MjLink Cannabis Business News and Press

Ascend Wellness Holdings Inc. (AWH), a multistate, vertically integrated cannabis operator, filed an amended complaint against MedMed Enterprises Inc. and a motion to dismiss “baseless counterclaims” on Feb. 14 in New York.

The filings are the latest in Ascend’s legal battle with MedMen, which stems from a roughly $73-million definitive investment agreement between the two companies on Feb. 25, 2021.

Under the signed agreement, Ascend was to acquire 86.7% interest in MedMen NY Inc. (MMNY), MedMen’s subsidiary in New York, through investing $35 million in cash and issuing a senior secured promissory note in favor of MMNY’s senior secured lender in the principal amount of $28 million.

In addition, Ascend held an option to acquire the remaining equity in MedMen’s New York operation through an additional investment of $10 million, which also was intended to be used to repay MMNY’s senior secured lender if adult-use cannabis sales commence in MMNY’s dispensaries, according to a February 2021 AWH press release.

Ascend would have acquired one of New York’s 10 licenses to distribute medical cannabis through the transaction.

“We believe the proposed transaction will bring fresh capital and a new perspective to New York’s medical marijuana program and its patients,” Ascend founder and CEO Abner Kurtin said in the February 2021 release.

A worldwide cannabis company has segued into the hemp industry with its recent acquisition.

Premium cannabis company Diego Pellicer Worldwide has acquired Hemp Choice Distribution, a hemp and CBD company, for a $4.4 million cash and stock deal.

Diego Pellicer Worldwide CEO, Nello Gonfiantini III, said in a press release that he hopes the recent acquisition will help advance the company’s long-term business goals. “We’re expanding into a rapidly growing product category,” he said. “Hemp Choice is a premium provider of hemp and CBD. We welcome them as a wholly-owned subsidiary.”

Hemp Choice works with a wide range of individuals in the industry–from growers and processors to manufacturers and retailers—and the company provides hemp and CBD for a wide array of commercial and industrial products, according to the release.

“I look forward to working with Diego as we expand business opportunities in the cannabis space of hemp and CBD—one of the fastest-growing segments in this marketplace,” said Gabriela Vergara, Hemp Choice Distribution founder and CEO.

The New Mexico Senate passed legislation Feb. 14 that would make changes to the state’s adult-use cannabis law, according to NM Political Report.

S.B. 100 would increase plant count limits for cannabis microbusinesses from 200 to 1,000, as well as allow those licensees to buy, sell and transport cannabis from other companies.

An emergency rule went into effect last month to temporarily allow New Mexico’s licensed cannabis producers to double their plant count from 10,000 to 20,000 mature plants, but the production limit for microbusinesses must be increased legislatively since it is set in statute in the Cannabis Regulation Act that legalized adult-use cannabis.

S.B. 100 would also allow New Mexico’s medical cannabis businesses, which have been required to register as nonprofit organizations, to operate as for-profit companies, according to NM Political Report.

The Senate Judiciary Committee approved the bill Feb. 13 after Sen. Cliff Pirtle (R-Roswell) added an amendment to eliminate a requirement that cannabis license applicants must show proof of water rights as a condition of licensure.

BETHESDA, Md., Feb. 15, 2022 /PRNewswire/ -- PRESS RELEASE -- CULTA, Maryland's craft producer of top shelf cannabis and extracts, today announced its new COO and organizational promotions that reflect its tremendous company growth. The company continues to provide opportunities for leadership and non-leadership roles as it focuses on maintaining brand momentum in the Maryland market.

MIAMI, Feb. 15, 2022 (GLOBE NEWSWIRE) -- PRESS RELEASE -- Ayr Wellness Inc., a vertically integrated U.S. multi-state cannabis operator, today announced that it has closed the acquisition of Cultivauna, LLC, the owner of Levia branded cannabis infused seltzers and water-soluble tinctures.

“Bringing Levia into the Ayr family represents a key addition to our portfolio of high-quality, branded offerings,” said Jonathan Sandelman, founder, chairman and CEO of Ayr. “We look forward to expanding the presence of Levia’s seltzers and water-soluble tinctures across our multi-state footprint, while bringing new, innovative form factors to life, like beverage enhancers. With a fast-acting formula and great taste, we believe Levia will be a crucial component in expanding our reach to new and existing consumers who seek a predictable and familiar cannabis experience.”

Levia uses a proprietary technology which provides for rapid onset of the effects of THC, typically 15-20 minutes with lasting effects up to 3 hours, allowing for a more consistent consumption experience compared to many edible products.

The ownership transition was approved by the Massachusetts Cannabis Control Commission (CCC) on Thursday, Feb. 10, 2022. Terms of the transaction can be found in the company’s press release announcing the signing of a definitive agreement, dated Sept. 7, 2021.

HUNT VALLEY, Md., Feb. 15, 2022 – PRESS RELEASE – Brytemap,a Maryland-based provider of software and technology for the cannabis industry,just introduced GreenR 3.0, the newest iteration of its dispensary softwaresolution.

Building on the success of previous versions of the all-in-onesoftware platform, GreenR 3.0 offers updated e-commerce features to deliver anunprecedented, enhanced user experience.

“Giving dispensary customers the ability to check allotments,apply discounts, promotions and loyalty points all within their cart atcheckout are next level, and this is only a small glimpse of all the newfeatures,” said Brytemap founder Bryan Lopez. 

Brytemap’s UI/UX Developer Jaclyn Davis added, “It’s no secretthat the top three benefits of a positive user experience are to increasesales, increase customer satisfaction and increase customer loyalty. Ourmission was to create the most user-friendly cannabis e-commerce platform onthe market today, and we’ve accomplished this. We optimized every customerview from big screen in-house menus down to hand-held devices, plus addedfunctionality in searching brand sizes, price, type of cannabis and cannabinoidlevels all contribute in a very positive way to the userexperience.”  

In addition to a dramatically improved customer-facingexperience, Brytemap has updated back-end functions, with more reportingoptions and better visibility. These include loyalty tracking and user balancereports, customized reports in real-time, and increased exporting functions foraccounting purposes, offering actionable, common-sense reporting for greaterinsight into business operations. 

Perhaps the most groundbreaking innovation in the BrytemapGreenR 3.0 platform is the superior smart pre-order function that recognizesproduct availability. This e-commerce capability intelligently recognizesweight combinations before marking a product as “sold out,” allowingdispensaries to maximize product sales without fixed weight or sizerestraints. 

The legalization of cannabis across dozens of individual state markets within our country has given entrepreneurs reason to believe in the phrase “the sky is the limit.” As 2021 showed, innovation in cannabis continues to force businesses to get creative and bring pristine products to the market. At the intersection of science, cannabis and technology, innovators have found a niche entry point to the industry, one vertical being infused beverages.

This segment is a great normalization tool for the industry. As a society, we’re constantly in environments where beverages are in hand—whether that be a ballgame, family dinner, or company outing. And now there are more beverage options for consumers wanting to feel the buzz without an alcohol component.

When it comes to creating a product and launching into a still-developing market, it is important to make sure the product aligns with current consumer trends. As the hard seltzer market rapidly grew in recent years, the seltzer trend was one cannabis beverage companies hopped on when generating their own business models. Forecasting into the very near future, the seltzer industry anticipates new products emerging from like-minded competitors. Current industry participants will have to continue to utilize consumer data from market intelligence companies such as Headset and BDSA as they have become and will continue to be valuable assets to make informed business decisions in the coming years.

As any entrepreneur can attest, however, with popularity comes competition.

Now that the cannabis beverage space is known as a viable avenue for cannabis product development, more entrants will arrive. Therefore, standing out among competitors is going to become a primal factor when developing a new cannabis beverage brand. Companies are naïve to think consumers are going to initially purchase a new product they hear about, just for the product. Those days are long gone; today, branding needs to be visually appealing and aesthetically pleasing in order to yield more customer attention. However, while branding can help secure a customer’s initial purchase, the goal is to attract repeat customers. Albeit difficult, attracting recurring consumers comes from the integrity of the product. Specifically in the cannabis beverage sector, consumers are looking for a product that yields a desired effect. Meaning, when it comes to securing frequent buyers, what’s in the can is more important than what’s on the can. The more positive experience a canna-curious consumer has, the more likely they’ll come back for more.

New legislation in New York would allow licensed hemp businesses to grow and process cannabis for the state’s forthcoming adult-use market, according to a local WGRZ report.

Assembly Bill A2682A and Senate Bill S8084 would allow the Office of Cannabis Management to issue “conditional adult-use cultivator licenses” to hemp farmers, who could then grow and process adult-use cannabis to supply the state’s dispensaries, WGRZ reported.

Applicants must hold a valid industrial hemp grower authorization from the New York Department of Agriculture and Markets as of Dec. 31, 2021, according to the news outlet, and be licensed to grow cannabinoid hemp.

"It provides a conditional license to make sure when licensing is in place that equity business will have a product to put on their shelves," Assembly Speaker Crystal Peoples-Stokes, who is a sponsor of A.B. A262A, told the news outlet.

Michigan Gov. Gretchen Whitmer has issued an executive order that consolidates cannabis and hemp regulation in an effort to improve efficiency and advance the growth of both industries, according to a press release.

Currently, the Michigan Department of Agriculture and Rural Development (MDARD) regulates the state’s hemp market, while the Marijuana Regulatory Agency (MRA) regulates the medical and adult-use cannabis markets.

Whitmer’s Executive Order 2022-1 renames the MRA as the “Cannabis Regulatory Agency” and charges it with regulating the processing, distribution, and sale of hemp and cannabis moving forward, although MDARD will continue to oversee hemp cultivation.

The executive order will take effect in 60 days, according to the press release.

“Consolidating multiple government functions into the newly named Cannabis Regulatory Agency will help us continue growing our economy and creating jobs," Whitmer said in a public statement. “And to be blunt—safe, legal cannabis entrepreneurship, farming, and consumption helps us put Michiganders first by directing the large windfall of tax revenue from this new industry to make bigger, bolder investments in local schools, roads, and first responders."

Washington’s Social Equity in Cannabis Task Force has been hard at work since its creation in 2020, and new legislation in the state Legislature now aims to incorporate policies recommended by the task force to increase social equity in the state’s cannabis market.

The task force, which is made up of lawmakers, government representatives and industry experts, was charged with making recommendations about issuing and reissuing cannabis dispensary licenses in ways that would promote business ownership among people of color, according to The Seattle Times.

A new bill in the Washington Legislature, House Bill 2022, aims to do just that by creating 38 new dispensary licenses, as well as 25 new producer and processor licenses, every year through 2029, the news outlet reported. These licenses may only be issued to social equity applicants through 2030, and then, beginning in 2031, 50% of the licenses must be awarded to social equity applicants.

Social equity applicants are defined as those who have lived in areas disproportionately impacted by the war on drugs, or those who plan to open a cannabis business that is majority owned by a racial group that has been disproportionately affected by arrests for cannabis possession, The Seattle Times reported.

H.B. 2022 also earmarks over $22 million annually to provide grants, low-interest loans and a mentorship program to social equity applicants, according to the news outlet.

The New Mexico Senate Judiciary Committee voted 6-3 on Feb. 13 to approve legislation that would make several changes to the state’s adult-use cannabis law, according to NM Political Report.

Senate Bill 100, sponsored by State Sen. Linda Lopez (D-Albuquerque) and Rep. Andrea Romero (D-Santa Fe), would increase production limits for cannabis microbusinesses from 200 plants to 1,000 plants, as well as allow microbusinesses to wholesale products, the news outlet reported.

RELATED: New Mexico Legislation Aims to Increase Plant Count for Cannabis Microbusinesses

Regulation and Licensing Superintendent Linda Trujillo told lawmakers during the Senate Judiciary Committee hearing that increasing the production limits will help ensure an adequate supply of medical cannabis for the state’s patient base, according to NM Political Report.

Last month, an emergency rule went into effect to allow New Mexico’s licensed cannabis producers to double their plant count from 10,000 to 20,000 mature plants, but the limit for microbusinesses must be increased legislatively since it is set in statute in the state’s adult-use cannabis law.

Newark, New Jersey - PRESS RELEASE - The New Jersey State Policy Lab at Rutgers University has released a first-of-its-kind report examining health, education, and law enforcement factors related to cannabis usage. It’s intended to be used as a baseline to measure the impact of legalization and identify disparities among different communities.  

“This report is critical to New Jersey setting a model similar to other states in recognizing that all people in the state are not the same, and by legalizing cannabis, its impact on different communities is going to vary,” said Charles Menifield, dean of Rutgers University-Newark School of Public Affairs and Administration and the study’s principal investigator.  

The goal is to use the data for comparative analysis over time to help shape state policy. "This is literally a baseline report of what we should be looking at and where we are now,’” said Menifield.

The study uses a wealth of secondary data to provide a snapshot of present-day usage and law-enforcement measures across age, racial, and gender lines. It also gauges youth attitudes toward cannabis, as well as medical and behavioral health factors that could be affected by legalization, such as suicide rates and the number of people entering treatment facilities for cannabis addiction. ? 

Some of the most glaring racial disparities occurred within the legal system. The number of Black residents arrested for selling cannabis was more than five times higher than white residents. Black residents were four times as likely to be arrested for possession. 

Virginia lawmakers have advanced legislation that would launch the state’s adult-use cannabis market sooner than expected.

On Feb. 10, the Senate Finance Committee approved Senate Bill 313, legislation sponsored by Sen. Adam Ebbin that would allow Virginia’s medical cannabis operators to serve the broader adult-use market starting Jan. 1, 2023, according to a Richmond BizSense report.

Additional adult-use cannabis businesses would then be able to launch on Jan. 1, 2024, under Senate Bill 391, separate legislation that aims to reenact last year’s adult-use cannabis law, the news outlet reported.

Virginia’s legalization law cleared the Legislature and received former Gov. Ralph Northam’s signature in April 2021 but requires reauthorization this year before it can take effect.

RELATED: New Governor, Reenactment Clause Could Mean Changes to Virginia’s Adult-Use Cannabis Law

CHICAGO, Feb. 11, 2022 – PRESS RELEASE – Cresco Labs, a vertically integrated multistate operator and the No. 1 U.S. wholesaler of branded cannabis products, announced the Clio Award-winning documentary short film, “The Sentence of Michael Thompson,” will have its world premiere on March 9 at the Santa Barbara International Film Festival (SBIFF) and screen March 13-17 at the South by Southwest (SXSW) film festival. 

“The Sentence of Michael Thompson” is the first documentary short film on the topic of social justice, criminal justice reform and cannabis decriminalization, and the first social justice-focused documentary produced by a cannabis brand (Cresco), to debut at both acclaimed global and U.S. film festivals held in Santa Barbara, Calif. and Austin, Texas, respectively.

“It is humbling and an honor to have the opportunity to help share Michael Thompson’s story through such prestigious film festivals like SBIFF and SXSW,” said Chima Enyia, executive vice president of SEED, Cresco Labs’ Social Equity, Education, Development initiative.

“Unfortunately, one of the themes central to Michael’s story is not unique; several hundred thousand Americans—predominantly Black and Latinx—continue to be arrested on marijuana-related charges every year,” he said. “Over 40,000 people suffer in prison because of cannabis-related convictions at this very moment. Through this film, we hope to help audiences truly understand the gravity of injustice on the lives of people adversely impacted by the war on drugs and advance the dialogue surrounding racial and social justice to help change our nation’s drug laws.”

The subject of the film, Michael Thompson, is the longest serving non-violent offender in Michigan history. In 1994, he was arrested for selling three pounds of cannabis to a close friend turned police informant. He was sentenced to 42 to 60 years and remained in prison after Michigan legalized the adult use and sale of cannabis.

“The Sentence of Michael Thompson” follows Michael’s daughter, Rashawnda, and his lawyer, Kim, during the fight for clemency. It examines the harm the war on drugs has caused on marginalized communities and explores paths forward as national cannabis legalization gets closer to becoming a reality.

Growers now have the ability to maximize the genetic potential of their crop using Climate Control Systems' Precision Fertigation Manager (FCS2).

“By using our proprietary programming advancements in the evolution of fertigation, we have been able to leap beyond our competitors in identifying obstacles and inefficiencies that have haunted growers globally,” states Ian Morrell, head of sales for Climate Control Systems Inc.

Developed in partnership with the Harrow Research and Development Centre and Agriculture and Agri-Food Canada, Fertigation CS2 (FCS2) is a next-gen fertigation system featuring targeted PPM nutrient and recipe management with full local data storage.

FCS2 offers true multi-layered precision control of fertilizer feeding formulas at a previously unheard-of level, allowing growers to explicitly set variables at a PPM level to ensure crops have exactly the nutrients they require at the time they require them. 

With the capability to specify up to 100 grow zones, and 100 feed formula schedules within each, this system has the potential to sustain 100 individually monitored crops in each grow zone.

Among the 18 states that have legalized adult-use cannabis in the U.S., six are still in the regulatory period of finalizing their program frameworks before officially launching commercial sales. Those states are Connecticut, New Jersey, New Mexico, New York, Vermont, and Virginia.

For vertically integrated Verano, founder and CEO George Archos says expecting and preparing for legislative and regulatory delays are key to ensuring growth. Verano’s current portfolio encompasses 15 states, with active operations in 12, including 12 production facilities comprising more than 1 million square feet of cultivation.

Specifically, Verano’s footprint extends to two of the six states gearing up for upcoming retail launches: New Jersey, which legalized adult-use cannabis through voter-approved Question 1 in November 2020, and Connecticut, which legalized adult-use via passage of Senate Bill 1201 in June 2021.

While Verano’s 4,000-plus employees are also going through organic expansion phases in Florida, Nevada and Massachusetts this year—not to mention the potential for additional M&A action geared toward gaining access to new markets, like New York, Minnesota and New Mexico—the company’s success in New Jersey and Connecticut depends heavily upon calculated moves riddled by launch dates, Archos tells Cannabis Business Times.

Editor’s note: This interview has been edited for style, length and clarity.

Tony Lange: What were the biggest challenges that Verano overcame in 2021?

Cannabis has been a part of my life for as long as I can remember. It was the "funny-smelling" cigarettes my Dad would smoke after dinner, the thing that kept my cousin Earl in fresh Jordans, and the only way I could put myself through junior college. It was the thing that caught the attention of the FBI. And it was the thing that brought me to the level of success I achieve today. 

In 2010, I faced a felony charge and a 10-year minimum sentence. Luckily, I had a great lawyer and was not the focus of the FBI investigation. After a brief stint in prison, getting a regular 9-to-5 job, and completing 1,000 hours of community service, I received time served. I was free to go about my life—as long as I stayed away from cannabis.

However, it was too late. I had fallen in love with the cultivation process, and I still believed cannabis was my calling. Plus, I knew corporate America was not my thing. I just wasn't happy. I'm used to being an entrepreneur.

RELATED: Ball Family Farms: One of the First Vertically Integrated Social Equity Cannabis Businesses in LA

So, I quit my day job, took all of my savings, and bought a 5,000-square-foot cultivation warehouse in Los Angeles with only 14 lights in a tiny room.

And against my family's protests, I began my self-taught botany education. I burned through plants as I attempted to master my cultivation skills for the next two years. Then I started small, selling to old contacts who had Proposition D-compliant shops. I quickly made a name for myself growing top-quality flower, but I wanted to expand.

All six states that have legalized adult-use cannabis through legislative action, as opposed to ballot initiatives, have done so via Democratic-controlled legislatures.

The Republican-controlled Ohio General Assembly doesn’t plan on breaking that trend any time soon.

Ohio Senate President Matt Huffman, R-Lima, told reporters Feb. 9 that he won’t act on calendaring a proposal to legalize adult-use cannabis for floor debate in his chamber, The Columbus Dispatch reported.

“I don’t want anybody to misunderstand my position,” Huffman said. “I’m not going to bring it to the Senate floor. And if that means people want to go put it on the ballot, have at it.”

Republicans hold a 25-8 majority in the Ohio Senate and a 64-35 majority in the House.

The legalization proposal stems from a citizen-led effort by the Coalition to Regulate Marijuana Like Alcohol (CRMLA), which met a 132,877-signature threshold to put its petition before state lawmakers, the Ohio Secretary of State announced last month.

SAN DIEGO, Feb. 10, 2022 – PRESS RELEASE – Innovative Industrial Properties Inc. (IIP), the first and only real estate company on the New York Stock Exchange focused on the regulated U.S. cannabis industry, announced that it closed on the acquisition of a property in New Jersey, and entered into a long-term lease with a subsidiary of Ascend Wellness Holdings Inc. (AWH) at the property.

The purchase price for the property was $35.4 million (excluding transaction costs). AWH is expected to complete additional improvements for the approximately 114,000-square-foot property as a regulated cannabis cultivation and processing facility, for which IIP has agreed to provide reimbursement of up to $4.6 million. Assuming full reimbursement for the tenant improvements, IIP’s total investment in the property is expected to be $40 million. AWH is planning to build out its overall New Jersey cultivation footprint to include a lab, kitchen and 150,000 square feet of canopy by the end of 2023.

In addition to this New Jersey property, IIP owns and leases to AWH three other properties in Illinois, Massachusetts and Michigan, with IIP’s total investment in properties leased to AWH, including commitments to fund future tenant improvements, equaling approximately $179.75 million.

As a pioneering real estate investment trust (REIT) for the regulated cannabis industry, IIP partners with experienced, regulated cannabis operators and serves as a source of capital by acquiring and leasing back their real estate assets, in addition to offering other creative real estate-based capital solutions.

“We have been AWH’s long-term real estate partner since 2018 and are excited to once again expand our relationship with Abner and his team,” said Paul Smithers, president and CEO at IIP. “The AWH team continues to distinguish themselves in delivering the highest quality cannabis products and services to their patients and customers, and has developed a tremendous strategic footprint in some of the strongest regulated cannabis markets, including New Jersey.”

AWH is a publicly traded, vertically integrated cannabis company, with assets in Illinois, Michigan, Ohio, Massachusetts and New Jersey and approximately 1,500 employees. AWH owns and operates state-of-the-art cultivation facilities, grows award-winning strains, and produces a curated selection of products, including its Ozone branded products. In New Jersey, AWH currently operates two dispensaries in Montclair and Rochelle Park, and expects to open an additional dispensary in Fort Lee in late spring of 2022.

The trio of lawmakers behind the Cannabis Administration and Opportunity Act (CAOA) has invited their colleagues to provide input as they finalize the legislation, which is expected to be formally introduced this spring.

Senate Majority Leader Chuck Schumer (D-NY), Finance Committee Chairman Ron Wyden (D-Ore.) and Sen. Cory Booker (D-NJ), the bill’s main sponsors, sent a letter to their colleagues Feb. 10, urging them to provide their feedback on the bill, which was initially released in draft form last summer.

“We write today to invite you into the drafting process as we work to finalize this legislation,” Schumer, Wyden and Booker wrote in the letter. “In order to appropriately address such a nuanced issue, we respectfully request the input, advice and guidance of Chairs and Ranking Members of relevant committees as well as senators who have dealt with the challenges and realities of legalization in their own states. We would deeply appreciate your willingness to share your expertise on the intersections between your committees’ jurisdictions, your states’ experiences, and comprehensive cannabis reform and invite you to join the process of perfecting this legislation.”

Industry stakeholders submitted their feedback on the CAOA by a Sept. 1, 2021 deadline for public comment, and Senate leadership has since faced criticism for the delay in the formal introduction of the bill.

“This issue, which we believe the Senate is long overdue in addressing, has implications across many areas of American politics and policy,” Schumer, Wyden and Booker wrote. “Following the release of the CAOA discussion draft, we received over 1,800 comments from a broad array of stakeholders, many with substantive and detailed policy recommendations. In the weeks ahead, we will continue the work of incorporating these comments as we aim to introduce legislation soon that is as comprehensive and as reflective of as many relevant views and voices as possible.”