Canopy Growth Corporation, a Canadian cannabis company, recently initiated legal action against another major cannabis company for alleged patent infringement. Canopy Growth claims that GW Pharmaceuticals is violating a patent for a specific carbon dioxide (CO2) cannabis extraction method that is used to create CBD and THC oils.
GW Pharmaceuticals is a UK-based company that produces Epidiolex, which is a prescription anti-seizure medication and the first and only cannabis-derived medication approved by the United States Food and Drug Administration (FDA).
This lawsuit has the potential ripple through the cannabis industry. If GW Pharmaceuticals settles or loses the lawsuit, every company that uses this popular extraction method could be held legally accountable for patent infringement.
Although, many CBD consumers are unlikely to spend much time wondering how CBD is extracted from a cannabis plant, the extraction method can contribute significantly to the success of those who those who manufacture or sell CBD products. One of the most common methods for extraction involves the use of liquid CO2 to separate the active compounds from the plant matter.
Inventor Adam Mueller reportedly first filed a patent application for this extraction method in Oct. 2000. On Dec. 4, 2020, Canopy Growth reportedly purchased rights to this technology from Spectrum Therapeutics, a German part of Canopy Growth. The United States Patent Office issued Canopy Growth the patent on Dec. 22, 2020, and on that same day, the company filed the lawsuit against GW Pharmaceuticals.
An article published by Forbes points out how the timing of the lawsuit appears noteworthy.
“The timing suggests Canopy had the lawsuit ready, and may have obtained the patent with the specific intent to file such a potentially industry-disrupting lawsuit,” the article says.
The article also points out that Canopy Growth’s decision to pursue legal action against an industry giant instead of a smaller company is also noteworthy. It states that this move could mean that Canopy Growth is planning to begin global sales for CBD-based medicine, intends to compete with GW Pharmaceuticals, or is aiming “to own a piece of almost every existing cannabis company.”
The patent “really broadly covers CO2 extraction, which is the most widely used, and perhaps most important extraction technique,” Larry Sandell, a Washington-DC patent attorney, told Forbes.
“I don’t know how much CO2 extraction falls outside the scope of the patent’s claims,” he reportedly added. “This is why people should care.”
Although Sandell is a patent attorney, he is not involved with the lawsuit.
Forbes reported that Canopy Growth must prove that its patent is the first recorded example of this extraction method to achieve a ruling in its favor. For GW Phamaceuticals to achieve a ruling in its favor, the company reportedly must prove that its method uses different technology than what is described in the patent or that the patent is invalid because the technology described in it was obvious at the time the original application was filed.
It is not yet clear if Canopy Growth intends to pursue litigation against any other cannabis companies, but companies who use the patented method to produce CBD or THC oil may consider taking a hard look at possible alternatives. Canopy Growth’s exclusive rights are set to expire in the middle of 2022, but the company still has the potential to cause significant disruption to the industry between now and then.
“It really could be a major threat to the extraction industry,” Sandell told Marijuana Moment. “Although there are steps that can be taken to reduce infringement liability risks, CO2 extractors may essentially have this anvil hanging over their head as the business continues on — at least until the patent expires or someone succeeds in knocking it out.”