MjLink Cannabis Business News and Press
Apothio sued Kern County for allegedly destroying $1 billion worth of its hemp crop. Now, officials within the city of Arvin—located in Kern County—are working to attract Apothio and other hemp businesses.
On April 28, Arvin, Calif., city council voted via teleconference to introduce a hemp ordinance that would provide local jurisdiction over hemp cultivation and manufacturing to the city. Mayor Jose Gurrola made a motion to approve the introduction of the ordinance, and council passed it with a 5-0 vote.
The city’s planning commission read the ordinance on April 27, permitting council to waive its own first reading on April 28. Another reading will take place during the next council meeting on May 12. if approved then, the ordinance would go into effect 30 days later, said Pawan Gill, Arvin director of administrative services, prior to the council meeting.
City officials’ decision to regulate hemp for commercial, educational and scientific purposes follows the alleged government destruction of 500 acres of hemp that Apothio LLC grew near Arvin.
Apothio sued Kern County, the Kern County Sheriff’s Office (KCSO), the California Department of Fish and Wildlife (CDFW) and multiple individuals. Its complaint said it can legally grow crops testing higher than the federal 0.3%-THC limit because it is an established agricultural research institution (EARI).
Arvin’s decision to work with the hemp industry on community development and obtain tax revenue wasn’t initially sparked by the recent destruction, but it was expedited by it, Gill said. “We've been talking to the industry for two years,” she said. “This was … a catalyzing moment where we said, ‘Okay, we shouldn't put this off anymore.’”
A Massachusetts appeals court has sided with Cambridge in a lawsuit over the city’s cannabis licensing moratorium, according to a MassLive.com report.
Revolutionary Clinics, a licensed medical cannabis dispensary that has been operational since 2018, sued Cambridge last year over a city ordinance that allows only economic empowerment applicants to receive adult-use dispensary licenses for the first two-years of the licensing process in an attempt to ensure those disproportionately impacted by prohibition have access to the industry.
A Middlesex Superior Court judge ruled in January that licensed medical cannabis dispensaries in Cambridge must be able to immediately seek licensure in the adult-use market, arguing that the city’s ordinance was in direct conflict with state law, as well as the Cannabis Control Commission’s adult-use cannabis regulations.
The appeals court vacated that decision April 24, when Associate Justice Joseph M. Ditkoff ruled that nothing in Cambridge’s ordinance conflicts with regulations surrounding priority applicants and that the evidence of economic harm resulting from the ordinance was minimal, MassLive.com reported.
Denver has established a working group to issue recommendations on the city’s cannabis policies and licensing process, according to a Westword report.
In an April 27 memo, the city’s Department of Excise and Licenses announced the Marijuana Licensing Work Group (MLWG), a 24-member advisory board made up of industry and community stakeholders who will “review, discuss, and make recommendations on policy direction and possible marijuana licensing laws, rules and regulations.”
Colorado Gov. Jared Polis signed two measures into law last year that allow the state’s municipalities to license cannabis delivery and social consumption businesses within their jurisdictions, and the MLWG is charged with reviewing licensing opportunities for these facilities, Westword reported.
The MLWG will also address social equity in Denver’s cannabis industry, according to the news outlet, as the new delivery and social consumption licenses could offer an opportunity to diversify the market.
The working group is scheduled to meet virtually on May 14, May 28, June 11 and June 25, Westword reported. The MWLG must ultimately present its formal recommendations to Mayor Michael Hancock’s administration, as well as the Department of Excise and Licenses’ Office of Marijuana Policy.
As U.S. states and municipalities responded to the COVID-19 pandemic, Nevada’s tribal communities crafted their own approach to social distancing and flattening the curve, and tribal cannabis businesses have not been immune to the challenges that much of the industry has experienced during this unprecedented crisis.
At the start of the pandemic, many of Nevada’s tribes declared a state of emergency and closed their borders to limit the number of visitors and minimize outside contact, Laurie Thom, enforcement director for the Inter-Tribal Marijuana Commission (ITMC) tells Cannabis Business Times.
The ITMC is an oversight commission for the Tribal Marijuana Enforcement Division, which regulates Nevada’s tribal cannabis industry. The commission currently has representation from the Ely Shoshone, Lovelock Paiute, Walker River Paiute and Yerington Paiute tribes.
“We are helping tribes enter this industry with compliance, safety and good foresight, trying to always look ahead be ready for that next change because the cannabis industry changes so fast, and it is hard for tribes to stay abreast of what’s going on on their own,” Thom says.
The ITMC consists of an administrative division, which reviews and distributes Nevada’s cannabis regulations to the tribes for approval, and an enforcement division, which ensures businesses maintain compliance with each tribe’s rules.
CHICAGO--(BUSINESS WIRE)--PRESS RELEASE--Cresco Labs, one of the largest vertically integrated multistate cannabis operators in the United States, has announced that it has reached a mutual agreement to terminate the purchase agreement dated Sept.16, 2019, to acquire certain assets from Tryke Companies, LLC.
Cresco Labs CEO and Co-Founder Charlie Bachtell said, “Our acquisition of Tryke has been impacted by regulatory delays, a decline in capital markets, and now COVID-19, which brought additional risk to this transaction. Given these events, we feel the resources previously targeted for this transaction are better invested in our existing markets, where we have high visibility and certainty of return on capital.”
Bachtell added, “The decisions we have made over the past year have de-risked Cresco, leaving us with one of the most experienced management teams, and one of the strongest balance sheets to deploy into our high-return, core markets. We know that times of uncertainty come with opportunity. Terminating the agreement puts Cresco in a position to better manage any potential future implications from COVID, take advantage of the current macro environment and succeed in achieving our goal of building the most important cannabis company in the U.S.”
The terminated agreement was for a purchase consideration of approximately US$282.5 million, including approximately US$55 million in cash. Cresco has agreed to pay equity valued at $1.25 million as total consideration for the termination of the agreement. With the termination of the agreement, Cresco has no outstanding acquisitions or major CAPEX obligations, leaving Cresco’s balance sheet unencumbered.
Planet 13 Holdings, a vertically integrated company based in Las Vegas known for its massive, glitzy dispensary just off the Strip, has long touted its strong tourist appeal.
Planet 13’s 16,200 square-foot dispensary, part of the overall 112,000-square-foot “Cannabis Entertainment Complex” that now includes a café, bar, and customer-facing production facility, is all about the Vegas-style experience, with its interactive LED floor, colorful, glowing orbs suspended on the dispensary ceiling that move to music, and a 18-foot water feature out front.
Before the coronavirus pandemic halted tourism, 85% of Planet 13’s customer base and about half of its revenue came from people who reside outside of Sin City. Planet 13’s Superstore saw about 2,000 to 2,500 visitors each day, according to an April earnings call.
In that same earnings call, the publicly traded company announced its 2019 revenue was $63.6 million, and that its Q1 revenue was about $16.6 million.
However, in March, Nevada Gov. Steve Sisolak instituted emergency declaration to prevent the spread of COVID-19, and all medical and adult-use dispensaries in the state were forced to close storefronts and move to a delivery-only model with less than 24 hours’ notice.
So how does a dispensary that caters to tourists and providing an unusual in-store experience transition to serving the local market exclusively and through delivery only?
When Harvest Connect was getting ready to open its flagship retail location, CBD Store and More in Roswell, Georgia, CEO Kevin Quirk says he and his team had planned “the grandest of grand openings” with a weekend full of events.
Then, the coronavirus hit the U.S. Grand opening plans fell by the wayside, and Quirk had to quickly decide whether to plow forward with the store’s debut or wait until normalcy resumed.
“We knew that we could open responsibly taking into consideration social distancing rules and recs and guidelines. That was the tactical component of it. … But the reality of it was as we were starting to finish up the store and getting all our permits, we had no less than 10 people walk into the store while we were open asking us if they could buy [CBD products]. They all had tears in their eyes, they’ve all lost their jobs, they’ve all been extremely stressed out, and their anxiety levels were off the chart, and they were just looking for something,” Quirk says. “That was the impetus for us to say, ‘You know what? Forget it. It’s time to open up, and we’ll do the best we can.’”
Quirk decided to scrap his initial plans and quickly formulate a way to open amid the COVID-19 pandemic. The company promptly got its online sales up and running, and CBD Store and More opened its doors April 7.
New Plans
Harvest Connect made key adjustments to open amid a pandemic, not the least of which included a complete overhaul of the store’s layout. The initial layout featured a lobby area with educational materials and a couch for consultation, an open area filled with products for customers to choose from and a point-of-sale (POS) system in the middle of the store.
The Portland City Council voted April 27 to allow the city to issue temporary cannabis testing lab licenses in an effort to ensure a quick launch of Maine’s adult-use cannabis market after the COVID-19 pandemic, according to a Portland Press Herald report.
City Council’s unanimous vote allows prospective testing labs to apply for a temporary local license, which would allow the facility to pursue a final state license, the news outlet reported. A lab must have a provisional state license and approval on a local site plan or a building permit, as well as security, waste disposal and odor mitigation measures implemented at the facility, to qualify for a temporary license.
Labs with temporary licenses can then pursue final licensure once the Portland City Council approves the final regulations for its adult-use cannabis program, the Portland Press Herald reported.
Two Portland-based companies, Nova Analytic Labs and ProVerde Laboratories, are in the process of obtaining certification from the Maine Center for Disease Control and Prevention, according to the news outlet, and Nova has applied for a state license with the Office of Marijuana Policy (OMP).
Kennebunk’s Nelson Analytical and Eliot’s Catlab have also applied for a state license, the Portland Press Herald reported.
California cannabis growers spend an average of $136 per pound of dried cannabis flower on testing costs, researchers at the University of California, Davis, found.
In a study published on April 23, Pablo Valdes-Donoso, Daniel A. Sumner and Robin Goldstein, all researchers with the public Californian university, found that testing costs accounts for approximately 10 percent of the reported average wholesale price for cannabis in the state.
The study’s authors, who published their findings on PLOS ONE, an open-access science journal, collected data from in-state testing labs as well as testing equipment manufacturers to calculate the average cost for various tests required for a product to be compliant. They found that testing costs varied greatly depending on the type of test, with a moisture balance test representing the lowest cost (approximately $1.25 per test) and a liquid chromatography-mass spectrometry (LCMS) test representing the highest cost (approximately $8.82 per test).
The study also highlighted the impact on batch size and failure rates on testing costs. For example, “given a 0 [percent] rejection rate, the cost of testing per pound of cannabis marketed from a one-pound batch is about 27 times higher than the cost of a 48-pound batch,” the researchers found. “[On] the other hand, given an 8 [percent] rejection rate, the cost of testing per pound of cannabis marketed from a one-pound batch size is only seven times higher than the cost from a 48-pound batch size.” (California allows for batch sizes of up to 50 pounds.)
The authors looked at how food products would fare if held to the same contaminant thresholds as cannabis. While more than 60 percent of food products have detectable (but allowable) levels of pesticides, only less than 1 percent actually fail to meet EPA standards. However, more than 13% of food products would fail compliance testing using criteria for inhalable cannabis products.
“Testing itself is costly,” said study author Dan Sumner, a professor of agricultural economics at UC Davis in a statement. “But growers have to destroy the product that doesn’t pass the test and that is where the biggest losses occur.”
CLEVELAND, OH & LAS VEGAS – APRIL 29, 2020 – Cannabis Conference Editorial Director Noelle Skodzinski and Director, Conference & Events Maria Miller have been selected as honorees in Folio: magazine’s “2020 Top Women in Media.” This prestigious media awards program highlights the best and brightest up-and-comers, entrepreneurs, change-makers, corporate champions, and industry trailblazers in the media industry.
Noelle Skodzinski, editorial director for Cannabis Conference (produced by GIE Media’s Cannabis Business Times, Cannabis Dispensary and Hemp Grower magazines), has been selected in the “Change-makers” group, comprised of women “who’ve successfully altered the course of their brands or the industry for the better.”
Skodzinski recently celebrated her 5-year anniversary at GIE Media on April 20, the day the company officially acquired Cannabis Business Times—the nationally award-winning trade publication that serves cannabis cultivators in North America. Skodzinski co-founded the Cannabis Business Times website and, in collaboration with the GIE Media team, launched the print publication in November 2015.
Maria Miller, director of conferences and events for Cannabis Conference at GIE Media, has been selected in the “Corporate Champions” group, comprised of women “who’ve steered their companies into new markets, new opportunities, new audiences and strong, measurable growth.”
Miller celebrated 22 years with GIE Media this past January and has been integral to the success of Cannabis Conference—the industry’s leading education and expo event for plant-touching cannabis businesses—since the event’s launch in March 2017. Cannabis Conference 2020 will take place Sept. 1-3, 2020, at the Rio All-Suite Hotel & Casino in Las Vegas (www.cannabisconference.com).
“Noelle and Maria have been extremely effective at finding innovative and competitive solutions that bring the industry the highest level of education and exhibition the cannabis market has to offer,” said GIE Media’s Cannabis Conference Group Publisher Jim Gilbride. “They’re hyper-focused on putting our audiences first, and that’s reflected in the integrity and professionalism of our events and media. It’s a privilege to work with them every day—and I look forward to seeing all they’ll continue to accomplish in their already-successful careers.”
The Phoenix, Ariz., based brand HUXTON—run by co-founders and siblings Dustin Johnson and Chelsea Johnson—has evolved quite a bit since Cannabis Business Times published their “10 Questions” interview in April 2017.
At the time, the Johnsons spearheaded a house of brands in the state’s medical cannabis market under the parent company Adakai Holdings, which included a retail dispensary (Monarch), an indoor cultivation facility (Omaha Farms), as well as the lifestyle cannabis brand HUXTON.
In 2018, amidst an industry ripe with M&A activity, they made the choice to sell their plant-touching license assets to the vertically integrated multi-state operator MedMen. However, they said it was important that they kept the rights to the consumer-facing brand that they’d built, HUXTON, which now has an exclusive licensing deal in Arizona with MedMen. At that time, HUXTON had already begun naturally evolving away from the medically focused patient market and more toward the lifestyle/consumer focus associated with adult-use markets.
“Since then, we’ve been working with growing that brand and using all of the knowledge and … operational background we have in the space to help move into as many markets as possible,” Dustin Johnson said. Today the HUXTON brand is geared toward consumers like creatives and athletes. Their digital branding often includes images of young skateboarders, hikers, musicians and muralists, most frequently boasting Western American vibes and modern, neutral color palettes.
HUXTON products are now available in three state markets under exclusive licensing agreements with its former company Omaha Farms in Arizona, Phat Panda/Grow Op Farms in Washington (partnership launched in December 2019), and Flower One in Nevada (launched in February 2020). They’re also working to come online in California through an agreement with Caliva.
While in Arizona the team has brought pre-rolls, all-in-one disposable vape pens, single-strain eighths and more to market—their foray into adult-use markets in Washington and Nevada began with their best-selling product: pre-rolls, packaged in recyclable tins and accompanied by a matchbook. “They’re meant to be grab-and-go. They’re easy to use. We’re all about consistency and simplicity,” Chelsea Johnson said.
New Jersey voters will get to decide whether to legalize adult-use cannabis in the Garden State this November, and a new poll conducted by Monmouth University indicates that legalization has strong support, according to The Motley Fool.
Sixty-one percent of roughly 700 registered voters who participated in the poll said they would vote in favor of legalization, while 34% said they would vote against it, according to the news outlet.
The poll also revealed that while the issue has strong support among Democrats, 40% of Republican voters polled said they would also approve the legalization measure, The Motley Fool reported.
New Jersey Gov. Phil Murphy campaigned in support of adult-use legalization and lawmakers fought unsuccessfully to pass a legalization proposal last year, when efforts ultimately stalled in the Senate over the summer.
Lawmakers introduced a resolution last fall to kick the issue over to voters on this year’s ballot.
Oklahoma Gov. Kevin Stitt recently told KTUL that legalizing adult-use cannabis will not help the state’s budget shortfall.
The governor said the state’s medical cannabis program “looks a lot like recreational,” and so a taxed and regulated adult-use program would not do much to boost tax revenue.
“By calling it recreational, I don’t think you have any more users or any more tax revenue off of that,” Stitt told the news outlet in an interview. “Pretty much, it looks a lot like recreational in our state as well.”
At least two groups are competing to bring adult-use cannabis legalization initiatives to Oklahoma’s November 2020 ballot, and Rep. Scott Fetgatter announced plans earlier this month to begin work on a legalization bill in the hopes that a taxed and regulated market would provide a new source of revenue in the wake of the COVID-19 pandemic.
In a week, Gov. Charlie Baker’s executive order shutting down nonessential businesses in response to the coronavirus pandemic is scheduled to expire in Massachusetts, but owners of adult-use cannabis dispensaries, which have been closed since March 24, are bracing for the possibility of another extension or restrictions to how they can operate once the shutdown is lifted.
Most licensed cannabis businesses have been able to continue sales in legalized markets in the U.S.—with some restrictions to maintain social distancing—as states continue to attempt to mitigate COVID-19. However, Massachusetts has been the state-level exception, as it drew the line between medical and adult-use businesses. Those operating under the medical program have been deemed essential, while adult-use retailers were given 24 hours’ notice to shut down.
“[Massachusetts] is really an outlier in terms of how the governor has responded to COVID with respect to the cannabis industry,” says Adam Fine, a partner at the national cannabis law firm Vicente Sederberg, which represented a group of cannabis companies and a military veteran who filed a lawsuit in response to Gov. Baker’s emergency orders. “Unlike liquor stores and unlike a lot of other sectors, [adult-use cannabis companies] really were treated differently. …It’s about as catastrophic as you can get for their businesses. They were forced to shut down with very little notice in a highly regulated industry after they had already implemented social distancing.”
Fine added that businesses are worried about employee retention, as it can be very expensive to hire and train people with the requirements in the cannabis industry. Plus, there is no federal safety net for the cannabis industry, although lawmakers have introduced a bill to grant state-licensed cannabis businesses access to COVID-19 emergency funding.
“Marijuana remains illegal under federal law, which means these bailouts and small business loans are not available to these businesses,” he says. “The businesses were already adapting, and the market was taken out from under them.”
Massachusetts Superior Court Judge Kenneth Salinger ultimately denied the plaintiffs’ emergency for a preliminary injunction April 16. Ellen Rosenfeld, president of the family-owned, vertically integrated CommCan, the lead plaintiff in the case, said although she was unsure of the chances of winning the lawsuit, she felt it was important to protest the governor's decision.
This week, Reps. Earl Blumenauer and Ed Perlmutter introduced the Emergency Cannabis Small Business Health and Safety Act to extend federal COVID-19 relief efforts to cannabis businesses. Elsewhere, the industry’s biggest sales day of the year saw a dip in sales due to states’ stay-at-home orders.
Here, we’ve rounded up the 10 headlines you need to know before this week is over.
Federal: The SAFE Banking Act may be back on the table in the coming weeks as members of Congress look to include a revised version of the proposal in the next COVID-19 stimulus bill. U.S. Rep. Ed Perlmutter, the SAFE Banking Act’s primary sponsor, is leading the charge to include its provisions in a forthcoming stimulus package. Read moreWhile dispensaries certainly saw a relative spike in purchases this past Monday for 4/20, the effects of the coronavirus outbreak and many states’ stay-at-home orders flattened the industry’s own demand curve a bit. According to Headset data, it appears that customers spread out their purchases across the entire week leading up to April 20. Read moreU.S. Reps. Earl Blumenauer and Ed Perlmutter have introduced the Emergency Cannabis Small Business Health and Safety Act, legislation that would extend federal COVID-19 relief efforts to the cannabis industry. The bill would grant state-legal cannabis businesses access to the resources offered through federal COVID-19 emergency response packages, and would prohibit additional federal relief funding provided through the Small Business Administration (SBA) from excluding both cannabis businesses and businesses that provide services to the industry. Read moreArkansas: The state’s medical cannabis sales have surpassed $63 million since the first dispensary opened in May 2019. As of April 16, Arkansans have spent $63.37 million on medical cannabis and have purchased over 10,000 pounds of products. Read moreAlaska: The Alaska Marijuana Control Board has adopted emergency regulations to allow the state’s cannabis dispensaries to offer curbside pickup services to their customers in response to the COVID-19 pandemic. In order to offer this service to customers, Alaska’s dispensaries must request an operating plan change to their license, provide written verification that their municipality allows the change and obtain written approval from the Marijuana Control Board. Read moreCalifornia: Cannabis retail applicants are suing Los Angeles, arguing that the city’s controversial process to award its latest round of dispensary licenses was “flawed.” The Social Equity Owners and Workers Association and one of its members filed the lawsuit to force the city to vet all the dispensary applications it received last fall under its first-come, first-served process, which has been met with backlash. Read moreCalifornia regulators have announced $30 million in grants for local jurisdictions to fund social equity initiatives in the state’s cannabis program. The grants can be used for small business support services such as technical assistance, reduced or waived licensing fees, recruitment assistance, workforce training and retention, and emergency preparedness to aid cannabis entrepreneurs from communities disproportionately impacted by prohibition. Read moreOregon: In response to last year’s vaping crisis, the Oregon Liquor Control Commission (OLCC) has given the go-ahead for random testing of cannabis products for the presence of undisclosed ingredients and additives. OLCC staff recommended the testing approach in the wake of the 2019 EVALI respiratory illness outbreak and approved the permanent rule at its regular monthly meeting on April 16. Read moreInternational: Mexico’s Supreme Court has extended an April 30 deadline for lawmakers to draft legislation to legalize and regulate cannabis for medical, adult and industrial uses. Lawmakers now have until Dec. 15, the end of the next legislative session, to approve legislation to end cannabis prohibition. Read moreElsewhere, in Lebanon, Parliament has legalized cannabis cultivation for medical purposes, eyeing it as a potentially lucrative export for the economy, which is facing an impending financial crisis. “We have moral and social reservations but today there is the need to help the economy by any means,” said Alain Aoun, a senior MP in the Free Patriotic Movement. Read moreHow New York’s Etain is Serving Medical Marijuana Patients in the Epicenter of the COVID-19 Pandemic
Etain, one of the 10 registered, vertically integrated medical marijuana businesses in New York, is doing everything it can to provide its patients with safe access to medical cannabis despite operating in the state–and the city–at the epicenter of the novel coronavirus pandemic.
New York has more than 263,000 confirmed cases of COVID-19, according to the latest updates from the New York State Department of Health, the most in the U.S. About half of the state’s cases are within New York City. A stay-at-home order is in effect until May 15, but as in many other states, the medical marijuana program is considered an essential business, and companies can stay open.
Etain has been able to retain its 50 employees, 20 who work in cultivation and manufacturing, 20 who work in the company's four dispensaries and 10 at the corporate office, says Hillary Peckham, co-founder and COO of the family-owned business. In addition to sanitation and social distancing protocols, people no longer work between the dispensary locations, arrival times and lunch breaks are staggered, and employees are wearing masks and gloves in the dispensaries. On the cultivation side, not much has changed, as staff already wore personal protective equipment (PPE).
“We’re trying to make sure everyone feels taken care of and everyone feels safe across the board, employees and patients. That has been my biggest role here and what I’ve spent most of my time on,” Peckham says.
Etain has conducted first-time and follow-up appointments with patients via phone or video conference since March. Patients are encouraged to order online or call their orders ahead rather than walk-in, and Etain already offered delivery services before the pandemic, Peckham says. However, plans to expand delivery in 2020 were expedited, and patients now can order delivery five days a week instead of just one.
“We’ve been ramping up delivery services, particularly in New York City, where it is the epicenter of this virus,” Peckham said, adding that many patients in Manhattan use public transportation exclusively, and do not want to venture out on crowded subways or buses, or have conditions that prevent them from doing so. “We would generally see 30 to 50 people a day [in the Manhattan dispensary.] Now it’s significantly reduced, but the delivery demand has gone up immensely. Delivery has been essential for them to continue to get their medication.”
Last month, the U.S. Drug Enforcement Administration (DEA) issued draft rules to regulate the cultivation of cannabis for research purposes in an announcement that was met with mixed industry reactions.
NORML announced April 8 that it had formally submitted comments in opposition of the DEA’s proposed rule changes. The advocacy group criticized the agency for maintaining the sole discretion to choose which applicants will be authorized to grow cannabis for research, and expressed its dismay that the DEA has not provided a timeline for approving pending applications.
“While NORML has long supported facilitating and expanding domestic clinical research efforts, we do not believe that these proposed rules, if enacted, will achieve this outcome,” NORML wrote. “Rather, we believe that the adoption of these rules may further stonewall efforts to advance our scientific understanding of cannabis by unduly expanding the DEA’s authority and control over decisions that ought to be left up to health experts and scientists.”
NORML also suggested in its comments that rather than licensing a new set of growers, the DEA should allow the cannabis already being produced by state-licensed cultivators to be used for federal research.
“Rather than compelling scientists to access marijuana products of questionable quality manufactured by a limited number of federally licensed producers, NORML believes that federal regulators should allow investigators to access the cannabis that is currently being produced by the multitude of state-sanctioned growers and retailers throughout the country,” the organization wrote. “Doing so would not only facilitate and expedite clinical cannabis research in the United States, but it would also bring about a long overdue end to decades of DEA stonewalling and interference with respect to the advancement of our scientific understanding of the cannabis plant.”
U.S. Reps. Earl Blumenauer (D-OR) and Ed Perlmutter (D-CO) introduced legislation April 23 that would extend federal COVID-19 relief efforts to the cannabis industry.
The Emergency Cannabis Small Business Health and Safety Act would grant state-legal cannabis businesses access to the resources offered through federal COVID-19 emergency response packages, and would prohibit additional federal relief funding provided through the Small Business Administration (SBA) from excluding both cannabis businesses and businesses that provide services to the industry.
“The cannabis industry employs nearly a quarter of a million Americans and has been deemed essential in state after state, yet many businesses will not survive the pandemic without help,” National Cannabis Industry Association (NCIA) Executive Director Aaron Smith said in a public statement. “They already face disproportionate financial burdens during normal conditions, and the strains created by the coronavirus response are putting them at an even greater disadvantage and jeopardizing their ability to provide vital healthcare services. We are incredibly grateful for the dozens of lawmakers who are urging their colleagues to give cannabis businesses fair access to federal relief funds in these difficult times.”
When the SBA allotted nearly $50 billion in aid to small businesses via low-interest loans last month, it became clear that cannabis businesses were ineligible to access this aid due to cannabis’ Schedule I status.
“Because federal law prohibits the sale and distribution of cannabis, the SBA does not provide financial assistance to businesses that are illegal under federal law,” Carol Chastang, SBA public affairs specialist, told Cannabis Business Times at that time. “Businesses that aren’t eligible include marijuana growers and dispensers, businesses that sell cannabis products, etc., even if the business is legal under local or state law.”
The University Philanthropic Venture Fund, managed by the institution's IU Ventures, is investing $250,000 in the Bee Corp., "an Indiana agtech startup developing solutions for growers and beekeepers who rely on commercial pollination," according to an IU press release issued today. "The company uses infrared cameras that attach to a smartphone to provide a noninvasive look at the health of the hive."
The funds were promised but not transacted before Gov. Eric Holcomb issued a statewide stay-at-home order, according to information in the release: "Despite mounting economic uncertainty, IU Ventures is proceeding with this and three other approved investment transactions, demonstrating the group's commitment to supporting Hoosier entrepreneurs in this time of heightened need."
To read the entire press release, click here.
April 20 is a major sales day for cannabis business across the U.S. and elsewhere. And while dispensaries certainly saw a relative spike in purchases this past Monday, the effects of the coronavirus outbreak and many states’ stay-at-home orders flattened the industry’s own demand curve a bit.
Typically, according to data gathered by Headset, a cannabis business intelligence firm, April 20 sees sales jump up more than 100% (compared to April 13, the week prior). In Nevada, for instance, April 20, 2019, notched a 130% increase over April 13 sales. Dispensaries stock up well in advance of this celebratory day, often planning promotional deals and special events around the 4/20 hype.
This year, not so much.
Not only were dispensaries (and most other businesses) barred from hosting any mass gatherings of people, but new social distancing norms precluded the usual long lines and shoulder-to-shoulder shopping in-store. According to Headset data, it appears that customers spread out their purchases across the entire week leading up to April 20. (The big day was on a Monday this year, as opposed to a Saturday last year.)
“Most states showed a significant increase in sales for the week ending on 4/20 in comparison to the week prior,” according to spokesperson for Headset. “These trends show that this year, in general, the 4/20 sales boost that retailers have grown accustomed to was similar to prior years (due to being spread out across a seven-day window). Thus, rather than a large single day sales boost, retailers enjoyed elevated sales throughout the week.”
In general, product category breakdowns remained the same from last year. Flower led the 4/20 purchases this year with around 43% of sales. Edibles saw an uptick, and vape pens saw a decline, perhaps part of a larger movement in the industry in the wake of last fall’s vaping-related lung illness crisis in the U.S.
