Two-Piece Capsules Vs. Softgel Capsules for Cannabis Oil Production

From working with over 30 Licensed Producers in Canada and in the US, the most common predicament that most companies are faced with, is if they should move forward with Softgels or Two-piece capsules (hardgel) for their cannabis oil production. This isn’t a simple question to answer, as both capsules have their pros and cons. However, this article will deconstruct two types of capsule productions, Softgels and Two-Piece capsules, by outlining the benefits and disadvantages of imploring soft-gel capsules for cannabis oil production. Please note it is always recommended to carry out additional research on your own. By the end of this article, you will have a better understanding of the capsule method you believe will work best for your company moving forward.

Initial Investment Costs

Although softgel capsules appeal to patients and consumers, there are extreme challenges in developing and manufacturing them. This prompts a major initial large-scale investment for the equipment, and infrastructure to support the process, such as controlled environment rooms, and specialized high skilled operators. The softgel manufacturing process differs remarkably from the two-piece capsule. For two-piece capsule filling, empty two-piece capsules are purchased separately and then filled with capsule filling equipment. For softgel, not only does the machinery fill, it also forms and seals the capsule. This makes the operation much more complex, expensive and requires additional special pharmaceutical equipment, such as, gelatin melters, reactors to prepare the fill material, encapsulators, tumble dryers, drying trays and drying tunnels. The total cost for all necessary soft-gel equipment is typically estimated to be anywhere from half a million dollars to over a million dollars, where as two-piece capsule equipment is a fraction of the cost. Keep in the mind that this is just for the equipment, and does not account for building infrastructure and labor costs required for softgels…

High Labor Costs and Room Sizes for Equipment

The softgel equipment also requires operators with extensive experience and knowledge on the equipment, which creates a heavy labor-intensive process. In addition to the complexity of the process associated with soft-gel capsule molding, it also requires an extremely large custom-built room to be able to accommodate the large size and multiple pieces of the equipment. Moreover, specific environmental requirements such as temperature and humidity control must be met considering the instability of soft-gel capsules whilst exposed to high temperatures and humidity. For most companies in the cannabis industry, lab space and room for oil filling is limited. See figure 1. for an example of the space and equipment required for a soft gel production set up. In contrast, two-piece capsule production does not require controlled environment rooms and only one filling room to accommodate the equipment. For this reason, companies need to seek out efficient ways to reduce cost and maximize return on investments, in order to better position themselves in the market.

Fixed Large-Scale Equipment & Slow to Market

Furthermore, there are no small — scale entry level equipment offered for softgel manufacturing. These machines were designed for large scale production of the same product, meaning that you are required to produce a minimum of 100,000 soft-gel capsules, per formula, per run. For cannabis companies looking to offer a range of different formulations, this production method would not be strategically viable. These large-scale also have extremely long lead times and can take years to be fully set up for production. A major advantage to choosing two-piece capsules for cannabis oil is that they can be used at all stages of manufacturing, from product development and testing, to full-scale production. Based on this information, scalable machinery provides the benefit of accelerated production, which in turn assists in launching product to market significantly faster.

Keep Away from Gelatin at All Costs

Another drawback that is associated with softgel manufacturing is the material makeup of the capsule. The majority of softgel capsules are made out of a Gelatin shell. Gelatin is traditionally made out of the bones and skins of animals, most specifically, of pigs and cows. Many religious groups have dietary proscriptions preventing them from consuming any animal products found in soft gelatin capsules. Softgel caps violate the religious dietary restrictions of observant Jews, Muslims, Buddhists and Hindus. Furthermore, since the Gelatin is made out of animal parts, many vegetarians and vegans are unable to consume them. In today’s age, our society consists of health-conscious consumers and diverse religions, making it crucial to find a solution that meets everyone’s needs. One of these solutions that companies should consider are the vegetarian capsules (HPMC) that are offered by all two-piece capsule suppliers. Vegetarian capsules are readily available by all supplies right off the shelf. Additionally, vegetarian capsules have no known potential health risks, even when consumed in a long-term scenario as they are 100% natural and nontoxic.

Royalty and Licensing Costs for Non-Gelatin Gel Caps

If a manufacturer intends to avoid non-Gelatin, and non-animal capsule shell materials for their softgels, they would be faced with licensing and royalty fees paid to certain suppliers, due to heavy patents and restricted intellectual property. Due to the rarity of finding a non-gelatin softgel, it can dramatically increase the per capsule cost, which will in turn price out companies from an already price sensitive market.

As well, with certain oil formulations, may require a special formulation of the softgel shell itself. If this is contracted out to a softgel manufacturer, intellectual property rights to the shell typically remain with the contract manufacturer, which limits the possibility of changing to another contractor. For the development of soft gelatin capsules, contract manufacturers also often require several kilograms of formulation, which can be challenging in the early development phase when large amounts of the oil formulation are difficult to acquire. Most contracted manufactures also have a minimum order quantity of 250,000 to 500,000 per order. With two-piece capsules, small scale filling with only a few grams of formulation can be completed in-house with lab-scale equipment. Therefore, this method would not be viable for cannabis companies looking to offer a range of different formulations and continue with R&D, as developments for new formulations would be extremely difficult and expensive to create.

Additional Notes on Two-Piece Capsules…

HPMC Two-Piece Capsule

Companies that adapt two-piece capsule formulation and manufacturing in-house, have the ability to use an HPMC (veggie) capsule, which is derived from vegetable cellulose. The benefits of the HPMC capsule include:

· 100% natural

· contains no preservatives gelatin, animal by-products, wheat or starch.

· More readily available high-quality suppliers of HPMC (veggie) capsule, with support and lower costs

Easy to Prevent Capsule Leakage

A common concern associated with the two-piece capsules is that they have a possibility to leakage. This concern can simply be mitigated by a number of solutions. Some solutions include:

· Look for high-quality suppliers — low quality capsules can potentially cause leakage

· Formulate product to be more viscous

· Banding machines — apply a resin along the break of the capsule, fusing the two-pieces together to form a one-piece hard gel capsule. A variety of different banding colours are also available which can be used as a low-cost marketing tool for colour coating specific formulation strains.

Final Thoughts…

Over the course of the last two years, we have been working with Licensed Producers and many other Medical Marijuana producers in the US to help set up their two-piece capsule production. There are many different options to choose from depending on what stage and production output you are looking to achieve. In short, the two-piece capsules give companies the advantage of reduced costs for equipment, labor and infrastructure requirements, as well as shortened product development cycles and launching finished product to market in a much shorter time frame. Essentially, lowered production costs, allows companies to achieve competitive prices on their capsules, and gain advantages over competitors who attempt to produce soft gels. There is a reason that most soft gel suppliers in the Pharmaceutical and Natural Health Industries outsource their production to co-manufacturers. Companies who are looking to keep production in house, for more control of quality and costs, it is highly recommended to look into two-piece capsule production.

ATG Pharma is Canadian Manufacturer of bench top packaging machines designed for the fast growing and dynamic Cannabis and allied health industries.