AURORA CANNABIS (ACB) IS UP 176% IN TWO WEEKS; WILL THE RALLY SUSTAIN?
The acquisition of U.S. hemp retailer Reliva LLC gives Aurora Cannabis (ACB) a foothold into the $24 billion U.S. CBD market and is one of the key catalysts of the sharp appreciation in ACB’s stock price over the last couple of weeks. On May 20, ACB announced that it will acquire Reliva LLC in a $40 million all-stock deal. This move marks the company’s initial foray into the U.S. CBD market that is expected to grow to $24 billion in retail sales by 2025 driven by the federal legalization of hemp in the 2018 Farm Bill that also prompted other Canadian LPs like Canopy Growth (CGC) and Cronos Group (CRON) to enter the U.S. market. The transaction is value accretive and synergistic for ACB since Reliva’s retail footprint covers ~40% of the 50,000 stores selling CBD in the U.S. at the moment through convenience stores like Circle K, which is owned by Alimentation Couche-Tard Inc. In addition, most of Reliva’s products are priced under $20, in line with ACB’s value positioning in the Canadian market. Given rising unemployment and the expected decline in spending by U.S. consumers, value products are likely to outsell premium products in the near future, a theme discussed in our April 1 Stash report. This acquisition positions ACB to benefit from that trend. The other advantages that Reliva brings to ACB include: 1) a focus on regulatory, testing and compliance protocols, 2) a proven management team with extensive CPG experience – Reliva CEO Miguel Martin is the former President of e-cigarette maker Logic Technology and former SVP and GM of Altria Sales & Distribution, 3) deep relationships with critical trade partners who provide a national distribution footprint in the U.S., and 4) financial discipline and a track record of profitability – Reliva recorded $14 million in annual sales last year with operating profit and no debt. Overall, the combination of synergistic product offerings, strong retail and distribution footprint, profitable operations, and expanded management bandwidth mark a solid entry for ACB into the world’s biggest cannabis market.
Better-than-expected earnings and reiteration of positive EBITDA guidance is the second reason behind the sharp surge. ACB beat Street estimates and reported CAD $75.5 million in net revenue during 3QFY20 (quarter ended March), up 35% q/q and 16% y/y, driven by the launch of Daily Special, Aurora’s value brand, and a full quarter of Cannabis 2.0 products. Medical cannabis net revenue, both Canadian and international, also showed healthy growth of 13.5% q/q. In line with the business transformation plan announced the company in February, it continued to optimize costs, resulting in a lower net loss of CAD $137.4 million vs. CAD $160.2 million a year ago and a massive CAD $1.3 billion in the previous quarter. The biggest positive, however, was the reiteration of positive adjusted EBITDA guidance for 1QFY21 (quarter ending September 2020) despite the uncertainty created by the COVID-19 pandemic – the company intends to meet its guidance through cost reductions and efficiencies in COGS and SG&A and believes it has numerous cost levers at its disposal to meet the positive adjusted EBITDA goal.
Investors looking to build positions at current levels, however, must consider the following headwinds – an uncertain regulatory environment, intense competition, lack of stability at the leadership level (CEO), a weak balance sheet, and rich valuation. U.S. hemp players have been facing intense scrutiny over their medical claims and advertising practices from the U.S. FDA and U.S. FTC, and this has acted as an overhang on their growth and valuations. Further, passage of the Farm Bill has attracted many players resulting in high competition and lower-than-expected revenue growth for players like Charlotte’s Web Holdings and the bankruptcy of Green Growth Brands, a major U.S. CBD seller. ACB is still run by Chairman and Interim CEO Michael Singer and, unlike CGC, it does not yet have a stable leadership team to execute its business transformation plan. After the recent run up, ACB’s stock is trading at >7x NTM sales, trailing only CGC and CRON, both of which have strong cash balances and the backing of CPG giants like Constellation Brands (STZ) and Altria Group (MO). ACB, on the other hand, has sizeable debt ($592 million) and a much weaker balance sheet compared to these players, implying that the valuation multiple has little room for upside after the current run up and that investors should wait for continued proof of performance and favorable valuations before going long on the name.
Postponing the green wave: Cannabis legalization in 2020. With cannabis already legal for medical use in 33 states; legal for medical and adult-use in 11 states; and more members of Congress – even those who previously opposed legalization – now supporting cannabis policy, state legalization agendas were moving quickly. But what was set to be a banner year for the cannabis industry has been slowed down by COVID-19. Nevertheless, COVID-19 has shown legal, regulated marijuana’s place as an “essential business,” even if state legislative activity may not come until 2021 or later. Read More (Forbes)
Was quarantine made for cannabis? Late last month, while President Trump flirted with solutions to the coronavirus—sunbathing with a “very powerful light,” injecting Lysol to clean the lungs—others elected to smoke pot. In Los Angeles, as a queue of cars crept slowly in a two-hour In-N-Out Burger drive-through line, in Hollywood, a string of people, standing six feet apart, snaked down the block outside the MMD cannabis dispensary. Mishka Ashbel, who co-owns the dispensary with his brother, Slava, said, “We get to provide a little relief to a stressed society.” Los Angeles, which shuttered its beaches and hiking trails, has deemed weed an essential service, critical to residents’ health and well-being. Read More (The New Yorker)
Quarantined Americans embrace cannabis, reshaping an industry. With nine in 10 Americans approving of either medicinal or recreational use, more than 20 states deeming medical or recreational sales “essential” businesses during the pandemic shutdown, and Americans using more weed than usual while they’re quarantined, advocates say the crisis will push the federal government to follow the lead of 33 states and legalize cannabis faster than it would have. The coronavirus has changed the landscape, they say. Governments, revenue-poor after months of lockdown, have an impetus to tap a marijuana tax and expand employment opportunities. Ben Kovler, of Green Thumb Industries (GTBIF), compared the situation with the end of Prohibition during the Great Depression. Read More (BNN Bloomberg)
Canadian cannabis sales surged in March amid COVID-19. Retail sales of regulated cannabis in Canada soared in March, growing 19% on a monthly basis to a record CAD $181 million ($129 million). The spike in cannabis sales came even as overall monthly retail sales in Canada cratered by an unprecedented 10% in March during the COVID-19 pandemic. In Canada’s four most-populated provinces, March retail cannabis sales increased as follows: Ontario – 21% to CAD $47.3 million; Quebec – 29% to CAD $37.7 million; British Columbia – 12% to CAD $23.5 million; Alberta – 21% to CAD $40.4 million. On an annual basis, the CAD $181 million worth of regulated cannabis sold in March 2020 represents a nearly 200% increase over March 2019, when Canada’s still-developing sector sold CAD $60.9 million worth of cannabis at retail. Read More (Marijuana Business Daily)
Researcher claims cannabis shows promise blocking coronavirus infection. Dr. Igor Kovalchuk led a team of researchers at the University of Lethbridge that examined over 400 cannabis strains to see if any of them helped reduce the chances of someone being infected by the coronavirus strain. Of the 400 strains examined, roughly a dozen of them showed promising results when cannabinoids were extracted from them according to the researchers. “A number of them have reduced the number of these (virus) receptors by 73 percent, the chance of it getting in is much lower,” Kovalchuk said according to Calgary Herald. “If they can reduce the number of receptors, there’s much less chance of getting infected.” Read More (Cannabis & Tech Today)
Prince Edward Island to reopen cannabis stores with restrictions. Licensed recreational cannabis stores in Prince Edward Island will reopen on May 22 “with limited access,” the government-operated marijuana retailer announced. All four PEI Cannabis stores on the island were closed on short notice in March in response to the COVID-19 pandemic, although online sales continued. The reopened stores will feature public health measures, including: Restricting the number of customers inside each store; Security outside stores to ensure customers line up in accordance with social-distancing rules; Floor markings to encourage social distancing inside stores; A “general screening” at store reception areas “to ensure compliance with self-isolation requirements”; Encouraging “touch-free” shopping in stores and promoting online orders; and Temporarily eliminating cash payments and product returns. Read More (Marijuana Business Daily)
STATE AND REGULATORY NEWS
New York governor says ‘I believe we will’ legalize marijuana. The governor of New York said that while the legislature hasn’t been able to pass a marijuana legalization bill so far during this legislative session, he feels the issue will end up getting over the finish line sooner or later. Gov. Andrew Cuomo (D) was asked during a coronavirus update briefing why the state hasn’t legalized cannabis as a way to generate revenue for economic relief rather than depend on federal funds. On marijuana reform, he said “I support legalization of marijuana passage. I’ve worked very hard to pass it. I believe we will, but we didn’t get it done this last session because it’s a complicated issue and it has to be done in a comprehensive way.” Read More (Marijuana Moment)
U.S. Virgin Islands governor unveils revised marijuana legalization bill. The governor of the U.S. Virgin Islands (USVI) unveiled a revised marijuana legalization bill, making a series of changes to previously introduced legislation and transmitting it to the Senate for consideration. Gov. Albert Bryan Jr. (D), who pushed for legalization as part of his State of the Territory address in January and previously called lawmakers into a special session to take up the issue, said in a letter to Senate President Novelle Francis Jr. (D) that the revisions to the bill were the product of “listening discussions with multiple senators and the general public.” Read More (Marijuana Moment)
Virginia governor officially signs marijuana decriminalization bills into law. The governor of Virginia signed a pair of identical bills to decriminalize marijuana possession in the state. Following the lawmakers’ initial passage of the measures in March, Gov. Ralph Northam (D) recommended a series of amendments and sent the legislation back to the Senate and House of Delegates for consideration. While they adopted 15 amendments, they rejected two, including one that proposed to delay a required study into the impact of broader cannabis legalization. Under the legislation, possessing up to one ounce of cannabis will be punishable by a $25 fine with no threat of jail time and no criminal record. Current Virginia law makes simple possession punishable by a maximum $500 fine, up to 30 days in jail and a criminal record. Read More (Marijuana Moment)
Louisiana lawmakers advance three marijuana reform bills in one day, including cannabis banking. Louisiana lawmakers advanced three marijuana reform bills, and that includes legislation that would dramatically expand the state’s medical cannabis program and offer protections for banks that service marijuana businesses. House-passed legislation to allow physicians to recommend medical cannabis to patients for any debilitating condition that they deem fit was approved by the Senate Health and Welfare Committee in a 5-1 vote. Another bill introduced by Rep. Edmond Jordan (D) to protect banks and credit unions that service cannabis businesses from being penalized by state regulators also advanced, clearing the full House of Representatives in a 74-20 vote. Over in the Louisiana House Labor and Industrial Relations Committee, members unanimously approved a resolution to establish “a task force to study and make recommendations relative to the cannabis industry projected workforce demands.” Read More (Marijuana Moment)
Maine’s largest city OKs adult-use cannabis, caps store licenses at 20. Portland, Maine, has opted into the state’s recreational marijuana industry with plans that call for 20 retail licenses and a scoring bonus for applicants who have been residents for at least five years. The City Council of Maine’s biggest city voted 8-1 to approve the proposed licensing ordinance after more than a year of deliberations, according to the Portland Press Herald. Councilors rejected a city staff recommendation to drop the residency scoring bonus. The state recently decided it wouldn’t enforce a four-year residency requirement because officials didn’t believe the requirement could withstand a legal challenge by Maine’s largest medical cannabis operator, Wellness Connection of Maine. Read More (Marijuana Business Daily)
Nevada marijuana sales see steep decline in February prior to pandemic. According to Nevada Department of Taxation (NDOT) data, Nevada cannabis retailers generated almost $51.7 million in revenue in February, down from over $64.1 million in sales in January. Those figures include both retail sales of adult-use and medical cannabis, with February’s off by 19.4% compared to January’s cumulative revenues. February 2020’s sales are up by 3.2% year-over-year, compared to over $50.1 million in cumulative revenue recorded in the same month in 2019. Recent months have generally seen year-over-year sales increases of around 20%. February 2020’s total retail revenues are the lowest monthly sales figure recorded for Nevada’s market since February 2019. While sales did decline from January to February 2019 they did so by a much smaller magnitude, of 5%. Read More (Cannabis Benchmarks)
Lessons from the Colorado recreational market’s sixth birthday. In the six years since Colorado began legalized adult-use sales, the state’s cannabis industry has proven to be a fast-growing source of tax revenue, generating over $300 million in taxes and licensing fees in 2019 alone — equivalent to 1% of the state’s annual budget. The tax revenues earned have been fueled by rapid growth in the industry, which includes nearly 3,000 licensed plant-touching businesses across the supply chain employing approximately 39,000 statewide. Two main drivers of tax revenue have been a 15% retail tax rate (which has yielded $692 million over the six years), and a 15% excise tax rate generating $304 million. Those taxes have provided a valuable infusion of revenue for myriad state programs, with Colorado’s education system being a notable beneficiary. Read More (New Frontier Data)
D.C. Mayor’s budget plan seems to set stage for legal marijuana sales. The mayor of Washington, D.C. released a budget plan for the 2021 fiscal year, and it contains a signal that the local government is preparing to implement regulations for retail marijuana sales just as soon as Congress allows it. Mayor Muriel Bowser (D) is proposing to shift regulatory and licensing responsibilities for the city’s current medical cannabis program from the Department of Health to the Alcoholic Beverage Regulation Administration (ABRA). The budget also calls for the establishment of “a non-lapsing Medical Cannabis Administration Fund to collect all funds received from medical cannabis licensing, permitting, and registration fees,” according to a fiscal impact statement. Read More (Marijuana Moment)
U.S. cannabis spot index nominally unchanged at $1,322 per pound, June forward unchanged at $1,425 per pound. The simple average (non-volume weighted) price was unchanged at $1,525 per pound, with 68% of transactions (one standard deviation) in the $784 to $2,266 per pound range. The average reported deal size decreased to 2.2 pounds. In grams, the Spot price was $2.92 and the simple average price was $3.36. The average reported forward deal size was 35.6 pounds. The proportion of forward deals for outdoor, greenhouse, and indoor-grown flower was 47%, 37%, and 16% of forward arrangements, respectively. Read More (Cannabis Benchmarks)
Federal judge orders Ohio to let marijuana decriminalization campaigns collect signatures electronically. A federal judge ruled that activists seeking to place marijuana decriminalization measures on local ballots across Ohio can collect signatures electronically after they were forced to suspend in-person gathering due to the coronavirus pandemic. The court also ordered state officials to extend the deadline to submit signatures from July 1 to July 31. The Sensible Movement Coalition (SMC), which has been behind more than a dozen successful decriminalization initiatives across the state in recent years, had big plans for 2020. They were gearing up to collect signatures in 14 additional municipalities before officials enacted stay-at-home orders and required social distancing measures. Those restrictions effectively spelled doom for the campaigns, and activists went to court to argue that preventing an alternative signature gathering method was unconstitutional under the circumstances. Read More (Marijuana Moment)
Legalizing marijuana boosts hotel bookings as cannabis tourism takes off. Colorado hotel room rentals increased considerably after the state began legal marijuana sales, a newly published study reveals. Washington State also saw increases in tourism after legalization, though the effect there was more modest. By comparing hotel room rentals in Colorado and Washington to states that did not change their legal status of marijuana from 2011 through 2015, researchers found that legalization coincided with a significant influx of tourists and a rise in hotel revenue. In Colorado, legalizing possession led to monthly hotel booking increases of 2.5 percent to 4 percent, depending on the modeling method used. Once retail stores opened, the state saw bookings increase by 6 percent to 7.2 percent. In Washington, the increases were roughly half that. Hotel bookings increased by about 1 percent after legalizing possession and 3.5 percent after retail stores opened. Read More (Marijuana Moment)
Signs point to possible illicit cannabis activity in L.A. blast. The Los Angeles Fire Department has launched a review of all smoke and vape shops in the city to ensure they’re storing explosive materials correctly after a recent explosion at Smoke Tokes that injured a dozen firefighters. According to the Los Angeles Times, the LAFD will be working to identify all similar businesses and ensuring those companies are displaying mandatory warning placards denoting that potentially flammable substances are being stored on-site. An investigation into the cause of the explosion is ongoing, and the probe now involves more than 50 staffers from the LAFD, the L.A. Police Department and the federal Bureau of Alcohol, Tobacco, Firearms and Explosives. Read More (Marijuana Business Daily)
Ontario’s ‘virtual inspections’ of cannabis stores keep industry growing. Cannabis store entrepreneurs are crediting Ontario’s regulator for its quick transition to a virtual inspection regime amid the coronavirus pandemic, saying the move has been key to increasing the number of legal stores in a province facing a serious retail shortage. The Alcohol and Gaming Commission of Ontario (AGCO) has conducted hundreds of virtual inspections since the province locked down for the pandemic almost two months ago. Typically, the process of licensing a store involves multiple in-person meetings and inspections. But instead of hitting the breaks on store openings when Ontario enacted its emergency order, the AGCO pivoted to conducting inspections using Apple’s FaceTime app. “Within a week of the announcement of Ontario’s emergency order, the commission commenced the virtual-inspection process,” AGCO spokesman Raymond Kahnert said. Read More (Marijuana Business Daily)
Despite COVID-19 lockdowns, Canada’s major provinces see proliferation of licensed retail storefronts. Despite COVID-related lockdowns in effect over the past two months, Cannabis Benchmarks are still seeing stores open in Canada’s major provinces. 122 stores have opened since the end of February, with 92% of the new shops located in Alberta, British Columbia, and Ontario. As of May, Cannabis Benchmarks count 891 retail stores across the country, an increase of 31 from the previous month. Alberta still has the highest store count at 461, or 52% of the licensed retailers in Canada. Month-on-month growth in store counts in Alberta is on a decline. However, the growth trajectory in Ontario, the country’s most populous province, is still going strong. Read More (Cannabis Benchmarks)
British Columbia books record tax revenue from cannabis sales. British Columbia’s monthly share of the federal excise duty on adult-use cannabis hit a fresh high as the province continued to execute its plan to greatly expand the number of privately and publicly owned marijuana stores. For December, British Columbia’s share of the federal excise tax was CAD $2.5 million ($1.8 million) – the province’s highest monthly total since cannabis was legalized in late 2018. The sum represents a 44% increase over the previous month’s CAD $1.7 million. The province’s share of the federal duty was CAD $10 million for all of 2019, according to updated data released in May. December’s record tax revenue is largely attributable to new store openings. Read More (Marijuana Business Daily)
Cannabis stores coming to Canada’s remote Nunavut territory. The government of Nunavut will soon accept applications for cannabis stores, bringing bricks-and-mortar recreational marijuana storefronts to the only Canadian jurisdiction that still doesn’t have any. License applications will be accepted starting June 1 through the territory’s department of finance. “Nunavut’s cannabis legislation and regulations have a broad range of requirements that licensed cannabis retailers must follow,” said a government of Nunavut announcement. Those requirements include security systems, inventory management systems, secure storage, floor plans and criminal record checks. Application fees are CAD $2,000 ($1,440). Read More (Marijuana Business Daily)
Cost-cutting cannabis giant Acreage to take $80 million-$100 million charge. Acreage Holdings (ACRGF) said it is still reducing overhead costs – including the sale of a North Dakota medical cannabis operation and undeveloped real estate in Nantucket, Massachusetts – as it seeks to improve its financial situation. The New York-based company said in a news release that it expects to take a pretax, noncash charge of $80 million-$100 million in the quarter ending March 31, 2020, based on planned operational changes. Acreage did not disclose details about the reductions. Read More (Marijuana Business Daily)
Aurora Cannabis continues divestment of hemp assets, citing low biomass prices. Aurora Cannabis (ACB) is further divesting itself of some of the hemp assets it began acquiring in 2017 as it tried unsuccessfully to profit from the CBD market. In its latest move, Aurora accepted an offer to sell a large greenhouse in Exeter, Ontario, for about half its CAD $17 million ($12.1 million) listing price. The sale was about one-third of the original purchase price for the greenhouse. Late last year, Aurora sold its remaining stake in Green Organic Dutchman (TGODF), a Toronto company that has a hemp subsidiary in Poland. The sale went for CAD $86.5 million ($64.9 million). Read More (Hemp Industry Daily)
Marijuana MSO Harvest announces layoffs, other pivots in $24 million cost-cutting. Arizona-based multistate cannabis operator Harvest Health & Recreation (HRVSF) revealed that it recently cut $24 million in expenditures – including laying off an undisclosed number of workers – in an effort to “rightsize” the company’s operations. According to the Phoenix Business Journal, Harvest disclosed during a May 20 earnings call that a “small amount” of the company’s roughly 1,000 staffers have been let go and that many acquisition deals have been suspended to cut costs. Read More (Marijuana Business Daily)
Khiron receives authorization for sale of high-THC medical cannabis. Khiron Life Sciences (KHRNF) announced that it has received authorization from the Colombian government to begin selling high-THC medical cannabis to patients. Khiron is the first, and currently only, company to receive authorization from the Colombian government for both the manufacturing and sale of high-THC medical cannabis. The company itself refers to the authorization as having been for “magistral preparation” for high-THC medical cannabis, a term which is defined as “any medicinal product prepared in a pharmacy in accordance with a medical prescription for an individual patient.” Read More (the deep dive)
LivWell continues Colorado expansion, buys marijuana retail chain Mindful. Colorado-based LivWell Enlightened Health continued its acquisition spree this month with the purchase of competing retail chain Mindful, which owns five cannabis stores in the state. According to Denver alt-weekly Westword, the acquisition expands LivWell’s footprint to 22 storefronts in Colorado with the addition of Mindful’s shops in Aurora, Berthoud, Colorado Springs and Denver to the company’s portfolio. Financial terms of the acquisition were not disclosed. Read More (Marijuana Business Daily)
The Green Organic Dutchman inks national supply agreement with Medical Cannabis by Shoppers. The Green Organic Dutchman (TGODF) announced that it has signed a supply agreement with Medical Cannabis by Shoppers, a subsidiary of Shoppers Drug Mart, making their certified organic medical cannabis products available via the Shoppers online medical cannabis sales platform. Under the terms of the agreement, TGODF will provide Shoppers with a broad portfolio of certified organic medical cannabis products, including its latest 2.0 offering such as Infusers (dissolvable powder), teas and vapes. The agreement is for a three-year term with a renewal clause for an additional two years. Read More (Newswire)
PharmaCann co-founder accelerates Northeastern-focused Ethos Cannabis with acquisition. Ethos Cannabis was a relatively unknown player prior to the announcement that it would be acquiring assets from 4Front Ventures (CNXXF) in Maryland and Pennsylvania. The company, led by the former CEO of PharmaCann, has quietly established itself in Massachusetts and Pennsylvania. Now, it is making waves with the 4Front deal and a new research partnership with Thomas Jefferson University in Philadelphia. CEO Teddy Scott, PhD, J.D., spoke with New Cannabis Ventures about his company’s opportunity in the Northeastern U.S., a disciplined approach to growth, and the opportunities ahead for Ethos Cannabis. Read More (New Cannabis Ventures)
Florida company hires new chief marketing officer. A Florida company that cultivates and processes hemp biomass has named a new chief marketing officer. Fort Lauderdale-based Green Point Research said Robin P. Pate will be responsible for developing new distribution channels, as well as brand development and partnerships to support the companies’ products. Pate was formerly with The Institute for Advanced Composites Manufacturing Innovation, a public-private partnership partially funded by the U.S. Department of Energy. Read More (Hemp Industry Daily)
Trulieve Q1 revenue increases 21% sequentially to $96.1 million with 51% adjusted EBITDA margin. Trulieve Cannabis (TCNNF) announced its first quarter of 2020 ended March 31, 2020. The company achieved record revenue of $96.1 million, an increase of 21% on a sequential quarter-to-quarter basis with an adjusted EBITDA of $49.4 million, or 51%. It opened three new stores in Florida, ending the first quarter with 47 stores nationwide and launched new products including TruPowder, TruTincture drops, and ground flower product offering during the quarter. Read More (New Cannabis Ventures)
U.S. pot earnings shine as Canada struggles. The top U.S. cannabis companies are notably outperforming their struggling Canadian counterparts, yet valuations are still held back by their inability to list on the big American exchanges. The divergence was well illustrated by two large companies that reported earnings on May 14 night. Green Thumb Industries (GTBIF) became the first U.S. pot company to generate revenue above $100 million and beat EBITDA expectations for the fifth consecutive quarter. Meanwhile, Canada’s Aurora Cannabis (ACB), which is struggling to turn a profit before it runs out of cash, said it is on track to meet previously disclosed cost-cutting targets. Read More (BNN Bloomberg)
Ayr Strategies revenues increase despite COVID headwinds. Ayr Strategies (AYRSF) reported that its revenue increased 4% sequentially in the first-quarter ending in March to $33.6 million. The company did note that sales began to decline in March due to the COVID-19 related closures. The company also reported a net income of $3.3 million after a foreign currency translation. The earnings per share were $0.06 basic and $0.05 diluted. Ayr also made improvements on its loss from operations as it trimmed that number from a loss of $16.9 million in the fourth quarter to a loss of $4.9 million in the first quarter. The adjusted EBITDA was $8.4 million, which dropped from the fourth quarter’s $9.2 million due to the COVID closures. Read More (Green Market Report) and More (GlobeNewswire)
Harvest Health tallies 35 retail stores nationwide, posts 134% YoY revenue increase. Harvest Health & Recreation (HRVSF) reported its financial and operating results for the first quarter 2020. The medical company said that its quarterly net revenue of $45 million represents a 134% year over year and 19% quarter-over-quarter increase. For the first quarter, Harvest posted a net loss of $20 million, down roughly 77% from the company’s fourth-quarter loss and in line with the first quarter of 2019. The company posted negative adjusted EBITDA excluding biological adjustments of $3.9 million versus a loss of $6.8 million in the previous quarter and a loss of $4.7 million in the same period of the last year. Harvest said its gross profit increased by roughly 14% sequentially, reaching $18.3 million. Read More (Benzinga) and More (New Cannabis Ventures)
Cannabis deals stunted by crisis. Less than $300 million in global M&A deals and investments involving cannabis entities have been announced in 2020 so far. This is just a fraction of the $7.4 billion in global cannabis deals that were announced last year. 2020 will almost certainly mark the second straight annual decline in cannabis M&A activity. Since the start of last year, U.S. entities have been involved in a majority of global cannabis investment activity. In 2019, $5.8 billion (78%) of all global deals announced involved at least one U.S. party, and this year $181.6 million (81%) have involved a U.S. party. Read More (Bloomberg Law)
Korean sovereign fund buys into cannabis as Canadian fund slashes Canopy stake. South Korea’s sovereign wealth fund bought up three Canadian cannabis stocks as they dipped to 52-week lows in the first quarter of 2020. Though the value of the cannabis holdings is a modest $8 million, it is the latest sign the stigma associated with the legal industry is slowly eroding in international finance circles. Seoul-based Korea Investment Corp. (KIC) added federally licensed Ontario producer Cronos Group (CRON) to its portfolio, according to a disclosure filed with the U.S. Securities and Exchange Commission. The sovereign wealth fund took on 45,800 Cronos shares, worth roughly $257,000. The KIC also increased its positions in Alberta-based Aurora Cannabis (ACB) and Ontario-headquartered Canopy Growth (CGC). Read More (Marijuana Business Daily)
How U.S. cannabis growers are keeping a tight lid on costs as recession looms. As the coronavirus pandemic plunges the U.S. economy into a sharp downturn, cannabis cultivators are managing finances by rethinking capital improvements and finding any area possible to lower costs. Although demand remains strong for marijuana in many state markets, prudent cannabis cultivation executives are planning for the worst and tightening their belts. Some have become more self-reliant when it comes to maintaining and repairing machines, while others are mixing their own sanitation chemicals and reusing personal protective equipment out of necessity. Read More (Marijuana Business Daily)
Recording leads to the ouster of management and board members of Anchorage marijuana company. An eight-minute audio recording that appeared on social media earlier this month has led to an Alcohol and Marijuana Control Office investigation and the ouster of the entire board of directors and senior-level managers at a large, Anchorage-based marijuana retailer. In the recording, Jordan Huss, formerly the vice president of Great Northern Cannabis and the company’s top shareholder, acknowledges switching out samples so that 100 pounds of marijuana would be able to be sold without undergoing the required testing for mold. Huss said management in the company was adamant that marijuana still be sold, although the former CEO and the former vice president of the company dispute that claim. Read More (Anchorage Daily News)
High Times’ deal to buy cannabis grow, processing facilities falls apart. High Times Holding move to expand into marijuana operations hit a snag with the collapse of a deal to buy a cultivation and processing business in California. The parent of the iconic High Times magazine said in a U.S. Securities and Exchange Commission filing that its planned acquisition of Humboldt Heritage was terminated by “mutual agreement” on May 15. No purchase price was announced for the deal, which included Humboldt subsidiaries Humboldt Sun Growers Guild and Grateful Eight. Read More (Marijuana Business Daily)
Judge OKs $77 million sale of GenCanna Global assets out of bankruptcy. A federal bankruptcy judge has approved the sale of the bulk of the assets for GenCanna Global, a hemp processor and CBD product manufacturer based in Winchester, Kentucky, to MGG Investment Group, a New York-based, private direct lender and one of GenCanna’s creditors. The deal, valued at $77 million, allows MGG Investment Group to recoup its investment, Law 360 first reported. GenCanna Global did not immediately respond to Hemp Industry Daily’s request for comment. Read More (Hemp Industry Daily)
Cannabis firm Green Growth Brands gets initial creditor protection. Green Growth Brands (GGBXF) said it has filed for insolvency protection in Canada. Green Growth Brands received an initial protection order from the Ontario Superior Court of Justice under the Companies’ Creditors Arrangement Act, the federal bankruptcy and restructuring law in Canada. Green Growth Brands’ U.S. subsidiaries, collectively known as GGB Group, “have always been cash-flow negative,” according to court filings that say the group faced “liquidity issues” starting in early 2019. Read More (Marijuana Business Daily)
Cannabis sector lender Trichome successful in bid for James E. Wagner. Trichome Financial has been declared successful in its stalking horse bid for Ontario-based James E. Wagner Cultivation (JWCAF), announced the latter company. JWCAF, which entered creditor protection earlier this year, plans to seek a court order approving the bid as “as soon as possible,” according to a news release. Toronto-based cannabis sector lender Trichome, which had a debtor-in-possession loan deal with JWCAF, initially made a stalking horse bid of CAD $11.95 million ($8.61 million) for the company’s assets, including property, inventory and other goods. Read More (Marijuana Business Daily)
Investment group buys Sundial medical cannabis subsidiary for CAD $105 million. The U.K.’s Bridge Farm Group, which cultivates ornamental plants, flowers and herbs, announced that it was sold by its parent company, Alberta, Canada-based Sundial Growers (SNDL), to an entity controlled by representatives of Artemis Growth Partners, an asset management firm based in Costa Rica. The transaction was worth CAD $105 million ($75 million), according to a Bridge Farm statement. As part of the deal, which Sundial confirmed in its own statement, the buyers will assume CAD $45 million of debt under the Calgary company’s existing CAD $115 million term debt facility. Read More (Marijuana Business Daily)
Ag biotech firm raises $6.8 million to fund hemp division. Arcadia Biosciences, based in Davis, California, gave investors the chance to exercise existing warrants to purchase nearly 1.4 million shares of common stock at a reduced price of $4.90 per share. Net proceeds from the offering are estimated at approximately $6.3 million. Existing stockholders also received new, unregistered warrants to purchase up to a combined 1,392,345 shares of common stock at $4.77 per share within five years. The company will use the proceeds to strengthen its balance sheet during the coronavirus pandemic, while pursuing a range of growth opportunities within its Good Hemp business unit. Executives did not elaborate. Read More (Hemp Industry Daily)
Green Organic Dutchman raises $15 million selling units at $0.40. The Green Organic Dutchman (TGODF) announced that it has entered into an agreement with Canaccord Genuity. The underwriter has agreed to purchase, on a bought deal basis pursuant to the filing of a short form prospectus, an aggregate of 37,500,000 units at a price of $0.40 per unit for aggregate gross proceeds to the company of approximately CAD $15 million. Each unit shall consist of one common share and one common share purchase warrant of the company. Each warrant shall be exercisable to acquire one common share of the company for a period of 48 months from closing of the transaction at an exercise price of CAD $0.50 per warrant. Read More (New Cannabis Ventures)
Oklahoma’s business-friendly medical cannabis program still has room to grow. Medical marijuana sales and patient numbers in Oklahoma continue to increase at a staggering rate, indicating the red-hot market has room to grow, although some sectors and parts of the state are saturated with businesses, industry officials say. The state’s free-market approach so far has proved successful, with April sales topping $60 million. Meanwhile, regulators have issued more than 10,000 licenses, and grower permits account for more than half that total. Read More (Marijuana Business Daily)
Medical cannabis sales regain their footing in Ohio despite coronavirus volatility. Sales in Ohio’s nascent medical marijuana industry steadily improved during the first four months of 2020, despite short-term hiccups caused by the coronavirus pandemic. Through the end of April, roughly $50 million of medical marijuana was sold in Ohio in 2020 – just shy of the $58 million sold for the entirety of 2019. Increasing patient counts drove the sales growth. Currently, Ohio reports that 101,400 MMJ patients have registered. That’s an increase of 227% from the 31,100 who were registered in Ohio at this time last year. Patient counts are growing by an average of 7% month-over-month so far in 2020. Read More (Marijuana Business Daily)
Louisiana medical marijuana program would grow under bill. State lawmakers are poised to greatly expand Louisiana’s medical marijuana to make more people eligible for the treatment, under a bill that continued to speed toward final passage. The proposal from Rep. Larry Bagley, the Republican chairman of the House health committee, would authorize therapeutic cannabis for any condition that a doctor “considers debilitating to an individual patient and is qualified through his medical education and training to treat.” The Senate health committee backed the expansion measure in a 5-1 vote, sending it to the full Senate for debate. The House already has voted 77-15 for the bill. Louisiana is one of more than 30 other states that allow medical marijuana in some form. Read More (Marijuana Retail Report)
Washington, D.C. extends medical cannabis protections for public workers. Washington, D.C., legislators passed an emergency amendment to extend protections from employment discrimination for public workers who also are medical cannabis patients. Current protections were set to expire on June 5, but city legislators unanimously approved the “Medical Marijuana Program Patient Employment Protection Emergency Amendment Act of 2020” on May 19, which will go into effect for 90 days once Mayor Muriel Bowser signs the bill, or, in case of a mayoral veto, the council overrides the veto. Read More (Cannabis Business Times)
Personalized medicine, transforming cannabis from weed to resource. How did cannabis’s transition from weed to resource come to be? Well, like most commercial medicines, it started with research. Currently, hemp is legally federally, and several states are coming around on cannabis. However, at the beginning of the push, defining the progression, were the trials proving CBD’s efficacy in treating epileptic conditions. Due to this research, in 2018, Epidiolex became one of the first cannabis-derived medicines approved by the Food and Drug Administration (FDA). Since then, research has grown in all jurisdictions of cannabis study, notably the worlds of terpenes and flavonoids. Additionally, our understanding of the vast amount of different cannabinoids continually improves as well. Decoding the potential contained within these compounds is an incredibly complicated job that will take researchers decades, but luckily the market provides more options. Read More (Cannabis Tech)
USDA says $19 billion virus aid program will not cover hemp yet. The U.S. Department of Agriculture has denied hemp farmers initial access to $19 billion in emergency coronavirus aid, though the agency said the crop could become eligible if its price is severely impacted by the pandemic. Hemp farmers could qualify for aid through the USDA’s Coronavirus Food Assistance Program if the industry shows prices have dropped 5% or more since the crisis began, according to the agency’s website. That was a change from earlier in the day, when hemp and tobacco were explicitly barred from the program. “We’re really pleased about the change,” U.S. Hemp Roundtable general counsel Jonathan Miller told Law360, saying language excluding hemp was dropped several hours after his group contacted the USDA. Read More (Law360)
New USDA guidelines for loans to hemp businesses, explained. A new set of guidelines, released last month by the U.S. Department of Agriculture (USDA), is being seen by hemp industry analysts as another sign of how the nation’s hemp sector is being integrated into the agricultural mainstream. One of the important points from the memo is, starting this season, the FSA will be able to consider applications to grow hemp “beyond the provisions of the 2014 pilot program.” Hemp producers must meet specific requirements from the 2018 Farm Bill in order to be approved for a loan. Among those requirements are that hemp producers “be licensed under a State or Tribal plan approved by USDA, or if a producer resides in a State or Tribe that does not have a USDA-approved plan, the producer must be licensed directly by USDA.” Read More (Hemp Benchmarks)
CBD companies see online sales spike as coronavirus shuts down retail shops. When COVID-19 spread and forced store closures, California-based Papa & Barkley lost about half of the 400 small CBD retail shops where the company was selling its products. Then online sales exploded. “We’ve seen a pretty dramatic increase in our online transaction volume,” said Adam Grossman, CEO and founder of Papa & Barkley. In March alone, as the nation went on lockdown, Papa & Barkley’s online sales transactions grew 240% over previous monthly averages, the company said. In April, online sales increased another 88%, according to the company, which sells both marijuana and CBD products. Read More (Hemp Industry Daily)
CBD oil product recalled due to high lead levels, FDA announces. A Florida CBD company is voluntarily recalling a CBD tincture product after a state agency tested a random sample and found dangerous levels of lead. According to the Florida Department of Agriculture and Consumer Services (FDACS), a sample of a Kore Organic Watermelon CBD oil tincture, produced by Summitt Labs, contained 4.7 parts per million of lead. The recall was amplified by the Food and Drug Administration (FDA) on Friday, May 15. When informed of these lead levels by the FDACS, Summitt Labs began an internal investigation and sent off another tincture sample to be tested by an independent lab. This test found lower lead levels (0.5 parts per million), which were within legal state limits. But, based on the test from the FDACS, the Tampa-based company still initiated a full recall of all Kore Organic Watermelon CBD oils. Read More (Analytical Cannabis)
How AGI Denim is rising to the challenges of hemp. Despite the fact that hemp currently has a more complicated and less robust supply chain than cotton, Pakistan-based premium denim manufacturer AGI Denim is embracing the emerging fiber in blended materials as interest in alternative yarns takes off. “The market has been recently captivated by this idea of hemp, this magical cellulosic fiber that requires so little input to grow,” said Henry Wong, director of product development and marketing for North America at AGI Denim, formerly Artistic Fabric and Garment Industries. Read More (Sourcing Journal)
Legal cannabis hemp oil effectively treats chronic neuropathic pain. Researchers examine the effectiveness of consuming hemp oil extracted from the whole Cannabis plant using a chronic neuropathic pain animal model. Researchers at The University of New Mexico (UNM) showed that legal Cannabis hemp oil reduced mechanical pain sensitivity 10-fold for several hours in mice with chronic post-operative neuropathic pain. This major breakthrough in cannabis prohibition now enables millions of Americans the ability to access a natural, effective, and relatively safe alternative option for treating chronic pain. Conventional pharmacological drugs, namely opioids, are driving the leading form of preventable deaths and conventional medical errors are the third leading cause of death in the U.S. Read More (Science Daily)
Oregon’s HempNova buys another Oregon hemp grower. Oregon’s HempNova Lifetech, which grows and dries hemp, has bought another hemp operation in southern Oregon. HempNova’s $2.03 million acquisition of Seven Oaks Hemp Center in Central Point includes 45 acres of land, a drying facility, an 8,000-square-foot greenhouse, and a 6,000-square-foot warehouse. HempNova CEO Ken Cai said in the announcement that the company plans to expand operations in southern Oregon. Two months ago, HempNova bought a 90% stake in southern Oregon’s Creekside Hemp for $4.5 million. Read More (Hemp Industry Daily)
HempFlax acquires hemp insulation company. Europe’s largest independent grower and processor of industrial hemp has announced the acquisition of a manufacturer of natural fibre insulation materials. HempFlax International says it is launching a building supplies division after acquiring German company Thermo Natur GmbH & Co. KG. HempFlax states acquiring Thermo-Natur’s existing operations and product certifications accelerates its move into this market by 18 months it would otherwise take. “Thermo-Natur is a company I’ve long admired because it is well-known for its safe, natural and breathable materials,” said HempFlax CEO Mark Reinders. “Synthetic construction materials are simply not needed, and their usage has dire ecological and climatic consequences, be it from pollutants, carbon emissions or unhealthy living environments.” Read More (HempGazette)
Locally ‘essential,’ federally illegal: How cannabis dispensaries are handling the pandemic. Like many small business owners, Amy Manganelli has taken a financial hit since the start of the coronavirus pandemic. So, a few weeks ago, she decided to apply for a small business loan from the federal government. She was turned down. Manganelli is the co-owner of Mapleglen Care Center, a cannabis dispensary in Rockford, Ill. “We’re a legitimate business in every sense of the word, until it comes to some kind of government program that might assist,” she says. Many small business owners have turned to the federal government for help through funds like the Paycheck Protection Program. But because dispensaries are federally illegal, they have been left out of such federal safety net programs. Meanwhile, in many states with stay-at-home orders, including Illinois, dispensaries have been deemed essential and have, therefore, continued to operate. Read More (KOSU)
Pacific Beach cannabis facility offers shopping via video chat. A cannabis provider in Pacific Beach makes it possible for its shoppers to dispense with a trip to the dispensary while still “visiting” the store. The San Diego location of Columbia Care (COLXF) at 4645 De Soto St. recently became the first of the company’s 35 active dispensaries to roll out a new digital platform to provide a virtual shopping experience. Columbia Care, one of the largest cultivators, manufacturers and providers of medical and adult-use cannabis products, launched Virtual. Care on April 20, an international day of celebration of cannabis culture. Read More (PB Monthly)
Here’s what curbside recreational cannabis sales will look like at Boston-area cannabis shops. Recreational marijuana shops across Massachusetts will reopen on May 25 for curbside pickup after a two-month closure because of the coronavirus outbreak. Here’s what recreational marijuana dispensaries in the Boston area will do for their reopening this week: Pure Oasis opened in March, just weeks before Governor Charlie Baker issued his initial nonessential business closure order. The dispensary, which serves adult-use customers only, is thrilled to be back starting May 25, said co-owner Kobie Evans. “We were frozen in time,” Evans said. Customers will order ahead online or by phone and be given a two-hour window to pick up their products. When they arrive at the dispensary door, their ID will be checked by a staff member, who will then radio inside for their products to be brought out. Read More (Boston Globe)
Cannabis cravings differ between the sexes. Women who regularly consume cannabis experience more intense cravings for the drug than their male counterparts, a study has found. Published in Drug and Alcohol Dependence, the study suggests this difference may be linked to estrogen levels, but this can’t be confirmed until further research is carried out. To reach this conclusion, the researchers from the Center for Brain-Health, University of Texas at Dallas, first recruited 112 participants (54 female, 58 male) who had consumed cannabis at least 5000 times. In the study, these “heavy cannabis users” were given a piece of cannabis equipment to hold and asked to rate their urge to use marijuana on a scale of 1 (no urge) to 10 (high urge). On average, the female participants ranked their cravings at 5.5, while the male participants’ average was 4.6. Read More (Technology Networks)
Uruguay exports largest-ever shipment of high-THC flower, but buyer remains a mystery. A shipment of medical cannabis exported from Uruguay in late 2019 to Europe is raising eyebrows, both about the buyer’s identity and the cargo’s sheer size. The 1,000-kilogram (2,205-pound) shipment of high-THC cannabis flower was legally exported from Uruguay to Portugal late last year, according to Uruguayan customs documents viewed by Marijuana Business Daily. By comparison, Germany – the largest importer of medical cannabis flower in the world – imported an average of 542 kilograms per month in 2019 for pharmacy dispensing. The Uruguayan shipment – likely the biggest-ever single international shipment of medical cannabis – symbolizes an increasingly global medical marijuana industry that’s still in its infancy. Read More (Marijuana Business Daily)
EU hemp industry awaits court ruling on French CBD ban. The hemp industry gained valuable insight into how the highest court in the European Union might rule on France’s ban on hemp-derived CBD products. The advocate general at the Court of Justice of the European Union (CJEU) issued an opinion that the restriction was not in line with EU law – an announcement that could liberate the French market and prompt legislative reviews and reform in other EU member states. The case being scrutinized by the Luxembourg-based CJEU touches on a key principle of the European Union’s project: the sanctity of intra-EU trade and the free movement of goods between member states. Read More (Hemp Industry Daily)
Materia Ventures enters German cannabis market with Cannaktiv acquisition. Materia Ventures has acquired Cannaktiv GmbH, a licensed importer and distributor of medical marijuana products in Germany. The company will be re-named Materia Deutschland GmbH. Materia did not disclose the value of the transaction, but its CEO Deepak Anand told Benzinga in an email that Cannaktiv is “1 of only 30 companies that have the relevant licenses to be able to import, stock and sell medical cannabis in Germany.” Anand said this move provides Materia with immediate access to one of Europe’s largest cannabis markets, with a platform to import EU-GMP certified products. Read More (Benzinga)
Increased cannabis demand in Europe amidst COVID-19. In April, during the Global Cannabis Town Hall hosted by New Frontier Data, Chief Knowledge Officer John Kagia detailed how the European cannabis market serves an estimated 42.6 million people (5.9% of the population) throughout 28 European countries. Those regular consumers of cannabis will annually spend an estimated €62.7 billion ($68.5 billion) between both the regulated and unregulated markets. Having recognized how the COVID-19 pandemic will hamper legalization efforts across Europe, with significant delays likely driving some consumers toward the unregulated market, a special report from the European Monitoring Centre for Drugs and Drug Addiction (EMCDDA) confirms some of the concerns. Read More (New Frontier Data)
Jamaica plans to maintain ‘functional’ cannabis market amid pandemic. Jamaica published details about the “Business Continuity Plan” it has implemented to maintain a functional and expanding cannabis industry amid the COVID-19 pandemic. Part of the plan involves the Cannabis Licensing Authority (CLA) using “remote” means to monitor harvests and other medical cannabis operations. “This is to allow for the continuity of activities on licensed sites, which is necessary for the sustainable development of the industry, whilst ensuring compliance during the COVID-19 pandemic,” the CLA noted in a news release. Read More (Marijuana Business Daily)
Australian hemp producer signs distribution deal with CVS Pharmacy. A subsidiary of Australian hemp product producer Ecofibre has signed a deal to distribute a line of topical products at the U.S. drugstore chain CVS Pharmacy. EOF Distribution said in a statement that it will supply 10 hemp-derived products for exclusive sale at some CVS Pharmacy locations. The Rhode Island-based chain has more than 9,900 retail locations in 49 states; EOF did not say which locations will carry its CBD topicals. All of the products will be manufactured at Ecofibre’s new U.S. headquarters in Georgetown, Kentucky, and are due to hit shelves in December, the company said. Read More (Hemp Industry Daily)
One of America’s biggest cannabis testing labs just grew bigger. As companies across the country are downsizing, industry-leading cannabis testing facility ACS Laboratory is expanding. On May 13, the company acquired Botanica Testing, a certified hemp and CBD testing laboratory. The move comes as more than 36 million Americans are filing for unemployment due to the COVID-19 pandemic. Though cannabis companies have been deemed essential, many have still struggled with lower than average sales. Even 4/20 brought in lower-than-expected revenues as people curbed spending to prepare for the economic fallout from the virus. ACS’ expansion is encouraging news for the industry and even better news for Botanica and their shareholders. The acquisition will supply the company with five-hundred new clients and extend their reach into a total of 44 states nationwide. Read More (Cannabis & Tech Today)
InMed and Almac Group developing improved cannabinoid production methods. InMed Pharmaceuticals (IMLFF) announced that it is working with the Almac Group (UK) on a proprietary approach to augment current biosynthesis-based methods for cannabinoid production. Over the last several months, InMed and Almac have been engaged in developing a streamlined cannabinoid manufacturing process, specifically optimizing the upstream cannabinoid assembly processes as well as downstream purification, to achieve cost efficient, GMP-grade active pharmaceutical ingredients for prescription-based medications. Read More (Extraction Magazine)
This cannabis software company secured a $2.2 million Paycheck Protection Program loan. Akerna (KERN), the parent of MJ Freeway, disclosed in its 10-Q for the quarter ending March 31 that it received a $2.2 million Paycheck Protection Program loan in April. The company received the loan, which is guaranteed by the Small Business Administration, prior to guidance that was issued on April 23rd, and it is “evaluating the impact this guidance has on Akerna and the PPP Loan”, though it’s not clear what exactly the company is evaluating. Read More (New Cannabis Ventures)
U.S. firm rolls out multi-crop harvester compatible with Deere combines. Nebraska, U.S.-based farmers and equipment developers FarmMax have debuted the Interceptor, multi-cropping hemp harvesting technology for flowers, seed and stalks. Designed to attach to the John Deere S Series combine (2012-2020), the Interceptor snips the hemp flowers which are then transported to an attached wagon while seed goes into a grain tank and the fiber is left to ret in the field for later collection. By pairing the Interceptor with a drying system, flowers are efficiently harvested without accumulating dirt, mold and bacteria associated with hang-drying, with the final material preserved within hours of harvest instead of days or weeks. The system also eliminates the loss of harvested material due to repeat handling. Read More (Hemp Today)
Nanotechnology in cannabis: Hot technology, but is it safe? The global nanotechnology market could hit $125 billion by the year 2024, at least according to a new analysis by Research and Markets. A percentage of that astronomical number will be thanks to the expansion of nanotech within the cannabis industry. Today, nanoemulsions are trendy. They are the hot new technology taking over cannabis consumer products like cosmetics, nutraceuticals, and pharmaceuticals. But, beneath the hype are serious questions about the safety of cannabinoid nanoemulsions. Not only are there questions about the safety of the technology more broadly, but there are real concerns about applications in cannabis. Nanoemulsion changes cannabinoids in specific ways, but ways we don’t yet seem to understand. Read More (Cannabis Tech)
LEGAL & IP
Charlotte’s Web earns U.S. patent for improved hemp variety. Charlotte’s Web (CWBHF) has achieved another milestone in its continued commitment to innovation and consistency in hemp genetics. The company has earned U.S. utility patent U.S. 10,653,085, its second U.S. patent for hemp genetics. This patent is for ‘CW1AS1’, a new hemp variety created by company co-founder Joel Stanley and Sr. Director of Cultivation R&D Bear Reel. The patent takes Charlotte’s Web’s premier proprietary genetics to the next generation, and builds a strong wall of protection around it, and the products made from it. Read More (Marijuana Retail Report)
Justice for all? How COVID-19 is affecting litigation in the cannabis industry. The pandemic has affected every industry in the U.S., some worse than others, and the cannabis industry has not been immune. Unfortunately, some cannabis companies seeking justice in court could face such long delays that they may never get resolution. Courts have never been known for speedy turnarounds even in the best of times, and in the midst of a pandemic, many legal proceedings have come to a grinding halt. To put things in perspective, in Denver, prior to COVID-19, a lawsuit typically took about a year from start to finish. And that’s extremely quick compared to other cities. In Chicago, for example, lawsuits can drag on for years. The current court closures are adding to the timing backlog that already existed and making it even more difficult for injured parties to recoup money they are owed. Read More (420 Intel)
DNA Genetics renames ‘Miss USA’ cannabis strain ‘Miss DNA.’ Citing the trademarked Miss USA beauty pageant, DNA Genetics is renaming its Miss USA cannabis strain as Miss DNA. The cultivar, a cross between DNA’s Kosher Kush and Strawberry Banana, generates high yields and “substantial returns for concentrates,” according to the breeding company. Limonene and myrcene display clearly in the strain’s terpene profile. “Miss DNA is the same strain you all know and love. This beauty queen of a strain still exhibits frosty buds and potency—just with a slight DNA twist,” Don Morris, Chief Cannabis Officer at DNA Genetics, said in a public statement. Read More (Cannabis Business Times)
Expiration dates and packaging for CBD pet products at issue in legal fight. A Seattle maker of CBD for pets and a holistic pet company that sold branded CBD treatments called the “Zen Pen” are now embroiled in a legal battle over shelf stability and expiration dates. Sage Fulfillment sued Earth Animal Ventures in April, accusing the Connecticut company of failing to purchase the minimum number of orders under a 2018 contract. Sage asked a federal court in Connecticut for some $6 million in lost profits, plus unspecified damages. Sage says it has been left with “an excess supply of empty, specially manufactured pens” it made for EAV. Read More (Hemp Industry Daily)
Tennessee CBD retailers’ ‘Operation Candy Crush’ lawsuits moving forward. Three lawsuits filed by Tennessee CBD retailers against local authorities for closing their legal stores during a sting operation in 2018 will move forward, despite the defendants’ appeal to dismiss the allegations against them. In the February 2018 “Operation Candy Crush” sting in Rutherford County, Tennessee, law enforcement officers padlocked 23 stores and charged 17 business owners with selling illegal drugs. The charges were eventually dropped and expunged, as hemp-derived products are legal in Tennessee. Read More (Hemp Industry Daily)
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