Hemp CBD Companies Struggle With Banking Services

6/12/2019

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Despite federal hemp reforms last year, many CBD-focused companies throughout the U.S. still lack basic financial services, such as business bank accounts and credit card processing. The problem, it appears, is less with federal policies (although CBD remains a thorny issue with the Food and Drug Administration and Department of Agriculture) and more with financial institutions unwilling to serve the industry, which they consider “high risk.”

Banks back away

Many of the industry operators interviewed for this piece pointed to the sudden decision by U.S. Bank subsidiary Evalon to stop providing merchant services – namely credit card processing – to CBD businesses in March after they started serving the industry last fall.

All entrepreneurs new to the industry pointed to the federal changes, which they believe to have given them the green light to open their CBD business.

Kyle Rapoza, the co-founder of Vermont-based Mansfield Provisions, which distributes online and through retailer partnerships, lost his credit card processing services on May 31, when Evalon banned the industry. He explained that, in the wake of Evalon’s action, many of the industry operators he knows and does business with are moving back to high risk (and high fee) accounts. Fortunately, Rapoza has been able to access more traditional business accounts through a state credit union.

“We didn’t have an e-commerce website a year ago because it was 10 percent fees and the accounts were in Amsterdam, which is kind of sketchy,” he said in a phone interview with Ganjaprenur. “We have processors asking us for $10,000 in an escrow account plus 10 percent of monthly transaction fees.”

Prior to getting credit card processing services in February, Mansfield sold online by accepting checks and money orders and has since moved back to that system as the company tries to find a replacement for Evalon. Rapoza said the company had “built a pretty good following” with their mail-order system and he prefers to wait it out than pay the high fees. He thinks Congressional action, namely the SAFE Banking Act, will pass and solve the problem; however, he recognizes that CBD is still considered a controlled substance to the feds.

“It’s definitely frustrating right now considering how easy it was two weeks ago,” he said, adding that his small, regional, company has lost between $1,000 to $2,000 per week since they lost credit card processing services.

A “high-risk” industry

Don Andrews, owner of Upstate CBD in New York’s Capital Region, which he opened just last month, said that while he has banking access, he has no way to take credit cards at his fledgling business.

He said that a company had installed a credit card machine at the location and “everything was all squared away,” but when he went to make his first credit card sale it kept getting declined. The credit card processing company explained that due to his high-risk business they would not process credit cards but customers could still use debit cards; however, the processor is gutting Andrews with near-8 percent per transaction rates.

He said that while his customers have been understanding – and many do get cash at an ATM across the street – “a lot of people live off of credit and that’s what they want to use and they’re forced to not buy anything.”

Andrews is considering getting an ATM on-site to serve his customers while he continues his search for a credit card processor – or move his CBD business (he also owns two head shops) to all cash.

“The credit card processing company said I was ‘good to go with credit cards, good to go with debit cards, locked in at 3 percent.’ Now it’s a whole ordeal – the percentage rate went up and they’re not accepting credit cards at all,” he said in an interview. “I wish I had known this before setting it all up.”

Many CBD companies can no longer process credit card payments via online or brick-and-mortar stores. Photo credit: Pixabay

In California, Sister Kate, real name Christine Meeusen, of Sisters of the Valley has been without banking since May. While they are still able to process credit cards via their website, they have no bank account in which to deposit the funds, which remain with the credit card company.

In an interview, she said the California Tax Authority and the Internal Revenue Service told her to “switch to cash.” She said that at least one bank she contacted would approve her for a business account if she kept a $60,000 minimum balance which would be charged 3 percent in fees on that balance annually along with a $2,000-per-month “compliance fee.” Sister Kate said she is actively looking for banks in states with no medical or recreational cannabis program which, she thinks, plays a role in the sweeping denials.

Since the loss of banking, Sister Kate described her business as “torpedoed to the bow” adding that she and her order cashed in all of their savings and retirement to keep the business afloat while she waits on “over $100,000” from the credit card companies that are holding her funds until she is able to open a business account.

“We were doing about $4,000-a-day going into this and we are doing about half of that now,” she said in a phone interview, adding that the banking issue is compounded by a recent decision by Merced County officials to ban hemp production.

“It’s irritating not to get the tools and services that everyone else gets,” she explained. “It makes me mad. … I’ve been applying to banks who say they’ll serve our industry and the underwriters don’t let them serve our industry.”

Sister Kate fears that if she doesn’t get access to banking services soon, she’ll “have to put the business down.”

Startups struggle, entrepreneurs reconsider

And it’s not just entrenched small-business owners whose businesses have been negatively impacted by canna-bias of financial institutions – some would-be entrepreneurs are ready to open shop but can’t access either banking or credit card processing, or both.

Lekisha Leonard, owner of Milwaukee, Wisconsin-based Future Leaf Organics, an online CBD store, has been unable to start sales via her online shop because she cannot find a credit card processor. In the meantime, she is accepting orders via Paypal and plans on using e-check processing so she can get the business off the ground. Leonard explained that in addition to being a CBD company – one that’s registered with the state’s hemp program – some merchant services won’t provide her accounts because she’s a startup.

Leonard had been rejected for business accounts by two traditional banks “due to high risk,” she said, but was approved by an online bank, despite their policies to not serve businesses that offer “marijuana derivatives.” She said that while she did expect some pushback from financial institutions, she considers her businesses health and wellness, rather than cannabis.

“My take on it is that CBD is not a derivative of marijuana, it’s part of the hemp plant,” she said during a phone interview. “My products do not contain any THC in them at all.”

The experience so far has Leonard reconsidering whether she wants to open a brick-and-mortar location. She noted that she has started other businesses – in the real estate and transportation sectors – and did not face the same trials.

“The challenges I am facing right now with merchant services and banking – it’s just like, I hope this won’t be an issue,” she said, adding that she has attempted to get business loans for the expansion but would have to procure them as personal loans.

In Grand Rapids, Michigan, April Moayyer is “one-click” away from launching her CBD online store, Shah Saffron, but has been unable to find a merchant services provider. She was able to find banking services through Chase bank, but their merchant services won’t provide credit card processing services.

“It’s crazy. If you’re going to market yourself as CBD-friendly – be consistent,” Moayyer said in an interview. “Don’t tell me I can open a checking and savings account and then drop me when I tell you what I am selling. You’ll take my money but not process my payments? Be full-service.”

Moayyer indicated she had contacted 13 merchant service providers in the day preceding the interview and one – Square – said they do serve CBD businesses but the program is an invite-only beta. She said that two other companies approved her business, but the rates were either “outrageous” or getting them set up could take at least three months.

“Rates like, 7 percent interest, plus 30 cents per transaction, plus $200 per month,” she explained. “I feel like some companies are just taking advantage blatantly.”

Cannabis and hemp companies alike face heavy scrutinization from banking service providers despite federal so-called protections. Photo credit: Rory Savatgy

Even in states with recreational cannabis sales, CBD businesses are being shut out of financial services.

Irene Shen, a California entrepreneur trying to launch a web-based CBD business, said opening a bank account was “the first thing” she thought she’d be doing but is “pretty stuck there.” She said she spent “several weeks” trying to find a bank that would serve her – targeting small regional banks – to no avail.

“When I called them they would just say ‘Oh, no, no no,’” she said in an interview. “They just start having this tone with you, ‘That’s against federal law, we don’t do that.’”

Shen ultimately got in touch with MMJ Fin Sol – a firm that connects canna-businesses with banking and financial services – hoping to get an account. She said that the firm found her a bank, but the lengthy application process is still under review. Shen admitted that part of the reason banks have, so far, refused her business is that she’s a one-person startup but she hasn’t shopped any business loans.

Moreover, Shen said, that one CBD supplier that she spoke with told her to identify her company as health and wellness and not mention CBD but she hesitates to do anything duplicitous and would rather remain “above board.” She admits that she felt safe to open the business after the passage of the Farm Bill, but pointed out that a San Francisco CBD store was ordered by city health officials in March to remove all of its edibles from its shelves due to FDA regulations. Shen added that the FDA hearing “just added more confusion” to the federal policy on hemp and CBD products.

Instead of having ordered products from her suppliers, Shen is still waiting on getting a business account set up so she can make those payments.

40,000 companies affected

Philippa Burgess, co-founder and director of marketing for MMJ FinSol, said that the banking-for-CBD issue is “confusing,” noting that she has been told by representatives from national chain banks that they accept CBD and hemp clients, “but don’t advertise it,” but then corporate officials from the same institutions say CBD “is not part of their risk matrix.”

Burgess estimates that Evalon’s policy changes affected 40,000 CBD companies. Adding to the confusion, Burgess said, is that the federal Financial Crimes and Enforcement Network issued a memo allowing banks to serve state-approved canna-businesses – so it’s not federal policy keeping the banks away from serving the industry, so much as the banks themselves. (Banks mentioned by the those interviewed for this story were contacted and none returned requests for comment.)

“People start a CBD business and believe they can go to their local bank and they can’t,” Burgess said in an interview. “So, there are a number of banks across the country, but they don’t advertise, and they don’t want to be rushed. They tend to want to keep it lowkey, so they prefer partnerships like ours.”

Jonathan Miller, general counsel for Kentucky-based industry association Hemp Roundtable, said it’s a “difficult time” for the industry as it related to financial services, which he called “the biggest challenge in the industry right now.”

“The law, we believe, is clear that since the [Farm Bill] that hemp and CBD are no longer controlled substances,” he said in an interview. “There should be no concern whatsoever that there would be violations of federal law to engage in commerce. … Unfortunately, there is a lot of misinformation – it’s banks, it’s credit card companies, it’s merchant services that have been refusing to do business with these hemp and CBD companies.”

In Kentucky, which has neither medical nor recreational cannabis programs but its hemp industry receives strong support from the likes of Sen. Mitch McConnel and Agriculture Commissioner Ryan Quarles, Miller said the industry faces the same setbacks as some places throughout the country which might not be as pro-hemp.

Miller explained that in his role as counsel for Kentucky hemp companies, he gets “a call-a-day” by farmers and business owners who can’t access financial services. He said he calls the companies directly to encourage them to provide services to the sector.

“We’re trying on every front to handle this issue because it really is impinging on commerce in this, very legal, area,” he said.

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California Court: Cannabis Possession In Prison Not a Felony

6/12/2019

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The California Court of Appeals for the Third Appellate District has overturned the convictions of five men for possessing cannabis while in prison, according to a Courthouse News report. While the ruling effectively legalizes cannabis possession in prison by inmates in California, smoking or ingesting cannabis while incarcerated is still a felony and prisons are still allowed to ban it.

“According to the plain language of Health and Safety Code section 11362.1, enacted as part of Proposition 64, possession of less than an ounce of cannabis in prison is no longer a felony. Smoking or ingesting cannabis in prison remains a felony and prison regulations forbid possession.” – Justice Vance W. Raye, The People v. Goldy Raybon

Prosecutors in the case had attempted to argue that because consumption remains illegal that possession is also illegal; however, Raye contended that “argument flies in the face of the plain language of the statute and common sense.”

The defendants in the case were only charged with possession of cannabis and not accused of consuming or smuggling it into the prison. Decriminalization under Proposition 64 preempts conflicting statutes, the court ruled, including the 1949 law that bans “illicit substances” from prisons – and cannabis is no longer an illicit substance in the state.

The court called back to a 2006 case, People v. Harris, when the defendant was accused of smuggling in cannabis-infused wafers and olive oil when he surrendered to authorities for an unrelated crime. In that case, the court ruled that Harris was a qualified medical cannabis patient in the state and had a right to possess the products.

However, neither the Harris ruling nor the Raybon ruling change prison regulations regarding cannabis possession in prisons.

“Just because the electorate no longer characterizes possession of small amounts of cannabis as felonious conduct does not preclude prison authorities from banning possession to maintain order and safety in the prisons and other penal institutions,” Raye wrote.

Associate Justices Ronald B. Robie and M. Kathleen Butz concurred with the decision.

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Oregon Legislature Passes Cannabis Export Bill

6/12/2019

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The Oregon Legislature has passed a bill allowing cannabis to be exported to bordering states with legal cannabis programs, Oregon Public Broadcasting reports. The measure passed the Senate 19-9 last month and the House yesterday by a 43-16 margin.

The bill includes one looming restriction – it requires federal government approval before cross-state sales can commence. Under the law, Oregon companies would be able to export their products to Washington state, California, and Nevada, which have all legalized cannabis for recreational use.

State Rep. Ken Helm (D), said that Oregon Democratic Sen. Ron Wyden has already drafted federal legislation for the state to get the permission required under the bill to begin exporting cannabis products to its neighbors.

“This is another instance in which Oregon can be a leader and be poised to take advantage of rational rules around the cannabis market,” Helm said in an OPB interview.

Republican state Rep. Carl Wilson called the measure a “strategic business approach.”

“It correctly assesses the industry’s strengths and foresees a time when export turns Oregon’s oversupply in a constrained market into a traded commodity in a national marketplace.” – Wilson, via OPB

Two years ago, the state passed a law forbidding cannabis exporting or importing. Nevada’s adult-use law prohibits importing of cannabis products and California’s law doesn’t “authorize or permit a licensee to transport or distribute, or cause to be transported or distributed, marijuana or marijuana products outside the state, unless authorized by federal law.”

A February report by the Oregon Liquor Control Commission found that the state has 6.5 years of cannabis oversupply based on current demand. Last month, the House passed legislation to implement a two-year moratorium on cannabis licensing due to the OLCC findings. That bill has yet to be considered by the Senate.

The export bill moves next to Gov. Kate Brown (D) for her signature.

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Australian Researchers to Study CBD for PTSD

6/12/2019

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Researchers in Australia are set to study the efficacy of CBD as a treatment for veterans suffering from post-traumatic stress disorder, the Australian Broadcasting Corporation reports. The year-long trials will be conducted in coordination with Cannabis Access Clinics and health and wellness firm BOD Australia.

The researchers hope to enroll 300 veterans for the trial. Lead researcher Dr. Sharron Davis said that traditional treatments do not always work for PTSD and the researchers must be able to show the Therapeutic Goods Administration that the study participants “have tried everything conventional medicine has to offer.”

“I would like to see CBD-only oil reclassified — it has no psychoactive effects whatsoever.” – Davis, to ABC

BOD Australia spokesperson Jo Patterson indicated participants could start with a dose for 5 milliliters and “might be on the product for up to five weeks,” noting it’s “an observational trial” and participants will “assess the benefits” of the CBD oil.

According to the report, the Australian Defence Force reports about 8.3 percent of its members have experienced PTSD in the past year and the rate of PTSD among males in the armed forces is almost double the general Australian population.

In the U.S., 26 of 33 states with medical cannabis programs include PTSD as a qualifying condition. The American Legion, a veterans organization, supports allowing veterans to access medical cannabis programs; however, Veterans Affairs does not allow veterans in its care to use medical cannabis. Two years ago, Congressional leaders blocked reforms that would have allowed veterans to enroll in medical cannabis programs.

In 2017, the Colorado Department of Public Health and Environment awarded a $2.2 million grant to the Multidisciplinary Association for Psychedelic Studies to study the efficacy of cannabis for PTSD. That study is being conducted by researchers at the University of Colorado, University of Pennsylvania, and the Scottsdale Research Institute in Phoenix, Arizona.

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New Alabama Law Establishes Committee to Consider MMJ

6/12/2019

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Alabama Gov. Kay Ivey (R) has signed SB 236, also known as the “CARE Act,” which stops short of legalizing medical cannabis but creates a fifteen-person commission of doctors, legislators, and other governor appointees to study medical cannabis legalization in the state.

The CARE Act Commission must present draft legislation for the 2020 session by December 1, 2019. In addition, the CARE Act extends Carly’s Law, the groundbreaking 2015 law that authorizes the University of Alabama at Birmingham to study high CBD oil and intractable seizure disorders.

Rep. Mike Ball (D-Birmingham) thinks most Alabamians won’t notice the change in law but believes it will eventually help Alabamians who need access to medical cannabis.

“I don’t think the public would notice it that other than people who have these cards and go to doctors who treat for that would be able to do that instead of some of the others drugs that they’re being given.” — Rep. Mike Ball (D-Birmingham), via WHNT.

Earlier this year, lawmakers shot down a proposal to expand the state’s extremely limited medical cannabis law.

If Alabama approves a medical cannabis law in 2020, they would become the 34th state, plus Washington D.C., to adopt a statewide medical cannabis system and would join only a handful of other states in the Deep South that have embraced such reforms.

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Purple Rose Supply Cannagar Mold Review

6/11/2019

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Smoking marijuana in rolled form has always been a reliable method of getting high, especially in social settings, and the blunt offers a potent and generous toke. I still think fondly of splitting Garcia y Vega cigars, removing the guts, and then smothering honey over the paper before filling it back up with brick weed and drying it with a lighter. While the tobacco leaf is not for everyone, it certainly offers a distinct experience that many enjoy.

One of the classier and more modern forms of the blunt is the cannagar, or cannabis cigar, which are a slow-burning and long-lasting option. The folks at Purple Rose Supply have come up with a line of products to help consumers easily roll their own custom cigars at an affordable price. If you don’t have access to fresh marijuana leaves or do not like cigar papers/wraps, they offer pre-rolled “shells” made from hemp leaves and hemp pulp to make the process simple and easy.

What’s in the box?

We were sent the G2 small cannamold with an additional shell stored in a cigar tube. The kit is packaged in a cardboard case with foam and comes with the mold, a packing tool, bamboo skewers, a wooden mouthpiece, and an easy-to-understand instructions sheet all arriving in a purple tote bag.

They currently sell four molding kits in three different sizes. The kits start at $44 retail and the hemp shell was $20 for a size small.

The rolling process

I began by latching the mold together and inserting a skewer through the hole in the bottom. The latches on the mold and the mold itself felt well-constructed and look like it would last a long time. I ground up 4 grams of flower and slowly filled the mold shaft using the packing tool. In a few minutes, I had packed the mold to the top and set it aside to cure for a couple of days (the minimum is least 3 hours).

After the wait, I opened the mold and popped out a well-molded cigar core. After removing the skewer, I inserted the core of flower into the shell, attached the mouthpiece, and admired the nicely rolled cannagar that was ready to smoke.

Enjoying the final product

The cannagar burned evenly, packing a hot and heavy punch, and ended up lasting for quite a while.

I found the kit to work well and the mouthpiece effective for heat displacement. For those looking for a classy way to spruce up a gathering, or for those occasions where something special is needed, the Purple Rose Cannamold is worth checking out.

For more information on Purple Rose Supply or to order their products, visit www.purplerosesupply.com or find them on social media @purplerosesupply.

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Harborside Goes Public on Canadian Securities Exchange

6/11/2019

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California cannabis company Harborside Inc., has gone public on the Canadian Securities Exchange following a reverse takeover involving FLRish and Lineage Grow Company Ltd, the company announced on Monday. Harborside operates a cultivation facility in Salinas and dispensaries in Oakland and San Jose, along with Terpene Station dispensaries in Portland and Eugene, Oregon.

Andrew Berman, CEO of Harborside, called the move “a very big milestone” for both his 12-year-old company and the cannabis industry.

“It’s extremely rewarding to combine this rich legacy with the opportunity for new growth capital from the public markets,” he said in a statement.

The reverse merger with Lineage was valued at about $150 million, according to a CNN report. Over the past 12 years, the company’s Bay Area dispensaries had over $300 million in sales. Last year, Harborside reported about $38 million, according to the filing.

Steve DeAngelo, who co-founded Harborside as a medical cannabis dispensary in 2006 and serves as its chairman emeritus, told CNN that the company going public “marks a very important milestone in the growth of the cannabis industry.”

“When you have an organization like Harborside that came from deep activist roots and was engaged in that activism in a very intense way, and now has been able to transition into a profit-making cannabis company that’s going to be valued at $300 million Canadian, is a tremendous validation.” – DeAngelo, via CNN

The company has agreements for two more dispensaries in San Leandro and Desert Hot Springs, along with agreements to purchase the 43,000-plus cultivation facility of Agris Farms in Yolo County, and a LUX dispensary in San Jose.

According to CSE CEO Richard Carleton, 170 cannabis firms are trading on the CSE and about 40 percent have material operations in the U.S. In 2018, U.S. cannabis companies raised $3.2 billion and have, so far, raised $1 billion this year.

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UC Riverside to Study Cannabis Impact on Metabolic Disorders

6/11/2019

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The University of California, Riverside School of Medicine has received a $744,000 grant to research the impact of long-term cannabis use on metabolic disorders, such as Type 2 diabetes. The grant is from the Tobacco-related Disease Research program administered by the UC Office of the President.

Nicholas V. DiPatrizio, an assistant professor of biomedical sciences, said the study will investigate how cannabis affects the equilibrium of glucose in health and disease. He indicated that there is a lack of research on how chronic cannabis use affects health “and a variety of tobacco-related pathologies such as Type 2 diabetes, and other metabolic diseases.”

“We will investigate in wild-type mice whether cannabis exposure is linked to higher incidence of Type 2 diabetes. We expect the knowledge we will gain in this project will help guide science-based public policy associated with the health impact of short-term and long-term cannabis use.” – DiPatrizio, in a statement

DiPatrizio noted that while short-term cannabis use often leads to an increase in eating, long-term use is, paradoxically, linked to lower body weights along with improvements in some metabolic parameters such as “good cholesterol.”

The study will look at “how important the endocannabinoid system … is for maintaining glucose homeostasis and if cannabis deregulates” the process, he said.

Outlining the project, DiPatrizio said the control group of mice will be fed a normal diet and remain lean while the rest of the group will be put on a Western diet – high in fat and sugar – to turn them obese. The team will then explore whether giving the obese mice THC extracts will make them leaner and improve their metabolism.

“We expect to find the endocannabinoid system in the small intestines of the lean mice controls incretin release and glucose homeostasis,” he explained. “Further, we suspect the endocannabinoid system becomes dysregulated in the obese mice and participates in cannabis-induced changes in metabolic function.”

The three-year grant is the first for UC Riverside for cannabis-related research and requires Schedule I licensing from the Drug Enforcement Agency.

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Understanding the Cannabis Light Cycle to Improve Yield

6/11/2019

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The most important part of growing cannabis is getting a favorable yield that brings smiles and profit when it’s time to harvest. Growing cannabis, however, can sometimes be challenging for beginners. The success of your marijuana grow frequently depends on one crucial factor: lighting.

Lighting is crucial when you are growing your cannabis, whether indoor or outdoor. The light cycle you use for flowering cannabis directly correlates to a crop’s quality and overall yield. Yes, you need light to grow your cannabis, and here is what you need to know about the cannabis plant light cycle.

There are two stages of cannabis growth where it is important to strategically monitor your light cycles. These are:

  1.  The vegetative stage
  2.  The flowering stage

The Vegetative Stage Light Cycle

This is the stage where your plants are growing. This stage is very vital for the success and health of your cannabis plant. At this stage, the stems and leaves of the marijuana plants start growing larger and taller. However, also at this stage, the cannabis plant doesn’t produce any buds and you will have to control the shape and size of your plant. That is where the cannabis light cycle comes in: the light for your plants can be manipulated at this stage to yield better growth. The more lighting your cannabis plant receives, the better their growth and future yield.

When marijuana plants are in the vegetative stage, keep them under a minimum of 18 hours of growing light (also known as 18/6). But if you are one of those growers that would like their plant to grow as big as possible, then you may keep them under 24 hour (24/0) indoor light.

Cannabis plants don’t start developing flowers until they start receiving 12 hours of continuous darkness. Otherwise, they will continue to remain in the vegetative stage. As long as your cannabis plants are getting about 13 hours of light (or more) every day, you can keep your plants in this stage forever.

Indoor Vegetative Stage

Note that while in the vegetative stage, light is not the only means of growing large cannabis plants. If you are growing your plants indoors, you will need a well maintained grow room with a high ceiling.

Also, it’s important to note that certain cannabis strains (like Northern Lights and Jack Herer, for example) grow higher yielding crops even without such manipulations.

Outdoor Vegetative Stage

Typically, most growers would start their cannabis plants indoors under lights before moving them outside to grow under the sun. Most growers would usually start either cutting clones or starting seeds during March or April, and would keep them under 18 to 24 hours of constant light before moving them outside in the early period of May or June.

So, if you have plans to grow your cannabis outside, it can be helpful to first keep them inside until all forms of danger like frost, for example, have passed. A sudden drop in temperature or a late spring snowfall can kill your cannabis crop outright.

But, once such risks are over, your plants will be in vegetative stage outdoor from the late period of spring down to late summer.

The Flowering Stage Light Cycle

For your plants to move from their vegetative stage to the flowering stage, they will need to be exposed to 12 or more hours of darkness each day to start flowering.

Flowering Indoor Cannabis

Most growers that grow their plants indoors begins from the point of 12 hours of darkness immediately the plants have reached the desired size and shape during their vegetative stage. Usually, most growers prefer an indoor vegetative period of 4-8 weeks under a 24/0 or 18/6 light period.

To grow cannabis successfully indoor, you need to mimic the natural growth pattern. When you grow your cannabis outdoor, they start to develop buds (flowers) as the days gets shorter, and they receive a minimum of 12 hours of complete darkness. To do this, just switch your light usage from 18 to 24 hours of good sunlight daily down to 12 hours of light and also of 12 hours of darkness for the cannabis life cycle.

Flowering Outdoor Cannabis

If you have plans to grow your plants outdoors, allow nature to take its course. During this time period, the cannabis plants will start to produce flowers naturally on their own, which usually happens after the 21st of June, as the days start getting shorter.  

Of course, the plants will not stop growing or developing flowers at this particular instance. On average, the plants start doubling up in height and shape after they begin the flowering stage — this is true for both indoor and outdoor plants. However, make sure your cannabis plants are NOT exposed to light during the 12 hours they are supposed to be in darkness. Take care: floodlights and even street lights can seriously disrupt the flowering period.

Scheduling Your Light Cycles for Maximum Yield

Are you planning to grow your cannabis indoor or outdoor? It is crucial you understand light cycles for cannabis seedlings so you can define the best light schedule for your crop. If you can follow up with a beautiful lighting plan, you will get maximum yield during harvest.

If you are growing your cannabis plant indoors and you do not have any issue with room height or space, then you should allow your plant to remain under 24/0 or 18/6 light schedule during the vegetative stage. This should last for 60 days, which is the best time to grow more flowers.

On the other hand, if you plan to grow outdoor, your light cycle for flowering cannabis should also be scheduled for 18/6 or 24/0, but you will want to first keep them inside until all unfavorable conditions like freezing temperatures and frost have passed. After that, you can safely bring them out and allow them to grow and flourish naturally under the open atmosphere, relying on the sun’s natural light cycle.

From the moment you have successfully crossed the vegetative stage of your cannabis plants, from 3 to 6 months, get ready to reap a bountiful harvest from your seedling efforts.

Final Thought

There are a whole lot of benefits to growing your own cannabis. However, you can only get the best harvest and therefore the most benefit from homegrown cannabis by knowing the various light cycles involved during the planting and growing of your crop.

You will have to do some experimenting to get truly familiar with the cannabis light cycles we have discussed. If you are cannabis cultivation newbie, however, you can stick to the tips above and rest assured that you will find success along the way.

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New York Farm Bureau Backs Adult-Use Bill

6/11/2019

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The New York Farm Bureau on Monday endorsed cannabis legalization in the state, calling the reforms a “potential opportunity” for the state’s agricultural industry, according to a Democrat and Chronicle report. The memorandum of support points out that the legislation being considered by lawmakers gives farmers priority consideration for cultivation licenses.

“For a successful implementation of a cannabis program in New York State, if legalized, farmers must have an active role in the growth and production, as well as development and implementation of the recreational cannabis program.” — New York farm Bureau, June 10 memo of support

The memo notes that there has been a 6 percent drop in the state’s farms since 2012 accompanied by a 9 percent increase in labor costs for farmers, along with a lower average net income for the sector compared to the rest of the nation.

The memo was met with opposition from cannabis opposition group Smart Approaches to Marijuana, whose president Kevin Sabet said the bureau had “fallen prey to one of the biggest lies pushed by Big Marijuana” – that a retail cannabis industry will help the state’s lagging economy.

“This industry isn’t about helping small family farms,” Sabet said in a statement to the Democrat and Chronicle. “It’s about investors, backed by Big Tobacco, Wall Street and the alcohol industry, getting rich off high-potency THC products like waxes, gummy bears, and edibles.”

According to a LoHud report, SAM has spent $10,000 on anti-cannabis billboards and $14,500 on anti-legalization lobbying efforts this session.

The memo comes on the heels of a Sienna College poll that found 55 percent of New York supports legalization.

Pro-legalization lawmakers are pushing for the reforms as the state’s session winds down. A June 5 Democrat and Chronicle report found 30 Senate Democrats support the measure, which needs 32 votes to pass the chamber. Assembly Majority Leader Crystal Peoples-Stokes told the Democrat and Chronicle that she believes that there are enough votes in the chamber to pass the bill.

In New York, Democrats control both legislative chambers and the governor’s office. Gov. Andrew Cuomo had included legalization in his budget plans and has indicated he would sign the legalization legislation if it received legislative approval. The state session adjourns June 19.

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Jay Burns: Cannabis Testing and Analytics

6/10/2019

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In this written Q&A, we ask Jay about his experience during Washington’s transition to a legal market, what it’s like doing the day-to-day work of a cannabis testing lab, what advice he has for entrepreneurs in the space, and more!

Scroll down to read the full interview.

Ganjapreneur: We’re rapidly approaching the five-year anniversary for Washington’s state-legal cannabis market. How would you say things are going, so far?

Jay Burns: Overall, I would give it a C+. Taking out the criminal penalties has been a big win for everyone, and with that alone, it’s been a great success from a social justice point of view.

The growth of the Washington market has been great for consumers, too. They have so many product choices now, most of which are good quality and relatively inexpensive. Retailers also seem to be doing well, while producers and processors are having a harder time. Some big farms are doing well, too, but the smaller ones are struggling because the wholesale price is so low. Testing labs, along with the rest of the industry, are dealing with changing regulations and always have to be prepared for more changes in the future. Government regulations need to shift away from a punitive mentality to more of a management mentality.

Looking forward, what major changes — legislative or otherwise — do you see on the horizon for the I-502 marketplace?

We anticipate that some form of pesticide testing, and possibly heavy metal testing, will soon be mandated in Washington state, but it’s still unclear what this will look like. The biggest issue here is the fact that science has not yet caught up with the needs of the industry. Cannabis is a difficult matrix to analyze, and it isn’t yet clear if similar testing methods from other industries will work. Nor is it clear if actions, limits and regulations on pesticide usage are applicable to cannabis production.

We need to get off the “potency system” where cannabinoid concentration drives the price. This will benefit everyone. I also think we will eventually see a shift to more environmentally friendly production. Right now, everyone is trying to produce however they can and with what they know. But there will be a movement among some in the cannabis industry to practice more awareness of the impact growers and the entire industry have. For instance, transporting product around for QA samples requires energy and fuel – bringing up geographical questions like should sellers and producers set up shop in or around the same location? These and other environmentally based issues will start to come to the forefront in the next few years.

Another change we anticipate is the legalization of CBD. Again, it’s unclear how this will be regulated, what tests will be required, or how it may cross over with the current cannabis market.

What would you say are the top misconceptions about working in cannabis? How about specifically for running a cannabis testing lab?

One of the biggest misconceptions we hear is that labs like ours test the product by using the product. Seriously. This is a frequent comment from the general public. Sometimes in jest, sometimes not. So let me put this one to bed, this is not the case…in our lab at least!

There is also an idea among some that the analytical process is some easy system where we put the sample in a box and all the numbers pop out. I can assure you, it is far more complicated than that and involves many steps and different instruments.

Another misconception comes from customers themselves, many of whom often blame us when they get results they don’t like. Somehow, we are responsible for their low cannabinoids or high bacteria counts. Go figure.

Additionally, customers will sometimes provide unusual or unique products for testing. They can be made of compounds that are difficult to extract or that may cause interference with our analytical process. They’re often unwilling to let us know what’s in the product, to protect proprietary info potentially, but this makes it very difficult for our lab to provide accurate data.

From the beginning, the standardization of consumer product testing has been a big topic for the industry — how has that discussion changed in the last five years, and what action(s) have you or the industry as a whole taken to improve the testing process?

There is talk about standardization from labs and regulators, however, very little progress has been made. The AOAC recently released new testing methods, but they’re not easily accessible and haven’t been tested in a real world setting yet.

Even after five years, there is still no real collaboration among labs to help work through the issues of standardization. The focus is directed more toward competition than cooperation. The Washington Department of Ecology is supposed to be working on standardizing methods, but this could take up to four or five years. It’s unclear at this point how much the industry will be involved, but there has been no mention yet of creating workgroups.

Another big hold up to standardization within the industry is the lack of federal regulation. This would advance much more quickly if non-industry scientists and academics got involved from a research perspective. The industry needs better “basic” research to support ongoing “applied” research. Basic research leads to a better understanding of plant and products without the bias of those trying to sell it. It will also lead to different questions being asked and different methods of answering those questions. Plus, research done by academia will be shared with everyone. Now, most research is proprietary.

What has been the most rewarding part of the last five years, for you?

For me personally, it was getting the lab started. Going through all the initial validation of our methods and audits to get approval. It was hard work and took a lot of time, but it felt really good to get it done.

Overall, it’s been very professionally satisfying to participate in the cannabis industry. I’ve welcomed the opportunity to utilize my training and experience in science, policy and education through my work with Treeline Analytics.

What has been the most challenging obstacle so far for you and/or your company?

There have and continue to be many obstacles in this business. To name a few – hostile competition and regulators; labs stabbing each other in the back; regulators taking a punitive approach instead of cooperation; and regulators’ lack of science literacy. Another obstacle for us is fighting all the misinformation that exists. For example: labs don’t do work; we’re responsible for “bad” results; labs are all dishonest.

Labs like ours actually work really hard to produce accurate results. Our processes are very tightly regulated, both legally and by scientific principles. But regulators often ignore these processes because they are unfamiliar with the complexities of science.

The social landscape can also be tricky to navigate. It’s hard to tell who is real, or who is just a lab group in disguise.

It can be hard to balance the maintenance of a healthy industry with protecting public health. Knowing that over-regulation is already stifling for some industry participants, would you suggest further changes to help protect consumers?

In theory, some regulations have the best intentions to protect consumer safety but in practice, they put too much burden on the industry. For example, the WSLCB is currently proposing a new regulation that would require pesticide and heavy metal testing on cannabis products before they reach the retail level. But in our opinion, this type of testing on all intermediate and final products is unnecessary. The protection of public health could be achieved more efficiently, both financially and practically, by the random sampling of producers and processors at the farm level, along with the random sampling of packaged product.

Furthermore, the industry needs to improve how its QA samples are collected in order to be truly representative of lot size. The sampling of 4 grams from a 10-pound lot will produce a QA sample that is statistically insignificant for the protection of the public. Due to analytical error, sampling error and natural variation of the cannabis plant, lot size should be reduced from the current 5-pound limit in order to achieve a truly representative and accurate result.

With so many of Washington’s producers focusing on indoor crops, is there much effort to emphasize sustainability in the industry and are there any regulations that address these concerns?

No, there aren’t any regulations that address these concerns yet. But there should be more effort made to prioritize environmental protection in how cannabis crops are grown, both indoors and outdoors. For example, regulation of waste, energy used via grow lights, and even the use of pesticides and how that may enter the ecosystem are all sustainability issues that should be considered, regardless of where or how the crop is grown.

Do you have any advice for entrepreneurs or investors who are looking at getting involved in the cannabis industry?

Think twice. But if you’re really serious about this business, be sure to do your due diligence. Learn the legal landscape and consider any pending or future changes that could take effect. Learn the market. Try to find areas that have not been over-produced.

What advice would you offer students or lab scientists who hope to find work in a cannabis testing lab?

There are plenty of opportunities to work in a cannabis testing lab, you just have to take it seriously. Create a real resume. Sell your skills. Familiarize yourself with the different areas you might want to go into, from sample prep to microbiology to high level chemistry. While the cannabis industry is still fairly new, it’s like any other industry or job. So most importantly, always be professional.

Thanks, Jay, for sharing your insights and experience with Washington’s industry! You can visit TreelineAnalytics.com to learn more about the lab and the cannabis testing process.

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Kroger Launches CBD Sales In 17 States

6/10/2019

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Cincinnati, Ohio-based grocery store chain Kroger Co. is now selling CBD-infused topicals in its stores in 17 states, the Detroit News reports. The company joins other traditional retailers, such as Walgreens, CVS, Walmart and even Family Video in offering CBD products following the passage of last year’s federal farm bill.

In Michigan, the products will be available at 92 of Kroger’s 120 stores. Rachel Hurst, corporate affairs manager for Kroger’s Michigan division, told the News that the company started carrying the products due to its “promising benefits” and its legality “within federal and state regulations.”

The company is sticking to topicals since the Food and Drug Administration has yet to approve adding CBD to dietary supplements, cosmetics, and food additives. Jennifer Holton, communications director for the Michigan Department of Agriculture & Rural Department, clarified that it remains against state regulations to add CBD to food, drink, and animal feed due to the FDA ban.

“Once you’re taking the oil and putting it into something, it makes it a food or feed additive. That’s not allowed at this point.” – Holton, via Detroit News

The FDA did hold its first public hearing about CBD on May 31; however, no decisions were made, and the FDA has offered no further guidance. A statement on the FDA website indicates that the agency “considers many factors in deciding whether or not to initiate an enforcement action.” The statement says those factors include “agency resources and the threat to the public health.”

“FDA also may consult with its federal and state partners in making decisions about whether to initiate a federal enforcement action,” the July 13, 2016 statement says.

A February survey by Cowen & Co. found that about 7 percent of Americans are already using some form of CBD. The firm estimates that 10 percent of U.S. adults will be CBD consumers by 2025.

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Poll: Majority of New Yorkers Support Legalization

6/10/2019

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A Sienna College poll has found the majority of New Yorkers back cannabis legalization in the state by a 55 percent to 40 percent margin, up from 52 percent to 42 percent in April. The poll comes as the state’s session nears its end and some lawmakers are coordinating a final push to pass the reforms.

The poll found Democrats overwhelmingly support legalization, 61 percent to 34 percent – which remains virtually unchanged from their April poll. Independents also support legalization 57 percent to 41 percent.

Republicans oppose the reforms 53 percent to 40 percent but opposition appears to have diminished since Sienna’s April polling, which found Republicans opposed legalization 64 percent to 33 percent.

Young voters — those under 32-years-old — strongly supported legalization 75 percent to 23 percent, while voters 55-and-older oppose it 54 percent to 42 percent.

Democratic Gov. Andrew Cuomo included legalization in his 2021 Executive Budget but it was pulled from the plan after key lawmakers told the governor they would prefer to pass the reforms via the legislative process.

Late last month, lawmakers amended the cannabis legalization bill to make it more palatable to the governor – whose party controls both legislative chambers – including raising taxes, lowering possession limits, and expunging records for low-level cannabis-related crimes.

As the legislature pushes to pass the bill before the June 19 adjournment, Smart Approaches to Marijuana, an anti-cannabis group, has spent $10,000 on billboards in the state rallying against the plan and $14,500 on lobbying efforts, according to a LoHud report.

If lawmakers do pass the legalization measure before the end of session, New York would become just the second state to approve a taxed-and-regulated cannabis industry via the legislative process. Illinois became the first last month.

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Oregon House Passes Expungement Reforms

6/10/2019

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The Oregon House has passed a measure to make expunging low-level cannabis crimes easier, including removing all fees associated with the process and lowering the identification requirement thresholds, the Corvallis Advocate reports.

The measure, which passed 41-16, removes the requirements for fingerprinting and undergoing background checks for expunging cannabis-related records.

The bill does allow prosecuting attorneys the opportunity to contest an expungement “if the office believes the person’s conviction is not for an offense eligible for a set aside,” according to legislative documents.

The legislature initially passed expungement laws in 2014 but there is no available data on how many charges have been sealed in the state under the regime.

In neighboring Washington state, an expungement bill passed in April is expected to clear about 69,000 criminal records. Some California officials, meanwhile, have used an algorithm to speed up the expungement process for as many as 50,000 old cannabis charges.

Expungement has become a key issue in the legalization conversation nationwide; language for overturning cannabis convictions was included in the cannabis legalization bill passed by Illinois lawmakers last month. In other states, such as New York and New Jersey — where lawmakers are currently considering cannabis legalization bills — expungement language has been included in the proposals.

The Oregon Senate is expected to vote on the bill on June 30.

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New Mexico Adds Opioid Addiction to MMJ Program

6/07/2019

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New Mexico Health Secretary Kathy Kunkel has approved six new qualifying conditions to the state’s medical cannabis list, including opioid addiction, Alzheimer’s disease, and autism, the state Department of Health announced on Thursday.

The addition of opioid use disorder comes nearly two years after former Health Secretary Lynn Gallagher first rejected the recommendation and former Gov. Susana Martinez vetoed legislation to add the condition to the qualifying conditions list.

Gallagher, again, declined to add opioid use disorder to the program last year.

Officials also added three neurological disorders to the regime – including spinal muscular atrophy, Friederich’s ataxia, and Lewy body disease – bringing the total number of qualifying conditions for the state program to 28.

According to the report, Gov. Lujan Grisham (D) had directed state health officials to add the disorder to the medical cannabis qualifying list during her January State of the State address.

“We need to explore and pursue every available means of responding to the health and wellness needs of our neighbors here in New Mexico. Compassion must guide our decision-making. Today marks an important and long-overdue step forward after too many years of status quo.” – Gov. Grisham in a statement

The state Medical Cannabis Advisory Board voted to add opioid use disorder to the list in March while the other conditions were hold-overs from the Martinez administration. A 2017 study by the University of New Mexico found that 34 percent of chronic pain patients enrolled in the medical cannabis program were able to quit using all prescription medication by the last six months of the two-year study.

According to Health Department figures, as of May there were 73,350 registered patients in the state.

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Minnesota Hemp Farmer Suing State Over Cease-and-Desist Letter

6/07/2019

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A Minnesota industrial hemp farmer is suing the state arguing that the Department of Agriculture violated his constitutional rights by revoking his hemp cultivation permit and ordering that he destroy his crops, according to a Minnesota Public Radio report.

A May 1 letter from the Agriculture Department to hemp cultivator Luis Hummel claims that Fillmore County Sheriff’s pulled over an individual with hemp from Hummel’s 5th Sun Gardens that exceeded the 0.3 percent THC threshold to be considered hemp.

“MDA is revoking your license from the Pilot Project Program and revoking your industrial hemp license for one year,” the letter says, according to the report. “As a result, you are no longer in the pilot program, and must immediately destroy all viable propagative plant material.”

Hummel contends that the individual wasn’t arrested for cannabis possession, and he was never contacted by law enforcement or given any further information regarding the stop or given a test showing that the products were above the threshold.

“They haven’t given us due process, so we will sue them for everything they have if they destroy our property. You’re not supposed to be able to deprive me of life and liberty or property without a fair trial. Why do they think they are above the law?” – Hummel, to MPR

The state’s hemp pilot program requires hemp crops to be laboratory tested for THC content within 30 days of harvest. Hummel indicated he has been “very transparent” with Agriculture officials and has provided them “a lot of information that no one else is giving them.” Hummel estimates his business is worth at least $3.5 million.

The Agriculture Department declined to comment to MPR because the litigation is still pending. Hummel said no one has come to take his plants, likely because the case is pending in federal court.

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The Delaware statehouse in Dover, Delaware.

Delaware House Committee Advances Adult-Use Bill

6/07/2019

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Delaware’s House Revenue and Finance Committee has approved a recreational cannabis bill, moving it to the full chamber for consideration, according to a Delaware State News report. A similar proposal failed in the chamber by just four votes last session.

The measure would set up a taxed-and-regulated market but would not allow home growing. It includes a 15 percent sales tax – and, because it would implement a new tax, the bill would need a three-fifths supermajority, 25 votes, to pass.

It would initially license 15 retail stores within 16 months of the bill’s effective date. Medical dispensaries would also be able to sell to non-patients if there is a sufficient supply. Recreational customers would be able to purchase up to one ounce. The measure includes municipal control, allowing communities to ban industry operations. Much like alcohol sales in the state, cannabis sales would only be allowed during certain hours and industry oversight would be the responsibility of the Division of Alcohol and Tobacco Enforcement.

Last year’s bill estimated that the state would see revenues between $9 million and $50 million from legal cannabis sales, but due to changes in this year’s version, it’s unclear how much the state could expect from cannabis-derived taxes and fees. A legalization task force widened that revenue estimate to between $9 million and $70 million.

Attorney General Kathy Jennings, a Democrat, supports legalization. Democratic Gov. John Carney does not. Last month a spokesperson for Carney told the State News that the governor “does not believe [Delaware] should move forward” with the proposal; following the committee approval, a spokesperson told the State News that Carney believes the state “should continue to monitor progress in other states that have legalized.”

Republican state Rep. Jeff Spiegelman, who voted to move the bill out of the committee, said he would not support the measure is it didn’t include some changes, including employer protection. Democratic state Rep. Ed Osienski, the bill’s main sponsor, indicated he was willing to amend the legislation so long as the intent remains intact.

Delaware decriminalized cannabis in 2015 and Carney signed an expungement bill for low-level cannabis offenses in September.

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Seattle Hempfest Sues Washington Liquor & Cannabis Board

6/07/2019

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Seattle Hempfest’s parent company, Seattle Events, and two licensed businesses are suing the Washington State Liquor Control board (WSLCB), contending the state legislature and WSLCB violated their first amendment rights.

The lawsuit stems from SB 5131, passed in 2017, and the WSLCB’s subsequent interpretation of state regulations. According to the Hempfest press release, the WSLCB issued Bulletin 19-01, interpreting the 2017 legislation in respect to “signs,” essentially barring cannabis retailers from displaying signs with the business name, or literature discussing cannabis science or potential cannabis public policy reforms.

“We believe that the new interpretation of Washington State’s I-502 ad guidelines are so overreaching and restrictive as to be unconstitutional,” said Vivian McPeak, Hempfest’s longtime director.

“It is imperative that Washingtonians have access it accurate and up to date information regarding the cannabis products they purchase and consume, and that those citizens and others are able to identify the source of that information. Businesses engaged in the cannabis industry in Washington State should also have the legal right to publicly show their support for political issues and causes of their choosing. The WSLCB’s interpretation of our state’s ad restrictions prevent businesses from doing so.” — McPeak, in the press release

The United States Supreme Court has a mixed record of protecting free speech in advertising. In the case Posadas de Puerto Rico v. Tourism Company, Puerto Rico banned gambling advertising for Puerto Rico citizens. The Court upheld the ban on the argument that if Puerto Rico could ban gambling, they could ban gambling advertising as well. Another case, United States v. Edge Broadcasting, involving lottery advertisements over state lines, said so-called “vice products” were not protected under the Constitution and therefore neither is advertising for said products. 

Other cases, however — like 44 Liquormart v. Rhode Island and Lorillard Tobacco Co. v. Reilly — uphold a business’ right to advertise more regulated products such as tobacco and alcohol.

 

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Study: Cannabis Consumers Seeking Relief, Not Just High

6/06/2019

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If cannabis were legalized nationwide in the U.S., the majority of consumers would use it to treat some sort of ailment, according to a recent Nielsen survey.

Eighty-five percent of survey respondents indicated they would use cannabis products to treat chronic pain, followed by 82 percent who said they would use it to improve mental health. 81 percent indicated it helps with minor injuries and 77 percent said they would use cannabis as a sleep aid.

Another 74 percent indicated they would use cannabis for recreational purposes, specifically relaxing, while 48 percent responded that they would use cannabis “to have a good time with friends and family,” and 46 percent said they would consume cannabis to enhance experiences and entertainment at home.

The U.S. Consumer Research Study also found that 88 percent of cannabis-interested adults suffer from headaches and migraines and actively use an over-the-counter or prescription medication for treatment. Another 64 percent suffer from back and neck pain, 63 percent from arthritis pain, and 61 percent from feminine pain.

“Seventy percent of adults who are interested in cannabis and who today treat their ailment with OTC/Rx medications say they would consider treating with cannabis because of the perception that it’s more effective than OTC/Rx alternatives.” – Nielsen, U.S. Consumer Research Study, May 15, 2019

The survey found 67 percent of respondents believed cannabis was “healthier” than their over-the-counter and prescription drugs. 69 percent said they believed cannabis was “more natural” than traditional medications.

While this isn’t the first Nielsen study asking cannabis-related questions, it is the first since their acquisition of Cannabiz Consumer Group. Nielsen is also partnering with cannabis analytics company Headset to release a report on the cannabis market from its infancy through 2018.

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Louisiana Legislature Approves MMJ ‘Inhalation’ Bill

6/06/2019

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The Louisiana House has unanimously approved a measure that allows “inhalation” under the state’s medical cannabis program but still prohibits smoking, the LSU Manship News Service reports. The law allows patients to inhale medical cannabis through an apparatus similar to an asthma inhaler.

The measure, which moves next to Democratic Gov. John Bel Edwards, also includes provisions allowing out-of-state physicians to recommend medical cannabis treatments.

According to an Associated Press report, the Senate had shelved the measure on June 1; however, after Republican Sen. Fred Marks amended the legislation to include “metered dose inhalers,” specifically, the measure was approved by the chamber.

Despite the legislative efforts to expand the program, patients in the state are still without access to medical cannabis products four years after the bill initially passed the legislature due to an ongoing feud between Agriculture Commissioner Mike Strain and the LSU AgCenter over cultivation methods. According to the report, medical cannabis products are expected later this year.

On May 7 the House Health Committee voted 6-4 to move oversight of the medical cannabis program from the Agriculture and Forestry Department to the Health Department, according to an AP report. Only LSU and Southern University are allowed to grow the crops in partnership with private firms.

The current law only allows edibles, oils, and extracts and for in-state physicians to recommend medical cannabis to patients. The state’s qualifying condition list allows for “debilitating medical conditions,” including cancer, epilepsy, intractable pain, HIV, and Parkinson’s disease.

Additionally, the House passed hemp-legalization legislation – which includes language allowing CBD products in the state.

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South Dakota Tribe Sues USDA Over Hemp Plan

6/06/2019

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The South Dakota-based Flandreau Santee Sioux Tribe is suing the U.S. Department of Agriculture and agency Secretary Sonny Perdue over the failure of not approving the tribe’s hemp cultivation plan within 60 days, as required under last year’s Farm Bill, the Sioux Falls Argus Leader reports.

According to the report, the tribe submitted its plan on Mar. 8 and explained to the USDA that it had already invested in the project with plans on planting crops this year.

“A delay in approval of the tribal plan and unlawfully withholding tribal authority curtails receipt of the tribal revenue from hemp production at grave cost to tribal members, putting tribal members’ health, safety, and welfare at risk,” the lawsuit states.

The USDA argues that it cannot approve hemp programs until it develops its own rules and regulations for the crops. Sonia Jimenez, deputy administrator of specialty crops for the USDA, said the government shutdown from December to late January delayed work on the hemp program.

The Farm Bill does allow states and tribes to create their own rules for hemp cultivation programs; however, the rules must be approved by the USDA. The USDA did send the tribe a letter on Apr. 24 explaining that plans would not be approved until the agency crafted its regulations, which are expected this fall.

According to court records, the USDA has received hemp cultivation plans from seven states and eight tribes and has yet to approve even one.

The Flandreau Santee Sioux Tribe made headlines in 2015 after announcing plans to open a cannabis resort but then quickly abandoned those plans due to federal and South Dakota laws.

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Researchers Map Cannabinoid and Terpenoid Gene Pathways

6/05/2019

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Researchers at Washington State University have mapped the gene networks that regulate the production of cannabinoids and terpenoids found in cannabis trichomes. The study was published in the journal Plant Physiology.

Due to federal and University restrictions, samples were handled off-campus at EVIO Labs, an Oregon Liquor Control Commission certified lab. The team isolated trichomes from nine commercially available strains and a third party sequenced their RNA. The WSU researchers only handled a high-resolution data set that clearly marked each gene and its end product. By creating unique genetic fingerprints for each strain, the researchers say improved breeding techniques, proper strain identification, and the testing of various CBD health claims and the validity of the synergistic entourage effect are now possible.

“One of the things that needs to happen in the emerging market is that you know what you’re selling,” said Mark Lange, a lead researcher on the study. “You can’t just call it something and then that’s good. We need to be very clear that this is the cannabinoid profile that is associated with, say, Harlequin – it has a specific cannabinoid profile, a specific terpenoids profile, and that’s what it is. If it has a different name, then it should have a different profile. Currently you can do whatever you want.”

“There is a reason why all these have different names – because a lot of them are very different. But some strains with different names are actually very similar. The bottom line with strains is there is a lot of confusion.” – Lange, in a WSU News Report

Cannabis genetic testing is emerging as a hot topic as the legal cannabis industry matures. For example, a recent controversy involving an announcement by Phylos Bioscience that they were starting a cannabis breeding program with genetics that was collected for a so-called “Galaxy Strain Database and mapping project” outraged growers who had donated their genetics to the project.

In 2015, the Biotech Institute filed three strain patents that if enforced could cause major disruptions to the cannabis industry as most strains fall within the THC, CBD, and terpene concentration ratios outlined by their patent, according to a High Times report.

Using blockchain technology, services like Strain Seek are registering strain genetics to protect breeders’ intellectual property.

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Tennessee Updates Hemp Rules

6/05/2019

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Hemp processors in Tennessee no longer need to register with the state Department of Agriculture and farmers can now apply to grow the crop year-round under new rules for the industry, according to a WREG report. Cultivation licenses will still expire on June 30 of each year but growers no longer have to meet a deadline to renew.

Agriculture Commissioner Charlie Hatcher, D.V.M., pointed out that after four years of crop research under a pilot program, the state’s hemp industry is maturing.

“The hemp industry and federal laws have changed in recent years, and we’re updating our program rules to be more consistent with how other crop programs are managed.” – Hatcher, to WREG

Under the new rules, growers are now required to obtain movement permits for transporting harvested crops from the grow site; previously, those permits were only required for rooted plants. Additionally, hemp regulators will no longer issue licenses for certified seed breeders but operators manufacturing, distributing, or labeling seeds should be licensed through the Ag Inputs section, according to the rules.

Hemp licensing in Tennessee has grown more 10 times from 2018 – when the Agriculture Department approved 226 licenses – to more than 2,900 this year.

Earlier this year, the University of Tennessee released an Industrial Hemp Extract Budget in an effort to help the state’s farmers understand the costs, and risks, associated with growing the plants for CBD extracts. That report estimates that the state’s farmers could net $6,562 per acre if they grow their plants for extraction purposes.

Although the federal Farm Bill legalized hemp cultivation federally, the law says that states must require licenses and codify hemp-growing programs.

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Minnesota MMJ Companies Lose Combined $2.4M in 2018

6/05/2019

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Minnesota’s two medical cannabis companies lost a combined $2.4 million last year, even after one turned a profit in 2017, the Twin Cities Pioneer Press reports. Leafline Labs reported a $1.8 million loss, while Minnesota Medical Solutions – which was profitable in 2017 – lost $610,000, according to documents obtained by the Pioneer Press.

According to the report, both companies invested in operation expansions last year in an effort to meet demand from the state’s 16,000 registered patients which contributed to the operating losses. According to the report, both companies plan on taking on debt in order to open four new dispensaries each throughout the state, doubling the current number.

The losses, however, are significantly less than previous years when, from 2015 to 2016, the companies lost a total of $11 million. In 2015, Leafline ran $2.5 million in the red and posted $4.7 million in losses the following year. In 2017, the company lost $5.3 million.

Minnesota Medical recorded $3 million in losses in 2015 and another $1.2 million in losses in 2016.

“To the public, it’s going to look extremely negative that we’re still posting (losses). I think what is a positive sign is how much we’ve decreased that loss compared to previous years. … We have righted that financial ship and we are heading in the correct direction.” – Leafline Labs CEO Bill Parker, to the Pioneer Press

The legislature did pass laws this year to allow the state’s medical cannabis companies to write off their business expenses, which Medical Solutions CEO Jay Westwater said would have “a significant impact” on the company’s bottom line.

State lawmakers rejected a measure this session that would have given patients access to flower products – a move that cut the average price-per-patient in half when enacted in Pennsylvania. Westwater said the company is “ready to provide that service.”

“We know from our own internal deliberations and calculations it would have significant effect on reducing costs,” Westwater said in the report. “We’re going to be advocates for our patients and make sure that if that’s the way the Legislature wants to go maybe in the next session, that we’ll make sure we can do it in as safe a way as possible.”

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