Beyond Emulsions: The New Playbook for Fast-Acting Hemp Beverages

Image courtesy of Azuca

Azuca is an award-winning biotechnology company founded in 2018 by Rael, along with Chef Ron Silver of New York City’s famed Bubby’s.

“Azuca is a biotech platform that figures out how to make molecules that are pesky and hard-to-work-with cannabinoids very easy to work with from a manufacturing processor’s perspective,” Rael says. “And also very enjoyable from a consumer perspective.”

Rael says Azuca and other businesses in this space all started to pop up around the same time, putting them at the forefront of the category.

“That was really exciting to me,” Rael says. “We were not only starting a new business, which is always fun; we were also starting a new category in a brand-new emerging industry.”

She adds, “That has all of the excitement and all of the brain damage of going where no one’s gone before.”

Initially, Azuca set out to solve the edibles “problem,” as Rael puts it, of slow-onset unpredictable effects and bad tastes. But eight years later, Azuca has gone even further, developing a portfolio of intellectual property that it now licenses to brands and manufacturers primarily in the United States.

“It takes the cannabinoid and makes it water dispersible,” says Rael, adding that some will call that water soluble. “It makes them taste good and delivers a fast onset—like five to fifteen minutes for gummy form and pretty fast as well in beverage form.”

Azuca’s proprietary TiME INFUSION® process is what “solves the problem,” making cannabinoids water-friendly for predictable, bioavailable, and fast-acting formulations. Other products in its portfolio include CX ACTiVATOR® for ingestible applications; Whole-Plant ACTiVATOR® for solventless cannabinoid and terpene preservation; and RTD ACTiVATOR® solutions created specifically for ready-to-drink beverages.

Rael refers to Azuca’s licensing business model as the magic ingredient inside many brands.

The company has over 150 licensing agreements across 30 states, as well as in Puerto Rico, Canada, and Australia, with Rael noting more agreements are expected soon in Europe and South Africa.

Image courtesy of Azuca

Rael says, from the vantage point of a company that creates a water-dispersible hemp infusion, there’s been an explosion in demand for hemp-infused beverages driven by consumers’ desire for something different.

“They want adult-alternative beverages to alcohol, and they love these products,” she says. “That’s what’s driving it.”

Rael notes that now there is a love and desire for the products as well as the infusion processes that Azuca uses to make hemp infusions, which didn’t really exist at the quality level where they are today just a few years ago.

“There’s this convergence of consumers finding out about these products, and we now have a few players that can deliver stable, high-quality beverage emulsions,” she says. “Consumers are now able to have that repeatable experience in a beverage.”

“The quality and the access to these beverages are driving this growing demand,” Rael adds.

Rael stresses the importance of creating a quality product to drive interest in the hemp beverage market.

“You have to have an emulsion with your beverage base,” she says. “It could be anything, but they behave differently. So the emulsion of the cannabinoid, the beverage base, and the packaging all interact. If they aren’t engineered to be compatible, they have stability problems.”

The stability issues could mislead a customer. For instance, if a label says there is 5mg of THC in the beverage, there has to be 5mg in the beverage so the consumer has the same experience each time.

Azuca conducted a study in which they bought nineteen hemp beverages off the shelf and tested them four times each for potency to see whether what was in the can matched the label.

“What we found was seventy percent of those beverages had a variance of twenty percent or more off of what their label said,” according to Rael. “And some of them had zero active ingredient in them.”

She adds, “And there were some that had two hundred percent of what was on the label. And that’s obviously a safety issue for the consumer.”

According to Rael, the significant variability can create what she calls “an Achilles heel for the industry.”

“So if someone does want to make an infused beverage, it’s very important to know who your emulsion provider is, to understand the part of the process that Azuca does,” Rael says, “and to make sure it’s compatible and tested with your base.”

Azuca does allow companies to send samples to ensure their base beverage is compatible with their emulsion at no charge.

Image courtesy of Azuca

“One of the big differentiators of Azuca with the other players out there is the breadth and depth of our track record in the market,” Rael says. “We have a long history and very deep relationships with over 150 licensing agreements.”

Within those agreements, Azuca has produced more than 700 million servings of cannabinoid-ingestible products in the market over eight years. According to Rael, none of the nearly 700 million servings has had an adverse effect.

“We really have established a trust in the Azuca solutions for both the manufacturers and also the consumers,” Rael says. “They know that if they purchase a product that has Azuca inside, powered by TiME INFUSION®, that they can trust that product—onset, flavor, and effect—every time.”

Rael continues by noting that, in addition to the trust built up, the Azuca products are backed by science and data.

“We have done multiple PK (pharmacokinetic) studies to show the onset of the actives in the bloodstream,” says Rael, noting that they are also getting close to releasing new studies on validating the results of the Azuca formulations. “We really care about and deliver the data behind the product so that the brands and consumers know they are getting a very trustworthy product and a predictable, precise, repeatable experience with the products.”

But beyond the business and tech, the product is the key. Rael says Azuca’s products are “exceptional” because of their consistent, predictable neutral flavor profile.

“One of the unique things about the formulations is that the cannabinoid—THC, CBD, whichever you want in your product—is absorbed in the soft tissue so it stays in its original form,” Rael says. “So for THC, it’s absorbed in the Delta-9 THC form. Traditional ingestible forms are processed by the liver into what is called 11-Hydroxy-THC.”

The latter form of THC, 11-Hydroxy, is what creates “couch lock”—essentially a sedative. The Azuca formulations, on the other hand, deliver consumers a “smoker’s high” which Rael describes as “very unique.”

“That’s because the active molecules, the THC molecules, are absorbed directly in the soft tissues,” she says. “So they don’t go through what’s called the first pass metabolism, the liver breaking them down.”

Rael adds, “So you get that euphoric elevated experience as opposed to that couch lock experience.”

Image courtesy of Edwin’s

From the beginning, Azuca created a business model to scale its infusion technology in an inherently unscalable industry.

“You can’t move product across jurisdictional state lines or country lines,” Rael says. “The key to any profitable growth business is ‘nail it and scale it.’ In this industry, you can’t do that in a normal way.”

The puzzle: How to create a business model in this unorthodox regulatory framework.

“What we designed was not only the beautiful, elegant technical solution to make the cannabinoids fast onset, great tasting, predictable, and easy to manufacture,” Rael says, “but also solve the business model challenge by modularizing our process.”

To that end, Rael says, when Azuca licenses its formulations to a manufacturer, it licenses the intellectual property before providing the equipment needed to run the process, selling the ACTiVATOR® in a bottle on a pay-as-you-go basis to make the infusions they need on their own site.

“This enabled producers of cannabinoid products to control their own destiny,” Rael says. All a manufacturer has to do is take Azuca’s ACTiVATOR® and, with the pre-programmed equipment, just press a button, and the infusion is ready within an hour to add to the beverage base. “So you’re completely in control of your process, dosing, and volume without having to commit to any minimum quantities of our infusion.”

With Azuca, the size of the operation doesn’t matter. “It’s really designed to be infinitely scalable at any producer to control their destiny at whatever scale fits their business,” says Rael.

Photography courtesy of Trophy

Rael understands there are many hurdles to ensure a manufacturer is compliant, but stresses that Azuca is a biotechnology company, not a compliance attorney. To that end, all license agreements include a clause stating that compliance is the licensee’s responsibility.

If you’ve done your homework and understand the regulations within your state and are ready to dabble in the hemp-infused beverage space, Rael is certain Azuca is the right company to call.

“Any state that allows a hemp-infused product, our solutions would be compatible,” Rael says. “There is nothing that would create a compliance issue with our products.”

The THC space is fluid and continues to shift, with regulations changing both federally and state-to-state.

“There is an incredible demand [for these products], and…it’s incredibly complex from a regulatory focus,” Rael says, emphasizing that Azuca’s business model means they’ve mitigated risk.

“If you are a craft brewer or beverage manufacturer, and your jurisdiction allows for hemp beverages,” says Rael, “we will be here for you.”

To schedule a meeting with an expert at Azuca, fill out this form here.