MjLink Cannabis Business News and Press
AURORA — PRESS RELEASE — As of Aug. 1, 2021, Victoria Williams is the first person in the State of Illinois to be issued a Cannabis Transportation License. This certification authorizes her business to transport cannabis and cannabis-infused products on behalf of other Illinois cannabis business establishments.
“I am so excited to take this step forward not just for my business, but for the entire cannabis industry in the state of Illinois,” remarked Williams. “I’m also very proud to represent my community as a Black woman, an educator and a businesswoman.”
Over the past six years, Williams and her partners at ACC of Illinois have developed multiple educational platforms and hands-on training programs necessary to participate in the cannabis business. This was developed alongside the cannabis tour she led in Denver, Colo., which provided potential applicants with courses on dispensary and processing facilities, networking opportunities with owners, and cost analysis strategies. She is also the author of three books titled Cooking with a Twist, Cannabis Puzzles, Illinois Dispensary Training Manual and How to Start a Daycare Sis!
“Our main goal is to address the lack of information about cannabis education and business, especially within Black and Brown communities,” said Williams. “My partners at ACC of Illinois and I are dedicated to providing education, training, networking opportunities to groups that were the most targeted by anti-drug laws in decades past.”
Three cannabis license applicants have sued the Illinois Department of Financial and Professional Regulation (IDFPR), claiming they were wrongfully excluded from an upcoming licensing lottery.
Justice Grown, Emerald Coast LLC and ReNu LLC filed the complaint in federal court July 30, claiming that their applications should have received perfect scores, thus qualifying them for an Aug. 19 lottery to win a cannabis retail license, but they were wrongfully denied points due to regulators’ scoring errors, according to a Law360 report.
The businesses say IDFPR notified them on July 29 that the agency would not consider their requests to re-score their applications, Law360 reported. The lawsuit alleges that denying the companies the opportunity to challenge their scores violates their constitutional right to due process.
The applicants have requested a court order forcing the state to let them participate in the upcoming lottery, according to Law360.
IDFPR awarded 55 cannabis retail licenses to 53 firms on July 29 in the first of three licensing lotteries meant to improve social equity in the state’s adult-use market. Regulators plan to hold two more lotteries on Aug. 5 and Aug. 19 to award 130 additional licenses.
A new lawsuit in Oklahoma alleges that the Medical Marijuana Authority violated the state’s Open Meeting Act when it adopted new emergency regulations earlier this year without notifying the state’s cannabis industry of the meeting or holding a public comment period on the rules.
Tulsa-based attorney Ron Durbin and co-counsel Rachel Bussett claim that the medical cannabis board was formed “in secret” and then “held a secret meeting to approve some regulations, and then sent those off to the governor as emergency regulations,” according to a KOKH report.
The attorneys claim that no agenda was posted for the Medical Marijuana Authority’s meeting regarding the emergency rules and that cannabis industry stakeholders were not notified of the meeting, which Durbin and Bussett said offered regulators “little time to read and understand” the regulations that were ultimately adopted, KOKH reported.
The lawsuit seeks to separate the Medical Marijuana Authority from the Oklahoma State Department of Health and place it under the control of the Oklahoma Bureau of Narcotics, according to KOKH.
Durbin announced his plans to sue the state’s medical cannabis board July 30 at a rally at the capitol, where medical cannabis patients and other industry stakeholders gathered to call for increased transparency from the Medical Marijuana Authority, according to The Oklahoman.
Over the past several months, onlookers have watched heavily hyped, high-inducing cannabinoids divide the hemp industry. As a growing number of states step in to regulate these controversial substances, such as delta-8 tetrahydrocannabinol (THC), multiple cannabinoids join the fray. A semi-synthetic cannabinoid known as THC-O acetate is one substance gaining attention.
To learn more about THC-O acetate, Cannabis Business Times, Cannabis Dispensary and Hemp Grower spoke with board-certified neurologist Ethan Russo, M.D., who’s devoted the last 25 years to studying the medicinal aspects of cannabis and the endocannabinoid system. That includes more than a decade as senior medical adviser to GW Pharmaceuticals, the company behind Epidiolex, the only cannabidiol (CBD)-containing drug approved by the U.S. Food and Drug Administration (FDA). Dr. Russo is now CEO and founder of CReDO Science, a company devoted to making cannabis safer and better.
Jolene Hansen (JH): The hemp industry is seeing a proliferation of controversial cannabinoids, including THC-O acetate. Does this surprise you or did you see this coming?
Dr. Ethan Russo (ER): More the latter. All this nonsense about these synthetics, I see as a byproduct of prohibition. If there were legalization of cannabis products with appropriate regulation, I don't think any of this would be happening. The continuation of prohibition has basically been a catalyst to this kind of development of products that people would like to think are legal but clearly are not. Certainly THC-O acetate falls in that category.
JH: So, what is THC-O acetate and how is it derived?
ER: It starts with tetrahydrocannabinol, better known as THC. That's the natural product that is the main psychoactive component of cannabis. THC-O acetate is what's called a semi-synthetic derivative, or analogue. Through a chemical process using a very toxic chemical called acetic anhydride, you can turn some of the delta-9 THC into THC-O acetate.
Portland, OR -- PRESS RELEASE -- On Aug. 2, the OLCC became the Oregon Liquor and Cannabis Commission, dropping the word “Control” that had defined the agency’s original post-Prohibition mission. Previously referred to as the Oregon Liquor Control Commission, the agency began regulating recreational marijuana after voters approved Measure 91 in November 2014.
This change comes five years after voters passed Measure 91 which directed the agency to establish a framework for regulating Oregon’s recreational marijuana marketplace. While the change updates the agency’s name to better reflect its mission, the OLCC acronym will remain the same.
“The industries we regulate matter, they matter a lot to the state of Oregon’s economy,” said Paul Rosenbaum, Chair of the Oregon Liquor & Cannabis Commission. “The cannabis industry in Oregon has become a billion dollar business and changing our agency name reflects our role in generating revenue to fund state programs.”
Newly issued alcohol and marijuana licenses, and alcohol server and marijuana worker permits, will be modified to include the new name and logo. Existing versions of these official documents continue to be valid with the agency’s previous name and logo, and will be replaced when the licensee or permit holder renews them.
The OLCC will make minor public facing adjustments to reflect the name change; the modifications will have a minimal cost. Exterior signage at OLCC headquarters and regional offices will gradually be brought up-to-date. Documents on the agency website will continue to be updated with the new OLCC logo. The agency will deplete its existing stock of paper documents branded with the agency’s old name and logo; these items will be replenished with the new name and logo when existing supplies are exhausted.
Recent legalization has added fuel to the green rush. As it makes its hurried way toward the East Coast, this wave of momentum feels like rocket fuel behind the maturation of the cannabis industry. While we’re far from a consistently regulated, low-stigma and widely embraced market, there are already multi-state operators (MSOs) like Cresco Labs and Curaleaf that are well poised to expand their reach and welcome in anxious to expert consumers with well-tested—and funded—brands, products and operations.
That’s not to say that leadership is guaranteed to these players—far from it, especially when you take into account how fragmented the market is—but it does give us an indication of where things may be headed. Most importantly, we can see how integral it will be to precede costly cannabis market entry with a compelling brand to help you rapidly compete with massive vertically integrated competitors who may well be situated to beat on cost, data and scale.
When thinking about the potential for cannabis branding, it may be useful to look to the beer industry’s Big Beer vs. Craft Beer dynamic for some clues.
For many years, the beer industry was dominated by a few major players, such as Coors, Budweiser and Heineken. For over fifty years following Prohibition, there were only a few hundred regional breweries, until President Jimmy Carter signed a bill legalizing homebrewing. Over the next ten years, the number of local beer brands began to grow, culminating in a craft beer renaissance beginning in the 1990s and exploding with the IPO of Boston Beer Company, the makers of Sam Adams, in 1995. With no signs of slowing down, Craft Beer has been giving Big Beer a run for its money and has forced them to take notice. In 2017, Heineken acquired Lagunitas Brewing Company for $1 billion, according to some estimates.
It is possible that when MSOs (e.g. Big Cannabis) eventually plateau in growth in the context of a flooded industry, the next logical step may be the snowballing acquisition of smaller, niche brands (e.g. Craft Cannabis) to expand their consumer base and offerings.
In anticipation of a potentially similar future, a simple and clear brand that compellingly elevates what makes you special to bombarded consumers will be essential to quickly stand out, command a premium and build loyalty through crowded physical and digital shelves. Perhaps as well, it will become the next “Big Beer,” or be positioned well for a lucrative acquisition.
LAFAYETTE, Colo., Aug. 2, 2021 – PRESS RELEASE – urban-gro Inc., a fully integrated architectural, engineering and cultivation systems integration company for commercial cannabis and food-focused Controlled Environment Agriculture (CEA) facilities, announced that it has completed the acquisition of MJ12 Design Studio and associated companies, 2WR of Georgia and 2WR of Colorado (2WR+ Partners). The acquisition extends urban-gro’s services into early-stage conceptual design and planning, and it creates the industry’s first fully integrated architecture, engineering and cultivation systems company serving the cannabis and food-focused CEA sectors.
urban-gro funded the $9.1-million transaction with a combination of cash and UGRO common stock (issued out of corporate treasury stock from prior buyback program), including contingent consideration of up to $2 million based on achievement of certain performance metrics. The company expects the transaction to be accretive to earnings within the first year and drive significant waterfall revenue opportunities for urban-gro’s existing suite of products and services. In a pandemic-impacted 2020, 2WR+ Partners improved upon 2019 numbers and reported revenue of $6.2 million, net income of $900,000, adjusted EBITDA of $1 million, a gross margin of 43% and an operating margin of 16%.
“In addition to increasing the value to our shareholders through an increased earnings per share in the first year following consolidation, we believe that this acquisition creates more than $10 million in incremental waterfall revenues for our existing offerings of engineering and design services as well as cultivation equipment sales,” urban-gro Chairman and CEO Bradley Nattrass said. “With the inclusion of architectural design to complement our existing services, we can now offer fully integrated design solutions for processing, extraction and retail facilities as well. With this acquisition and continuing to work closely with our existing strategic manufacturing partners, we are much closer towards delivering complete, end-to-end turn-key indoor CEA facilities for our clients.”
Nattrass added, “We have a long history of working with MJ12 Design Studio on a variety of major CEA projects. The past successes of urban-gro and MJ12 Design Studio provide an excellent framework for how our teams will come together as one entity moving forward, providing significant value to our customers. We’ve already launched this integration, recently bringing the company’s now combined 80 employees together to kick-off this exciting new stage of urban-gro’s evolution.”
MJ12 Design Studio Principal Sam Andras, AIA, will join urban-gro’s senior leadership team in the role of executive vice president of professional services. Andras will lead urban-gro’s full building and cultivation systems design services. Collectively, the company’s portfolio of experience totals more than 450 CEA facilities.
“On behalf of our 23 employees, we are excited to become part of the urban-gro team,” Andras said. “Through the synergies of our two firms, we can leverage the collective experience and expertise of our professionals to deliver high performance facilities that will allow for cultivating the highest quality production of plant-based medicines and food crops at the local level across the globe. We bring with us a deeply experienced team with over 110 CEA facility designs comprising over 9 million square feet in 21 states and four countries. I view the ability to provide fully integrated design solutions under one roof as a natural step in the progression of offerings within the CEA industry and something the industry has needed.”
Genetixs, a California-based cannabis company, has named Tennessee Titans’ Julio Jones and his former Atlanta Falcons teammate, Roddy White, as defendants in a lawsuit alleging that the duo illegally harvested and sold millions of dollars’ worth of cannabis in California.
White’s company, SLW Holdings, is one of five business entities that comprise Genetixs, according to an AP News report, and Genetixs’ complaint claims that Jones and White worked with two other defendants to conduct black market sales out of a Genetixs facility in Desert Hot Springs. The lawsuit alleges that the group has not reported cannabis sales since March and estimates that they have sold $3 million in cannabis per month since then.
The complaint also claims that Genetixs fired a manager in March after a state inspection of the company’s facility found several violations, AP News reported, and says that the manager did not report the cannabis sales, as well as refused to provide budgets and other business-related documentation to Genetixs.
After the manager was let go, the lawsuit alleges that Jones, White and others operated an “illegal black-market operation from the Genetixs Cannabis Facility to sell cannabis and misappropriate the illegal sales proceeds without reporting them,” according to AP News.
Genetixs holds a cannabis business license in California, but says it could now lose its license due to the actions detailed in its lawsuit, which was filed July 21.
A lot has happened in the world of cannabis legalization since Colorado voters passed Amendment 64 in 2012.
Over the last decade, many states across the country have moved to legalize recreational and/or medical use. Others have begun decriminalizing cannabis. As the industry continues to mature and develop, there are signs that cannabis is following the familiar path of the pharmaceutical industry. Paying close attention to these cues can help cannabis entrepreneurs anticipate what's coming as the industry continues to evolve.
Extracting specific plant properties rather than using the plant as a whole.
When people think about cannabis, they now focus on single cannabinoids within the plant. THC is the most well known cannabinoid, but it's more mellow sister CBD has also launched an entire additional sector of business. Right now, people are fixated on delta-8, and were previously focused on CBG and CBN. But the truth is that drilling down to specific properties has all been done before by pharma.
Aspirin was originally derived from a compound in willow bark. Nowadays, it is created synthetically, but it started out as a salicin extraction from willow bark that was then converted to salicylic acid to make aspirin. When you take vitamin C rather than eat an orange, you are opting to have a specific property taken out of a plant and consumed in a high concentration.
The link between food and health was established centuries ago. Hippocrates famously said, “Let food be thy medicine and medicine be thy food.” While creating a very high concentration can aid in health depending upon the medical issue, it is also likely that most of that will be flushed out from the body rather than absorbed.
Many cannabis companies are working to understand Environmental, Social and Governance (ESG) trends so that they may mitigate risks and establish compliant policies at the enterprise level.
The growing impetus behind the current focus on ESG is not only to comply with new regulations and meet consumer and employee demand, but also to increase the capacity to attract capital as many investors are looking to invest in companies with ESG initiatives in place. Given increased demand for ESG action from businesses, many cannabis companies are uniquely positioned to benefit from highlighting their current ESG efforts and incorporating additional ESG practices.
ESG is in the headlines, but it is more than just a fad.
At its core, ESG is a process for evaluating longer-term environmental, social and governance risks that are often considered when implementing traditional risk management strategies. This evaluation includes everything from a company’s treatment of employees and contract labor to its potential unintended impacts on the communities in which it operates. This can encompass product safety and labelling, carbon emissions, water consumption, as well as a company’s adoption of meaningful diversity, equity and inclusion programs. The list is long, but it is also important and cannabis operators are poised to take advantage.
Because the nascent legal cannabis industry often finds itself needing to overcome public and policymaker misperceptions and abide by strict regulations, many cannabis companies have already incorporated ESG-like policies and good governance into their business model.
Growers already analyze their environmental impacts. Brands are required to know the sources of their ingredients and to track their quality. Cannabis product labels are scrutinized for misrepresentations. Because cannabis companies are typically less corporately established entities and because many have evolved from a non-traditional financial background, cannabis companies already also tend to be more diverse and concerned about social justice. By converting de facto ESG policies into express, well-formulated and executed ESG policies, allows companies to add value and position themselves for stronger growth in the marketplace.
As July comes to a close, we’ve got plenty of work to do in the cannabis space. Perhaps the biggest story of the month was the announcement of the Cannabis Administration and Opportunity Act, a fairly comprehensive legalization bill that actually stands a chance at making headway in Congress this year.
It’s hard to say what that means to currently licensed cannabis business owners, except for the fact that change is coming. But you already knew that, right? That’s the name of the game.
N.B.: Next month, we’ll be in Las Vegas for Cannabis Conference 2021. Check the full schedule of educational programming here—and make sure to register!
We’ve rounded up some of the key cannabis headlines from the week right here.
Ohio is making a run at adult-use legalization. Will it work? Read more
“Colorado has created the Cannabis Business Office to promote social equity and provide financial and technical assistance to entrepreneurs in the industry.” Read more
Rhode Island has delayed a medical cannabis dispensary licensing lottery, which was originally planned for the first week of August, due to an administrative appeal brought forth by one of the rejected lottery applicants.
The Providence Journal reported that Office of Cannabis Regulation Chief Matthew Santacroce said July 27 that the lottery to award six new licenses won’t be rescheduled “until that appeal has run its course.”
The state received 45 applications from 28 different companies in December, and subsequently qualified 24 applicants for the lottery, according to the news outlet.
The state has identified the four companies that did not qualify for the lottery as Enlite RI Inc., Livity Compassion Center, Atlas Enterprises Inc. and the Edward O. Hawkins Center Inc., but has not indicated which company is appealing its exclusion from the lottery.
Rhode Island currently has three licensed medical cannabis dispensaries—The Thomas C. Slater Compassion Center in Providence, the Greenleaf Compassion Center in Portsmouth and the Summit Medical Compassion Center in Warwick—and former Gov. Gina Raimondo’s administration expanded the number of licenses in the state, with the application opening last summer.
A pair of Ohio lawmakers officially put their plans into action July 30 by formally filing adult-use cannabis legislation in the state’s House—the first of its kind in the state.
Democratic Reps. Casey Weinstein and Terrence Upchurch, both representing Northeast Ohio districts, first introduced their 180-page bill two weeks ago, which includes four major components: decriminalization, a cannabis excise tax, commerce and licensing, and medical cannabis.
More specifically, the Ohio Medical Marijuana Control program would remain intact, and licensed operators could pursue additional licenses to enter the adult-use market.
According to a memo Weinstein and Upchurch sent to fellow House members two weeks ago, the bill would enable municipalities to restrict the type and number of cannabis establishments operating within their jurisdictions and require the Department of Commerce to adopt rules related to the licensure of cannabis businesses. And the bill would impose restrictions on the cultivation, processing, transportation and sale of cannabis.
Also, the legislation would allow adults 21 and older to buy and possess up to 5 ounces of cannabis and grow as many as 12 plants for personal use.
“It’s time to lead Ohio forward,” Weinstein said in a joint press release issued Friday. “This is a big step for criminal justice reform, for our veterans, for economic opportunity, and for our individual liberties.”
Colorado has created the Cannabis Business Office to promote social equity and provide financial and technical assistance to entrepreneurs in the industry, according to an AP News report.
The new agency, which was established by legislation passed during the state’s 2021 legislative session, will provide microloans and grants, as well as planning advice and other support, for business owners with a focus on economically disadvantaged areas, people of color, and those with past cannabis-related arrests and convictions, the news outlet reported.
The Cannabis Business Office falls under the jurisdiction of the Colorado Office of Economic Development and Trade, and will be supported by the state’s cannabis cash tax fund.
“The Cannabis Business Office shows our administration’s focus on growing this thriving industry that supports jobs and our economy,” Colorado Gov. Jared Polis said in a statement, according to AP News. “Where the federal government has fallen behind, Colorado will lead. Colorado is, and always has been, the best place to live, work, grow and sell cannabis."
The Illinois Department of Financial and Professional Regulation (IDFPR) awarded 55 cannabis retail licenses to 53 firms on July 29 in the first of three licensing lotteries aimed at improving social equity in the state’s adult-use market.
“Illinois has taken the most comprehensive approach in the country to putting social justice at the heart of cannabis legalization, and today is an important day in expanding the diversity of the industry—on top of all the work we’ve already done to expunge convictions and investing tens of millions of cannabis revenue into the communities hit hardest by the war on drugs,” said Toi Hutchinson, Senior Advisor to the Governor for Cannabis, in a public statement. “We look forward to seeing businesses get off the ground and into this space.”
The conditional licensees, which are listed in the IDFPR’s announcement here, were chosen from 626 finalists who scored 85% or higher on their applications.
Illinois Gov. J.B. Pritzker announced a new scoring process and created 110 additional cannabis retail licenses after some industry stakeholders pushed back last September, when only 21 applicants were included in a lottery to award 75 dispensary licenses.
Earlier this month, after lawsuits and lengthy delays, Pritzker’s office announced the series of three lotteries to award the 185 licenses.
As a guinea pig for adult-use cannabis legalization, Colorado is often a target for prohibitionists trying to magnify what they consider shortcomings of the first state-legal market.
Two key arguments repeated by lawmakers voting against reform efforts include their concerns about how legalization might impact youth as well as the possible increase of impaired drivers on their state roadways.
In Minnesota, where House members discussed an adult-use bill for roughly five hours in May, before it passed via a 72-61 vote, Republican Rep. Glenn Gruenhagen took aim at Colorado in his efforts to deter passage of House File 600. While H.F. 600 did clear the House, it did not make its way through the Senate.
“Since recreational marijuana was legalized [in Colorado], traffic deaths in drivers which tested positive for marijuana increased 135 percent while all other traffic deaths increased 24 percent,” he said. “So, one of the members said, ‘This doesn’t cause death.’ Well, it does with increased traffic death.”
Gruenhagen went on and said, “One other finding is that marijuana use ages 12 and older increased 30% and is 76% higher than the national average, currently ranking third in the nation in Colorado.”
Lawmakers who oppose adult-use legalization in other states that have debated or passed bills this year have echoed similar reservations before casting their no votes.
SCOTTSDALE, Ariz. (July 2, 2021) -- PRESS RELEASE -- Bianchi & Brandt, a full-service business and litigation law firm with an emphasis on the cannabis and hemp industries, recently added social media coordinator Marley McIntosh to the practice.
“Being able to bring my knowledge and continue to expand on my social media marketing skills at a firm like Bianchi & Brandt really excites me,” said McIntosh. “The cannabis industry is so intricate when it comes to social media due to the rules and regulations, not to mention the fact that it's an ever-changing industry. I’m looking forward to creating engaging, informative, and educational content to keep Bianchi & Brandt’s audiences in the know and also keep the firm top of mind as leading industry experts.”
McIntosh has experience working on social media marketing in a variety of industries. As a college football fan, a highlight in her career was having the opportunity to create content for the Oregon Ducks’ football team. She earned a bachelor’s degree in advertising from the University of Oregon.
“Bianchi & Brandt is thrilled to add Marley’s expertise to our high-growth firm,” said Laura Bianchi, partner of Bianchi & Brandt. “The cannabis industry is evolving daily and adding Marley to our team will allow us to effectively communicate this rapidly changing industry in the most effective and creative ways.”
Several states legalized adult-use cannabis during their 2021 legislative sessions, and while many industry hopefuls are eager to enter these new markets, most have not yet adopted regulations for cannabis business licenses.
So, what’s an entrepreneur to do?
According to Jay Czarkowski, co-founder of cannabis business consulting firm Canna Advisors, those looking to secure licenses in Connecticut, New Mexico, New York, Virginia and beyond can make plans now, while the rulemaking process is under way, to serve them well later, when the actual application becomes available.
“There are things one can do to stay ahead of the curve no matter where you’re at,” Czarkowski tells Cannabis Business Times and Cannabis Dispensary.
Here, he shares four ways entrepreneurs can prepare for the cannabis licensing process.
In an effort to redefine the cannabis experience, Jushi Holdings Inc., a multistate operator and owner of cannabis retail, cultivation and processing licenses based in Boca Raton, Fla., has partnered with actor, producer and director Colin Hanks to bring his 'Hanks Kerchiefs' line to select BEYOND / HELLO retail stores.
An out-of-state operator has dropped its lawsuit challenging Illinois’ cannabis licensing process, meaning that the state can now proceed with its plan for upcoming lotteries to award 185 new dispensary licenses.
Sozo Illinois Inc., whose parent company operates vertically integrated cannabis operations in Michigan, sued the state last week over its revised licensing plan, which Gov. J.B. Pritzker unveiled earlier this month.
The new licensing rules give priority to social equity applicants whose businesses are majority-owned by people from communities deemed disproportionately impacted by the war on drugs, which deviates from the state’s original regulations that allowed applicants to commit to employing a certain number of people from those communities.
Sozo took aim at these new rules in its lawsuit, arguing that it structured its business and prepared its application under the initial rules allowing the company to qualify as a social equity applicant by hiring a certain number of employees from disadvantaged communities. The company said the change in regulations made it impossible for it to qualify for a license, and that the new rules discriminate against out-of-state operators, as well as violate the commerce, due process and equal protection clauses of the U.S. Constitution.
The company sought a temporary restraining order and preliminary and permanent injunctions to prevent the state from issuing the licenses, but AP News reported that Sozo dropped the case on July 27, allowing the state to proceed with its licensing process.
