MediPharm Labs (MEDIF) is well positioned to benefit from growth of the global cannabis extraction market to $23.7 billion by 2025. The launch of cannabis products in Canada in December has put the spotlight on Canadian cannabis players and their readiness to benefit from the expansion of the legal market in the country, with Deloitte expecting the Canadian market for cannabis edibles and other 2.0 products to be worth more than $2.5 billion. However, while LPs deal with the capital-intensive nature of the cultivation business and other issues like a shortfall in retail outlets, extraction services providers – which specialize in the production of purified, pharmaceutical-quality cannabis oil and concentrates, and advanced derivative products – are set to emerge as key beneficiaries of the rapidly expanding extraction market not just in Canada but across the world, with global sales expected to grow at a 22.1% CAGR to $23.7 billion by 2025, according to Grand View Research. MediPharm Labs – which formulates, sensory-tests, processes, packages, and distributes cannabis extracts and advanced cannabinoid-based products in Canada and in international markets like Australia – is the key extraction name for investors to focus on.

The company stands out due to its pure-play extraction focus, proprietary extraction methodologies, and strong execution. MediPharm Labs has the distinction of being the first company in Canada producing cannabis extracts to become a licensed producer for cannabis oil production without first receiving a cultivation license. This focus on cannabis oil production and the resulting cannabis extract concentrate from its cGMP (current Good Manufacturing Practices) and ISO standard clean rooms and critical environments laboratory make MEDIF stand out in the extract market, as does its investments in expert, state-of-the-art technology, and extraction methods. The company’s strong execution is also reflected in the license amendment it received from Health Canada in December. The amendment allows for production to begin at the recently expanded area of its specialized manufacturing facility in Ontario and increases MEDIF’s licensed facility footprint by 3x to a total of ~25,000 sq. ft., thus placing the company in prime position to benefit from the expected rise in demand for cannabis edibles in Canada.

MEDIF’s investment appeal is enhanced by its profitable business model and international footprint and is reflected in the stock’s outperformance in the last year. MEDIF is one of the few profitable cannabis companies in North America and has a solid balance sheet with positive working capital of $87 million and cash and equivalents of $42.1 million. The company is among the top three in Canada by revenue – it reported a topline of $43.4 million in the September quarter, a 38% q/q growth, with EBITDA topping $10 million and net income before tax coming in above $5 million, representing the fourth consecutive quarter of positive EBITDA and revenue growth. MEDIF benefits from its fee-based processing contracts which typically last 18 to 36 months, give strong revenue visibility, allow for efficient expense planning, and result in predictable cash flows – a combination that is hard to replicate in the cannabis space struggling for profitability. The company plans to scale this model worldwide, a goal that has been boosted by the GMP certification granted to the company’s manufacturing facility in Canada by the Australian Therapeutic Goods Administration (TGA). This certification will not only boost MEDIF’s market share in Australia but will also help the company in obtaining the EU-GMP certification to directly sell into the EU market (TAM = $100 billion+), a key trigger for investors to monitor. The company’s stock price is up ~90% y/y and is outperforming the North American Marijuana index (down 60% y/y), a trend that we expect to continue given MEDIF’s strong fundamentals and long growth runway.

Chart 1: MediPharm Labs – On Track to Dominate the Global Cannabis Extraction Market

Chart 1: MediPharm Labs – On Track to Dominate the Global Cannabis Extraction Market



Marijuana legalization may hit 40 states. Now what? More than 40 U.S. states could allow some form of legal marijuana by the end of 2020, including deep red Mississippi and South Dakota — and they’re doing it with the help of some conservatives. State lawmakers are teeing up their bills as legislative sessions kick off around the country, and advocates pushing ballot measures are racing to collect and certify signatures to meet deadlines for getting their questions to voters. Should they succeed, every state could have marijuana laws on the books that deviate from federal law, but people could still be prosecuted if they drive across state lines with their weed, because the total federal ban on marijuana isn’t expected to budge any time soon. Read More (Politico)

U.S. federal cannabis reform outlook: Progress expected in 2020, but distractions, high hurdles persist. Cannabis industry observers say that while it’s unlikely the Republican-controlled Senate will pass a major piece of marijuana reform this year, they expect continued momentum, building on a historic 2019 in which the full U.S. House of Representatives overwhelmingly passed a cannabis banking bill, the SAFE Banking Act and a house committee advanced a descheduling measure. Cannabis industry associations and businesses are pushing to keep federal reform moving forward by accelerating lobbying efforts and expenditures on Capitol Hill. Read More (Marijuana Business Daily)

U.S. House lawmakers make marijuana banking reform pitch to key senator. The four lead sponsors of the successful cannabis banking bill in the U.S. House of Representatives are urging the chair of a key U.S. Senate panel to work in partnership to move the issue forward in the Republican-controlled Senate. In a letter, the four representatives praised Senate Banking Chair Mike Crapo, an Idaho Republican, for his attention to the issue. The two Democrats and two Republicans who signed the letter also emphasized the shared goals of addressing public-safety concerns that currently result from cannabis-related transactions outside the regulated banking system. The letter noted that marijuana businesses are targets for crime because of the cash on hand. In fact, burglaries at cannabis businesses are increasing in some areas. Read More (Marijuana Business Daily)

U.S. house panel calls for stepped-up marijuana research, which could prove critical to federal reform. In a positive signal for the cannabis industry, lawmakers from both parties and three government witnesses told a U.S. congressional subcommittee the federal government urgently needs more access to research around marijuana. But it remains unclear when that will occur, which could hinder the cannabis industry’s prospects if additional research findings are needed to overcome the skepticism that is holding back federal legalization reform. During the hearing, lawmakers spoke of a catch-22: Research is restricted because cannabis is currently considered a Schedule 1 drug under the Controlled Substance Act, yet more research would better determine if marijuana should be rescheduled or descheduled. Read More (Green Entrepreneur)

Virginia lawmakers approve marijuana decriminalization bill. Virginia senators advanced a bill to decriminalize marijuana in the state, voting in favor of a measure to remove the threat of incarceration for simple possession. The Senate Judiciary Criminal Law Subcommittee passed the legislation in a voice vote. The panel also took up separate bills concerning expungements as well as a separate decriminalization proposal that was adopted into the approved cannabis measure. The subcommittee’s action came in spite of opposition from the state chapter of the ACLU, which has complained that the reform move doesn’t go far enough and said that it’d prefer the status quo of prohibition until comprehensive legalization is accomplished. Read More (Marijuana Moment)

New Mexico lawmakers introduce legislation to legalize adult-use cannabis. New Mexico lawmakers unveiled legislation January 16 to legalize adult-use cannabis in the state, and Gov. Michelle Lujan Grisham seems eager to sign the bill should it make it through the legislature, but Drug Policy Alliance New Mexico State Director Emily Kaltenbach says continued advocacy efforts and education are key to a successful legalization attempt this year. “These bills definitely could pass,” she told Cannabis Business Times. “The question, I think, is we still have a few senators who have been on the fence about it”. New Mexico legislators considered two competing adult-use legalization bills last year, and although one proposal gained House approval and even cleared a Senate panel, the legislation ultimately stalled in the Senate at the close of last year’s legislative session. Read More (Cannabis Business Times)

The unlikeliest state is voting on marijuana in November. Of the 17 U.S. states that haven’t legalized medical marijuana, the least surprising is arguably Mississippi. It is “least surprising” for one pretty substantive reason: Mississippi is a heavily Republican-leaning, conservative state. That matters, because Gallup’s national polls have shown that people who identify as Republicans and/or conservative in ideology are far less likely than self-identified Democrats or independents to be in favor of legalizing recreational or medical cannabis. But that could be about to change come November. Read More (The Motley Fool)

Oregon marijuana sales 420% stronger near Idaho border. Marijuana sales in Oregon along the Idaho state line are 420% the statewide average, according to a state report. Idaho residents are purchasing recreational marijuana in Oregon because it is illegal in Idaho, the report released by the Oregon Office of Economic Analysis said. The report also showed stronger marijuana sales for Washington state along its border with Idaho in 2019 than along its borders with Oregon or Canada. The report found about 75% of Oregon sales and about 35% of Washington state sales in counties along the Idaho border were caused by the border effect. Read More (420 Intel)

Florida sales of smokable marijuana topped 22,000 pounds in less than six months. Medical cannabis patients in Florida have embraced the addition of smokable products to their purchasing options, with more than 22,000 pounds of the product sold in less than six months. By comparison, that figure is more than three times the quantity of all medical marijuana sold in Ohio during the first 12 months of sales in that state. Florida lawmakers repealed the state’s ban on sales of smokable medical marijuana in March 2019 with limited locations initiating sales just days later. Read More (Marijuana Business Daily)


Chart 2: Florida Smokable Medical Marijuana – Pounds Sold per Month, July 12 to December 31, 2019 Source: Intro-Blue, Marijuana Business Daily, Florida Department of Health

Chart 2: Florida Smokable Medical Marijuana – Pounds Sold per Month, July 12 to December 31, 2019
Source: Intro-Blue, Marijuana Business Daily, Florida Department of Health

New York aims to adopt adult use cannabis, tout regional cooperation. New York Governor Andrew Cuomo presented an FY 2021 budget outline to legalize and tax adult-use cannabis in the nation’s fourth-largest state and one of its cultural centers and tourist meccas. With a population of 19.5 million residents, New York in 2020 commences its fifth year of legal medical cannabis sales. Overcoming some implementational issues during the program’s rollout and first few years of operation, the Empire State adopted some important regulatory changes to improve patient access and participation. Now, New York (as of January 21) has 112,569 certified patients and 2,648 registered physician practitioners participating in its medical program, which projects to exceed $500 million in annual sales by 2025. According to New Frontier Data’s calculations, should New York legalize cannabis for adult use this year, projected annual sales of adult-use cannabis will surpass $2.4 billion by 2025. Read More (New Frontier Data)


Chart 3: New York State Potential Legal Adult-Use Cannabis Sales Source: Intro-Blue, New Frontier Data

Chart 3: New York State Potential Legal Adult-Use Cannabis Sales
Source: Intro-Blue, New Frontier Data

Cannabis firms cautiously optimistic New York could legalize adult-use sales this year. Industry experts list several factors: 1) New York faces a $6 billion budget gap. The state estimated that cannabis sales could generate $300 million in tax revenue annually when the adult-use market matures; 2) Neighboring states might apply pressure. New Jersey’s lawmakers have placed adult-use legalization on the 2020 ballot. That could compel New York’s Legislature to act; 3) Public support for adult-use legalization is strong. A Siena College poll released January 21 showed the New York public in favor of adult-use legalization by a margin of 58% to 38%. Read More (Marijuana Business Daily)

Temporary uptick in Washington state wholesale cannabis flower prices on shuttered businesses, unused canopy. Although Washington state has experienced oversupply challenges for several years and wholesale flower prices were once some of the lowest in the country, the market has experienced an increase in prices in the recent months for several reasons, including 1) smaller operators have gone out of business because the market was too competitive and profit margins were unfavorable; 2) with prices at rock bottom, some licensees chose not to grow cannabis at all, driving down supply; and 3) poor weather conditions, including overcast summer months and early fall frosts, led to suboptimal outdoor crops in 2019. Read More (Marijuana Business Daily)

Chart 4: Wholesale Cannabis Prices in Washington State Source: Intro-Blue, New Frontier Data

Chart 4: Wholesale Cannabis Prices in Washington State
Source: Intro-Blue, New Frontier Data

Two years in, California’s legal marijuana businesses struggle with financial woes as they battle illicit market. Licensed California cannabis companies face a business climate that’s arguably more dire than ever before, despite the hope that came with the launch of legalized adult-use sales in January 2018. Many feel as if they’re on a death watch of sorts, waiting to hear about more layoffs or company closures, stemming from a chaotic mix of high taxes, a lack of local buy-in, high barriers to entry, skyrocketing compliance costs and unforeseen complications – including the vape crisis. The difficulties led to a trend of many licensed companies struggling to pay business partners and vendors for inventory they’ve already stocked or services received, because they’re strapped for cash. Read More (Marijuana Business Daily)

About 20% of licensed marijuana companies in California’s capital city face temporary closure. More than a fifth of the cannabis companies in Sacramento, California, are confronting the possibility of at least a temporary suspension of operations on the first day of February. City regulators sent notices to dozens of registered marijuana businesses in December as a reminder they had not formally completed the process for acquiring a Sacramento business operations permit. Though many have finished the process since then, officials in California’s state capital said last week that 58 businesses still have not completed the paperwork and might have to cease operations as of Feb. 1 until they can get it in order. Read More (Marijuana Business Daily)

Where is California’s $635 million in cannabis taxes going? In 2019, Leafly estimates California took in about $635 million in state and local cannabis tax revenue. That includes $538.10 million remitted to the state, and another $100 million to local sales tax coffers. Here’s where that money is currently going: $140.8 million for 11,000 low-income children in child care; $44.8 million for public health and safety grants in cities that allow dispensaries; $39.9 million to combat illegal grows, wildland restoration; $37.5 million for helping thousands of at-risk youth; $30 million in community reinvestment grants for social workers; $21.8 million for safer roads; $57.8 million to license, regulate the industry; $15 million for cannabis science and policy research; and $100 million in local cannabis business taxes to parks, etc. annually. Read More (Leafly)

A tale of two markets: How Illinois succeeded in rollout of adult-use cannabis and why Massachusetts floundered. One stat exemplifies this tale of two states better than any. In Massachusetts, where legalization was passed by voter referendum in November 2016, there are currently 38 stores open to serve adult-use customers. Illinois, where the state legislature passed legalization just seven months ago in June 2019, already has 48 operational adult-use stores, with more to follow shortly. Add to this the fact that Massachusetts has no cap on the number of licenses the state can issue, while Illinois launched with only it’s limited legacy medical operators, and it’s clear something has gone seriously wrong with implementation in Massachusetts. Read More (Forbes)

Illinois adult-use cannabis stores might face more shortages. Recreational marijuana sales in Illinois could be hurt by a surge in medical cannabis applications with the January 1 launch of adult-use sales. More than 2,570 people applied for medical marijuana cards January 1-17, nearly a 34% jump from December 1-17, the Chicago Tribune reported. Regulators earlier in January warned marijuana retailers they are required to keep enough product on hand for marijuana card holders, which means the stores might not have enough recreational product to meet demand. Read More (Marijuana Business Daily)

Cannabis taking a larger share of alcohol industry amid concern over calories and hangovers. The growing concern over calories and hangovers is driving more millennials to replace alcohol with cannabis in their social life — a trend that pushes investors to increasingly eye the infused beverage industry as an opportunity. A recent Monitoring the Future research found U.S. millennials drink far less alcohol than previous generations: The percentage of college students who drink alcohol daily declined from 6.5% in 1980 to 2.2% in 2017. By contrast, there was a significant increase in daily marijuana use among young U.S. adults, especially during 2019, the research further revealed, resonating with the gradual legalization of medical and recreational marijuana across the country. Read More (Forbes)

U.S. cannabis spot index up 3.0% to $1,443 per pound, February forward unchanged at $1,450 per pound. The simple average (non-volume weighted) price increased $44 to $1,623 per pound, with 68% of transactions (one standard deviation) in the $898 to $2,348 per pound range. The average reported deal size declined to 1.9 pounds. In grams, the Spot price was $3.18 and the simple average price was $3.58. The average reported forward deal size was 42 pounds. The proportion of forward deals for outdoor, greenhouse, and indoor-grown flower was 47%, 39%, and 14% of forward arrangements, respectively. Read More (Cannabis Benchmarks)

Chart 5: Cannabis Benchmarks U.S. Spot Index

Chart 5: Cannabis Benchmarks U.S. Spot Index


Chart 6: Cannabis Benchmarks U.S. Implied Forward Curve

Chart 6: Cannabis Benchmarks U.S. Implied Forward Curve


Chart 7: Cannabis Benchmarks U.S. Spot Price by Medical or Recreational

Chart 7: Cannabis Benchmarks U.S. Spot Price by Medical or Recreational


Canadian illicit pot market still robust as prices beat legal sources: StatsCan. The difference between cannabis prices on the illicit and legal markets in the fourth quarter of last year widened slightly from the prior three-month period, according to new figures from Statistics Canada. The average price of cannabis in the illicit market during the fourth quarter of 2019 was $5.73 per gram, slightly higher than the $5.65 reported in the prior quarter but below the $6.44 mark tallied in the year-earlier period, data from StatsCan showed in its quarterly release of crowdsourced pricing information. The average price of legal cannabis purchased by Canadians in the fourth quarter was $10.30, edging higher from the $10.12 observed in the prior quarter and up from the $9.69 in the fourth quarter of 2018, the data showed. Read More (BNN Bloomberg)

Affordable legal cannabis should be priority as illegal pot prices drop, experts say. The gap between what Canadians pay for legal and illicit cannabis is widening — a sign experts say points to the need for the marijuana industry to make prices a priority this year. Statistics Canada said that the average price of legal cannabis increased to $10.30 per gram in the period between October and December 2019 from $9.69 per gram the year before. The change came as the average price of illegal cannabis fell to $5.73 per gram in that fourth quarter from $6.44 per gram a year earlier and as the overall average price of cannabis rose to $7.50 per gram, an increase from $7.46 per gram a year earlier. The agency based its conclusions on price quotes gathered using its StatsCannabis crowdsourcing application between October 1 and December 31. Out of 291 price submissions, 248 of were deemed plausible, it said. Read More (CBC)

BC’s adult-use cannabis sales spike in November to pace Canadian growth. British Columbia accounted for almost all of Canada’s latest month-over-month increase in adult-use marijuana sales as the nation’s westernmost province is seeing improved access with a slate of new store openings. Canada’s retail sales rose by CA$6.8 million ($5.1 million) to CA$135 million from October to November. Sales in British Columbia, meanwhile, increased CA$6 million, or 47%, in November to CA$19 million, according to the latest data from Statistics Canada. The data includes online and in-store sales. The number of stores opening in British Columbia ramped up in recent months. In March, for example, only 14 stores were open, but that number grew to 79 by mid-November. Read More (Marijuana Business Daily)

November 2019 store sales by Canadian provinces rose 5.25% m/m. Sales from cannabis retail stores in November rose 5.25% across Canada from the previous month. Sales were $135.8 million with Ontario generating the highest sales of $31.6 million despite only having 24 stores open at the time. Alberta with 343 stores at the end of November came in with the second highest sales of $29.84 million, according to Statistics Canada, closely followed by Quebec at $29.81 million generated from their 31 stores. BC sold $19 million through 168 licensed retail stores and had the highest increase of 47%, while Saskatchewan sold $7.4 million and Manitoba $4.6 million. Read More (Cannabis Retailer)

B.C. cities that veto retail weed creating vast cannabis deserts. More than 1.5 million British Columbians in Metro Vancouver and the Fraser Valley have no local retail access to recreational cannabis more than a year after weed was legalized for sale. “In B.C., municipalities have been given veto power over the rights that the federal government has given to Canadians, the right to regulated, dignified access to cannabis,” said Jeremy Jacob, president of the Association of Canadian Cannabis Retailers. About 174 cannabis retail stores are concentrated on Vancouver Island, the southern Interior and Vancouver. But from Surrey through the populous Fraser Valley all the way to Hope, just three recreational cannabis stores are operational, one newly opened store in Maple Ridge and two in Chilliwack. Surrey, zero. The Langleys, zero. Abbotsford, zero. Read More (Vancouver Sun)

Cannabis NB sales getting higher, outpacing Atlantic counterparts. As New Brunswick evaluates proposals to unload Cannabis NB to a private-sector operator, the agency continues to show steady improvement in its operations. According to figures released by Statistics Canada, New Brunswick’s legal cannabis retailer recorded sales of $3.47 million in November, a 4.8 percent increase over October and 14.6 percent better than last November. None of the other Atlantic provinces posted a month-over-month increase in sales in November, according to Statistics Canada — with Nova Scotia and Newfoundland and Labrador each recording sales declines and sales remaining flat in Prince Edward Island. Cannabis NB has been offering lower pricing options for consumers in recent months, which it credits for the growth in business. Read More (CBC)

Hungry market: Industry insiders urge patience over limited supply of cannabis edibles. Cannabis retailers say the appetite for pot-infused edibles is outstripping the supply — and the provincial distributor can’t say when that will change. It’s a replay of what occurred a year ago when logistical and regulatory hurdles created a shortage of cannabis in stores, a bottleneck that led to a six-month halt on new pot shops being approved by regulator-wholesaler Alberta Gaming, Liquor and Cannabis. “This was definitely to be expected in a brand new industry,” said AGLC spokeswoman Heather Holmen. She noted 406 cannabis stores have now been approved by the AGLC — by far the most of any province — that share the limited supply. Read More (Calgary Sun)


MedMen responds to vendor payment crisis. MedMen (MMNFF) CEO Adam Bierman responded to rumors about the company offering stock in exchange for payment it owes to certain vendors. Bierman confirmed the rumors, noting that “there’s a lot of pain” currently going on within the company as it aims to find a pathway toward sustainability. Bierman, who spoke to Green Market Report, said MedMen is approximately 30 days away from exiting its restructuring and that the company’s “cash position is very healthy, our balance sheet is strong.” Bierman also said the company doesn’t have plans to sell the Illinois dispensaries it obtained from its failed transaction with PharmaCann, noting it averages 200 transactions per hour. Read More (Green Market Report)

Cronos Group chief operating officer, chief commercial officer resign. Cronos Group (CRON) filed a Form 8-K identifying that two members of the management have resigned from their positions with the company effective December 31, 2019. It is unclear whether the resignation was forced or not at this time. The first executive to see his walking papers is that of chief operating officer David Hsu. The second executive to depart the firm is that of William Hilson, who was formerly the chief commercial officer at the firm. Read More (the deep dive)

Judy Schmeling appointed as chair of Canopy Growth board of directors, Jim Sabia appointed to the board. Canopy Growth (CGC) announced that Judy Schmeling has been appointed chair of the board of directors and Jim Sabia has been appointed in principle as a member of the company’s board of directors. Mr. Sabia will act as an observer to the board as he and Canopy complete the standard Health Canada processes associated with the appointment. David Klein, CEO, Canopy Growth said: “Judy’s leadership experience in highly competitive industries will be instrumental as we focus the business on its core priorities. Both Judy and Jim’s contributions will be extremely valuable as we continue the journey of building iconic brands.” Read More (Newswire)

Flower One announces appointment of Molly Hemmeter to Board of Directors. Flower One Holdings (FLOOF) announced the appointment of Molly Hemmeter to its Board of Directors, effective immediately. Ms. Hemmeter will replace Warner Fong, who is stepping down due to the demands and time requirements of his other professional duties and obligations. Ms. Hemmeter currently serves on the Board of Directors at Wilbur-Ellis, a leading international marketer, distributor and manufacturer of agricultural products, animal nutrients, and specialty chemicals and ingredients, with annual sales of over $3.0 billion. Read More (Flower One)

Aphria receives EU GMP Certification for subsidiary ARA-Avanti Rx Analytics. Aphria (APHA) announced that it has received its European Union Good Manufacturing Practices (EU GMP) certification in respect of medicinal products for human use and investigational medicinal products for human use, from the Malta Medicines Authority (MMA) at the company’s subsidiary, ARA – Avanti Rx Analytics. Aphria selected the MMA to perform the EU GMP audit as the criteria and certification thresholds established by the MMA are among the most stringent and demanding in the EU. The certification will allow the company to ship bulk and finished dried flower, as well as bulk and finished cannabis oil for medicinal use in permitted jurisdictions throughout the European Union. Read More (PR Newswire)

iAnthus approved to enter adult use Massachusetts market. iAnthus Capital Holdings (ITHUF) will be proceeding with adult-use operations in Massachusetts. The company announced that it has secured approval from the Massachusetts Cannabis Control Commission for cultivation and processing of adult-use cannabis products at its Holliston facility. The approval follows an inspection conducted by the commission back in December 2019. Following the approval, iAnthus’ Massachusetts operation is approved to begin its adult-use cultivation and processing activities on January 27, 2020 at its 36,000 square foot facility. Read More (the deep dive)

PharmaCielo becomes first cultivator awarded Good Agricultural Practices (GAP) global certification for Colombian medicinal-cannabis operations. PharmaCielo (PHCEF) is pleased to announce that the company has received the global Good Agricultural Practices (GAP) certification for its propagation, flowering and medical cannabis production operations in Colombia. “The GAP certification attests our commitment and best practices that we deploy in the production of the highest-quality medicinal-cannabis extracts while adhering to the most stringent international safety, environmental and regulatory standards,” said David Attard, CEO at PharmaCielo. Read More (Newswire)

AgraFlora Organics receives controlled drug license in UK. AgraFlora Organics (PUFXF) announced that Farmako GmbH, through its wholly owned subsidiary Farmako Limited, has received its Home Office Controlled Drug License. Farmako was awarded the License less than one month following the successful completion of its inspection by the UK Home Office in December 2019. Having obtained the license, Farmako Limited intends to commence wholesaling medical cannabis in the UK by mid-year 2020, including the importation of Bedrocan products from the Netherlands to the UK for patient distribution. Read More (Globe Newswire)

KushCo expects growth in its core cannabis business as it expands into CBD market. KushCo Holdings (KSHB) is expanding its core business and focusing on new business divisions to drive its strong revenue projections for 2020. Vape has been a significant segment of KushCo’s business, and the company did experience short-term effects from the vaping crisis. According to KuchCo’s Co-Founder, CEO and Chairman Nick Kovacevich, the stock sold off due to uncertainty around how sales would be affected as consumer demand declined. Now, the health issues related to vaping have been tied to vitamin e acetate, an additive largely found in black market products. Read More (New Cannabis Ventures)

Sundial confirms layoffs. Alberta-based cannabis producer Sundial (SNDL) confirmed that it has laid off “less than 10 percent” of its workforce. In a statement, it said: “In the spirit of continuous optimization for efficiency and effectiveness, Sundial has made some organizational change. It’s important we remain agile in responding to the realities of the evolving cannabis market”. Sundial did not confirm how many people 10 percent equated to. In an emailed statement, CEO Torsten Kuenzlen said the layoffs were “a necessary step that was taken in the long-term interest of the company, our investors, and customers.” Read More (Global News)

PharmaCielo signs pan-European distribution agreement for CBD isolate and broad-spectrum CBD oil. PharmaCielo (PHCEF) announced that it has signed a three-year pan-European distribution agreement, in which the company’s high-grade CBD isolate and broad-spectrum CBD oil will be sold to wholesalers and medicinal CPG product manufacturers through GMP certified lab owner, CBD Export Global. The agreement with the Quebec, Canada-based CBD Export Global expands PharmaCielo’s distribution network in Europe with shipments into the EU to commence in 2020 with increased volumes during the duration of the agreement as B2B markets are expanded. Read More (Newswire)


S&P, Toronto Stock Exchange launch cannabis indices. Two indices tracking the performance of cannabis companies on North America’s largest stock exchanges have launched in recent months, demonstrating a growing level of mainstream interest in the burgeoning industry. The first to launch was the Standard & Poor’s/MX International Cannabis Index on November 18, 2019. The index measures the performance of cannabis firms trading on the Toronto Stock Exchange (TSX), TSX Venture Exchange (TSXV), New York Stock Exchange (NYSE) or Nasdaq, according to a notice by TMX Group, which owns and operates the TSX and TSXV. Eligibility to be added to the index requires companies to have a minimum market cap of $120 million and an average and median daily value traded of $400,000, according to the release. Read More (Marijuana Business Daily)

Cannabis companies could go bust in 2020, industry insiders predict. The pot industry has been plagued with supply problems, stiff competition from the black market and a resulting loss of enthusiasm from investors. “There’s a lot of trepidation, understandably, and I think it’s going to be some time before the capital markets come back,” said Rishi Malkani, a cannabis industry expert and partner at Deloitte Canada. Oversupply, falling prices and the slow rollout of brick-and-mortar stores, particularly in Ontario, has contributed to low revenues for most licensed cannabis producers in the past year. Malkani said he expects more than a dozen businesses to face “significant cash crunches” in the next six to 12 months, without naming specific companies. “We are now seeing the separation between real operators and companies that based their value on hype,” said Engel. Read More (CBC)

Cannabis fund turns to distressed debt amid sector slump. The partners at cannabis-focused Altitude Investment Management didn’t imagine that their decades of experience in distressed debt would apply to the rapidly growing pot industry, yet it’s become a key focus as they raise capital for their second fund. Three of Altitude’s four principals came from Longacre Fund Management, a distressed-debt investor that wound down its main funds in 2011. Now they’re looking for high-yield pot debt as the industry struggles with a months-long share slump, unreceptive capital markets and a growing cash crunch. Read More (BNN Bloomberg)

The importance of cannabis debt scoring during the capital crunch. Despite solid efforts to reduce cash burn, cannabis companies will require significant amounts of financing in 2020 to complete their build-outs and strategic acquisitions but the equity market is virtually closed to a large swath of cannabis companies. Even those with solid business positions and clear paths to profitability will find selling equity painful at the new price levels. Expect to see a marked increase in distressed asset sales from companies who probably could have sold equity in early 2019. Read More (New Cannabis Ventures)

Chart 8: Cannabis Credit Model Final Rankings Source: Intro-Blue, New Cannabis Ventures

Chart 8: Cannabis Credit Model Final Rankings
Source: Intro-Blue, New Cannabis Ventures

Five critical success factors to close cannabis mergers and acquisitions. The latest news on cannabis M&A transactions in the U.S. might make one wonder if more deals are falling apart than are closing. In Q4 2019, over $1 billion in M&A deals were terminated by multi-state operators (MSOs). The reasons for failed deals in the cannabis market are as complex as the industry itself. KO Acquisitions has identified five factors that cause deals to collapse and how buyers and sellers might plan for these situations to keep deals on track: licensing/regulatory issues, poor corporate hygiene, seller risk exposure, a protracted M&A process, and capital market challenges. Read More (New Cannabis Ventures)

Evolve to shut down cannabis ETF. Evolve ETFs announced morning that it will close its Evolve Marijuana Fund (TSX: SEED) next month. The firm, which is also closing Evolve U.S. Marijuana ETF (NEO: USMJ) and the Evolve North American Gender Diversity Index Fund, has requested that the funds be delisted in March. The Evolve Marijuana Fund listed in February 2018 and has just C$6 million in assets. It had tried to differentiate itself by being actively managed and by having the ability to invest up to 10% of its portfolio in private companies. In 2019, the ETF returned -34.06%, which trailed the North American Marijuana Index, which returned -31.51%. Read More (New Cannabis Ventures)

Curaleaf secures $300 Million in capital. Curaleaf Holdings (CURLF) announced that it had closed on a loan for $300 million in capital, which will be used to strengthen the company’s balance sheet and liquidity, according to Chief Financial Officer Neil Davidson. The financing was secured from a syndicate of lenders and matures 48 months from closing. The proceeds will be used to refinance existing debt, pay transaction fees and expenses stemming from previously announced acquisitions, and fund capital expenditures. Curaleaf originally sought to raise $275 million, but Davidson said the company simply had more interest from investors, which helped it reach the $300 million mark. Read More (Cannabis Business Times)

Aphria announces $100 million strategic institutional investment. Aphria (APHA) has secured a significant investment from an institutional investor to the tune of $100 million. The investment, conducted at $7.12 per share, has been made by an undisclosed party, however the entire financing is coming from a single party. The total financing will see a total of 14,044,944 units issued, which contains both a common share and a half warrant. Each unit, priced at $7.12, will see the attached half warrant have an exercise price of $9.26 for a period of 24 months from the date of closing. The offering is expected to close January 31, 2020, and will see funds raised put towards international expansion, working capital, and general corporate purposes. Read More (the deep dive)

Cresco Labs announces $200 million senior secured credit agreement. Cresco Labs (CRLBF) announced that it has entered into a non-brokered credit agreement for a senior secured term loan in an initial aggregate principal amount of up to $100 million, with a mutual option to increase the size of the facility to a maximum of $200 million. The company expects to complete an initial drawdown of up to $100 million on or about January 30, 2020, subject to the satisfaction of customary funding conditions. The proceeds from the senior loan will be used to fund the expansion of operations in Illinois, closing and integration costs associated with pending acquisitions, and other strategic growth initiatives in key markets. Read More (Cresco Labs)

Tetra Bio-Pharma announces upsizing of previously announced offering. Tetra Bio-Pharma (TBPMF) announced that it has entered into a revised agreement with Echelon Wealth Partners, pursuant to which the underwriter will purchase, on a bought deal basis pursuant to the filing of a short form prospectus, an aggregate of 29,245,300 units of the company at a price of $0.53 per unit for aggregate gross proceeds of $15,500,009. The company intends to use the net proceeds of the offering to continue the development of its clinical program aimed at bringing novel drugs and treatments to patients and their healthcare providers, and for working capital and general corporate purposes. Read More (Newswire)

Indiva closes final tranche of its unsecured convertible debenture offering. Indiva (NDVAF) announced that further to its news releases dated December 9, 2019, and December 23, 2019, it has closed the second and final tranche of its non-brokered private placement of unsecured convertible debentures in the aggregate principal amount of $1,040,000. This brings the total funds raised for this private placement to $3,155,000. The company expects that the proceeds of the offering will be used for capital expenditures, equipment purchases, and working capital purposes. Read More (Globe Newswire)

HEXO closes $20 million registered direct offering. HEXO Corp. (HEXO) announced it has closed its previously announced registered direct offering with institutional investors. Under the offering, the company sold 11,976,048 common shares at an offering price of $1.67 per share for gross proceeds of $20.0 million before deducting fees and other estimated offering expenses. The company also issued to the investors common share purchase warrants to purchase 5,988,024 common shares of the company. The warrants will have a five year-term and an exercise price of $2.45 per share. Read More (Globe Newswire)

Cannabis REIT raises $217 million with equity offering. Innovative Industrial Properties (IIPR) announced the pricing of an underwritten public offering of 2,967,799 shares of its common stock at $73.25 per share for gross proceeds of approximately $217.4 million. The company has also granted the underwriters a 30-day option to purchase up to an additional 445,170 shares of its common stock. All of the shares are being sold by the company. The company intends to use the net proceeds from this offering to invest in specialized industrial real estate assets that support the regulated cannabis cultivation and processing industry that are consistent with its investment strategy, and for general corporate purposes. Read More (New Cannabis Ventures)



Missouri licenses 192 medical marijuana dispensaries. It took only two days for Missouri regulators to award all 192 medical cannabis store licenses in the state. Voters approved a constitutional amendment in 2018 that requires the state’s Department of Health and Senior Services (DHSS) to license at least 192 dispensaries, 24 in each of Missouri’s eight congressional districts, according to St. Louis Public Radio. Medical marijuana sales are expected to begin in the spring, according to the DHSS. Marijuana Business Daily projects annual retail sales will reach approximately $300 million in a few years. Read More (Marijuana Business Daily)

Justice Grown wins an additional 8 Missouri medical cannabis licenses. Justice Grown announced that it has been awarded an additional eight new Missouri medical cannabis licenses. Having just won three cultivation licenses in Missouri in early January, Justice Grown was also granted three manufacturing licenses, as well as five dispensary licenses for the state’s medical cannabis program, bringing the company to a total of 11 licenses for the Show-Me State. The manufacturing licenses will allow the company to create cannabis-infused products, such as edibles, concentrates and tinctures, while the dispensary licenses will allow for the opening of five medical marijuana storefronts across Missouri. Read More (Cannabis Business Times)

1 in 13 Oklahoma adults are now using medical marijuana legally. Oklahoma’s only 18-months into its medical marijuana program, and it has already become one of the most robust medicinal cannabis markets in the entire U.S. The ease of access has allowed a record number of Oklahomans to participate in the program. To date, over 220,000 patient licenses have been approved, granting 1-in-13 adults the legal right to use cannabis. The state’s medical marijuana industry has expanded to meet the growing demand, and the Sooner State now leads the country in per-capita medical marijuana dispensaries, with 56 per 100,000 residents. The small town of Edmond actually has more legal dispensaries per capita than Denver, Colorado. Read More (Merry Jane)

Canadian medical cannabis firms eligible for federal government funding. Medical marijuana companies in Canada interested in exploring business opportunities overseas are eligible to receive financial aid and other forms of support from the federal government through Canada’s Trade Commissioner Service (TCS). The network of trade commissioners reaches more than 160 cities around the world and offices across Canada, helping Canadian businesses reach new markets. A spokesperson for Ontario-based Global Affairs Canada said the TCS can provide services to Canadian companies involved in the medical cannabis industry if they are seeking to do business in jurisdictions that: 1) are parties to the United Nations Single Convention on Narcotic Drugs and 2) have a legal framework for the medical or scientific use of cannabis. Read More (Marijuana Business Daily)

Cannabis compound CBG could be a weapon in fight against superbugs. A compound made by cannabis plants has been found to wipe out drug-resistant bacteria, raising hopes of a new weapon in the fight against superbugs. Scientists screened five cannabis compounds for their antibiotic properties and found that one, cannabigerol (CBG), was particularly potent at killing methicillin-resistant Staphylococcus aureus (MRSA), one of the most common hospital superbugs. Tests in the lab showed that CBG, which is not psychoactive, killed common MRSA microbes and “persister” cells that are especially resistant to antibiotics and that often drive repeat infections. The compound also cleared up hard-to-shift “biofilms” of MRSA that can form on the skin and on medical implants. Read More (The Guardian)

Cannabis helps protect HIV patients’ brains from deteriorating, study finds. A new study published in the Journal of Acquired Immunity Deficiency Syndrome found that HIV patients who consumed cannabis showed significantly less cognitive impairment compared to HIV patients who didn’t. The researchers collected data from 679 people living with HIV and 273 people who didn’t have HIV. Participants’ ages ranged from 18- to 79-years-old. The researchers then assessed each participant to see how well their brain worked, their general state of health, and what kinds of drugs they were currently taking — FDA-approved or otherwise. By the end of it, the researchers found that regular cannabis consumers living with HIV were at a 53 percent lower risk of developing cognitive impairments compared to people living with HIV who didn’t partake. Read More (Merry Jane)

Marijuana is risky for people taking common heart medications. More than 2 million Americans with heart conditions report that they have used marijuana, but many questions remain about the drug’s effects on the heart, according to a review published in the Journal of the American College of Cardiology. What is known, however, is that the drug can interact with common heart medications, including statins and blood thinners, potentially putting patients at risk, the review said. Using marijuana while on a statin or a blood thinner can change how these drugs work in the body, said lead author Dr. Muthiah Vaduganathan, a cardiologist at the Brigham and Women’s Hospital in Boston. More (Analytical Cannabis)

Cannabis extracts don’t effectively relieve cancer pain, review finds. The validity of medicinal marijuana’s most celebrated benefit, pain reduction, has been called into question by a new review. Published in the British Medical Journal, the systematic review of six randomised controlled trials (RCTs) found that cannabinoids were no different to placebos when it came to changing patients’ average pain scores. All trials assessed in the review examined the effects of cannabinoid extracts, such as Sativex, rather than flower-based medicinal cannabis, so its conclusions may not be entirely applicable to many patients’ products. Read More (Analytical Cannabis)


Hemp prices plunge as CBD demand falls short. Hemp prices are plunging amid a “grossly oversupplied” market, according to the head of the industry’s first price provider. Hemp biomass prices reached a high of over $40 a pound in July, just before the 2019 harvest came in, according to PanXchange Chief Executive Officer Julie Lerner. Today, it’s trading under $10 a pound following a quadrupling of supply from 2018 to 2019. Meanwhile, the CBD consumer market remains limited as the U.S. Food and Drug Administration continues to prohibit the extract in food or dietary supplements, although many sellers ignore that mandate. “Every way you slice it, the physical demand for the CBD market is much, much smaller” than the supply, Lerner said in an interview. “I’m a little surprised that retail prices have not started to come down yet. There’s so much competition.” Read More (Bloomberg)

Industry will consolidate and the green rush will be over: Cheryl Shuman. In an interview with Hemp Today, Cheryl Shuman, Founder, Beverly Hills Cannabis Club, USA, told that investors need to truly understand what makes the cannabis and hemp industry “tick”. She further added, “Before there was an industry, this sector was a movement. When the first stocks were traded in the sector, it was fueled by the hunger of the movement to see the end of prohibition. Soon the industry will consolidate and the green rush will be over. Those who invest wisely will make major profits. Those who are inexperienced without professional guidance are risking everything. I urge those who want to invest in high risk stocks to look into private companies that no one has on their radar yet.” Read More (Hemp Today)

CBD warnings from FDA spook major consumer brands. The U.S. Food & Drug Administration (FDA) has started 2020 as it ended 2019 – with a shot across the bows of the booming CBD industry. At the end of last year, the Federal Spending Bill provided the FDA with $2 million of firepower to undertake enforcement. This money will allow it to pursue rogue CBD companies making contentious medical claims, as well as an in-depth analysis of CBD product content – both, to be completed by the summer. However, the FDA’s proclamations have not gone down well in the commercial CBD world. The Wall Street Journal reports on the uncertainty it has caused, saying the likes of PepsiCo, Starbucks, Kellogg and Red Bull have all put CBD plans on hold. It quotes Mike Luce, co-founder of consultancy High Yield Insights, as saying it has gone from ‘all gas on, one foot from the consumers’ to ‘now there’s a very strong foot on the brakes from the FDA’. Read More (CBD Testers)

Former DEA chief joins new CBD advisory panel. A former head of the U.S. Drug Enforcement Administration (DEA) is joining the latest advisory panel tackling CBD regulations. Karen Tandy, who led the DEA from 2003 to 2007 and was the first female DEA chief, is among a panel of former government officials looking at the CBD industry for the Consumer Brands Association, which represents consumer packaged goods companies. The group formerly was known as the Grocery Manufacturers Association. The group’s CBD panel aims to make recommendations and “provide thought leadership and strategic oversight for the industry,” Consumer Brands Association CEO Geoff Freeman said in a statement announcing the panel. Read More (Hemp Industry Daily)

With 40% of hemp testing ‘hot,’ Arizona losses pegged at $13.4 million. Arizona’s budding hemp-growing industry is suffering growing pains as levels of THC that are too high force some farmers to destroy crops instead of harvesting them. More than 40% of hemp from fields in the U.S. state of Arizona that were tested for THC content proved to be over the legal limit, the Arizona Department of Agriculture’s Plant Services Division, which runs the testing program, has reported. A total of 670 acres deemed non-compliant was estimated at a value of about $13.4 million by the state agency, which seemed unsurprised by the test results. More (Hemp Today)

Here is why states are keeping their pilot hemp programs through 2020. Timing, testing, and the lack of in-state access to drug-registered laboratories were among the reasons state agriculture officials in six states said their hemp programs will be run under the 2014 pilot research program this year instead of submitting a 2020 hemp production plan under the new proposed federal rules. “We looked at all the uncertainty of what’s going on at (the U.S. Department of Agriculture) USDA and decided that it would be better for our growers if we just continue on with our program,” told Maine’s state horticulturist, Gary Fish. Read More (Hemp Industry Daily)

Kentucky will skip USDA rule this year, will continue to operate under 2014 Farm Bill pilot program rules for 2020. Kentucky Agriculture Commissioner Dr. Ryan Quarles announced that his state will not submit draft hemp regulations to the U.S. Department of Agriculture, opting instead to remain under the auspices of the 2014 Farm Bill’s pilot program provisions through 2020. The move will allow Kentucky hemp farmers a bit of breathing room, a chance to regroup and watch the federally legalized hemp marketplace settle into itself a bit. And the wariness is not unfounded. Quarles said that he landed on this decision “after much discussion with industry stakeholders in Kentucky”. Read More (Cannabis Business Times)

Hemp producers finding major profits from minor cannabinoids. Will 2020 be the year of the cannabinoid CBG? Some hemp producers are betting on it after a year of overproduction of CBD. Hemp farmers are looking to diversify their production options – and go after larger profits – by sourcing genetics that will allow them to grow novel or minor cannabinoids – including CBG, CBN, CBD-V and others – that are currently high in demand because few growers are producing them. While industry observers warn producers to be careful and source genetics only from reputable breeders, they expect the boom for minor cannabinoids could be as big or bigger than demand for CBD once consumers catch onto the benefits they offer. Read More (Hemp Industry Daily)

Colorado State University to study chemical compounds of hemp. A research center at Colorado State University (CSU) dedicated to studying the chemical compounds in hemp and marijuana is expected to open this spring, school officials said. The research facility on the CSU campus in Fort Collins, Colorado, will allow faculty and students to study the formulation of cannabinoids, separation efficiencies and efficacy testing. The university recently received a $1.5 million donation from Golden, Colorado-based CBD company Panacea Life Sciences, founded by CSU alumna Leslie Buttorff. CSU researchers will work in partnership with the company. Read More (Hemp Industry Daily)


9,000 vape cartridges recalled from Detroit medical cannabis store. Michigan regulators recalled 9,380 vaping cartridges containing vitamin E acetate sold by a licensed medical marijuana dispensary in Detroit. The vape cartridges recalled by the state’s Marijuana Regulatory Agency (MRA) came from Plan B Wellness. The cartridges recalled were manufactured before Plan B Wellness obtained its medical marijuana license, an MRA spokesperson told The recall includes 1,360 cartridges that were sold and 8,020 that had been pulled from the shelves. The existing inventory is to be destroyed. Read More (Marijuana Business Daily)

San Francisco vape shops scramble with ban taking effect. San Francisco’s first-in-the-nation ban on e-cigarette sales, scheduled to take effect this week, is weighing heavily on Asad Sharifi, who owns Cheaper Cigarettes in the city’s Sunset District. Similar misgivings have been brewing among the 700-plus tobacco retailers in San Francisco — many of them family-owned and immigrant-owned corner stores, smoke shops and vape shops — since city officials passed an ordinance in June prohibiting the sale of many nicotine vaping products, specifically those that have not been cleared by a Food and Drug Administration review required under federal law. Read More (San Francisco Chronicle)


Alaska pot shops to be among first in U.S. to allow consumption. Marijuana shops in Alaska will be among the first nationally where onsite use would be permitted. Alaska’s legal marijuana industry hit the milestone as regulators approved the first retail stores in the state that will be allowed to have customers smoke or consume marijuana products on site. Some cities in other states have approved such actions, but these are the first state-issued approvals, said Chris Lindsey, director of government relations with the Marijuana Policy Project. “But clearly we’re still very, very early in all of this,” Lindsey said. Read More (BNN Bloomberg)

Illinois’ first marijuana lounge gets approved, hours away from Chicago. A Springfield marijuana dispensary is the first in the state to get approval to open a spot for people to smoke weed. Illinois Supply and Provisions plans to connect the space to its marijuana shop in downtown Springfield. The company is still working on the concept and has not set an opening date. “It’s going to be more than just a big open room where people can smoke cannabis,” said spokesman Chris McCloud. “It’s going to be well done, it’s going to be tastefully done, and it’s going to be an experience”. Read More (Chicago Tribune)

Gentrification in the cannabis industry and the War on Drugs. There is a theory that the War on Drugs has morphed into a new strategy: Legalization or Regulations. The main idea in this theory is that the strategy was to legalize cannabis, create all kinds of social equity programs that go nowhere, and then apply such difficult application processes, extremely high fees, legal and operational costs that only big money can possibly afford to open licensed cultivation, manufacture, distribution, or dispensary operations. Part of the “legalization promise” included many great ideas about how the newly legal industry must ensure that the groups who have suffered the most under the War on Drugs can participate in the green rush. Read More (420 College)

Weed? CBD? New products, new laws are causing confusion in the workplace. Cannabidiol or CBD has been showing up in a widening array of goods. That’s because federal legislation in 2018 deemed that hemp – one of its sources – was not an illegal controlled substance. But a person’s job could be in jeopardy if one of those products, which are largely unregulated, contains THC, the same compound that causes marijuana users to get high. Employers are now grappling with CBD use by their employees, while also dealing with the rising legalization of recreational and medical marijuana in states across the country. Read More (USA Today)

MLB officially removes cannabis from banned substances list. In a move that raised many eyebrows, Major League Baseball (MLB) and the players union announced they had reached an agreement to remove cannabis from the sport’s banned substances list. “Going forward, marijuana-related conduct will be treated the same as alcohol-related conduct under the Parties’ Joint Treatment Program for Alcohol-Related and Off-Field Violent Conduct, which provides for mandatory evaluation, voluntary treatment and the possibility of discipline by a Player’s Club or the Commissioner’s Office in response to certain conduct involving natural cannabinoids,” MLB said via an official press release. Read More (Cannabis Aficionado)

BLK MKT cannabis brand sparks controversy over racist marketing. A booth slogan at Vancouver’s Lift & Co. (LFCOF) trade show sparked controversy over racism and diversity in the cannabis sector. At its center was a booth from BLK MKT, an adult-use brand launched in early December by LP GTEC Holdings (GGTTF), with large text on one side reading “Once You Go BLK”. Lift & Co itself tweeted advertisements for the booth, including the slogan, and a hail of angry responses followed accusing the company of being complicit in advertising that was both racist and sexualized. Read More (Leafly)


Buy the shop, not the pot: Cannabis retail chains may outshine producers. Canadian cannabis retail chains see themselves as the kingmakers of brands, and the growth engine driving the sector as more store locations broaden access to legal pot. Analysts expect a strong performance from pot shop chains in 2020, as producers seek to wedge pricier products into limited store space. However, the capital crunch of 2019 may haunt those without deep pockets. Fire & Flower (FFLWF), Meta Growth (NACNF) (formerly National Access Cannabis), and High Tide (HITI-CA) collectively oversee more than 100 stores, and they all plan to grow their retail footprints in 2020. Chief executives from the three companies participated in a panel hosted by AltaCorp Capital, where they discussed how they see cannabis retail evolving in 2020. Read More (Yahoo! Finance)

California to require marijuana retailers to exhibit QR code. Citing the 2019 vaping crisis, California cannabis regulators mandated that licensed marijuana retailers and distributors display a QR code in order to differentiate legal cannabis businesses from illicit ones. The new regulation will go into effect after it’s approved by the state Office of Administrative Law, which will likely take at least two weeks. “The move is designed to help consumers identify licensed cannabis retail stores, assist law enforcement and support the legal cannabis market where products such as vape cartridges are routinely tested to protect public health and safety,” the state Bureau of Cannabis Control (BCC) said in a statement. The mandate stems from vape-related lung illnesses that led to at least 60 deaths nationwide and 2,600 hospitalizations last year. Read More (Marijuana Business Daily) and More (CNN Business)

20 new BC cannabis stores planned. The BC Liquor Distribution Branch has 20 BC Cannabis Stores in the works that already have local government approval and are currently in the process of being built. Viviana Zanocco, the branch’s manager of corporate communications, says locations include Penticton, two in Nanaimo, two in Prince George, Vanderhoof, Oliver, Vernon, Prince Rupert, Port Coquitlam, Quesnel, Sechelt, Salmon Arm, Maple Ridge, North Vancouver, Kelowna, and New Westminster. “One or two of those might be pushed into next year,” notes Zanocco, adding that two BC Cannabis Stores have already opened in 2020: Kamloops and Parksville. Read More (Cannabis Retailer)

Meta Growth provides update on Ontario roll-out. Meta Growth (NACNF) announced that both of the winners of the Ontario cannabis store lottery which the company has entered into agreements with have received their Retail Operators License. “Receipt of their Retail Operators License is a major milestone for the lottery winners,” said Mark Goliger, CEO of Meta Growth. “The last step to open these stores is to pass store inspection and considering the construction is in its final stage, we expect this in a matter of days for Toronto and a few weeks for Kitchener”. Read More (Newswire)

Pot delivery services looking to replace illicit dealers face hurdles. Selling cannabis largely used to be the domain of drivers shuttling illicit product directly to their customers. But companies aiming to replicate that model in the legal cannabis industry may face challenges given the nature of Canada’s regulatory framework. Only a handful of provinces such as Manitoba, Saskatchewan, and Alberta have rules in place that would allow third-party companies to deliver legal pot from provincial retailers to customers. Other provinces in Atlantic Canada and Quebec opted for a more cautious approach to cannabis delivery with more prohibitive regulations on how third parties can manage their cannabis distribution. Read More (BNN Bloomberg)



Mexican Senate proposes latest draft for cannabis legalization. Mexico took its latest step in what has become a seemingly interminable process towards the legalization of adult use cannabis. The country’s Senate published a draft of legislation that would regulate the consumption, production, harvest, packaging, distribution, and other facets of marijuana culture. The justice and health committees presented the weekend’s new plan in tandem. The Senate hopes to debate and pass the legislation during its next session, which will take place from February to April. Notably, the new law would guarantee access to medicinal cannabis for individuals with severe qualifying health conditions. The legal limit for possession would rise from five to 28 grams for individuals. Read More (High Times)

Italy sets THC limits, testing standards for hemp food. Italy put in place a THC limit for foods made from hemp’s grain, giving producers “long-awaited” guidance for bringing products to market. The Italy Ministry of Health set the maximum THC levels at: 2 milligrams per kilogram for flour, seeds and supplements derived from hempseed (grain); 5 milligrams per kilogram for oil derived from hempseed. Italy set the limits in a decree published January 15. The levels apply only to hemp food derived from the plant’s grain, not foods infused with CBD or other cannabinoids. Read More (Hemp Industry Daily)

German pharmacies have a new pharmaceutical CBD supplier. A Cologne, Germany-based distributor of medical cannabis started offering pure CBD in kits with which pharmacists can compound preparations according to a doctor’s prescription. The kits allow pharmacists to prepare oils with either 5% or 10% CBD, depending on the prescription, and include: 3.5 grams of European Union-Good Manufacturing Practice (GMP)-certified CBD, 6 brown glass bottles, 90 milliliters of mygliol oil, and dosing syringe. Currently, only a handful of suppliers offer CBD to pharmacies that can be dispensed to patients. One of these is Ontario-based Canopy Growth (CGC) through its acquisition of C3. The price at which the pharmacies buy the CBD varies depending on the size of the order and the supplier, but it is typically between 60 euros to 70 euros ($66-$77) per gram. Read More (Marijuana Business Daily)

Delayed French medical cannabis pilot program planned for Q3 launch. In 2019, France announced plans to commence a medicinal cannabis pilot, which is now due to start in September 2020. According to New Frontier Data, the country’s cannabis consumer market is worth an estimated € 9,437,336,621. The pilot will run for two years with the initial six months will serve to identify the 3000 patients who will most benefit from the programme. The second six months will focus on recruiting hospitals, private clinics and multidisciplinary centers where the specialized doctors, physicians and clinicians will be located. All participating medical professionals will be required to go through an extensive online training programme. One these steps are completed, the pilot is expected to be fully operational, and the first prescriptions for medicinal cannabis are expected to start in January 2021. Read More (New Frontier Data)


Chart 9: Medical Cannabis in France Source: Intro-Blue, New Frontier Data

Chart 9: Medical Cannabis in France
Source: Intro-Blue, New Frontier Data


New Zealand to overturn cannabis vaporizer ban, clearing the way for imports. New Zealand plans to reverse a law banning cannabis vaporizers before new regulations kick in for the launch of the country’s medical program in April. “Currently, vaporizers are prohibited under the Misuse of Drugs (Prohibition of Cannabis Utensils and Methamphetamine Utensils) Notice,” a Health Ministry spokesperson told. Reversing the ban will create opportunities for international companies to supply the New Zealand market, provided the vaporizers have been approved as medical devices by a national health body. The ministry envisions this will be completed before the regulations go into force April 1. Read More (Marijuana Business Daily)

No edibles under New Zealand’s medical cannabis scheme, government says. Businesses will be barred from marketing cannabis edibles under New Zealand’s medical program, which kicks off in April, the government confirmed, eliminating for now the opportunity for companies to capitalize on what could be a sizable market. Some businesses had believed that doctors would be allowed to prescribe edibles. A Health Ministry spokesperson said medical cannabis products are prescription medicines under the Medicines Act 1981. But the law effectively bars edibles. The upcoming change will allow for the import of dry herb and oil vaporizers that have been approved as medical devices by a national health body. Read More (Marijuana Business Daily)

Thailand issues 442 medical cannabis licenses, but full market access years away. Thailand is on track to be competitive in the nascent Asian medical marijuana and hemp markets, but the full commercialization of the sector and liberal access for private businesses is not likely to be implemented before 2024, according to a new report. By 2024, Cannabis Catalysts estimates that the Southeast Asian country’s wholesale medical cannabis market could be worth $46 million to $312 million, depending on a wide range of factors. Among the report’s estimates for 2024: Medical cannabis tourism could be worth $60 million, the export potential of medical cannabis is upwards of $618 million, and the ancillary market for medicinal cannabis could be valued from $808 million to $1 billion. Read More (Marijuana Business Daily)


Sixth Wave Innovation introduces Affinity. Sixth Wave has announced Affinity™, their new cannabinoid separation and purification system that will simplify processing and innovate the field. The President and CEO of Sixth Wave, Jonathan Gluckman Ph.D., spoke with Kristina Etter of Cannabis Tech to detail this technology. Through offering higher yields than chromatography, Affinity™ aims to save $0.25 per gram of processed material. It is capable of producing a wide variety of market-ready products including: THC-Free Crude Oil, THC-Free Distillates, and cannabinoid isolates. Read More (Cannabis Tech)

Rapid Dose Therapeutics and McMaster University awarded NSERC Research and Development grant. Rapid Dose Therapeutics Corp. announced their newest research partnership program entitled “Rapid Delivery of Therapeutics via Dissolution of Polymeric Films” with McMaster University, located in Hamilton, Ontario, Canada. This research program, which was successfully awarded a NSERC Collaborative Research and Development (CRD) grant, will receive a total funding amount of $540,000 over three years, effective January 1, 2020. The project will focus on developing novel biopolymer compositions that can offer enhanced drug delivery performance when formulated in oral dissolvable thin films. Read More (Globe Newswire)

EcoGen Labs is building new headquarters in Colorado and expanding genetics capacity. Colorado-based EcoGen Laboratories will build out a new headquarters in Grand Junction, in the western half of the state, showcasing the growth of a company that now employs 205 people. Just last years, EcoGen landed what it called “the largest genetics deal in the history of the CBD industry.” The company sold 20 million feminized hemp seeds in March 2019 at the annual NOCO Hemp Expo in Denver. The price tag? $11 million. Now, the Grand Junction footprint will expand on that work. Read More (Cannabis Business Times)

Why bioactive terpenes will soon share headlines with CBD and other cannabinoids. Terpenes are the precursors of terpenoids. Terpenes, cannabinoids, and the other phyto-compounds give cannabis, including so-called industrial hemp with low THC potency and its oil, their unique medicinal benefit, taste, and smell. Terpenes work together with cannabinoids and other plant compounds through the “entourage effect.” This symbiotic interplay of many different naturally occurring molecules in various ratios in different cannabis cultivars has been attributed to the improvement of therapeutic qualities. The good news about terpenes is that the FDA has acknowledged that terpenes as safe. Terpenes can be used in various ways, including oral consumption and inhalation by vaporization. Read More (Cannabis Tech)


Data leak shows legal weed is a privacy nightmare waiting to happen. A sales management system specifically geared towards the cannabis industry has exposed the personal information of over 30,000 people by storing it in an unsecured database. The leak itself has been patched, but questions about the consequences of outing who uses a quasi-legal substance hang over the increasingly mainstream industry. THSuite, which makes software for selling cannabis, stashed extensive customer information collected by at least three U.S. dispensaries in plain sight, according to the cybersecurity firm vpnMentor, which warned that many more dispensaries may have been affected. Among the exposed details were full names, dates of birth, phone numbers, emails, addresses, signatures, cannabis varieties and quantities purchased, the amount of money each customer spent, and transaction dates. Read More (The Daily Beast)

Hawthorne Gardening Company announces the first DesignLights Consortium listing for Gavita LED lighting fixtures. Hawthorne’s Gavita 1700e LED lighting fixture has been certified by the DesignLights Consortium (DLC). This listing status means growers who purchase the fixture are now eligible for state and national rebates—potentially cutting upfront equipment costs by as much as half and making it increasingly appealing for growers to switch to more efficient LEDs inside their facilities. As the first Gavita fixture with DLC listing status, the 1700e combines power and efficiency like never before in the brand’s three-decade history. Read More (Cannabis Business Times)


MediPharm sues Hexo claiming breach for $9.8M in unpaid bills. MediPharm Labs (MEDIF) is suing Hexo Corp. (HEXO) after alleging the pot producer failed to pay for millions of dollars’ worth of cannabis oil over a supply deal signed last year, the marijuana extraction company said in a court filing. MediPharm issued a press release stating its wholly-owned subsidiary filed a lawsuit against an unnamed cannabis producer for $9.8 million in an outstanding payment related to a supply deal announced in 2018. According to court documents obtained by BNN Bloomberg, MediPharm filed a lawsuit against Hexo in the Ontario Superior Court of Justice’s London office for the $9.8 million outstanding. The lawsuit alleges that no payments have been made on behalf of Hexo to MediPharm since October. Read More (BNN Bloomberg)

California marijuana firm Falcon seeks $50 million from Harvest. California-based cannabis firm Falcon International wants a $50 million breakup fee from multistate operator Harvest Health & Recreation (HRVSF). Falcon is asking for a cash payment as part of a move to dismiss a complaint that Arizona-based Harvest filed January 8. In that lawsuit, Harvest sought to terminate its acquisition of Falcon, a deal that was announced in February 2019. As part of the suit, Harvest is seeking the $50 million it paid to Falcon as part of the merger agreement. Read More (Marijuana Business Daily)

Golden Leaf Holdings Pursues legal action against BMF Washington and its owner. Golden Leaf Holdings (GLDFF) have filed a lawsuit against BMF Washington LLC and Peter Saladino, seeking to recover US$‎6,916,580 in damages. The plaintiffs assert two claims for breach of contract, arising out of the parties’ equipment leasing and intellectual property licensing agreements, seeking damages of US$676,580 and US$2,080,000, respectively, with alternative claims against both BMF and Saladino for unjust enrichment related to their improper use of plaintiffs’ equipment and intellectual property. Read More (Cannabis Business Times)


Illinois social equity cannabis applicants laud licensing help from consultants, technology. Many marijuana industry watchers tout the social equity program in Illinois as one of the most far-reaching and likely to succeed in the U.S. cannabis sector. However, experts also note that for all the Illinois program’s positive intent, it is still a sometimes prohibitively expensive and burdensome undertaking for any social equity applicant. With associated expenses potentially in the hundreds of thousands of dollars and an application package running up to 700 pages, many are put off from the get-go. Read More (Marijuana Business Daily)

Energy efficient cannabis cultivation. Beyond innovations, efficiency in sustainable cultivation through standard practices has moved the cannabis industry towards a green movement. Many of these standard practices include improvements in waste management, adding value to waste by recycling and forwarding any useful, compostable materials towards local non-cannabis farming sectors. Strategies in production by taking advantage of peak demand can help mitigate high energy demand by up to a 22% reduction. Creating energy efficiency regulations through consolidation efforts has added a net value to the need to write up certifiable standards of cultivation for cannabis growers. Read More (Cannabis Tech)


Chart 10: Wholesale Cannabis Pricing Guide 2019 Source: Intro-Blue, Leafly

Chart 10: Wholesale Cannabis Pricing Guide 2019
Source: Intro-Blue, Leafly


Chart 10: Wholesale Cannabis Pricing Guide 2019 Source: Intro-Blue, Leafly

Chart 10: Wholesale Cannabis Pricing Guide 2019
Source: Intro-Blue, Leafly


Chart 11: Weekly Summary (January 1 – January 10, 2020) Source: Intro-Blue, Viridian Capital Advisors

Chart 11: Weekly Summary (January 1 – January 10, 2020)
Source: Intro-Blue, Viridian Capital Advisors

Chart 11: Weekly Summary (January 1 – January 10, 2020) Source: Intro-Blue, Viridian Capital Advisors

Chart 11: Weekly Summary (January 1 – January 10, 2020)
Source: Intro-Blue, Viridian Capital Advisors

Chart 11: Weekly Summary (January 1 – January 10, 2020) Source: Intro-Blue, Viridian Capital Advisors

Chart 11: Weekly Summary (January 1 – January 10, 2020)
Source: Intro-Blue, Viridian Capital Advisors


Chart 12: Cannabis Capital Raises by Week (2020) Source: Intro-Blue, Viridian Capital Advisors

Chart 12: Cannabis Capital Raises by Week (2020)
Source: Intro-Blue, Viridian Capital Advisors


Chart 13: Cannabis M&A Activity by Week (2020) Source: Intro-Blue, Viridian Capital Advisors

Chart 13: Cannabis M&A Activity by Week (2020)
Source: Intro-Blue, Viridian Capital Advisors


Chart 14: U.S. Cannabis Market Prices Source: Intro-Blue, Cannabis Benchmarks Price Index

Chart 14: U.S. Cannabis Market Prices
Source: Intro-Blue, Cannabis Benchmarks Price Index

Chart 14: U.S. Cannabis Market Prices Source: Intro-Blue, Cannabis Benchmarks Price Index

Chart 14: U.S. Cannabis Market Prices
Source: Intro-Blue, Cannabis Benchmarks Price Index


Chart 15: U.S. Implied Forward Prices (Week Ending January 17, 2020) Source: Intro-Blue, Cannabis Benchmarks Price Index

Chart 15: U.S. Implied Forward Prices (Week Ending January 17, 2020)
Source: Intro-Blue, Cannabis Benchmarks Price Index


Chart 16: Canada Cannabis Spot Index Source: Intro-Blue, Cannabis Benchmarks Price Index

Chart 16: Canada Cannabis Spot Index
Source: Intro-Blue, Cannabis Benchmarks Price Index


Chart 17: Best-Selling Flower Brands and Products in Colorado Source: Intro-Blue, Headset

Chart 17: Best-Selling Flower Brands and Products in Colorado
Source: Intro-Blue, Headset


Chart 18: Best-Selling Edibles Brands and Products in Colorado Source: Intro-Blue, Headset

Chart 18: Best-Selling Edibles Brands and Products in Colorado
Source: Intro-Blue, Headset


Chart 19: Best-Selling Vapor Pens Brands and Products in Colorado Source: Intro-Blue, Headset

Chart 19: Best-Selling Vapor Pens Brands and Products in Colorado
Source: Intro-Blue, Headset


Chart 20: Best-Selling Beverage Brands and Products in Colorado Source: Intro-Blue, Headset

Chart 20: Best-Selling Beverage Brands and Products in Colorado
Source: Intro-Blue, Headset


Chart 21: Best-Selling Capsules Brands and Products in Colorado Source: Intro-Blue, Headset

Chart 21: Best-Selling Capsules Brands and Products in Colorado
Source: Intro-Blue, Headset


Chart 22: Best-Selling Topical Brands and Products in Colorado Source: Intro-Blue, Headset

Chart 22: Best-Selling Topical Brands and Products in Colorado
Source: Intro-Blue, Headset



Chart 27: U.S Cannabis Index Source: Intro-Blue, The Marijuana Index

Chart 27: U.S Cannabis Index
Source: Intro-Blue, The Marijuana Index


Chart 28: Canada Cannabis Index Source: Intro-Blue, The Marijuana Index

Chart 28: Canada Cannabis Index
Source: Intro-Blue, The Marijuana Index


Important Disclosures
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