Just fall into water. We all know what happens there. So the only two ways to do it aren't emulsion and ours. And there is potentially a herd of one other company that was working on a system that was more like ours, but I would call it a hybrid between an emulsion and ours in the middle there somewhere. But they can't I don't think they're scalable, ready for commercial use. So there really isn't much out there. And from what I understand, I don't think there will be too much. I'll put it to you a different way. We are working with several of the biggest brand corporations in the world and they're not looking to make something themselves. I think they realize that it's not really something that is going to work for us or we have the time and energy to build it.

Keith (00:32:20) - So if we can supply their engine for them, they will. So I really don't see a lot coming down the pipeline right away. And obviously we don't know what everybody's working on, but I think we're going to see a fairly big push in the well, I'll put it this way. I think in the next 12 months, the landscape for beverages is going to be something you couldn't understand was going to happen. It's just it's coming like a freight train, not only in the licensed THC space, but the hemp space. And it in my personal view, it's going to help transform. You know, users that are on the fence. You know, I've always said that I had a discussion with someone that's fairly big in the industry recently, another CEO, and he said to me, he said, well, drinks are still, you know, not that popular the amount to 2% or 1% of sales and and gummies and our, you know, much higher ratio. So we're going to continue to focus on those.

Keith (00:33:23) - And my response was, I agree, gummies at the moment make a bigger sale. However, in my opinion, my humble opinion, gummies are the fringe product. Gummies will always be a fringe product. And what I mean by that is I associate gummies with, you know, the gummies that kids would eat or, you know, the time. I like them but non based. That's what a gummy is. The other thing gummies are they're associated with cannabis, they're associated with THC and etcetera. So that will always have that stigma. And if I am not a full blown user and I want to use a lot of and I'm not ready to use THC or I'm, you know, just starting to dabble in it, I'm a new user. A gummy is a fringe because they've heard horror stories about someone. To me, gummies ended up on the floor, can't stand up, but we've been drinking alcohol or RTD beverages for decades, hundreds of years. So that, in my opinion, will outpace gummies once we're all set.

Keith (00:34:30) - But the biggest reason we haven't done it to date is there hasn't been this technology, and now we're seeing that technology and people are we get this is not an exaggeration. I get a call every single day from another company looking or talking to one of our staff about, I want to build a beverage, I want to build a beverage. And that doesn't include those monster companies that are already selling a million cans a day in their other beverages. So I personally believe and it's a good thing because it's going to help be that transition into cannabis that a lot of people were afraid to take or didn't want. They're never going to smoke. They're ever going to vape. They might do a gummy, but it still sounds scary, but, oh, I'll drink a beverage that tastes like orange soda from the fountain, right?

Marge (00:35:22) - Well, it's such a safe entry point to like you said. And if you know, the onset time is relatively quick, especially comparable to smoking versus a traditional edible. And you also know that, you know, it's going to last an hour, give or take, instead of three or 4 or 5, which is a lot.

Marge (00:35:37) - If you've taken too much. It's such a safe entry point into cannabis. And I've talked to a lot of people as well who are super skeptical, skeptical about drinks and now a fully converted. And these were like, you know, regular cannabis users. So I'm with you. I also see people using the beverages in place of alcohol and that seems to be pretty popular as well. So can you talk a bit about how you see cannabis beverages fitting in amongst the alcohol industry?

Keith (00:36:03) - Right. Yeah, great, Great segue, Great question. Um, we spent a lot of resources and time building all back up. So this is obviously an equipment, I mean an IP technology company, but we also own a few manufacturing facilities where we make the cans. We kind of think of ourselves as that farm to table kind of company. So we don't grow a plant, but we take the distill the raw materials and we convert them in our process. We put them in a can we, we do what we do.

Keith (00:36:36) - Then we also have this large distribution network and we are in 12 states and we focus on nothing but liquor stores that and liquor distributors. That is all we do. And in that in that farm compliant space. So our distributors nationwide basically are that. And we believe we very much believe that this will supplement alcohol, it will help the decline in alcohol sales. We have a lot of smaller distributors that are feeding from our very large distributors that are showing dramatic decreases in their craft beer sales. So they are running around trying to find a way to supplement their sagging sales with something new. And that's where this is starting to come in. And we see it on a regular basis. Like I grew up with alcohol, I grew up with alcohol, and so did I. Yeah, I've never been a cannabis user, really. I mean, I take our stuff, I like our stuff a lot, but I've never been a traditional cannabis user. So when I grew up, I was always raised on the idea that, Oh, cannabis was so bad and it was going to kill you and you can't even look at it wrong.

Keith (00:37:45) - And that was the generation that we grew up in, right? And I look at it now and I go, Wow, cannabis, When it's over, it's over. Light switch is off and I'm done. Alcohol, it doesn't do that. So and. Myself, just like so many people and yourself. We're seeing that. And you know, I have two children. One's just about out of college. One's just went into college. Their alcohol consumption, compared to what I did when I was younger, two different. And all of their friends alike are just completely different. But what we are seeing is they're starting to entertain cannabis instead of alcohol. And in my opinion, if you can have cannabis without having the cigarette attribute, you're not having the damage to the lungs, You're going to see that big uptick. And I think that's exactly where this is going. And I do know I mean, we're working with several of the biggest alcohol companies in the player in the in the in the space.

Keith (00:38:42) - And the industry are looking at this, too. And they're trying to you know, and there's a couple paps has already started to go down the road a little bit, but we have built prototypes for some of the other bigger companies and they're all there. I think they're still waiting on the sideline to really figure out what to do and pull the trigger. But I don't think you know, I've had many discussions with the purists in the cannabis world that say, oh, we don't want to let the Anheuser-Busch and Coors and Corona guys get in the cannabis space. I think it's naive. I think it's just absolutely ridiculous to think that because it's not it's not going to happen. They are already poised. They have all their troops at the border, if you might call it that. They're going to come in the space. But I think it allows us to have craft manufacturers that are smaller and you're still going to have the Budweiser's of the world that are just, of.

Speaker 3 (00:39:31) - Course.

Keith (00:39:32) - Budweiser, but you're going to have a bunch of the other guys.

Keith (00:39:34) - And I think there's lots of room for all of it. But what it is going to do is make it mainstream. And we don't have to think about that because I want to have a cannabis beverage. I'm going to be looked at. Weird. Not anymore. That's that's ending.

Marge (00:39:47) - And I think that's interesting, too, because I see it across all demographics as well as a bit of a pushback against alcohol because it's at the end of the day, not very healthy for you. And they're finding out more and more about how unhealthy it is for you, never mind the hangovers, but it's interesting that you're seeing it with your own kids about how their sounds like they have a much healthier relationship with alcohol than we did at their age.

Keith (00:40:08) - So yeah, and and don't get me wrong, they're still getting drunk sometimes and doing their thing, but it's definitely like. You know, and bad, this is to say. But I remember getting in a car with someone drunk driving and doing that kind of stuff today.

Keith (00:40:24) - Kids don't. I mean, the kids, my kids, their friends, there's not a chance they'll do that. And they're just learning, you know, growing up, different generation, they're starting to see things differently. And I think what they're seeing is cannabis is a completely different alternative. And my kids were on that border like they're 21 and 18. And, you know, it was kind of illegal when they were little and now it's not illegal. And they can go into a store because now they're both of age where they are. So, you know, we are seeing that big change. And like I said, I really think the shift in beverages is going to make it really mainstream.

Marge (00:41:04) - Right? I tend to agree and I like what you said, too, about being a little naive not to want to have the big players come into this market because it sounds like the edible space in particular is I guess you just have to be far more capitalized in order to even get into that space.

Marge (00:41:19) - So naturally bigger players are more poised to do that. But like you said, I think there's room for everybody now. Was curious about what you think about beverages that have higher doses like I've seen drinks on the market, not in Canada of course, because we have those ten milligram limits, but drinks that have, say, 100 milligram limits or 100mg in a in a can or a bottle.

Keith (00:41:42) - Yeah, We have had many, many discussions internally about this question. And one of them for being are we being responsible by helping them do that? And I'll tell you, the old 100 milligram drinks for the most part, unless they put them in a root beer or we're really able to hide them, taste awful. And it's really hard to try and drink a whole one of those, let alone, you know, a couple of them. So we we have been torn to a degree about how we do that because you can take 100mg of ours, put it into water and basically drink it with no flavoring and it tastes good.

Keith (00:42:23) - It's not clear or anything like that. But it's it's it's pretty good. So we have had that issue now, I think, you know, like everything the hemp industry, the 100mg and one container, we're all pushing the limits of what the law says and what the law allows and all the things that go in between and saying it's a multi serving and so forth and so forth. You know, it's it's my opinion and that of every single distributor that we deal with, they don't want it. And I think for two folds they don't want it be three folds they don't want it for the. Compliance issues, especially in the hemp space. Now, you can still get away with a 50 milligram drink almost or 25 for sure, depending on how big the can was. There's a compliance issue. There is a safety issue for sure. They're like, this is way too much. And then there's a pure economic you know, if I want you to buy five, I want you to buy a six pack and drink all five in a weekend or overnight or a whole party or whatever you're going to do.

Keith (00:43:31) - But if you buy one 100 milligram drink, you're going to buy one because you can't stand up after you've drank the one. So, you know, now there is the sides that say, Oh, the heavy, heavy users need 100. The heavy, heavy users are always going to be the heavy, heavy users. The. The cannabis social drinker. The cannabis social user doesn't need 100mg per. And it's just so as far as I'm concerned, all you know that we don't accept anything over ten milligrams in our network, in our distribution. So and we do have 1 or 2 retailers and or 1 or 2 distributors and states that will take that. But 90% of our stuff is five milligrams. And we don't believe we really need 1 or 2 and a half. And I know that can does, you know, they're smaller ones that they've always done and I'm not beating up on can but it was the best way to make it taste good and try and be an entry. So I think five becomes a good moderate number.

Keith (00:44:33) - It might be strong for some people, but at the same time. Everybody's going to be comfortable with it to some degree, whether they drink half of it or not, but 100mg, 50mg and all the rest of it, it's really designed for a very specific user. And we don't feel that very specific user is the future.

Marge (00:44:52) - Right? It's going to be people with the lower tolerances. They're just looking to have a beverage with their social time on a Friday night kind of thing.

Keith (00:44:59) - Yeah, like I like instead of having a beer with dinner, a wine with dinner, I can have a square with dinner and I'm completely normal and I'm having a normal conversation and I'm not passed out, you know?

Marge (00:45:14) - Yeah, absolutely.

Keith (00:45:15) - Like a beer. Like, could you imagine if you drank one Budweiser and you were, you know, talking sideways and couldn't stand up? I mean, nobody would drink another Budweiser. I mean, they would, but there's usually somebody would. But somebody would, of course.

Keith (00:45:31) - But you know what I mean.

Marge (00:45:32) - Yeah. So I guess basically what you're saying, too, is that for widespread adoption to happen, you have to have sort of the milligrams at a reasonable level. And also if they're using powdered beverages, that five milligrams is actually five milligrams.

Keith (00:45:47) - Yeah, absolutely. I think I think wide scale adoption would have never happened if people were still trying to make 100 milligram drinks. And I've made the argument to a lot of manufacturers, a lot of brand owners over the past, you know, we just made a beverage for a company in LA. It's only going to be sold in LA and it's a high dose hemp nine beverage. It will be the I won't say their name because it's the last one we're ever going to do. And it was the first one we ever did. And it's only 25mg. It's fine, taste amazing, all those things. But we just looked at it and said it's not socially responsible. I think in my mind, I don't think it's going to be mass adoption and the people that do want it are a different market share than what we're really going after.

Keith (00:46:37) - So it's no different than I want to have a glass of wine at dinner. I want to have a I want to have a scotch and soda. I want whatever that person's going to have or I want to have a shot of Jager, right? So it's all different. And if it's all consumer based too, and consumer decisions, you want to drink a whole bottle of vodka straight up on your own, you are going to be in trouble. You want to drink a whole 100 milligram drink. That's your choice. You're going to do it right. I looked at it and said, For an economic and fastest to market and quickest adoption, we wanted that low hanging fruit, which was the low milligram count. And every one of our distributors is on board with them. And and they were the ones actually saying, we really want to do it this way.

Marge (00:47:25) - Right. And I suppose, like you mentioned, for widespread adoption, if you want beverages to become more mainstream, that also means you're educating the public at the same time.

Marge (00:47:34) - And as that education comes in and people become more comfortable with these things and maybe one day 100 milligram drinks, you know, won't be a big deal because people will understand how beverages work and all the rest of that thing.

Keith (00:47:47) - Yeah, absolutely. I mean, if you if you give a 15 year old a bottle of vodka, they're going to try and drink the whole thing, depending on who.

Marge (00:47:55) - Did that when I was 15. So yeah, yeah.

Keith (00:47:57) - Right. So you get a little older and you're like, Oh, that's a bad idea, you know? So Right. We're educating the the consumer. This is a brand new industry. I can't remember the the company, but there's a company that tracks sales data for all over the country and it's for retail stores, big brand box stores, all that kind of stuff. Well, we are the squared is the very first product in that category that has ever been in there. And I looked at that and I talked to the rest of the guys and the team and I said, Does anybody find that amazing? That of the billions of products that are on the market today, we launched an industry that there's none in there yet and we are the first ones to be there.

Keith (00:48:46) - So I look at that and I say we have a we have a duty to help bring this mainstream and we're not the first beverage with cannabis in it, but we're the first beverage with cannabis in it to bring it to mass market, to bring it in a legal way, to bring it in a social drinking atmosphere through liquor stores, through bars, through restaurants where it's legal. And so it is the adoption is key at the moment. And we we are helping and I'll put it this way, I talk about Square because Square is the first one. A big brand of ours is three. So we partnered with with Justin and three quite a while ago and three Chief and Square, the two big brands that are going into this distribution network. But we are currently building three or 4 or 5 new ones that are going to go along with this we want the market to have. Multiple choices. We want the consumer to have the ability to say, I want a low calorie seltzer, I want a old fashioned soda, I want an RTD that tastes like tequila.

Keith (00:49:48) - And, you know, it tastes like a margarita, but it has no alcohol in it. It has this. We want them to have a lot of choices. So whether we partner with the group, develop it in-house ourselves and bring it to market, we're doing that right now.

Marge (00:50:02) - I'm curious because this all sounds so good. Are any of them available or any of your access power drinks available in Canada, by any chance?

Keith (00:50:10) - Yeah, not yet. What part of Canada are you in?

Marge (00:50:12) - I'm in Ontario.

Keith (00:50:13) - Oh, okay. I'm born in Calgary, so. Okay.

Marge (00:50:17) - So Canuck. That's awesome.

Keith (00:50:19) - There you go. Yeah. So, no, not at the moment. Now, we have been in talks with two big beer companies there to do this. We haven't gone down the road. We do have a I can't say the name. There's a there's a really big one that we are working with. So with a little luck in the beginning of the new year, we may start to see that change.

Marge (00:50:44) - Okay, that would be awesome because I love the sounds of what you're doing. Like it Like if I'm buying and spending the money on a beverage and the beverages aren't necessarily the cheapest option as far as purchasing edible cannabis, right. And I do enjoy them. So if I'm buying something, I want to get that five milligrams or that ten milligrams. And it sounds like most of the time I'm getting just a percentage of that stated milligrams. So, you know, I'd be excited to support whatever powered beverage comes to the market in Canada, hopefully sooner rather than later.

Keith (00:51:17) - If you are if you are ever out of Toronto or Ontario and you're down, you just let us know. We're in like 12 states now. You can drive across the border and into New York and you can get them in upstate New York, right? But they are, um, I think. The other thing was price point. And you're right, a lot of the cannabis beverages that have come on the market have priced themselves so high because they couldn't handle economies of scale.

Keith (00:51:45) - Economies of scale wasn't going to help them get to the next level. So, you know, if I I'm a small manufacturer and there's a small manufacturer and they're trying to make some cans and they do a run of 10,000 cans or something like that, it's understandable that they're going to have to retail the can for $7 to be able to make any money where, you know, we're set up, we produce millions per month and we are in that situation now where there will be you know, we'll we'll put on 15 to 20 million cans on the market this year. And that means you are going to be able to buy a square can of three chicken, depending on where you are for potentially in the $3 range. So it's no longer do you have to go and spend $6. So that's a big change to where the market has been, where it's been this craft market and those craft brewers, those craft manufacturers will start to still be there or continue to be there and they'll have a marketplace and we encourage them every day, but they will still be there.

Keith (00:52:53) - But there's that need for that larger scale to transform it. So that just like you said, if I pay $7, well, how about I give you an amazing product, but you have to pay 3.99 instead. So much better mass appeal that way. And again, for sure.

Marge (00:53:07) - Yeah. And then you're more likely to buy more than one at a time when you know they're more reasonably priced for the consumer and they're getting, you know, hopefully the milligrams that they're expecting to get to.

Keith (00:53:16) - So yeah, absolutely.

Marge (00:53:18) - Now, just a couple more questions for you, because I want to be cognizant of your time. But what was surprised people about you, Keith?

Keith (00:53:27) - Me personally. Yeah. Um, I sleep three hours a day.

Marge (00:53:34) - Three hours a day. Is that an afternoon nap or is that what you sleep per night? Because that's not a lot.

Keith (00:53:39) - That's it. I've never sleep more than four hours. I sleep Three hours is about it. It's just always been kind of where I'm at.

Keith (00:53:47) - I live, breathe and eat this company. I don't do. I've been very successful in my career and had some some great wins, but I. I made it a passion of mine a long time ago that I wouldn't do anything anymore that I didn't absolutely believe in and want to do. And obviously we do this thing for the money. I am very much not going to sugarcoat that. I look at this and go, this is the next billion dollar deal. But I also look at it and say it's something that means a lot to me in a legacy. It's going to be here a long time. I think people are going to look back and go, you know, we were one of the the we were on the forefront of this beverage industry and we helped to get here. So when when I don't sleep, it's I will be working and working. And then I go to bed and I, you know, usually stay in my head there for a couple hours. But it works for me.

Keith (00:54:43) - I'm up at 430 every morning and go to the gym for an hour or 45 minutes and go to work.

Marge (00:54:49) - So amazing. Well, I'm pretty. I don't think I could do that. But not everybody glad that you're there, though. Like on the basically at the end of this whole industry because like I said, I really think beverages are such a beautiful way to bring people into the cannabis space who are who are kind of curious and want to sort of dabble a little bit. But finally, what is there anything in particular that you're super excited about right now?

Keith (00:55:14) - Um, yeah. So the cannabis industry is absolutely massive, but I'll tell you a few things that we're working on. Originally they were very undercover, very under wraps. But two things the psychedelic space is extremely important to me. On a personal level, I never quite understood the potential of psychedelics for therapy, for helping people and that type of thing. I'd always thought of it as this recreational thing that shoots the magic mushrooms. In a way you went, but I didn't understand.

Keith (00:55:53) - Now I've seen people that has helped first hand and I want to do everything I can with the resources that I have at my disposal to help forward that. And we have had some very major success. Major breakthroughs, I guess, is a better way to put it in terms of some research and development that we've done, being able to turn that into something that could be a beverage in the future once we get some kind of legalization and that beverage may be used for therapy, may be used for things like that. But, you know, we were we were working with early on and, you know, we continue to do for a group that is handling concussion trauma, post-traumatic stress disorder. And they are one of the few licensed DEA facilities that is is handling that substance. So we're very excited about that. I think it's a long way down the road, but it's coming. The other thing is. We released a product. We didn't release it, but we told the world about it's called an NX one.

Keith (00:56:54) - And so our NX one is we were able to fuse a bare nicotine molecule to our carrier. So we did a small clinical trial, 141 subjects placebo, double blind controlled sub style, where about 65 ended up doing the the non placebo 74 Did the placebo or the placebo at the end of the day. What it is, is we turn this molecule into a beverage. So we gave it to people that smoke 10 to 25 cigarettes a day and it stopped 95.8% of the subjects from smoking for more than four hours on one drink. So, wow, that's pretty fascinating.

Marge (00:57:40) - I know. So I know too many smokers.

Keith (00:57:42) - Yes. So it's it's it's not designed to be you know, we don't pretend that it makes you stop smoking. No, it doesn't. But it is far it's 2 to 3 times more effective than something like Nicorette or like the patch system or things like that. So we looked at it as several things. Any time you can get someone to stop inhaling the nicotine, the better nicotine on its own, no matter what the FDA would like to tell you, is not bad for you.

Keith (00:58:10) - The nicotine itself is good for Alzheimer's, Parkinson's, focus, concentration, energy.

Marge (00:58:15) - Level, cognitive enhancement.

Keith (00:58:17) - Absolutely. And nicotine on its own is great. The problem is getting it in your system safely. So this system, we can take nicotine, which is technically poisonous, like you can put 70mg on your skin, you can drink, it will kill you. So we've been able to process that, turn it into this inert powder that we do, put it in a beverage. You can't taste it, smell it or see it, and it stops you from smoking. So imagine the people that are and I've seen it firsthand. You go to a restaurant and you are a heavy smoker. You got to get up three times from dinner to go outside and smoke. Well, you have this can that we may taste like grapefruit for these trials. And it tasted like a grapefruit soda and or sugar free soda and not smoking, never once left to go eat. And we did multiple trials of that.

Keith (00:59:11) - Or the person that's on an airplane for six hours they can't right All of there's or you're just in a social atmosphere in a bar and you don't have to go outside to smoke. So there is a million aspects for it. We are going to be launching it overseas. We do have a big market in Southeast Asia that has adopted it, so we will be licensing it there. We are going to build a facility there in November. Sorry. Yeah, in November, the facility should be open and we're moving a bunch of our production manufacturing to Thailand to handle Southeast Asia. So those are things that I'm really excited about. Those two markets that are a little bit different than what we're doing. And then functional mushrooms. So functional mushrooms have shown such a potential and we're working with first in class company in that where we've done an exclusive agreement with a company called First Person. So first person is their absolute amazing company. They're growing a lot of their spores in western Canada that kind of shipping them around the world.

Keith (01:00:19) - But they are very excited about this. And so we've been able to take a mushroom. I don't know if you've ever seen like the mud waters and things like that, but taste terrible. Smell terrible.

Marge (01:00:33) - I've never tried the mud water once now. Yeah.

Keith (01:00:35) - So, you know, mushrooms don't taste great, but we've been able to turn it into what basically tastes like an orange citrus, like one of those emergency drinks you dump in the water like a vitamin C orange. And it doesn't have the mushroom flavor, but it has all of the actives. We built prototypes for them at the biggest supplement show last year, and they won first place overall. So it's all of these type of things that we're excited about. Cannabis is obviously, you know, our bread and butter and where we kind of cut our teeth on, but we see all these other things as huge potentials as we go forward.

Marge (01:01:08) - Oh, absolutely. Everything you just mentioned, like I could pick your brain probably for another hour about all that stuff.

Marge (01:01:13) - But again, I want to be cognizant of your time and say, thank you so much for spending an hour with me to talk about cannabis, cannabis, beverages, basically the future of cannabis. So thank you for that. Yeah, well.

Keith (01:01:25) - Marj, I thank you. I'm so glad we finally got it together, but. And all of my fault, not yours, but I really, really appreciate it. And I look forward to talking to you again.

Marge (01:01:37) - Awesome. Thank you.

Keith (01:01:38) - Thank you so much.

Marge (01:01:40) - The next time you're at the dispensary, look for those drinks labeled reactions powered and know what you're getting. I'm grateful for hard working entrepreneurs like Keith who are leveling up the game in the cannabis space and bringing products to market that are better for the consumer. But I'm curious, have you tried any of these beverages? I'd love to hear what you think and if you noticed a difference, you can always hit me up by email the podcast hotline or shoot me a DM over on Instagram. And of course, if you enjoyed this episode, please consider consider sharing it with somebody else that you think would enjoy it.

Marge (01:02:10) - You can always stay up to date with news events, giveaways and the rest with the newsletter, and that helps keep these episodes timeless. And you know what won't leave you wishing for more the products. The services found on the march recommends Page. I'm your host, Marge. And until next time, my friends stay high.