Coca-Cola is Closely Eyeing the Cannabis-Infused Drink Market

Coca-Cola, Aurora in talks about making cannabis-infused drinks: report

: Coca-Cola is 'closely watching' the cannabis space — and is reportedly eyeing a deal with one of Canada’s biggest producers (KO)

Coke and Aurora would likely develop beverages that will ease inflammation, pain and cramping, the BNN report said, citing sources familiar with the matter.

Molson Coors has also entered the marijuana space through a joint venture with Canada's Hydrotherapy Corporation to make non-alcoholic, cannabis-infused beverages.

According to a report by BNN Bloomberg, sources said that the world's largest beverage company is interested "in developing beverages that are infused with cannabidiol, commonly referred to as CBD, the non-psychoactive chemical found in marijuana plants".

Shares of Aurora were up almost 17 percent on the Toronto Stock Exchange on the report.

To expand the range of products the company intends adding to the beverage substance contained in marijuana - cannabidiol (CBD).

With consumption of soft drinks down in recent years, Coca-Cola and its competitors have diversified, with Coca-Cola in recent years widening its product array to include bottled water and juices.

"Along with many others in the beverage industry, we are closely watching the growth of non-psychoactive CBD as an ingredient in functional wellness beverages around the world", Coke said in its statement on Monday.

And Lagunitas, a craft beer label of brewing giant Heineken, already has a drink infused with THC, marijuana's active ingredient, which does produce a high.

Vivien Azer, an analyst with brokerage Cowen, said she would not be surprised to see Pepsi seeking a similar tie-up.

Canada is in the process of legalizing recreational use of marijuana. The first-ever medical treatment derived from a marijuana plant will hit the US market soon, after regulators in June gave an epilepsy treatment by GW Pharmaceuticals the green light. It does not cause intoxication.

Aurora's shares rose 17 percent while U.S-listed shares of fellow Canadian producers Canopy Growth Corp and Tilray Inc were up 2 percent and 9 percent, respectively.

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