MjLink Cannabis Business News and Press

The Democrats’ majority in the U.S. Senate isn’t getting any younger this Congress, but a trio of proponents behind cannabis reform have remained gradual in kickstarting their efforts. Their pace picked up July 14.  

Michigan Gov. Gretchen Whitmer signed multiple cannabis-related bills into law July 13, including one that aims to regulate the sale of delta-8 THC in the state.

The cannabis compound has been loosely regulated in the state thus far, MLive.com reported, with gas stations, online vendors and other retailers selling delta-8 THC products without the licensing, testing and other regulations that govern Michigan’s legal cannabis market.

Under the new law, however, businesses will not be able to sell delta-8 products without proper licensing from the Michigan Marijuana Regulatory Agency, and products must be tracked and tested like any other cannabis product. The new law also bars businesses without state cannabis licenses from producing and selling any other potentially intoxicating cannabis compounds, MLive.com reported.

As previously reported by Hemp Grower, 15 states have issued outright bans on delta-8 THC, while six additional states have pending legislation to regulate the cannabinoid.

California Gov. Gavin Newsom signed legislation July 12 to create the Department of Cannabis Control (DCC), which will consolidate the state’s three cannabis regulatory agencies into one.

Assembly Bill 141 creates a standalone cannabis regulatory body, which was proposed in Newsom’s 2021-2022 state budget. The change is intended to “improve access to licensure, simplify regulatory oversight and support California businesses,” according to a press release announcing Newsom’s signing of the bill.

“California has led the nation in progressive cannabis policies, beginning 25 years ago as the first state in the nation to legalize medicinal use of cannabis,” Newsom said in a public statement. “We’ve taken another significant step forward to fulfill the opportunities of legalization and better serve all Californians. We will continue building upon our efforts to foster a diverse and inclusive industry, protect consumer and public safety, safeguard our environment and advance economic opportunity for small businesses.”

Newsom has appointed Nicole Elliot as director of the DCC, which is a consolidation of three cannabis regulatory programs within the Department of Consumer Affairs’ Bureau of Cannabis Control, the Department of Food and Agriculture’s CalCannabis Cultivation Licensing Division, and the Department of Public Health’s Manufactured Cannabis Safety Branch.

“The state’s consolidation effort delivers on the commitment made by the Newsom Administration to listen to and work with California’s legal cannabis industry to streamline participation in the legal market by offering a central point of contact for licensed operators,” said Lourdes Castro Ramirez, agency secretary of the BCSH Agency, which houses the DCC. “One of the key missions of our agency is to build strong, equitable, and vibrant communities. This action takes bold steps in that direction.”

U.S. Sen. Jacky Rosen (D-NV) has led a group of her colleagues to submit a letter to a Senate Appropriations subcommittee requesting that cannabis businesses gain access to Small Business Administration (SBA) loans.

The letter, dated June 22, is addressed to Sens. Chris Van Hollen (D-MD) and Cindy Hyde-Smith (R-MS), the Chairman and Ranking Member of the Senate Appropriations Committee’s Subcommittee on Financial Services and General Government. Sens. Jeff Merkley (D-OR), Bernie Sanders (D-VT), Ron Wyden (D-OR), Alex Padilla (D-CA), Cory Booker, (D-NJ), Maria Cantwell (D-WA), Ed Markey (D-MA), Robert Menendez (D-NJ) and Raphael Warnock (D-GA) cosigned the letter, which asks that businesses legally operating in states with regulated cannabis markets receive access to the 7(a) Loan Guarantee Program, Disaster Assistance Program, Microloan Program and 504/Certified Development Company Loan Program.

Rosen and her colleagues ask the Senate Appropriations Committee to include language in the 2022 Financial Services and General Government Related Agencies Appropriations Bill that would grant cannabis businesses access to these SBA loans, which remain off limits to the cannabis industry.

“In 2020, states collected an estimated $3 billion in tax revenue from legal cannabis sales,” the senators wrote. “However, SBA’s current policy excludes small businesses with ‘direct’ or ‘indirect’ products or services that aid the use, growth, enhancement, or other development of cannabis from SBA-backed financing. Consequently, small businesses in states with some form of legal cannabis must choose between remaining eligible for SBA programs and participating in or doing business with a rapidly-growing and legal industry.”

The letter goes on to say that “SBA programs would be especially helpful to cannabis small businesses because they would fill gaps left by the private sector and help mitigate the effects of the COVID-19 pandemic. Access to these SBA programs could ensure that small businesses—including those led by our minority, women, and veteran entrepreneurs—support job creation and recover from the COVID-19 pandemic.”

With Virginia becoming the first adult-use cannabis domino to fall in the South, the race is now on among neighboring states to follow suit and end prohibition. South Carolina gubernatorial candidate Joe Cunningham hopes his state is the next.

The former one-term Democratic congressman, who represented South Carolina’s coastal 1st District from 2019-2021 in the U.S. House, narrowly lost his re-election bid to Republican state representative Nancy Mace, 50.6% to 49.4%, in the November election.

During his two years in Washington, D.C., Cunningham joined bipartisan bills the second most often compared to other House Democrats, and was the fifth most politically right compared to House Democrats, according to GovTrack.us.

Cunningham, 39, is now seeking his party’s nomination to challenge South Carolina Republican Gov. Henry McMaster, 74, in the November 2022 election.

While Cunningham announced his run for governor in April and has since announced his support of cannabis legalization, he formally released his plan to end cannabis prohibition in the state during a press conference July 12 in Charleston. That plan calls for the full legalization of medical and adult-use cannabis for adults 21 years and older, as well as for the expungement of cannabis-relation convictions.

“There are countless reasons to provide our citizens with a safe and legal marijuana option,” Cunningham said. “Legalizing marijuana would free up our law enforcement to focus on more serious crimes and more effectively tackle our state’s record-high murder rate. It would be a game-changer for people in South Carolina with debilitating health conditions. And it would generate tens of millions in tax revenue to finally provide critical funding for our state.” 

Cannabis has now become easier to access with new delivery app, 'Eaze.'

On June 7, Apple released several changes to its App Store Review Guidelines, clearing up existing policies, adding new specifications for app makers, and altering rules about what available apps for download can do, according to Apple Insider (AI).

Included in the changes was a loosening of restrictions regarding in-app purchases from a cannabis dispensary and licensed and legal pharmacies, AI reported.

One month after Apple released its new policies, 'Eaze' launched in the App Store--the first app in the U.S where consumers can purchase and get cannabis delivered directly to them.

"Eaze has always been about using the latest developments in technology to make shopping for legal cannabis more accessible," said Eaze CEO Rogelio Choy. "It's hard to overstate how important this is to our company and the industry."

The app utilizes geofencing to locate where purchases are made to ensure it's in areas where cannabis is legal. According to AI, consumers must be 21 years and older to purchase from the app and should be prepared to show several forms of identification throughout the purchase and delivery process. 

CALGARY, Alberta, July 6, 2021 – PRESS RELEASE – High Tide Inc., a retail-focused cannabis corporation enhanced by the manufacturing and distribution of consumption accessories, is pleased to announce that it has completed the acquisition of DHC Supply LLC operating as Daily High Club.

The acquisition was completed pursuant to the terms of the merger agreement previously announced by the company on June 25, 2021, pursuant to which High Tide USA Inc., a Nevada corporation and a wholly owned U.S. subsidiary of the company, has acquired 100% of the issued and outstanding shares of Daily High Club.

Pursuant to the terms of the acquisition, the total consideration to Daily High Club shareholders for all the issued and outstanding securities of Daily High Club is: 839,820 common shares of High Tide valued at U.S.$6.75 million on the basis of a deemed price per High Tide share of CAD$9.92, being equal to the volume weighted average price per High Tide share on the TSX Venture Exchange for the 10 consecutive trading days preceding the closing of the transaction; and U.S.$3.25 million in cash (collectively with the share consideration).

In connection with the closing, Daily High Club CEO Harrison Baum has joined the High Tide team as director of digital marketing to oversee all social media initiatives for High Tide globally.

The High Tide shares issued pursuant to the share consideration are subject to a statutory hold period of four months and one day. In addition, the High Tide shares having a value of 25% of the consideration will be held in escrow to insure certain indemnification obligations if claims arise.

Furthermore, High Tide granted 13,333 stock options to Baum, exercisable at CAD$9.39 per High Tide share for a period of three years.

Missouri Gov. Mike Parson vetoed a bill July 9 that would have provided tax relief legislation for medical cannabis businesses.

S.B. 226 would have allowed the state’s licensed medical cannabis businesses to deduct business expenses on their state income taxes. Specifically, businesses would have been able “to claim an income tax deduction in an amount equal to any expenditures otherwise allowable as a federal income tax deduction, but that are disallowed for federal purposes because cannabis is a controlled substance under federal law,” according to the legislation.

Parson did not specifically mention the cannabis provisions in his letter announcing the veto, according to The Missouri Independent, but indicated that he rejected the bill due to a section that would have provided tax relief for businesses affected by city-wide or county-wide public health restrictions.

Tennessee Rep. Bruce Griffey (R-District 75) introduced legislation July 7 that would place an adult-use cannabis legalization measure on the state’s 2022 ballot.

H.B. 1634 would require county election commissions to place three non-binding questions related to cannabis legalization before voters in the November 2022 election. The Secretary of State would then compile the results of the questions, which are referred to in the legislation as a “public policy opinion poll,” and send the results to the legislature, which would not be obligated to implement an adult-use cannabis program.

According to WBIR, the three questions are:

The Tennessee legislature has considered medical cannabis bills in the past, although none have been passed into law to date.

ASTON, Pa., July 12, 2021 – PRESS RELEASE – Discovering water leaks immediately is key to preventing costly damage to facilities, equipment and inventory. To help business owners catch leaks before they become emergencies, Sensaphone offers cost-effective water detection sensors designed for use with its remote monitoring systems. When the sensor detects water, the system sends alerts via phone call, text or email to designated personnel, so they can take fast corrective action.

Widespread Water Detection

The Sensaphone Zone Water Detection Sensor detects the widespread presence of water in areas like floors or drop ceilings. Users receive an alert when the sensor comes into contact with water. The sensor includes 10 feet of water rope to cover a large area. Operators can connect up to 10 water ropes to a single sensor for up to 100 feet of coverage. This sensor operates on two AA batteries. When the batteries become depleted, the sensor will automatically send out an alert, so users can replace the batteries when no water is present.

Small Area Water Detection

The Sensaphone Spot Water Detector Sensor reveals the presence of water on a horizontal surface. Operators can wire multiple sensors to a single input on the remote monitoring system. The sensor is powered by internal lithium batteries. When the batteries become depleted, the sensor will automatically send out an alarm when no water is present to alert users.

Wireless Water Detection Monitor

Five years after California voters approved Prop. 64’s adult-use cannabis framework, the legal market is still struggling to catch fire, in part, because of a complicated regulatory structure, licensing hurdles and a heavy tax burden.

The Legislative Analyst’s Office—a nonpartisan fiscal and policy research institute for California’s Legislature—estimates that adult-use cannabis businesses operate in less than one-third of jurisdictions statewide.

Meanwhile, the illicit market continues to bloom. On July 7, the Los Angeles County Sheriff’s Department announced the results of a 10-day sting operation that involved more than 400 law enforcement personnel, who seized $1.2 billion of illegal harvested cannabis and plants last month in Southern California, and arrested 131 Mexican, Chinese and Armenian cartel members.

Investigators said that the operation accounted for only 40% of the illegal outdoor grows in the county, where up to four harvests per year can materialize. If those illicit grows went uninterrupted by law enforcement, Los Angeles County alone would shadow the state-legal market, which brought in $4.4 billion of retail sales in 2020.

California state Assemblyman Tom Lackey, whose 36th District encompasses the bulk of identified illegal operations in the Antelope Valley, said the people who passed Prop. 64 had no intention of creating the “toxic environment,” happening in his backyard.

“But here’s the reality that a lot of people don’t realize is that in California, and we’re very unique to the rest of the country on this whole cannabis issues, is that we allowed the illicit market to flourish for almost two decades, and they became very, very skilled in their delivery models and in their business operations,” he said. “And now we have international cartels that are here and they’re invading our desert for heaven’s sake. Who would have ever thought that they would go to the desert?”

More than 400 law enforcement personnel from city, county, state and federal agencies seized $1.2 billion of illegal cannabis harvests and plants in Southern California during a 10-day eradication operation resulting in 131 arrests last month.

Despite exhausting human and financial resources during the operation, Los Angeles County Sheriff Alex Villanueva is still calling the largest operation in his department’s history part of an ongoing whack-a-mole game because more than half of the illicit cultivation practices on his team’s radar remain operational in the Antelope Valley of the High Desert, he said.

“The beauty of it is, they can’t hide,” he said in a press conference held July 7. “We see them. We’re going to come after them. It’s hard work. But with the resources, we’re going to get to all 100 percent of them. We got about 40 percent of them we addressed. We’ve got 60 percent to go.”

Operation personnel served search warrants at 205 locations. In the weeks leading up to the operation, investigators conducted reconnaissance flights and surveyed approximately 70% of all the available lands in the Antelope Valley—a region in northern LA County and the southeastern portion of Kern County, which constitutes the western tip of the Mojave Desert. During their flights, the investigators identified more than 500 illegal cannabis grows in LA County, Villanueva said.

The majority of those arrested were undocumented persons, Villanueva said. Many of the illegal grows have been directly tied to Mexican drug trafficking organizations as well as Asian and Armenian organized crime groups, he said.

This month, MIchigan-based Gage Growth Corp. announced a partnership with Khalifa Kush, the cannabis brand launched by hip-hop star Wiz Khalifa. While the brand has been found on shelves in Nevada, Arizona and Utah, this move marks a notable entry into one of the fastest-growing markets in the U.S. 

“The strategy for us has been to partner with best-in-class brands outside of Michigan and bring best-in-class brands to the state of Michigan,” Gage CEO Fabian Monaco said. The KK pickup complements Gage’s partnerships with visible brands like Cookies and SLANG Worldwide, each deal bringing a new suite of inventive product lines to the Michigan consumer.

With a deal that was at least a year in the making, Khalifa Kush targeted Gage Growth for its rapidly increasing production capacity. In the third quarter of 2020, Monaco said, Gage was capable of producing 200 to 300 lbs. of cannabis per month. Now, the company is up to 3,000 lbs. per month. It’s that ability to guarantee production that catches the eyes of out-of-state brands interesting in expanding into new markets.

Gage currently runs nine dispensaries in Michigan, though the company has plans to increase that scope to 20 stores by the end of the year. This, too, matters: Holding the reins on retail allows a company like Gage to convey a certain amount o control over a brand partner’s products.

“You have to be able to control the experience for their customers from seed all the way to smoke,” he said. “That vertical integration is important.”

Monaco pointed out that Michigan’s highly competitive market has the economic mechanisms to propel prices downward over time. With more supply comes a lower price point. To beat that trend, it helps to provide an interesting twist on your product offerings. A celebrity like Wiz Khalifa is one part of that equation, and a lineup of different cultivars and flavor profiles tended by a local business like Gage is another. These things are important to a customer base that grows quickly more sophisticated.

In Oklahoma, illicit growing operations are dominating the medical cannabis market, and it’s taking a toll on local growers. 

"When Oklahoma passed the State Question 788 [the Medical Marijuana Legalization Initiative] in June 2018, really for about the first two and a half years, we had very little, criminal activity that worked its way into our lane," says Mark Woodward, the public information officer at Oklahoma Bureau of Narcotics (OBN). "But in the last six to eight months, we've seen an influx of both legal and criminal organizations pouring into Oklahoma and applying for a license." 

Woodward says the OBN has shut down more than two dozen criminal growing operations between April and June, and the organization currently receives about 30 to 100 tips a week of suspicious farms. 

There are a few standard methods of illicit cannabis operations the OBN is recognizing, he says. 

"We've got some dispensaries that are selling out-of-state [illicit] market products from places like Nevada and California coming here," he says. "We've got some criminal organizations that come here, and they just start growing. They never get a license, and they think because it's so overwhelming in Oklahoma, nobody will notice as we've got over 7,300 licensed growers." 

The operations that are growing without a license have been relatively easier to crack down on, Woodward says. If the OBN gets a tip on a suspicious operation, runs the address, and no active license is registered, they can immediately go to a judge and get a warrant and file cultivation, he says. 

In the growing world of medical and adult-use cannabis, the need for safe products is inarguable. Exactly what those safety measures will be, however, is subject to a debate that can range from access to packaging, labeling, advertising and beyond. Two aspects of safety that are often overlooked, but just as important, are  product testing and insurance.

The cannabis world has access to insurance policies that cover a variety of losses, including crop loss and personal injury. But in order to protect losses, cannabis-friendly insurance companies require applicants to test their product. Some carriers even ask for the testing facility the applicant uses, because the application becomes a part of the policy. In this way, a company can do more than simply say it is cannabis-friendly. The company can have the insurance and receipts to prove it.

In the long run, cannabis companies that avoid insurance or product testing will only open themselves to potential losses later down the line.

A $1-Million Difference

If the insured elects not to test its product after representing to its insurance carrier that it does, the carrier can deny or to exclude coverage.

In its most benign form, lack of coverage arising from the insured’s failure to test its products means a mere waste of money paid on annual policy premiums. But in its worst manifestation, it could mean no coverage in the event of a serious casualty event. Consider the implication of having no coverage in the wake of a customer who suffers extreme medical issues or death from ingesting tainted product. Or worse still, imagine a cluster of injured customers that ingested a bad batch of product. Such a scenario is not merely possible, but inevitable.

Product recalls, like the recent spate in the state of Arizona, are not uncommon in these early years of legal cannabis. In those triggering events, insurance policies kick into gear and begin working to ferret out the source of the problem. Retailers can benefit from having the proper types of insurance in place to protect themselves—particularly when selling products grown and manufactured by other parties.

As cannabis legalization becomes more widespread across the U.S., farmers are discovering new ways to grow the crop.

DeMario Vitalis, owner of New Age Provisions Farms, a farming business based in Indianapolis, has experience growing a variety of crops outdoors, but a couple years ago, he began searching for something new—a method that might provide him more control over his work. 

In 2019, Vitalis started to explore cultivating hemp indoors hydroponically—the process of growing plants in soilless nutrient solution, Cannabis Business Times previously reported.

That year, Vitalis began working with Freight Farms, a Boston-based company that provides farmers with cultivation software integrated within a 320-square-foot shipping container. He received his first shipping container from the company in August 2020 and his second one in January.

Through the use of automation equipment, the Greenery S and farmhand, Freight Farms has created a way for growers to control and access their farming operations from anywhere in the world.

According to James Woolward, chief marketing officer at Freight Farms, the Greenery S manages the environment inside the 40-foot shipping containers using four specialized systems: air, light, water and nutrient control. It also has sensors throughout the grow area so it can relay information, data and updates about the grow directly to farmhand, an operating system app that growers can download on their phone.

SANTA ANA, California, July 8, 2021 - PRESS RELEASE - Terra Tech Corp. announced that it has completed its merger with UMBRLA, Inc., doing business as Unrivaled.

The merger with Unrivaled brings together two California-based companies with combined operations in California, Oregon and Nevada. Collectively, the company operates a broad array of cannabis assets involving cultivation, distribution, brands, processing and dispensaries. The combined company's portfolio includes well-respected brands in cannabis, including Korova, Sticks, Cabana, Blüm and The Spot.

In connection with the merger with Unrivaled, the company changed its name to Unrivaled Brands, Inc. As part of the company's rebranding, it will start trading under its new ticker symbol, "UNRV," on the OTCQX market at the market opening July 8.

The company's CEO, Frank Knuettel II, said "We are pleased to have successfully closed the merger with Unrivaled as we expected. We believe the synergies with Unrivaled's existing brand portfolio and distribution operations in multiple states will lead to greater scale and produce meaningful economic and operational benefits. We look forward to integrating our businesses and expanding the company's platform."

Knuettel continued, "Additionally, as part of the merger, we are excited to launch our new corporate identity, rebranding the Company to Unrivaled Brands, Inc., which we believe aligns with our goal of becoming the premier cannabis multi-state operator in the West. Based on our growth trajectories and new operations coming online during 2021, we believe that on a combined basis, the company will generate revenues in excess of $70 million in 2021 and be cash flow positive in Q4 of 2021. Putting approximately $40 million in cash on our balance sheet following the monetization of our Hydrofarm investment, the close of this important transaction and the ongoing restructuring of our balance sheet and operations, we believe we've never been in a stronger position to create sustainable shareholder value."

DETROIT, Michigan – July 7, 2021 – PRESS RELEASE – Today, Gage Growth Corp., a cannabis brand and operator in Michigan, announced their exclusive partnership agreement with multi-platinum-selling, GRAMMY® Award and Golden Globe® Award-nominated recording artist Wiz Khalifa’s brand, Khalifa Kush, to develop and launch a line of premium cannabis products in the state of Michigan.

Through this partnership, Gage will be the exclusive producer, processor and retailer of KK branded products in Michigan. Gage and KK will work to develop and commercialize a product lineup that includes flower, pre-rolls, extracts, and concentrates that will be sold at Gage provisioning centers.

“We are excited to partner with Gage for our first expansion into the Midwest, and to finally release KK to my fans in Michigan,” said Wiz Khalifa. “From day one of Khalifa Kush, we have only partnered with people we align with, who focus on customer and quality over everything, and Gage is one of the best.”

“Wiz is a globally-recognized cannabis connoisseur. KK has had incredible success in other U.S. cannabis markets, establishing a brand that is synonymous with ultra-premium quality,” said Fabian Monaco, CEO of Gage. “We are confident that this partnership will allow Michigan to become a unique cannabis destination in the near future.”

The arrangement includes a grant of license to certain intellectual property to produce and sell KK branded products in Michigan, and is subject to Michigan regulatory approval. KK will consult on cultivation, distribution, branding, consumer engagement and other operating responsibilities. The initial term of the license agreement is five years on an exclusive basis.

PORTLAND, Ore. (June 30, 2021)—Jonathan Eisenberg, a partner in Tress Capital, has joined the Board of Directors of Resource Innovation Institute (RII) as the non-profit gears up to provide cultivation operations with services related to Environmental, Social & Governance (ESG) performance.

Eisenberg brings over 25 years’ experience in supporting carbon credits sustainability programs, water conservation, energy efficiency and waste diversion economics to the RII Board of Directors. At Tress Capital, Eisenberg focuses on the Tress mission of creating economic and social impact through responsible strategic investment in Controlled Environment Agriculture (CEA) sectors.

“RII is thrilled to bring Jonathan onto our Board. He brings investment depth and over two decades of expertise that will help inform and guide our work, especially as it relates to ESG, now an important measure of success for CEA producers,” said Derek Smith, RII Executive Director. “Jonathan’s appointment comes as RII supports jurisdictions with policy guidance and cultivation operations with benchmarking services using PowerScore, our trusted, vetted and secure facility benchmarking platform that measures energy, emissions, water and waste performance relative to industry-standard KPIs.”

“Based on aggregating individual site data into anonymized CEA industry benchmarking metrics, investors and producers can now answer the call for credible ESG benchmark reporting.” said Eisenberg. “RII is a leading non-profit organization, and the PowerScore is a highly secure platform that operates at a HIPPA compliant level of data confidentiality. I’m excited to join the Board and support the market adoption of the PowerScore as a means to measure and manage CEA performance relative to industry peers.”

Eisenberg is a former managing director, Asia Pacific Region for Citicorp Capital, and by appointment of Citigroup, served as a Board member for several listed and unlisted companies. Over his career, Eisenberg has filed patents on online fractional plant monitoring and on using molecular bio markers for use in cannabis breath diagnostics; was a co-founder of an industrial hemp processing company converting hemp waste stalks into commercial products; advised Agilyx, a company focused on diverting low-value plastics from landfills into industrial uses; was a director of a 180,000-square-foot zero discharge (living machine) aquaculture facility where fish waste fed bacteria to create clean water; was a director of a battery monitoring company that partnered with NASA on lithium battery state-of-health monitoring devices in service at utilities in California and in the Midwest; advised MBL, one of the largest solar installation companies in California; advised the City of Bayannur in Inner Mongolia on an ethanol project using sorghum; advised (in partnership with Owens Corning) the City of Urumqi, Xinjiang China on an energy efficiency city plan in line with the Kyoto Protocol; and was an analyst for the U.S. Foreign Commercial Service at the U.S. Consulate in Shanghai to research 10 Sino-Foreign JVs on foreign technology transfers to China.

Eisenberg has an MBA from Columbia University Graduate School of Business and has received New York State Workforce Development certifications as an Energy Efficiency Building Analyst and on PV (Solar) System Installations. Eisenberg currently serves as Chairman of Grownetics (www.grownetics.co), a Tress Capital portfolio company serving large scale cultivators with sensor networks and AI-driven quality and yield gains from big data analytics.

BILLERICA, Mass., July 6, 2021 – PRESS RELEASE – Agrify Corporation, a developer of advanced and proprietary precision hardware and software cultivation solutions for the indoor agriculture marketplace, announced that it has signed a definitive collaboration agreement forming a long-term research and development (R&D) partnership with Curaleaf Holdings Inc. Curaleaf is one of the largest multistate operators (MSOs) in the U.S. and the largest vertically integrated cannabis company in Europe as Curaleaf International.

The research will be focused on evaluating the impact of certain environmental conditions created and controlled by Agrify’s vertical farming units (VFUs) and Agrify Insights software platform on harvest yields, plant terpene profiles and flavonoid concentrations. It will also explore and analyze techniques to enhance the aesthetic appeal, aroma and overall chemical profile of cannabis flower. In addition, the joint research team plans to study the effect of regulated environments on the overall health and longevity of cannabis plants, including research on the maturation of the chemical profile of the plants over their lifecycle.

“We are thrilled to announce our first MSO collaboration and honored to partner with Curaleaf to advance this important research,” Agrify CEO Raymond Chang said. “Curaleaf is a cannabis industry leader, and our shared research will demonstrate the critical importance that an optimally controlled environment can play on the cultivator's ability to consistently produce high-quality flower. I am proud to showcase our cutting-edge indoor vertical farming grow cultivation technology and assist Curaleaf in growing the high-quality, consistent cannabis they are known for in the most cost-effective manner possible.”

Curaleaf CEO Joe Bayern said, “Since our inception, we have been committed to providing our customers with premier and innovative cannabis products and experiences, with a relentless drive for quality. The cultivation environment plays a critical role in the plant’s chemical composition, and we believe this research will help to further increase understanding of the conditions required to optimize a plant's genetic potential.”

Under the terms of the agreement, Agrify will supply its VFUs and provide use of the company’s Agrify Insights software platform for a period of three years at Curaleaf's primary R&D facility in Massachusetts, with an option to extend another three years. The collaboration combines Agrify’s technology and expertise in creating optimized cultivation environments with Agrify Insights-based data and Curaleaf’s expertise in cultivation and production of quality cannabis products. All test data collected by Agrify Insights will be jointly owned.