The topline of Cresco Labs (CRLBF)one of the biggest vertically integrated MSOs and the largest branded cannabis products wholesaler in the U.S. is set to grow to $1.3 billion in 2024, nearly 10x its 2019 revenue. Cresco is one of the largest U.S. MSOs with a presence in nine state markets with operations that include 16 cultivation and production facilities, 29 retail licenses, and 19 dispensaries. The company’s geographic footprint covers 60% of the addressable U.S. market, including six of the ten most populous states and seven of the ten most populous cities in the country. Its strong presence in these large markets is reflected in the 42% q/q sales growth reported by the company in 2Q20, with all states but one (Massachusetts) reporting 30%+ q/q sales increases, driving consolidated topline to $94.3 million. The company is headed into an accelerated growth phase with Street estimates pegging 2024 topline at $1.3 billion, nearly 10x the 2019 revenue of $128.5 million and a five-year CAGR of 59%. The rapid topline growth is complemented by growth in profitability, with adjusted EBITDA rising ~5x to $16.5 million in the second quarter and expected to grow further as sales growth quickens.

Successful strategic expansion to – and leadership position in – key state markets is a key driver of CRLBF’s growth. Cresco is one of the leading players in its home state of Illinois, where cannabis sales are growing fast and are on track to top $1 billion this year. CRLBF owns and operates nine retail stores in the state and last week it received approval for its tenth Illinois dispensary, a key competitive advantage in this limited license state. Pennsylvania is the second key market for CRLBF where medical sales are expected to double y/y in 2020 with huge upside from potential recreational use legalization next year. Cresco owns an 88,000 sq. ft. cultivation facility in the state that, along with IL, was one of the key drivers of the impressive topline growth in the second quarter. The biggest market that CRLBF is targeting is California – Cresco has established a strong presence in the state through the acquisition of Origin House which is one of a select few companies that possess a cannabis distribution license in CA, the largest pot market in the world by sales. With the deal closed, Cresco now has the ability to sell its products as well as the more than one dozen third-party products Origin House distributed through more than 575 dispensaries in the Golden State whose cannabis market has emerged from its 2018 slump and is on track to top $4 billion in legal sales this year and reach $7 billion in 2024. Other state markets that are expected to contribute to CRLBF’s sales growth are Massachusetts, Ohio, Michigan, and Maryland.

Diversified revenue streams and a strong brand portfolio lend further strength to Cresco’s fundamentals. Unlike most other MSOs that are predominantly retail focused, CRLBF has also built a sizeable wholesale business. In fact, the wholesale segment accounted for 51% of the consolidated topline in 2Q20. Coupled with Cresco’s vertically integrated operations, it allowed the company to register robust sales growth even as retail-only players experienced deceleration in growth due to the pandemic. Revenue diversification is boosted by Cresco’s brand portfolio – Cresco, Reserve, Remedi, Mindy Segal, Good News, High Supply, and Floracal – which has products across multiple price points and consumer needs (medical, wellness, and recreational) and provides a hedge against disruption in one specific segment. Sunnyside, Cresco’s retail brand, is among the leaders in Illinois and is key to the company’s plans to improve brand penetration and consolidate market share.

CRLBF’s capital position is good and the company has also strengthened its management team to drive growth. Cresco is well capitalized to execute its growth strategy – the company closed a $100 million senior credit facility in early February with an option to double it in size to $200 million. It has also done sale-leaseback deals with IIPR, including a recent $28.8 million transaction in MA, that helped free up cash to drive growth. CRLBF ended the second quarter with $71 million in cash and cash equivalents, a strong position given the cash crunch faced by most other cannabis operators. Additionally, Cresco recently bolstered its leadership team with the promotions of David Gacom, Melissa Wagamon, and Sean McAlister to regionally focused president positions. Gacom will focus on the West region (California and Arizona), Wagamon will be responsible for growth in Illinois and Michigan, while McAlister will lead CRLBF’s expansion in emerging markets like Massachusetts, New York, Pennsylvania, Ohio, and Maryland. These three executives have experience in operations, marketing, and sales through previous leadership roles at top CPG companies like MillerCoors, PepsiCo, and The Kraft Heinz Company. Their promotions follow the appointment of Dennis Olis as CFO in June. Olis previously served as the CFO of Allscripts Healthcare Solutions and also held a leadership position with Motorola.

Overall, CRLBF offers an attractive combination of rapid revenue growth, improving profitability, strong position in key cannabis states, diversified revenue streams, and a respectable balance sheet, making it one of the U.S. MSOs that investors should evaluate.

Chart 1: Cresco’s Fundamentals Inflected in Q2 and Are Set to Register Robust Growth in the Coming Quarters Source: Intro-Blue, Company Investor Presentation

Chart 1: Cresco’s Fundamentals Inflected in Q2 and Are Set to Register Robust Growth in the Coming Quarters
Source: Intro-Blue, Company Investor Presentation



As COVID-19 rattles global markets, cannabis commerce shows resilience. Despite the global economic downturn resulting from the COVID-19 pandemic, legal marijuana in the U.S. continues to post record cannabis sales — effectively weathering the storm. Some now believe that the industry may be, to some degree, recession-proof. In July, Colorado marijuana sales exceeded $200 million in one month for the first time since the industry came online in 2012. The Denver Post reported sales of more than $1.2 billion for the year. In Illinois, where recreational cannabis dispensaries didn’t open their doors until January 1, 2020, sales topped nearly $64 million during August, surpassing the mark set in July by more than $3 million. Read More (Forbes)

Consumers’ cannabis buying patterns change markedly in wake of COVID-19 pandemic. Consumers’ purchasing patterns involving marijuana have changed noticeably over the past several months in response to the coronavirus crisis. Marijuana shoppers are spending more money per visit to recreational retail outlets. But they are shopping less often, perhaps for safety, or scheduling, reasons. Marijuana Business Daily’s heat map of weekly adult-use sales changes in four western states show sales recovering through the year, with retailers benefiting from favorable treatment by state governments that allowed them to stay open or provide curbside service. Across the country, in fact, many states declared cannabis companies “essential” businesses. But there have been roller-coaster weeks in adult-use sales in California, Colorado, Nevada and Washington state, according to data provided by Seattle-based analytics firm Headset. Read More (Marijuana Business Daily)

Chart 2: Adult-Use Cannabis Sales: Week-Over-Week Change by Market Source: Intro-Blue, Marijuana Business Daily, Headset

Chart 2: Adult-Use Cannabis Sales: Week-Over-Week Change by Market
Source: Intro-Blue, Marijuana Business Daily, Headset

The post pandemic cannabis industry will continue to bloom. After an initial explosion in cannabis sales when the pandemic began, record sales have continued in some states. A recent report called ‘State of the Cannabis Industry’ conducted by LeafLink, Flowhub, and Vangst found that cannabis sales nationwide have stabilized at a rate 40 percent higher than in 2019. That stabilization indicates that post-pandemic sales numbers should stay strong. Officials in Michigan, for example, expect the market in their state to surpass $3 billion in the near future. Nationwide, some projections call for a $34 billion U.S. cannabis market by 2025. Medical marijuana also is growing. The number of people in the U.S. who have enrolled in the medical marijuana program in their home state surpassed 3 million for the first time in August 2020. Read More (Green Entrepreneur)

New poll breaks down why people are turning to weed during pandemic. A new report says that as the pandemic evolves, large percentage of users have been seeking for the plant’s therapeutic relief. Rising levels of anxiety and sleep issues have resulted in an uptick in cannabis use as well as a stable rise in the use of cannabis delivery services. These results appeared in a recent poll conducted by cannabis delivery service Ganja Goddess, which surveyed over 850 people. Their numbers suggest that the majority of users are consuming flower and that the rise in use of delivery services is mostly due to convenience and safety. Zachary Pitts, CEO of Ganja Goddess, explained in a statement (via Forbes) that the poll’s results reflect a shift in consumer behavior due to the pandemic. He says that the majority of poll respondents increased their cannabis use by 9% since April of 2020, when Ganja Goddess completed its last poll. Read More (The Fresh Toast)

Cannabis may help or hinder virus damage — or both, early studies find. Some studies have found potential for cannabis to help with a dangerous excess of immune system substances called cytokines that trigger inflammation and can lead to death in COVID-19 patients. Others suggest that cannabis users may be more susceptible to catching COVID-19. While these two lines of research seem at odds, experts say cannabis may have potential to both help and hurt in COVID-19 — depending on when and how it is used. When it comes to cannabis’ benefits for COVID-19, the majority of the research points to its anti-inflammatory potential and how that might treat a dangerous symptom of the virus called a cytokine storm. Researchers from the University of Nebraska and the Texas Biomedical Research Institute first brought up the possibility that CBD could help, in a peer-reviewed article in the journal Brain, Behavior, and Immunity, based on previous studies of the chemical. But since then other studies have added evidence to the theory. Read More (SFGate)


State ballot measures to legalize cannabis could add $9 billion to U.S. marijuana market. According to a new report from New Frontier Data, state ballot measures slated for 2020 in five states — Arizona, Mississippi, Montana, New Jersey and South Dakota — could be the green light for adding $9 billion dollars to the size of the nation’s legal cannabis market if all are approved by voters this November. “The 2020 election could be one of the most consequential and historical events to change the landscape of the legal U.S cannabis industry,” New Frontier Data CEO Giadha DeCarcer said in a release. “With $9 billion in new revenue from 2022-2025, should all five states ballot measures pass, New Frontier Data estimates that revenues from all legal U.S. markets will reach $35.1 billion in 2025.” Read More (Yahoo!)

Chart 3: Cannabis Legalization Across the U.S. Source: Intro-Blue, Yahoo!, New Frontier Data

Chart 3: Cannabis Legalization Across the U.S.
Source: Intro-Blue, Yahoo!, New Frontier Data

IRS greenlights tax loophole for pot businesses. The IRS has updated its guidance for cannabis operators, a move some in the industry view as a rare helping hand from the tax agency. The revised guidance, published September 12, maintains that state-legal marijuana businesses do not qualify for most common business deductions and credits, per Internal Revenue Code Section 280E. But the IRS now points out, those businesses can reduce gross receipts using an accounting method available under Section 471. Section 280E, which the industry despises, puts strict limits on which taxes cannabis businesses can deduct, forcing them to pay a far higher effective tax rate than conventional businesses. Section 471, enacted with 2018’s tax law, enables businesses grossing less than $25 million in revenue to deduct a greater portion of their expenses. Until now, the question of whether it applies to marijuana businesses has been a source of controversy. Read More (Forbes)

U.S. House vote delay likely will not derail marijuana reform momentum. The postponement of a U.S. House vote until after the November election to remove marijuana from the federal Controlled Substances Act is a disappointment to many in the industry, but it changes little in terms of the momentum of reform. That is, as long as the House remains controlled by Democrats, as is highly expected. Industry lobbyists say the House is setting the tone for marijuana reform going forward – descheduling with a social justice component – in a move that would usher in sweeping and massive business opportunities. By voting on the Marijuana Opportunity Reinvestment and Expungement (MORE) Act before the end of the year, the House also is setting the stage, industry experts said, for the U.S. Senate to take similar action in 2021 or 2022 – if the Senate flips from Republicans to Democrats in November. Read More (Marijuana Business Daily)

Will cannabis hurt or help Democrats this November? It would seem that legalizing cannabis would be a popular move for any presidential hopeful. But Trump has been largely silent about cannabis and while Jeff Sessions was his Drug Bizarre for a while – his government hasn’t done much for or against weed. This leaves the Democrats with cannabis legalization as part of the platform. Joe Biden – the candidate of choice – is not in favor of cannabis legalization. He is in fact in favor of the worst policy for the cannabis industry – rescheduling it to Schedule-II in the CSA. If Joe Biden has its way – well, you can kiss goodbye to home growing, craft cannabis and Mom & Pop Shops and say hello to Big Corporate bud with a cap on THC. Another thing that could play against Democrats is optics. With a pandemic in full-swing, riots and protests in the streets, and the economy not doing too well – focusing on weed might be seen as “secondary.” Read More (

Extreme weather patterns force cannabis growers to rethink cultivation strategies. As extreme weather events ravage the country from coast to coast – including wildfires, floods and early freezes – marijuana growers are being forced to reevaluate their risks and consider changes to their cultivation practices. Outdoor marijuana growers, in particular, are vulnerable to severe changes in weather, prompting farmers to consider moving their crops inside and using new cannabis varieties. Other cultivators are locating their operations on higher ground to avoid flooding. Scientists have linked the extreme swings in the weather to climate change. Jon Vaught, CEO and co-founder of Front Range Biosciences, a Lafayette, Colorado, cannabis biotech firm with hemp growing operations, noted that, like cannabis growers, mainstream farmers are dealing with volatile weather tied to a changing climate. “We can debate about whether we’re getting hotter or cooler,” Vaught said. “But the bottom line is it’s getting more unpredictable, and that makes it worse.” Read More (Marijuana Business Daily)

Chart 4: Adapting to Climate Change Source: Intro-Blue, Marijuana Business Daily

Chart 4: Adapting to Climate Change
Source: Intro-Blue, Marijuana Business Daily

New marijuana coalition unveils plan to legalize interstate cannabis commerce. A coalition of advocacy groups and marijuana businesses have unveiled a unique plan to legalize interstate cannabis commerce regardless of ongoing federal prohibition. The Alliance for Sensible Markets campaign will be pushing governors from legal and likely soon-to-be legal marijuana states to enter into an interstate compact—a constitutionally recognized agreement between two or more states—establishing a framework for cannabis to be transported and marketed across state lines. Such an arrangement hasn’t been tried before for marijuana, but if the new effort succeeds in getting at least two states to sign on, the compact would then be transmitted to Congress, where lawmakers would have the choice to codify the agreement. It could be passed as standalone legislation or attached as an amendment or rider to a broader bill. Read More (Marijuana Moment)

Oregon loses at least seven cannabis businesses in wildfires; more damaged. Wildfires in Oregon destroyed at least seven marijuana companies and damaged at least a dozen more, according to state regulators, but it’s too early to tell how the fires will affect the state’s cannabis supply chain. According to The Oregonian, seven companies were totally burned in the Beachie Creek, South Obenchain, Almeda and Holiday Farm fires: Canyon Cannabis, Gates; Primo Farms, Jackson County; EcoTest Labs, Phoenix; Grateful Meds, Talent; Blue River Grass Station, Blue River; Fireside Dispensary, Phoenix; and Emerald Consulting, Medford. Read More (Marijuana Business Daily)

Vermont finally OKs retail cannabis stores, years after legalizing. Nearly two years after legalizing the possession of marijuana for all adults, the Vermont legislature passed a bill on September 22 that will finally allow the state’s first licensed retail cannabis stores to open no later than May 1, 2022. If Gov. Phil Scott signs the bill, Vermont’s first retail cannabis stores will open by May 1, 2022. With a vote of 23-6, the Vermont Senate adopted S. 54, the Senate version of a bill passed last week by the House. The bill now goes to Gov. Phil Scott. Scott said he will “take a look” at the legislation when it reaches his desk before he decides what to do. His choices include signing the bill, vetoing it or allowing it to become law without his signature. Scott is widely expected to sign it. Read More (Leafly)

California will not increase cannabis taxes for a year thanks to new law. California cannabis companies won’t see their state taxes go up until at least next year. Gov. Gavin Newsom signed into law Assembly Bill 1872 (same language as Senate Bill 827), which prohibits the California Department of Tax and Fee Administration from adjusting the cannabis excise tax markup amount until July 1, 2021, the Modesto Bee reported. The bill also doesn’t allow cultivation taxes from 2021 to be adjusted for inflation, unless that rate would be adjusted to less than zero. Marijuana industry representatives in California don’t oppose the law, but some say it doesn’t do enough to alleviate the weighty tax burden on the state’s cannabis businesses, thus hindering their ability to defeat their toughest competition: the illicit market. Read More (Marijuana Business Daily)

Cannabis sales in Illinois to out-of-state residents nearly doubles. Despite the pandemic, cannabis sales in Illinois continue to increase. But it’s not just in-state sales. Sales to out-of-state consumers in Illinois has nearly doubled since January. Of the nearly $64 million in total adult-use cannabis sales in Illinois for August, $17.2 million was in “out-of-state resident sales.” That’s nearly double the $8.6 million in out-of-state sales back in January. Pam Althoff, executive director of cannabis business group CannaBiz, said people are more anxious because of COVID-19. “The knowledge is now common that Illinois did pass recreational cannabis use, is now out there and people are coming in and trying,” Althoff said. Read More (Marijuana Retail Report)

Rise in Illinois marijuana demand continues to elevate wholesale prices. The Illinois Department of Public Health (IDPH), which oversees the state’s medical cannabis program, recently issued an update on patient numbers and sales figures for August. Retail and cultivator sales subsided after both reached new record highs in July. However, the state’s Spot Index and the price for flower designated as medical both rose significantly in August. This is almost certainly due to expanding demand in the adult-use sector, as the same cultivators are producing for both segments of Illinois’ market. Dispensaries are required to keep a certain amount of product on hand for sales to patients only, but other inventory can be sold to general consumers, tightening overall supply. IDPH data shows retail sales of medical cannabis in August totaled over $31.5 million, down by 5.1% compared to July’s record revenues of over $33.2 million. August 2020’s retail revenues are up by 31.8% year-over-year, compared to over $23.9 million in sales recorded in the same month in 2019. Of August’s sales total, 48% – or over $15.1 million – went to purchase flower, a proportion up from the month prior, when the percentage was 46.7%. Flower’s proportion of total medical cannabis sales in Illinois has generally trended upward to this point in 2020. Read More (Cannabis Benchmarks)

Oregon marijuana sales spike could continue as consumers ‘permanently adjust their behavior’ following COVID. Record-setting Oregon marijuana sales continue to be a bright spot in the state’s coronavirus-slowed economy, state analysts reported, but a convergence of unknowns—including the end of federal coronavirus relief and a possible rise in cannabis prices due to devastating wildfires—could still mean a rocky road ahead for consumers. “Marijuana sales continue to be strong,” Oregon’s Office of Economic Analysis wrote in a quarterly revenue forecast published. “Since the pandemic began, the increase in recreational sales have been more than 30 percent above forecast.” The increase tracks with other more established cannabis markets, such as those in Colorado, Washington and Nevada, which have also seen “strong gains” since the pandemic, the office said. “There are a number of likely reasons for these higher levels of sales and expectations are that some of these increases will be permanent.” Read More (Marijuana Moment)

Chart 5: Oregon Recreational Marijuana Source: Intro-Blue, Marijuana Moment

Chart 5: Oregon Recreational Marijuana
Source: Intro-Blue, Marijuana Moment

Wholesale cannabis bud prices rise significantly in Colorado. The average market rate for wholesale marijuana in Colorado hit a three-year high, according to new figures from the Colorado Department of Revenue. For the quarter from October 1 to December 31, the average market rate for a pound of unprocessed retail marijuana bud was $1,316, and the average market rate for a pound of trim was $350. The average market rate for bud increased by 31.6% over the previous quarter, while the rate for trim grew 16.7% on a quarterly basis. Other average market rates for the quarter, with quarterly changes were: $502 per pound of bud allocated for extraction (down 16.2%), $175 per pound of trim allocated for extraction (down 13.4%), $9 per immature plant (no change), $175 per wet whole plant (down 0.6%), and $8 per seed (up 100%). Read More (Marijuana Business Daily)

Massachusetts marijuana regulators close in on cannabis home delivery plan. The Cannabis Control Commission filled in the blanks of its long-discussed marijuana home delivery rules, agreeing upon a framework that creates two types of delivery licenses and settling on a timeline that would have new cannabis industry rules in place in about a month. The CCC adopted draft delivery regulations that would create two distinct delivery license types: a “limited delivery license” that would allow an operator to charge a fee to make deliveries from CCC-licensed retailers and dispensaries, and a “wholesale delivery license” that would let an operator buy marijuana wholesale from cultivators and manufacturers and store it in a warehouse. The licensees would augment retail stories and serve as a new means for people to acquire recreational marijuana. Read More (MassLive)

Montana recreational marijuana ballot measure would allow only local operators. Montana voters will decide in November if they want to join the growing list of states with adult-use marijuana, and if they do, the market will be one of a shrinking number that allow only in-state residents to comprise the industry. The ballot measure would also set the first 12 months of recreational sales aside for existing medical marijuana businesses, so any locals that are hoping to get in on the ground floor should apply for a provider license before November 3. Major changes would be in store for those existing MMJ companies, however, including the establishment of a new wholesale market and a reduced vertical integration requirement for dispensaries, which would allow them to sell up to half the marijuana products they produce. The result could take the Montana market to a whole new level, while also keeping it out of the hands of growing multistate operators, said Pepper Petersen, spokesman for New Approach Montana, the committee running the legalization campaign. Read More (Marijuana Business Daily)

U.S. cannabis spot index up 1.5% to $1,594 per pound, October forward closes up $30 to $1,525 per pound. The simple average (non-volume weighted) price decreased $28 to $1,768 per pound, with 68% of transactions (one standard deviation) in the $987 to $2,548 per pound range. The average reported deal size decreased to 2.1 pounds. In grams, the spot price was $3.51 and the simple average price was $3.90. The average reported forward deal size was 25 pounds. The proportions of forward deals for outdoor, greenhouse, and indoor-grown flower were 36%, 38%, and 26% of forward arrangements, respectively. Read More (Cannabis Benchmarks)

Chart 6: Cannabis Benchmarks U.S. Spot Index Source: Intro-Blue, Cannabis Benchmarks

Chart 6: Cannabis Benchmarks U.S. Spot Index
Source: Intro-Blue, Cannabis Benchmarks


Chart 7: Cannabis Benchmarks U.S. Implied Forward Curve Source: Intro-Blue, Cannabis Benchmarks

Chart 7: Cannabis Benchmarks U.S. Implied Forward Curve
Source: Intro-Blue, Cannabis Benchmarks


Chart 8: Cannabis Benchmarks U.S. Spot Price by Medical or Recreational Source: Intro-Blue, Cannabis Benchmarks

Chart 8: Cannabis Benchmarks U.S. Spot Price by Medical or Recreational
Source: Intro-Blue, Cannabis Benchmarks

Retail cannabis sales in Canada rose CAD $30.5 million M/M in July. Sales have been increasing steadily across Canada, but July’s sales growth was explosive. July sales settled at CAD $231 million for the month, which is CAD $30.5 million higher than June 2020 and up CAD $124 million year-over-year. The monthly increase is the largest gain since cannabis was legalized almost two years ago. Cannabis Benchmarks’ current 2020 legal cannabis sales forecast is CAD $2.45 billion, but July’s figures point to an annual run rate of CAD $2.73 billion. The prospect of retail sales eclipsing CAD $3 billion in 2021 looks to have a high probability now. The high level of sales are a result of elevated demand during the summer months, growth in retail outlets in key provinces such as Ontario and British Columbia (BC), more higher value sales opportunities with cannabis 2.0 products, and traditional consumers switching to the safer and regulated legal channels. Read More (Cannabis Benchmarks)

Chart 9: Retail Cannabis Sales by Province (CAD $ Million) Source: Intro-Blue, Cannabis Benchmarks

Chart 9: Retail Cannabis Sales by Province (CAD $ Million)
Source: Intro-Blue, Cannabis Benchmarks


Chart 10: Daily Cannabis Sales Growth from Previous Month (%) Source: Intro-Blue, Cannabis Benchmarks

Chart 10: Daily Cannabis Sales Growth from Previous Month (%)
Source: Intro-Blue, Cannabis Benchmarks

BC cannabis sector getting farm-gate – but not until 2022. British Columbia is developing farm-gate and direct delivery programs to benefit cannabis industry businesses and expects them to be rolled out in 2022. The province’s farm-gate sales program will allow cannabis cultivators to sell their products at stores located at their production sites. The direct delivery program will give Health Canada-licensed “small-scale producers, including nurseries” the ability to deliver cannabis directly to provincially licensed stores, according to a rare news release by the Ministry of Public Safety and Solicitor General. BC Liquor Distribution Branch currently is the sole wholesale distributor of non-medical cannabis in the province. Business groups such as the Association of Canadian Cannabis Retailers (ACCRES) and the B.C. Chamber of Commerce have been pushing for the policies. However, the announcement was light on details, including not defining “small-scale producer.” Read More (Marijuana Business Daily)

‘Show us the money’ for cannabis, local governments tell B.C. B.C. local government leaders have voted almost unanimously at their annual convention to call on the province to start sharing legal cannabis revenues with them, as Alberta, Ontario and Quebec have done. Sooke Mayor Maja Tait, outgoing president of the Union of B.C. Municipalities, was visibly frustrated as she introduced the executive’s now-annual resolution on cannabis revenue sharing. She cited sales and tax figures that show B.C. is reaping millions from its monopoly wholesale and tax revenues as cannabis stores continue to open in communities around the province. The latest data suggest previous claims by Finance Minister Carole James that B.C. is still losing money on legal cannabis due to its regulatory and enforcement costs are out of date. “Notably, during the most recent fiscal year, the province collected $14.4 million in excise tax revenue, more than double its projection,” Tait told delegates at the convention September 23. Read More (Victoria News)


New Aurora CEO to go premium in bid to win back investors, customers. In the wake of the cannabis industry’s largest quarterly loss, Aurora Cannabis’ (ACB) new chief executive officer has a plan he hopes to turn the company’s fortunes around. The challenge, however, is convincing a growing group of skeptical, once-burned investors to come along for the ride. “The proof’s in the pudding,” said Miguel Martin, the former Altria (MO) executive who formally took on the role at Aurora earlier this month. “It may not happen as quickly as everyone likes, but the category is growing, the margins are really healthy, and if we can do this very quickly as evidenced in this quarter and the quarter after, then we’ll see.” Read More (BNN Bloomberg)

Curaleaf’s Select brand announces partnership with Jim Belushi and Belushi’s Farm. Curaleaf (CURLF) announced that its Select brand is launching a vape pen in collaboration with Belushi’s Farm, available exclusively in Oregon. Select will release the limited-edition product with the famous Captain Jack’s strain, grown exclusively on Belushi’s Farm and featured in the new reality series GROWING BELUSHI on The Discovery Channel. The Captain Jack’s x Select strain will premiere at Curaleaf’s Portland dispensary and will also be available at selected dispensaries throughout Oregon. “Our goal with Select is to put the consumer first and deliver the best possible experience with full flavor and a smooth feel – without sacrificing on high quality control standards and superior testing standards,” said Joe Bayern, president at Curaleaf. Read More (Curaleaf)

Innovative Industrial Properties makes $56.4 million deal to acquire Florida property. Innovative Industrial Properties (IIPR) is acquiring the property in Lakeland, Florida, from Atlanta-based multistate cannabis operator Parallel. Formerly known as Surterra Wellness, Parallel still does business in Florida under the Surterra brand. Under terms of the deal, IIPR will pay $19.6 million for an existing 65,000-square-foot building; Invest up to roughly $36.8 million in the industrial and greenhouse indoor cultivation and production space currently in operation and add approximately 155,000 square feet of space. That will bring the facility’s total footprint to roughly 220,000 square feet; Have a total investment, assuming full reimbursement, of $56.4 million. With this deal, IIPR has spent more than $150 million since April to acquire cannabis facilities in sale-leaseback deals. Read More (Marijuana Business Daily)

Government of Colombia declares Clever Leaves Colombia as ‘Project of National and Strategic Interest.’ Clever Leaves announced that its Colombian operations have been named a Project of National and Strategic Interests (PINE) by the Government of Colombia. The PINE designation highlights the Colombian government’s continued support of Clever Leaves’ work within the industry, as well as the importance of its economic contributions to Colombia and the growing medical cannabis industry. The PINE designation will offer Clever Leaves accelerated and simplified administrative processes as the company continues to develop new products and services and bring them to market. Read More (GlobeNewswire)

Consumer packaged goods giant Unilever inks distribution deal with Neptune Wellness. Neptune Wellness (NEPT) is partnering with consumer-packaged goods giant Unilever as an import and stocking distributor and logistics partner in the U.S. and Canada. The Laval, Quebec-based extraction company and product manufacturer of health and wellness products will provide Unilever’s selling partners with products in its warehouse system in the U.S. and Canada to support the growth of the hygiene category, The Fly originally reported. The partnership could generate sales revenue of $65 million to $137 million over the next 18 months, based on projections from Neptune and Unilever, according to a Neptune company statement. Neptune expects to receive the first shipments of products into its inventory by the end of October. The distribution agreement does not require any minimum annual purchase commitments. Read More (Hemp Industry Daily)

GW Pharmaceuticals cannabis drug gets regulatory OK in Australia. GW Pharmaceuticals’ (GWPH) plant-derived CBD drug Epidyolex received approval from Australia’s Therapeutic Goods Administration (TGA) to be used in treating seizures related to Lennox-Gastaut syndrome and Dravet syndrome for patients 2 and older. The approval is the third major global regulatory approval for Epidyolex, GW said in a news release. “The TGA approval is further proof that cannabis-based medicines can successfully go through extensive randomized placebo-controlled trials and a rigorous evaluation process to reach patients who need them,” GW chief operating officer Chris Tovey said in a statement. Read More (Marijuana Business Daily)

4Front closes on sale of three Maryland medical marijuana dispensaries. Multistate cannabis operator 4Front Ventures (CNXXF) said it has completed the sale of three medical marijuana dispensaries in Maryland for $5.5 million, as the Arizona-based company shifts its focus to adult-use markets such as in Illinois. Philadelphia-based Ethos Cannabis announced in a news release that it acquired the rights to 4Front dispensaries in Rockville, Catonsville, and Hampden, which are in the Baltimore-Washington DC corridor. The dispensaries currently are operated under 4Front’s Mission brand but will be rebranded to Ethos. The Maryland transaction is part of an $18 million deal announced in May in which 4Front agreed to sell cannabis stakes in Maryland and Pennsylvania to Ethos. Read More (Marijuana Business Daily)

MediPharm Labs enters Brazil in partnership with XLR8 Brazil. Medipharm Labs Corp. (MEDIF) announced that its wholly owned subsidiary MediPharm Labs Inc. will supply premium, GMP-certified formulated cannabis oil to XLR8 Brazil, a Rio de Janeiro based value-added distributor serving Brazil, Latin America’s largest medical cannabis market. Under the two-year agreement commencing from the time of product authorization, MediPharm Labs Inc. will provide a variety of cannabis concentrate formats for patient-ready formulated products that will be distributed by XLR8 to leading pharmacies and other authorized channels in Brazil. The initial product SKUS include a 20:1 CBD rich product and a 10:10 balanced THC and CBD formulation. XLR8 will obtain ANVISA Sanitary Product Authorization and undertake the process for final product registrations. Read More (GlobeNewswire)

Khiron becomes first company to sell medical cannabis in Peru and surpasses 3,000 prescriptions in Colombia. Khiron Life Sciences (KHRNF) announced that it has filled the first prescriptions of full spectrum, high CBD medical cannabis to patients in Peru. This comes following authorization from DIGEMID, Peru’s drug regulatory authority, and expands sales of Khiron’s medical cannabis to a second jurisdiction in Latin America, following established sales in Colombia, where over 3,000 prescriptions have been filled to date. “After completing successfully all export, import and distribution requirements to bring our approved high CBD medical cannabis products into Peru, we are now very proud to begin sales and give patients greater access to medical cannabis therapies in order to improve significantly their quality of life,” comments Luis Marquez, Khiron Peru Country Manager. Quotas for Khiron’s high THC medical cannabis have also been approved by DIGEMID with first prescriptions anticipated in Q4 2020. Read More (Newswire)


Aurora ends fiscal year with CAD $3.3 billion loss. Aurora Cannabis (ACB) reported a net loss of more than CAD $1.8 billion ($1.4 billion) for its fourth quarter, ending its 2020 fiscal year with a CAD $3.3 billion loss. The quarterly loss includes a previously signaled CAD $1.6 billion write-down. Net revenue for the quarter ended June 30 was CAD $72.1 million, down 4.5% from the previous quarter. Revenue from adult-use cannabis was CAD $35.3 million, down 8.5% on a quarterly basis. Although Aurora sold 36% more recreational cannabis by volume during the quarter, that product sold for 30% less than in the previous quarter as Aurora’s discount brand, Daily Special, made up an increasing proportion of revenue. On a conference call with investors, Aurora’s new CEO, Miguel Martin, said he intends to adjust Aurora’s portfolio of adult-use cannabis brands. Read More (Marijuana Business Daily)

Supreme Cannabis revenue falls as a result of COVID. Supreme Cannabis (SPRWF) released its financial and operating results for the fourth quarter and year ending June 30, 2020, as total revenues fell for the quarter, but were up for the year. In the fourth quarter, total revenue fell slightly to $10.8 million from last year’s $11 million as stores were closed due to the COVID-19 pandemic. The net losses were trimmed to $33 million from last year’s net loss of $73 million. Overall net revenue decreased 2% to $9.5 million in the fourth quarter from $9.7 million in the third quarter. This was primarily driven by a change in the company’s focus from the domestic wholesale channel to its growing recreational channel. Wholesale net revenue in the quarter was $2.3 million, down 43% quarter-over-quarter. Read More (Green Market Report)

KushCo expects fiscal Q4 revenue to increase 14%-17% sequentially. KushCo (KSHB) expects its preliminary and unaudited fiscal fourth quarter 2020 revenue to be between approximately $25.5 million and $26.0 million, compared to approximately $22.3 million in its fiscal third quarter 2020, which represents an improvement from its previously disclosed guidance of between $24.0 million and $26.0 million. The 14% to 17% expected sequential increase in revenue is being driven primarily by an increase in sales to the company’s top 100 customers, which consist of leading multi-state operators (MSOs), licensed producers (LPs), and brands. It also expects adjusted EBITDA for the fiscal fourth quarter 2020 to be preliminarily between $0.25 million and $0.75 million, which represents an improvement from its previously disclosed guidance of between ($1.0) million and $1.0 million. Read More (New Cannabis Ventures)

Meta Growth trims fat and grows profits. The last quarter has brought big changes for Meta Growth, and it’s paying off. The company saw a quarter over quarter gross profit increase of 24% and reduced its loss from operations by nearly half (46%). In the third quarter, Meta earned $13.7 million and saw $4.9 million in profit. In the second quarter, revenue was approximately the same at $13.4 million, however, profits were lower at $3.9 million. In the interim, Meta managed to increase its profit margin to 36% by cutting expenses and operating losses by 15% and 46%, respectively. Operating expenses went from $8.9 million in Q2 to $7.6 million in Q3, and losses from operations dropped from $4.9 million to $2.6 million. Read More (Cannabis Retailer)


SPACs offer marijuana companies a source of funding – and a way to go public. A meteoric rise in cannabis special purpose acquisition companies (SPACs) is providing private marijuana and hemp companies an unprecedented opportunity to raise money and go public. “Cannabis SPAC IPOs (initial public offerings) raised more than $2.6 billion (in 2019) and more than $700 million in the first half of 2020, as institutional investors recognized the opportunities to acquire distressed/discounted assets in the industry,” Scott Greiper, president and founder of Viridian Capital Advisors, told Marijuana Business Daily. In the cannabis industry, Bruce Linton, a former CEO of Canopy Growth (CGC), last March announced a $150 million SPAC called Collective Growth (CGROU), which initially plans to focus on hemp products, according to U.S. Securities and Exchange Commission filings. Read More (Marijuana Business Daily)

Want to invest in the U.S. cannabis market? This new ETF can help you do that. The cannabis industry is scorching hot this year, proving to be pandemic-proof thus far. For investors, trying to figure out the best stock to buy to take advantage of these opportunities can be difficult, since different companies operate in different states. They can also invest in producers such as Green Thumb Industries (GTBIF) and Curaleaf (CURLF), or a company like GrowGeneration (GRWG) that’s in the hydroponics business and helps both businesses and individuals grow pot. Given all these choices, investing in an exchange-traded fund (ETF) can be the best approach, as it gives you a good mix of all those strategies. The AdvisorShares Pure US Cannabis ETF (NYSEMKT: MSOS), which began trading in September, includes all of the stocks mentioned above plus others, and it can be your best way to invest in the U.S. pot market. This isn’t the only cannabis ETF out there, but it does present one of the best investment opportunities. The reason it’s a better buy than other ETFs is that it’s focused primarily on the U.S. market. Read More (Nasdaq)

What are the risks of investing in cannabis stocks? Cannabis is a growing industry that intrigues many investors. But there are risks you should consider before deciding to invest. There are four categories of risk in investing in cannabis: 1) Legal restrictions – As of January 2020, state legislatures and Congress were considering 975 cannabis-related pieces of legislation. That could mean more regulation or it could change the way cannabis businesses operate. 2) Valuation – Because the industry is so new and rapidly changing, it’s tough to know when a stock is at a good price to buy or is overpriced. 3) Dilution – Given the legal uncertainty around cannabis, these companies have fewer ways to raise money than businesses in more established industries. 4) Commoditization – Cannabis is a crop, the same as oil, gold, wheat, corn, or soybeans. That means as the market changes, cannabis crops can be worth more one year or less the next. Read More (Money Morning)

Does the U.S. cannabis industry turn to one guy in Puerto Rico? With a unique risk like a cannabis business surety bond (meaning an insurance company steps in with its good name and creditworthiness and agrees to stand behind the promises of a licensee to “do the right thing”), who would step forward in to the unknown? There is one. Surety One is an international insurance intermediary domiciled in Puerto Rico, licensed in all 50 states, the U.S. Virgin Islands, Canada and the Dominican Republic. To date, the Surety One underwriting office has issued over 3,000 surety bonds for marijuana and cannabidiol (CBD) operators in 15 states. Operators in states that have legalized marijuana show no signs of abandoning the sector and new jurisdictions appear to be poised to enter. Read More (The Weekly Journal)

Veritas Farms seeking up to $6 million in stock offering. Florida CBD maker Veritas Farms (SSWH) is looking to raise up to $6 million to boost marketing and to expand a production and distribution facility in Colorado. The Fort Lauderdale company announced that it will offer 8 million shares at 50 cents each to raise $4 million. The action gives the company the option to expand the offering to 12 million shares to raise $6 million. The company, which grows hemp in Pueblo, Colorado, says it will use the money for marketing and sales efforts, building out a new manufacturing and distribution facility near the Denver airport, developing new strains of hemp and additional products, and software upgrades and other corporate purposes. Read More (Hemp Industry Daily)

Founder of cannabis firm CannaRegs sued for alleged securities fraud. A securities fraud lawsuit filed against the co-founder of the web-based marijuana rules monitoring firm CannaRegs underscores how company sales can lead to court battles among initial investors – a development that could continue as more founders exit the industry. Lester Firstenberger and Sathya Rajavelu, two former CannaRegs executives, said they sold their remaining cumulative 11.8% interest in the Denver-based company last September for $178,942, based on a $1.5 million valuation of the company. Their federal court complaint, filed earlier this month in the Southern District of New York, claims that CannaRegs founder Amanda Ostrowitz encouraged them to sell, while concealing that she planned to sell the company for $10 million to Fyllo, a Chicago-based software company. Read More (Marijuana Business Daily)

Aurora sinks to four-year low, told to ‘stop growing so much weed.’ Aurora Cannabis (ACB) shares tumbled to the lowest price in four years on September 23 after its fourth-quarter results prompted an MKM Partners analyst to tell the company, “Please stop growing so much weed.” Shares fell as much as 25% in Toronto trading, the biggest drop in six months, to the lowest level since 2016 when Canada was still two years away from legalizing recreational marijuana use. The results dragged other Canadian pot stocks lower on the same day, with Tilray (TLRY) down as much as 9.6%, Canopy Growth (CGC) losing 9% and Cronos Group (CRON) falling 4.7%. Read More (BNN Bloomberg)

Chart 11: Aurora Shares Hit Their Lowest Level Since 2016 Source: Intro-Blue, BNN Bloomberg

Chart 11: Aurora Shares Hit Their Lowest Level Since 2016
Source: Intro-Blue, BNN Bloomberg

WeedMD borrows CAD $30 million from Canadian pension fund. Canadian cannabis grower WeedMD (WDDMF) secured a loan worth CAD $30 million ($22.5 million) from the LiUNA Pension Fund of Central and Eastern Canada, a retirement plan associated with the Laborers’ International Union of North America. “This $30 million of nondilutive financing will enhance our liquidity position and provide additional working capital at this inflection point to drive our adult-use brands, add distribution points and expand our sales and marketing team,” WeedMD CEO Angelo Tsebelis said in a news release. The LiUNA Pension Fund of Central and Eastern Canada, a major WeedMD shareholder, invested CAd $25 million in the company earlier this year. The new CAD $30 million credit facility has an interest rate of 15% and matures in August 2022. WeedMD has the option to capitalize the interest in lieu of cash interest payments. Read More (Marijuana Business Daily)

FCA publishes guidance on its approach to cannabis companies looking to list in the UK. On September 18, the Financial Conduct Authority (FCA) published guidance on the listing of cannabis-based businesses onto public stock exchanges in the UK. These are: 1) The proceeds from recreational cannabis companies, even when they are located in those jurisdictions that have legalized it, are considered to be proceeds of crime by the FCA and therefore the securities of such a company would not be admitted to listing on the Official List in the UK; 2) The UK-based medicinal cannabis companies can have their securities admitted to listing on the Official List (provided they have the requisite Home Office licenses); and 3) Overseas licensed companies may have their securities admitted to listing on the Official List provided POCA does not apply and they satisfy the other eligibility criteria for listing. However, such companies will need to satisfy the FCA as to the POCA risk and that their activities would be legal if carried out in the UK. Read More (Forbes)

London-based manager aims to raise Europe’s biggest cannabis fund. Chrystal Capital Partners believes a growing wave of legislation will boost the popularity of cannabis investment, and its potential returns. It is hoping to raise an initial $100 million for the Verdite Capital Fund, an actively managed fund, before growing it to $200 million through a later fundraising. “We think this will be a highly regulated industry in 10 years’ time,” said Kingsley Wilson, an investment partner at the firm, acknowledging that regulatory risk had deterred many private equity and institutional investors from the sector. “Regulation and funding will underpin the market transition and how it moves from an illegal to a legal market.” Chrystal’s strategy will focus on medical marijuana, cannabis-derived drugs and so-called CBD — a cannabinoid that does not make users feel high. About half of its assets will be invested in North America and at least 35 percent in Europe. It will avoid companies supplying marijuana for recreational use, Chrystal said. Read More (Financial Times)

Insurance for cannabis. While the explosive growth of the cannabis industry was tempting enough to draw thousands of businesses, it’s an inconsistent industry. Now investors are beginning to grow wary of cannabis claims, and many lawsuits have already been launched against CBD and cannabis brands. Many investors require companies to offer directors’ and officers’ coverage before even engaging with them now to be safe from this wave of litigation. Many of those who help cannabis companies get policies have no idea how the industry works, and as such, end up creating policies that don’t hold water in court. Simply put, one can lose their entire policy. If you add a new product without consulting your insurance or your agent, then you might invalidate the entire policy. While your insurance could cover everything you’re selling now, the addition of a product with B12 or melatonin could completely change the agreement. While most of the cases haven’t gone to court, accusations of fraud and misinformation are abundant. If companies are guilty of such actions, obviously they could lose their insurance. Read More (Cannabis Tech)


It is time to embrace cannabis for medicinal use, say experts. Attitudes towards cannabis products for medicinal use need to change with much greater appropriate use of such products to help alleviate patients’ pain, suggests research published in the journal BMJ Open. Researchers found that hundreds of thousands of UK patients were self-medicating with illegal cannabis-based products for medicinal use due to the fact that much of the medical and pharmacy professions have so far not embraced and prescribed legal cannabis-based products for their patients. Various reasons to explain why there was resistance to use of these drugs were given, such as the fact the use of medicinal cannabis products was something being driven by patients and not doctors, which the latter group might resent. They also offered the potential of cost savings to the NHS in terms of reduced hospital stays and less prescribing of other medicines particularly opioids for chronic pain, they argued. Read More (Science Daily)

Cannabis use is associated with greater total sleep time. Researchers recently explored the relationship between cannabis consumption and the amount of sleep that someone gets at night. The team of researchers are based out of California, however, because sleep problems exist all over the planet, the results of the research are significant and applicable worldwide. “We aimed to examine the relationship between daily cannabis use and subsequent objectively-measured sleep quality in middle-aged and older adults with and without HIV.” the study states. The study involved 17 subjects, all aged between 50-70 years. Each subject reported cannabis use and sleep duration for 14 days in a row via a smartphone app survey. “In linear mixed-effects models, cannabis use was significantly associated with greater subsequent total sleep time (ß = 0.56; p = 0.046). Cannabis use was not related to a change in sleep efficiency (ß = 1.50; p = 0.46) nor sleep fragmentation (ß = 0.846, p = 0.756) on days with cannabis use versus days without cannabis use.” according to the study. Researchers concluded that, “These preliminary results indicate cannabis use may have a positive effect on sleep duration in middle-aged and older adults.” Read More (Cannabis & Tech Today)


USDA invites additional public comments per hemp IFR till October 8. The United States Department of Agriculture (USDA) is reopening a public comment period on its interim hemp regulations. Though the initial go-round garnered more than 4,600 comments, the department seeks additional input due to requests from both lawmakers and industry stakeholders. The USDA hopes to gain feedback from stakeholders, particularly, about a dozen specific issues. In the first of a two-part review, the Hemp Business Journal breaks down six areas in which the USDA seeks comment, outlining mitigating issues and some of the changes which stakeholders have suggested. The comment period on the USDA’s Interim Final Rule will remain open until October 8; all interested parties are invited to submit comments online. Read More (New Frontier Data)

Chart 12: Submission and Approval Status for State Hemp Production Plans (As of September 23, 2020) Source: Intro-Blue, New Frontier Data

Chart 12: Submission and Approval Status for State Hemp Production Plans (As of September 23, 2020)
Source: Intro-Blue, New Frontier Data

Hemp advocates secure major win in new house government funding measure. Hemp industry stakeholders are celebrating the introduction of a House of Representatives funding bill that would extend a 2014 pilot program for the crop until 2021. While the 2018 Farm Bill more broadly legalized hemp, it required the U.S. Department of Agriculture (USDA) to develop regulations for the market—and many farmers and processors have expressed concern about certain proposed rules. Industry groups, lawmakers and producers have been asking USDA to extend the earlier, 2014 Farm Bill pilot program, which they consider to be more flexible. That program is set to expire on October 31. But if the new continuing resolution to keep the government funded and avoid a shutdown is approved, it would stay in effect until at least September 2021, also pushing back the implementation of USDA’s interim final rule on hemp and its derivatives. Read More (Marijuana Moment)

New FDA guidance will make it easier to approve CBD-based medicines. The Food and Drug Administration (FDA) is releasing new draft guidelines that are meant to streamline approvals for generic oral CBD medications. To expedite the approval process, FDA said applicants can request a waiver of an in vivo bioequivalence study if they meet certain requirements. Going forward, if a drug company wants to produce generic versions of that 100 mg/mL cannabidiol solution, they could follow specific rules to skip the in vivo bioequivalence study step if the draft guidance is finalized. The drug would have to be derived from Cannabis sativa L, contain no more than 0.1% THC and have “no inactive ingredient or other change in formulation from the [reference listed drug] that may significantly affect systemic availability.” Read More (Marijuana Moment)

Swiss food giant Nestle enters European CBD market with softgel launch. A subsidiary of Nestle has started producing and selling CBD softgels in Europe. Nestlé Health Science partnered with Geocann, a cannabis-product manufacturer headquartered in Fort Collins, Colorado, to launch broad-spectrum CBD softgel formulations with a special droplet delivery system known as VESIsorb. The first large-scale batch of the softgels was produced in Switzerland earlier this month from hemp grown and extracted in Slovenia, Geocann said in a statement. “We are extremely proud to expand our relationship with Nestlé’s health-care professional brands into Europe after their success in the U.S. market this past year,” said Jesse Lopez, CEO and founder of Geocann. Read More (Hemp Industry Daily)

Tobacco consumers more likely to convert to smokable hemp in coming year. Entrepreneurs in the smokable hemp sector have reason to hope that tobacco consumers may convert at least partially to hemp products within the next year. That’s because 29% of cigarette and cigar users have indicated they are willing to try these products, according to research by Nielsen Global Connect. Nielsen noted that nearly 1-in-4 cigarette or cigar smokers claim to have consumed a hemp-CBD product (24%) or e-cig or non-cannabis vape product (24%) over the past year. That compares to the aggregate of U.S. adults, of whom fewer than 18% have ever consumed hemp-CBD. Read More (Hemp Industry Daily)

Chart 13: Likelihood to Consume Smokable Hemp in the Next 12 Months Source: Intro-Blue, Hemp Industry Daily

Chart 13: Likelihood to Consume Smokable Hemp in the Next 12 Months
Source: Intro-Blue, Hemp Industry Daily

CBD maker, HIA sue Drug Enforcement Administration over extract rule. The Hemp Industries Association and a South Carolina CBD manufacturer are suing the U.S. DEA over a recent rule they say wrongly criminalizes how hemp extracts are made. The filing asks a federal appeals court in Washington DC to throw out a DEA rule published last month. At issue is whether the DEA is simply updating its policies to comply with the 2018 Farm Bill, which removed low-THC cannabis from the Controlled Substances Act, or whether the DEA is making an illegal power grab by saying that hemp extracts are Schedule 1 controlled substances during a portion of the extraction process when the plant’s THC levels spike above what’s allowed. CBD makers howled when the rule was published, saying the DEA’s interpretation would criminalize hemp extracts even though Congress specifically mentioned extracts in the Farm Bill. That’s because the DEA rule says that hemp legalization “does not automatically exempt any product derived from a hemp plant.” Read More (Hemp Industry Daily)

Papa & Barkley inks national distribution deals for CBD topicals, tinctures. California CBD maker Papa & Barkley has expanded distribution from 20 states to 48 states thanks to new distribution deals with retailers including wellness retailer The Vitamin Shoppe. Papa & Barkley, based in Eureka, California, says the deals take its CBD retail presence from 462 retail locations to 1,034 retail locations. In addition to The Vitamin Shoppe, the company’s national CBD line is going for sale in Equinox fitness clubs, Natural Grocers grocery stores, Erewhon (a health-food chain), Thrive Market (an online grocer), and PDM Healthcare which sells medical supplies. Read More (Hemp Industry Daily)


Cannabis subscription boxes are hot commodity during the pandemic, growing by 550%. Weed-related subscriptions have jumped by an eye-popping 550% on the subscription box service Cratejoy during the pandemic, and box companies like Hemp Crate, Cure Crate, and The Stoney Babe Box are at the forefront of this surging popularity. Cratejoy offers subscription boxes for any enthusiasm, need, or DIY endeavor (current picks include lesson planning boxes to make in-home schooling less onerous and multiple iterations of the “date night” theme). COVID-19 has been a major driver of the subscription box boom, allowing Cratejoy and the weed companies it features to cash in on cannabis in a big way. Hemp Crate, Cure Crate, and The Stoney Babe Box profit from their great reviews, built-out listings, and artsy photos showcasing what to expect in each delivery. Read More (Green Entrepreneur)

Manitoba considering allowing restaurants, spas to sell pot products. Two years since recreational use of marijuana was legalized across the country, Manitoba’s cannabis authority is exploring the possibility of providing licensing to allow businesses like restaurants and spas to offer cannabis products. The Liquor, Gaming and Cannabis Authority (LGCA) of Manitoba is launching numerous campaigns geared toward gauging the interest of businesses and consumers in expanding the availability of cannabis products. As part of the initiative, the LGCA is working with Leger, a market research and analytics firm, to survey a sample of Manitobans about authorizing licensed cannabis consumption spaces. “This is really an exploratory process, so we’re trying to understand if Manitobans want these types of businesses to be available in our province and that’s why we’re out there asking them these questions right now,” says Kristianne Dechant, LGCA’s executive director and CEO. Read More (Global News)


Cannabis-infused products markets poised to reward sector-specific strategies. Demand for cannabis-infused products is experiencing explosive growth, fueled by surging consumer interest and technological advancements which present boundless opportunity for new product innovation. In the THC market, infused products (including edibles and topicals) in 2019 accounted for 14% of sales, generating over $2 billion in retail sales. Between 2020 and 2025, the category will generate an estimated $21.5 billion. Including CBD- and other minor-cannabinoid-infused products, substantial opportunities presented by the sector are fueling interest from investors and entrepreneurs. Uncertainty exists as regulators (i.e., both the U.S. DEA, and the EU’s European Commission) have proposed rules effectively constraining those respective markets. Read More

Chart 14: U.S. Sales of Cannabis Products – Q1 2020 Source: Intro-Blue, New Frontier Data

Chart 14: U.S. Sales of Cannabis Products – Q1 2020
Source: Intro-Blue, New Frontier Data

Government study released on vape-related illnesses shows why marijuana regulation is working. A grant was given to Ohio State by the American Heart Association in July of $5.5 million dollars to study the vaping related illness issue. The study found that states such as Delaware, Utah, Illinois, Indiana, Iowa, Minnesota, North and South Dakota and Wisconsin  – accounted for a high prevalence cluster. In other words, this is where most of the EVALI cases were happening. To put it into perspective – these states had a prevalence of 25 – 114 per 100,0000 versus legal states with 1 per 100,000. The vast majority of the cases were due to black market purchases. “If e-cigarette or marijuana use per se drove this outbreak, areas with more engagement in those behaviors should show a higher EVALI prevalence,” she says in a statement. Read More (

Pot-infused products fail to draw in new consumers, survey finds. New cannabis users account for one-quarter of all legal Canadian consumers, but many appear to be eschewing infused products originally aimed at drawing them into the market, according to a survey. The survey conducted by Chicago-based Brightfield Group found that “newbies,” or those who have only consumed cannabis since the drug was legalized in late 2018, made up 25 percent of legal pot purchases in the second quarter of the year, a sign that the regulated market is garnering increased consumer interest in Canada. A significant lure to the legal cannabis market has been the recent advent of cheaper products, better known as the “value” segment, which competes directly with the illicit market on price, according to Bethany Gomez, managing director of the Brightfield Group. Read More (BNN Bloomberg)

Fast-acting cannabis edibles offer easy alternative to smoking during COVID-19. As the pandemic continues, it’s not just cannabis sales that are increasing. There has also been an increase in edibles sales, which traditionally have only made up a small part of the cannabis market – with some estimates between 16-20%. But in recent months, many cannabis companies are reporting increased edible sales – suggesting that many consumers may be deciding to forgo smoking cannabis and instead use edible options during the pandemic. Still, those shifting to edibles from smoking may notice big differences in how they are affected by the drug. Studies show that cannabis edibles have a markedly different effect profile than cannabis when it is smoked – with many preferring the experience from smoking. Read More (Forbes)

Gourmet CBD from Martha Stewart — a good thing? Was it something she smoked? Lifestyle guru Martha Stewart has a new line of wellness products — Martha Stewart CBD. The gourmet gummies, oil drops and soft gels, which launched this month ($34.99 to $44.99,, contain hemp-derived CBD isolate and are a partnership with Canada’s Canopy Growth (CGC). Flavors of citrus (Meyer lemon, kumquat and blood orange) and berry (raspberry, huckleberry and black raspberry) are based on plants grown in Stewart’s greenhouse and gardens, and used in her kitchen. A gift box and pet products are in the works. It was rapper Snoop Dogg, her co-star on VH-1 TV’s “Martha and Snoop’s Potluck Party Challenge,” who introduced Stewart to Canopy Growth executives several years ago. Read More (San Francisco Chronicle)


Congressional Research Service highlights four consequences of federal marijuana prohibition. A new report from the Congressional Research Service (CRS) identifies multiple problems caused by conflicting federal and state marijuana laws. Those issues include a lack of access to financial services for state-legal cannabis businesses and challenges accessing marijuana for research purposes, CRS said. First it said universities might be disinclined to take on cannabis study initiatives out of fear of losing federal funds. General research is also hampered by federal prohibition, CRS said, as the requirements to obtain cannabis for studies is onerous. The CRS report also talks about how, despite Treasury Department guidance for banks on the rules for servicing marijuana businesses. Finally, CRS said people in general face the threat of prosecution under federal law for cannabis-related activity, regardless of their states’ policies. Read More (Marijuana Moment)

Cannabis use associated with better sleep for seniors. According to a new study, the daily use of cannabis by older adults is associated with improved sleep duration, as sleep is a major issue that patients medicate for. This new study from the University of California at San Diego is unique because it looks at cannabis use and how it can help sleep for seniors both with and without HIV. “Researchers with the University of California at San Diego assessed the relationship between daily cannabis use and sleep quality over a 14-day period in a cohort of older adults (ages 50 to 70) with and without HIV,” the study explains when giving an overview of procedures used and the setting of the study. “Participants wore actigraphy watches during the study period to objectively assess their quality of sleep.” The researchers found that overall, cannabis helped seniors get, on average, an 30 extra minutes of sleep. Read More (High Times)

54 ex-NFL players tested a mental clarity cannabinoid product. Some now swear by it. While the U.S. FDA strictly prohibits medical claims about the efficacy of cannabinoid products, Dallas-based wellness company Prime My Body’s medical advisor Dr. Cheng Ruan says that Focus – a cannabis oil product – may be the first such product to undergo large-scale testing. A test of the product in a controlled medical setting involving 54 former NFL players (who signed releases plus others who did not) resulted in relief from various side effects and a bevy of enthusiastic reviews. Many of those players reported the same kinds of mental clarity issues as Brian Jones, a college football commentator for CBS Sports who played pro football for five years with the L.A. Raiders, Indianapolis Colts and New Orleans Saints, has since dealt with shoulder, back, knee pain, and more. Read More (Forbes)


European cannabis: Waking the sleeping giant. The burgeoning markets of North America have shown the economic potential of cannabis, with hundreds of thousands of jobs created over the last decade and billions collected in tax revenue, as referendums on medical and recreational legalization have swept across the U.S. However, it is not a simple matter to replicate this course of development in the quite different political landscape of Europe. Despite having a considerably larger population than the U.S. and Canada put together, patient numbers in Europe show a far laxer growth. In the premier market of Europe, Germany counts barely over 0.1% of the population accessing medical cannabis via their healthcare system, while many countries are yet to allow the therapeutic use of the plant. Europe lacks the political and cultural harmonization exhibited by American States and Canadian provinces. Despite strong public majorities in favor of medical cannabis in many European countries, it has been difficult to build the political will to tackle the issue. The prohibitionist inertia is strong and heavily institutionalized, despite weakening year after year.  Read More (Prohibition Partners)

Chart 15: Medical Cannabis Patient Penetration – Europe vs. Mature Markets Source: Intro-Blue, Prohibition Partners

Chart 15: Medical Cannabis Patient Penetration – Europe vs. Mature Markets
Source: Intro-Blue, Prohibition Partners

The future of medical cannabis in the UK: Regulation, capital raising, and investments. As policy on cannabis in the UK and Europe continues to evolve, Rohit Fogla, Senior Associate at Hill Dickinson LLP, outlines the current regulatory regime for medical cannabis, capital raising and investment options for enterprises and investors operating in this sector. The UK has seen a handful of companies listing on its public markets with cannabis as their core business. This includes World High Life (WHL), Ananda Developments, Greencare Capital plc (Greencare) and Sativa Group plc (Sativa). Difficulties can arise when UK investors seek to invest in a company that operates outside of the UK. Medical cannabis companies may be able to raise capital through a mixture of sources. However, like most companies, these will boil down to two main options (or a mixture of the two): debt and equity. There also have been a number of high-profile investments and transactions in the cannabis sector within the UK. Read More (Health Europa)

UK food regulators reject CBD as narcotic, stand by novel food deadline. Great Britain has rejected the European Commission’s preliminary stance that hemp flower-derived CBD should be regulated as a narcotic, a key food safety regulator in the United Kingdom says. Paul Tossel, who leads the Novel Foods authorities at London’s Food Standards Agency, said that although British authorities continue to mirror requirements set out by the EU’s Novel Food Regulation and the European Food Safety Authority, they did not agree with the Commission’s assessment. Tossel said during a panel on the future of CBD in grocery retail that the European Commission’s preliminary CBD position isn’t shared by the UK’s Home Office, a government department that oversees drug policy and law enforcement. The UK said in February that CBD products already on the market would need to have a validated novel food application in hand in order to remain on the shelves beyond March 31, 2021. Read More (Hemp Industry Daily)

High hopes for a slow-moving German cannabis market. Germany is the world’s third-largest medical cannabis market behind the U.S. and Canada, respectively. Unsurprisingly, it is also the EU country having seen the most investment in the legal cannabis industry (both for medical cannabis and CBD), with German medical cannabis distribution companies involved in about 80% of European investment activity. Western Europe’s medical cannabis market was estimated last year at between €230-€280 million, with German shares at between €150–€175 million. In the first half of 2020, insured medicinal cannabis sales in Germany were worth about €75 million. As the first wave of the COVID-19 pandemic wanes, market momentum is building from a bullish 2019 market in which more than a dozen cannabis-related deals over €5 million saw German-based businesses accounting for four-fifths of them. Read More (New Frontier Data)

Chart 16: Germany’s Cannabis Market Opportunities Source: Intro-Blue, New Frontier Data

Chart 16: Germany’s Cannabis Market Opportunities
Source: Intro-Blue, New Frontier Data

German medical cannabis applications for insurance reach 100,000. Applications for medical cannabis reimbursements with German statutory health insurers (GKV) have hit the 100,000 milestone this year – and 62% were approved, according to data obtained by Marijuana Business Daily. The figure accounts for individual applications submitted since the current program started in early 2017 through mid-2020. This is the first-time comprehensive data about cannabis applications for reimbursement have become available in recent years. Last March, the government said it did not have such information available. Some insurers have consistently higher approval rates than others, but on average, 62% of the applications have been approved every year since 2017. Read More (Marijuana Business Daily)

Chart 17: Applications for Insurance Coverage of Medical Cannabis in Germany Source: Intro-Blue, Marijuana Business Daily

Chart 17: Applications for Insurance Coverage of Medical Cannabis in Germany
Source: Intro-Blue, Marijuana Business Daily

Dutch government seeks to ease doubts over adult-use cannabis trial. As it seeks to ease public concerns, the Netherlands is evaluating applications to grow marijuana under a pilot program to permit limited cultivation and sales of adult-use cannabis. The selection process involves consulting with mayors of the municipalities where the applicants intend to grow. To clear up any confusion and ease public jitters about the program, the government this week published a lengthy Q&A featuring 77 questions and answers covering a variety of topics, including the applicant review process, the mayors’ input on public safety issues, background checks into the growers, the pilot program’s timeline, local requirements, regulatory oversight and enforcement. By the end of the July deadline to apply, the government had received 149 applications to grow marijuana to be sold to coffee shops in the 10 municipalities that are part of the experimental program. Read More (Marijuana Business Daily)

Cannabis could save the Spanish economy, but will the prohibitionists let it? Spain is a major agricultural producer and is the vegetable garden of Europe. Southeastern Spain has vast areas under greenhouses, so it would be an ideal place to grow cannabis. Actually, there is already a major legal hemp industry, as well as a thriving illegal marijuana industry, especially in Catalonia. Barcelona has some amazing “Cannabis Social Clubs” that operate by stretching a loophole in Spanish laws, enforced in Madrid, but more or less ignored in much of the rest of the kingdom. Recently, El País, one of Spain’s leading newspapers, carried an article in its English edition, Could Catalonia’s growing marijuana market lead to a ‘narco-economy’? Read More (LA Weekly)

New Zealand cannabis market estimated at NZD $1.5 billion, 74,000 kilograms. Roughly 74,000 kilograms (74 metric tons) of cannabis is consumed annually in New Zealand’s illicit market, with a retail value of up to NZD $1.5 billion ($1 billion), according to newly released research by Wellington-based Business and Economic Research (BERL Economics). New Zealand is holding a referendum in October to ask voters to decide whether cannabis prohibition should end and those expenditures transitioned into the regulated economy. BERL Economics was commissioned by New Zealand’s Ministry of Justice in 2019 to produce two reports to inform regulations for a potential legal market for recreational marijuana. The reports ultimately paint a picture of what an adult-use market in the country could look like, including financial viability of legal cannabis industry enterprises, baseline market estimates, and post-legalization scenario modelling. Read More (Marijuana Business Daily)

Chart 18: Estimated Number of New Zealand Cannabis Business Licenses by Type Source: Intro-Blue, Marijuana Business Daily

Chart 18: Estimated Number of New Zealand Cannabis Business Licenses by Type
Source: Intro-Blue, Marijuana Business Daily


New appellations would celebrate individual terroir of cannabis strains. California’s cannabis industry may soon have legally recognized geographic areas as highly regarded as those of the wine industry. Just as Sonoma’s Russian River Valley is known for Pinot Noir and Napa’s Oakville for Cabernet Sauvignon, Northern California sub-regions like Salmon Creek, Comptche and Ukiah Valley could each become world-renowned for their signature strains of cannabis. If cannabis industry leaders and the California Department of Food and Agriculture (CDFA) follow through on a mutually accepted agenda, the appellation of origin application process will be in place by January 1. Read More (SFGate)

Delta-8-THC promises to get you high without the paranoia or anxiety. Delta-9-THC, the main drug in cannabis plants that gets people high, can also be a potent medicine. But while marijuana is a relatively mild drug with few side effects — at least, compared to alcohol or tobacco — too much Delta-9-THC has its downsides. That’s why many cannabis consumers are turning to an obscure analogue of Delta-9-THC called Delta-8-THC. The difference between Delta-8 and Delta-9 is subtle: Both will get you stoned, but the former is about half as potent as the latter. Many people claim that Delta-8 is a smoother, less anxious psychoactive experience than the more familiar Delta-9. Read More (Discover Magazine)

The science of cannabis genomics. The science of “genomics” refers to the biological study of genomes – encompassing the analysis of their structure, function, evolution, including mapping and editing of these components. In the world of cannabis, there is a wide variety of cannabis cultivars made from the hybridization of two or more of the currently three known strains: Cannabis sativa, Cannabis indica, and Cannabis ruderalis. The plethora of mixes, which before the advent of genomics would have been formerly considered impossible, are created from the mapping out and fusion of the desired parent strain genomic sequence to identify and highlight favorable traits and create an entirely new kind. Read More (Cannabis Tech)


Federal courts are going backward on cannabis. In 2020, state courts still seem to be a good bet for cannabis businesses in cannabis-legal states. But federal courts are sliding backward. Federal courts in 2020 look less inviting than before for cannabis business disputes. That is even (especially?) true in certain cannabis friendly jurisdictions. It seems true in less friendly jurisdictions, too. Skillful contract drafting is terribly important. “Severability” clauses, for example, are generally considered boilerplate, but in the cannabis contract context they can be paramount. As always, federal law has to change. Cannabis is legal for adult use in 11 states and for medical use in 33 states, yet no one has any contract certainty. None of this makes any sense. Read More (LA Weekly)


As Congress inches closer to legalizing cannabis nationwide, states with a head start warn of environmental complications. While most of Washington, D.C. is distracted by the Supreme Court drama, a buzz is building around one particularly green issue — namely whether the U.S. House of Representatives could be set to pass a bill to legalize cannabis as early as this month. The states are now empowered to regulate cannabis use. And 14 jurisdictions have legalized the drug for recreational use while 33 have done so for medical purposes. And if those businesses continue to expand, it would create new opportunities for utilities to increase their electricity sales. As with any new enterprise, though, the cannabis industry is learning as it goes along. Read More (Forbes)

British Columbia to reserve shelf space for Indigenous cannabis producers but will not compel private cannabis stores to carry Indigenous products. Shelf space in British Columbia’s privately and publicly owned recreational cannabis stores will soon be reserved to highlight products from Indigenous producers. The province announced the Indigenous Shelf Space Program in a news release. British Columbia wants to start the program in 2021. “The program will highlight cannabis products produced by B.C. Indigenous producers in BC Cannabis Stores, helping consumers easily identify those products and make purchasing decisions,” according to the announcement. Participation in British Columbia’s upcoming Indigenous Shelf Space Program will be voluntary for the province’s privately owned cannabis stores, according to provincial regulators. Read More (Marijuana Business Daily)

Cannabis-based packaging and paper could reduce waste, promote sustainability. Cannabis businesses have long struggled with the excessive packaging their products are required to use, employing extra layers of plastic and paper to ensure that flower or vape products are childproof and don’t fall into the wrong hands. But that struggle might be nearing its end: New plant-based paper and plastic packaging options are coming to market at a price point that’s comparable to conventional packaging. That’s all thanks to the ingenuity of a few innovative minds that are working to use hemp and marijuana waste to make cannabis bio-circular. And cannabis companies are here for it, said Erica Halverson, founder and CEO of Tiny ePaper, a Long Beach, California-based company that makes 100% hemp paper. Halverson said the interest in and need for sustainable packaging in the cannabis industry was the green light she needed to launch her company. Read More (Marijuana Business Daily)


Chart 19: Stocks of Large U.S. Cultivators Gain While Small Competitors Languish Source: Intro-Blue, Viridian Capital Advisors

Chart 19: Stocks of Large U.S. Cultivators Gain While Small Competitors Languish
Source: Intro-Blue, Viridian Capital Advisors


Chart 20: Weekly Summary (September 14 – September 18, 2020) Source: Intro-Blue, Viridian Capital Advisors Chart 20: Weekly Summary (September 14 – September 18, 2020) Source: Intro-Blue, Viridian Capital Advisors Chart 20: Weekly Summary (September 14 – September 18, 2020) Source: Intro-Blue, Viridian Capital Advisors

Chart 20: Weekly Summary (September 14 – September 18, 2020) Source: Intro-Blue, Viridian Capital Advisors

Chart 20: Weekly Summary (September 14 – September 18, 2020)
Source: Intro-Blue, Viridian Capital Advisors


Chart 21: Cannabis Capital Raises by Week (2020) Source: Intro-Blue, Viridian Capital Advisors

Chart 21: Cannabis Capital Raises by Week (2020)
Source: Intro-Blue, Viridian Capital Advisors


Chart 22: Cannabis M&A by Week (2020) Source: Intro-Blue, Viridian Capital Advisors

Chart 22: Cannabis M&A by Week (2020)
Source: Intro-Blue, Viridian Capital Advisors


Chart 23: Capital Raises by Sector (2020 vs. 2019) Source: Intro-Blue, Viridian Capital Advisors

Chart 23: Capital Raises by Sector (2020 vs. 2019)
Source: Intro-Blue, Viridian Capital Advisors


Chart 24: U.S. Cannabis Market Prices Source: Intro-Blue, Cannabis Benchmarks Price Index

Chart 24: U.S. Cannabis Market Prices Source: Intro-Blue, Cannabis Benchmarks Price Index

Chart 24: U.S. Cannabis Market Prices
Source: Intro-Blue, Cannabis Benchmarks Price Index


Chart 25: U.S. Implied Forward Prices (Week Ending September 25, 2020) Source: Intro-Blue, Cannabis Benchmarks Price Index

Chart 25: U.S. Implied Forward Prices (Week Ending September 25, 2020)
Source: Intro-Blue, Cannabis Benchmarks Price Index


Chart 26: Canada Cannabis Spot Index Source: Intro-Blue, Cannabis Benchmarks Price Index

Chart 26: Canada Cannabis Spot Index
Source: Intro-Blue, Cannabis Benchmarks Price Index


Chart 27: Best-Selling Flower Brands and Products in Colorado Source: Intro-Blue, Headset

Chart 27: Best-Selling Flower Brands and Products in Colorado
Source: Intro-Blue, Headset


Chart 28: Best-Selling Edibles Brands and Products in Colorado Source: Intro-Blue, Headset

Chart 28: Best-Selling Edibles Brands and Products in Colorado
Source: Intro-Blue, Headset


Chart 29: Best-Selling Vapor Pen Brands and Products in Colorado Source: Intro-Blue, Headset

Chart 29: Best-Selling Vapor Pen Brands and Products in Colorado
Source: Intro-Blue, Headset


Chart 30: Best-Selling Beverage Brands and Products in Colorado Source: Intro-Blue, Headset

Chart 30: Best-Selling Beverage Brands and Products in Colorado
Source: Intro-Blue, Headset


Chart 31: Best-Selling Capsule Brands and Products in Colorado Source: Intro-Blue, Headset

Chart 31: Best-Selling Capsule Brands and Products in Colorado
Source: Intro-Blue, Headset


Chart 32: Best-Selling Topical Brands and Products in Colorado Source: Intro-Blue, Headset

Chart 32: Best-Selling Topical Brands and Products in Colorado
Source: Intro-Blue, Headset



Chart 37: U.S Cannabis Index Source: Intro-Blue, The Marijuana Index

Chart 37: U.S Cannabis Index
Source: Intro-Blue, The Marijuana Index


Chart 38: Canada Cannabis Index Source: Intro-Blue, The Marijuana Index

Chart 38: Canada Cannabis Index
Source: Intro-Blue, The Marijuana Index


Important Disclosures

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