Cannabis company buys Aurora brewery known for CBD-infused beer

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An Aurora brewery that caused a national buzz with its cannabis-infused beer is pushing deeper into the marijuana industry.

Dad & Dudes Breweria is the only brewery in the country with federal formula approval to brew beer infused with CBD, a non-psychoactive hemp extract. And now it’s been acquired by San Diego-based cannabis company Cannabiniers, according to Dad & Dudes owner Mason Hembree.

“I think they view us as pioneers of cannabis-infused beers and wanted access to our formula,” Hembree said. “As things progress in the U.S. with legalization, holding the patent for this production is going to be a big wrench in the machine.”

Cannabiniers is a “cannabis brand management company” that’s behind four lines of cannabis-infused beverages and a line of hemp-derived CBD creams called Bask, according to the company’s website. Its beverage lines are Brewbudz (coffee pods designed for Keurig brewers), Brewblendz (coffees and teas), Just Society (cold-brew coffees and teas) and Two Roots Brewing Co. (non-alcoholic, cannabis-infused beer).

One of the brewery’s CBD-infused beer lines, called George Washington’s Secret Stash.

Hembree said the two companies are “finalizing the minor details” of the acquisition, but added that “as far as I’m concerned, it’s final.” Terms of the deal were not disclosed.

Cannabiniers did not respond to a request for comment. But Hembree said Dad & Dudes won’t see many immediate changes, pending a six- to 12-month evaluation period of its brand.

“They’re going to keep our brand going while they evaluate what we’ve established in the local market and where we’re going in respect to CBD beer,” Hembree said. “The most exciting changes that are coming are the impressive executive team at Cannabiniers and its sister companies, who I believe will help us further our brand and add strength to our expertise in CBD beer.”

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Hembree started Dad & Dudes in 2010 with his dad, Thomas. The 3,200-square-foot breweria — a portmanteau of “brewery” and “pizzeria” — at 6730 S. Cornerstar Way is also known for its eight-inch pizzas.

Dad & Dudes didn’t launch with a CBD focus, although its initial offerings did include a 420 Pizza and a Dank IPA. Hembree said he’s “always been a proponent of cannabis.” The brand debuted its first CBD beer, George Washington’s Secret Stash, at Denver’s Great American Beer Festival in 2015.

“I wanted to see how interested people were in CBD beer,” Hembree said. “To no surprise, we had lines stretching around the building, almost choking out the lines at our large brewery competitors.”

Dad & Dudes first debuted its CBD-infused at Denver’s Great American Beer Festival in 2016.

From there, he decided to begin the process of getting federal formula approval from the Alcohol and Tobacco Tax and Trade Bureau (TTB). Testing took about a year, and the brewery was awarded approval in July 2016.

But in December 2016, just as Hembree was working on plans to distribute his CBD-infused beer out of state, the U.S. Drug Enforcement Administration announced that it considered all marijuana derivatives — even its non-intoxicating extracts — to be Schedule 1 drugs, which are illegal to transport across state lines.

Hembree said the TTP asked that the brewery surrender its formula, but Hembree said they refused, and “continue to do so.” As part of negotiations, the brewery did cease production of its CBD beers for over a year, but started brewing — and selling — George Washington’s Secret Stash last July.

“We haven’t had any problems yet,” Hembree said.

And now, with the December passage of the 2018 United States farm bill, it’s a moot point. The bill exempts commercial hemp (including CBD) from Schedule 1 classification, as long as the hemp product contains no more than 0.3 percent THC, the main intoxicating agent in cannabis.

Through this process, Hembree said he’d become known as an advocate for legalization within the craft brewing space, which may have attracted Cannabiniers to his business.

Cannabiniers is on a mission to acquire 500,000 barrels of brewing capacity, according to Brewbound. In addition to the Dad & Dudes purchase, Cannabiniers has signed letters of intent to acquire three other craft breweries, located in California, the Midwest and on the East Coast.

Brewbound noted that Cannabiniers hopes to compete in three categories: traditional alcoholic beer, CBD-infused alcoholic beer, and non-alcoholic THC-infused beverages, including beer, coffee and tea.

“We’ll have to see what the future holds for the combination of alcohol and THC,” Hembree said. “Brewers love the plant.”

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