Using Mergers and Acquisitions to Grow Your Cannabis Company

Mergers and acquisitions are happening fast in the cannabis industry. In 2018, Forbes predicted there would be an explosion of M&A throughout the medical marijuana industry. It turns out their predictions were right: 2019 has seen the biggest mergers in history within the cannabis sector, and the trend isn’t slowing down.

In order to understand how companies grow through M&A, let’s start with today’s biggest cannabis players.

Cannabis M&A 101: Here’s How Major Players Have Merged and Acquired 

If you want to understand how to successfully leverage M&A to grow your own cannabusiness, take some lessons from today’s top players.  

Tilray Merges with Its Largest Shareholder 

Tilray has completed multiple successful mergers, such as their recent merge with High Park. This merger allowed them to obtain a 662,000 square foot greenhouse facility. 

However, Tilray’s most notable merger was their recent merge with Privateer, which allowed Tilray to take back control of their stock prices. Before the merger, Privateer held the majority of Tilray’s stock. Vivien Azer, an analyst with Cowen and Company, told CBC News that the transaction effectively flips the control of a stock sale from Privateer to Tilray and provides Tilray more control. Specifically, the deal allows Tilray to increase its ability to manage the shares within the hands of public investors.

Aurora Buys Up The Competition 

“If you can’t beat ’em, join ’em.” That’s exactly what Aurora did during a round of mergers in 2018. 

In the past, marijuana producers were smaller, independent companies. As you can imagine, being a smaller company in a growing field of giants has its struggles. Access to capital is a huge barrier to expansion, but so are more complex issues such as the infrastructure required to distribute cannabis in different states and provinces. If a small, independent-type business hopes to expand, they face an uphill battle and often don’t have the team, expertise, and capital required to expand to the level that giants such as Aurora already play at.

Not only did Aurora merge with smaller producers such as H2Biopharma, they also merged with their main competitor, CanniMed.

Canopy Preparing for the Future 

Canopy’s biggest merger yet was with the U.S. company Acreage, but the deal going through is contingent on the end of cannabis prohibition in the U.S. Even still, the merger allows Acreage shareholders to rake in about $300 million, with the rest of the money contingent on legalization at the U.S. federal level. This is a bold move by Canopy because it’s a complicated deal with lots of red tape — if the deal is completed, however, it would position Canopy as a global player to be reckoned with.

Interested in growing your own company through M&A?

Wondering where to go from here? Good news! You can acquire what you lack. M&A can help solve a variety of problems faced by growing companies.

Here’s what you can focus on: 

1) Keep an eye on top players 

It helps to know what’s going on in the big leagues, even if you’re in the little leagues at the moment. Keep an eye on new trends, big mergers, and other top stories. These can help you predict trends in the future, avoid making the same mistakes, and start to learn patterns within the industry.  

2) Understand your strengths and weaknesses   

Successful M&A is a result of each party leveraging their strengths and weaknesses to create something greater together than what existed when they were apart. 

For example, Tilray’s merger with Natura Naturals Holdings allowed Tilray to supply more cannabis products across Canada to a customer list they previously didn’t have access to. Tilray’s ability to widely distribute matched with Natural Naturals Holdings customer list combined to create something bigger than they were before.  

Be sure to analyze your strengths and weaknesses in a variety of verticals, such as: technology, talent, infrastructure, geography, product lines, and proprietary information.

3) Think outside the box  

As legal adult-use cannabis becomes more widespread, the plant’s uses and applications will grow accordingly. That’s why we’ve seen players like Budweiser enter the market

It also means successful organizations are always looking to innovate and grow. Just because something isn’t available yet to the public doesn’t mean it’s off the table. If your cannabis company has the ability to do its own unique take on something, use this to your advantage. For example, there’s a strong chance there will be greater demand for food, beverage, and cosmetic cannabis products in the future. What can your company do to stay ahead of the curve?

Before you go, take some advice from Kevin Murphy, CEO of Acreage: “One important investment principle I learned early on: Do what everyone else is not doing and be right.”

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hemp flower for veterans

Jason Ambrosino: CBD Hemp Flower for Veterans

Jason Ambrosino recently joined our podcast host TG Branfalt to talk about the New York hemp and cannabis markets, how CBD’s influence has benefited countless military veterans (including Jason, himself), and more. The interview covers the public perception of hemp and cannabis and what the Veterans Hemp Market does — and what other industry operators can do — to help educate the masses and break the ongoing stigma around cannabis use.

Tune in to the interview below, or scroll further down to check out a full transcript of this week’s Ganjapreneur.com podcast episode!


Listen to the podcast:


Read the transcript:

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TG Branfalt: Hey there, I’m your host TG Branfalt and thank you for listening to the ganjapreneur.com podcast where we try to bring you actionable information and normalize cannabis through the stories of ganjapreneurs, activists, and industry stakeholders. Today I’m joined by Jason Ambrosino. He’s a former army officer. He’s the owner of Cohoes, New York-based Veterans Hemp Market. Cohoes is notably a former manufacturing town outside of Albany. He’s a vocal cannabis advocate who this year launched his company hoping to provide CBD for the everyday hero. I’ve been fortunate enough to have some of his pre-rolls that I’ve found at a local market up here in the Adirondacks. So, I’m looking forward to this. How are you doing this morning, Jason?

Jason Ambrosino: Good, Tim. Thanks for having me.

TG Branfalt: I’m super stoked. It’s not really every day that I actually get to talk to somebody whose product I’ve actually used because I don’t live in a legal state and I talk to a lot of THC entrepreneurs. But this is about you, man. Tell me about yourself. How’d you end up in the cannabis space? I’m sure it’s a real interesting story judging by your background.

Jason Ambrosino: Well, it really is. I got out of the army, retired out of the army in 2014, medically retired actually. Years prior had gotten blown up and I had a variety of health problems, PTSD, the normal charade of problems that most veterans face. And when the army was done with me, when the army is done with anybody, they kind of say, “Okay, go find a new life.” And that’s pretty much how it feels because that’s your family, that’s … everything you know is tied to that organization.

So, when you’re given seven months and say go figure it out, well can you start figuring things out? And what you find out is, it’s tough when you get out and there’s a lot of stuff you have to deal with and cope with. And jobs get a little bit more difficult because people in the civilian world aren’t necessarily understanding of what veterans go through.

And I said, there’s got to be a better way here. And I started doing a lot of reading and I read this book. I’m trying to remember what the name of it is here. I’ll have to give it to you at the end of the program because it’s not coming to me at minute. But I read this book and it had a lot to do with the use of cannabis, the use of different types of psychedelics for treating these types of problems, PTSD related issues, psychological things that you deal with as a veteran. And in this book I started reading about cannabis and opened my mind to it, of which at the time was kind of back and forth. I didn’t mind people doing what they did, but I certainly didn’t have the knowledge base that I have now. And for years I … for about a year and a half, I just filled my mind up with this information and said, well, you know, it’s time. It’s time to try this and see how it helps me.

And I didn’t know where to turn. I’m in the same state as you. It’s not a legal state. And honestly, the medical program in New York state is … it needs work. It needs a lot of work. So, I did what anybody did … would do. I went out and found someone and I got product for myself and I started medicating. And the results were immediate. I said, this is … I feel better. I’m getting … the more and more I use it, the more I’m dialing in … the more I’m dialing in my dosage. And Oh, by the way, now I’m starting to notice that sensory stress is going down since the anxiety’s going down. Oh, well the pain is starting to go down as well.

And it all just kind of clicked at the same time. Like, whoa, we’re missing the picture here. So, I was already a cannabis supporter. And then I was … had issues with regards to always having to be in that stoned state. And anyone who depends on cannabis for medical reasons, they understand what I’m talking about. And it’s a constant battle of building a tolerance up so that you can increase the amount of THC enough to get to the pain threshold that you’re trying to deal with. And it’s a constant battle.

And I started looking into this side of it and said, well, what was actually going on with these components or these cannabinoids that are inside this product? And how is that affecting me inside my body? And it was just at the time where we were really starting to dig into the CB1, the CB2, and now just recently they believe there’s a CB3 receptor. And it just made sense to me that well, CBD should accomplish all these other things and all I got to do is treat it exactly like cannabis so that I’m getting the full range effect of the cannabinoid profiles, your entourage affects, your terpene profiles, which is … our slogan is, we’re about the flower.

And over the next couple of years I started researching the CBD space and then everything just kind of came to a head in 2018 with the farm bill. And I was already treating myself. I had already had pretty much all the contacts I needed to have and I saw where the market was going. And we knew in 2014, with some of these other companies like Hemp Works that were popping up and they just weren’t doing the right thing. They were in it to make money and take advantage of the situation. They weren’t there to help people and provide them with good medicine. Because the idea that hemp and cannabis and marijuana, it’s all the same thing, it’s just the difference of something being sour or sweet. It’s a profile inside that plant but it’s the same plant. That was like earth shattering to a lot of the people we spoke to.

And that’s how we get to 2018 and saying we need to expand this because it’s helping me, it’s helping my friends and more veterans need access to this. And if they don’t have to get bogged down by the worry of being constantly stoned and they can engage in this and it can help them, then there’s … not only is there a huge market here, there’s a huge amount of people that need to be helped.

TG Branfalt: So, how do you go from, an officer in the army … I mean, that’s just a massive undertaking and I mean, anyone that I’ve spoken to about it, they talk about how impressive the person has to be to get to that point. How does that experience drive your mission and what skills translate from that role to the cannabis space?

Jason Ambrosino: It’s always difficult to figure out what skills transfer to any space out of the military because it’s such a niche thing that we do. But I would say … let me answer this by saying how that has helped me. Because being in the military, particularly being an officer and having a successful career when I was in the military, has helped me gain clout, I should say, with a lot of people that would otherwise dismiss the idea of cannabis as something that we should have in our everyday lives.

And I hope I don’t confuse your listening audience too much because I’ll refer a lot of times to cannabis rather than just CBD because at the end of the day it’s the same plant. And I would say that the willingness to drive on regardless of anything else that’s going on around, you’ve got to kind of drown out the noise and keep pushing forward. But the respect that I had received when I was in the military and I received as a veteran, and because I was an officer has just allowed a lot of people who would otherwise have dismissed this to come in and say, “Hey, maybe there’s more something to this. Maybe I should sit down and listen. Maybe I can open my heart and my mind and learn something that I didn’t know.” And that’s what we’ve seen lately, in the past six months.

It’s been overwhelming to see, you know, the Baptist minister coming up to the table at one of these events we do and saying, “Well, you know what? I want to just forget everything that I’ve ever been taught. Because for 70 years I was taught that this is wrong and bad. And I want to hear what you have to say because clearly you guys are doing something right where …” It goes back to the veteran suicides, right? Obviously we’ve got a problem. We’re doing something wrong when 22 veterans are killing themselves every day. So, I think people are finally looking for solutions to that. And the military has given us a mouthpiece or a window or a doorway to to bring this information to these folks.

TG Branfalt: I mean, that’s super interesting. And I’ve spoken to several other veterans who have launched companies, NEVA comes to mind, that have said the same thing. So, it’s interesting to hear you echo sort of that … what I heard from them a few months ago.

And you mentioned the suicides and I mean, we have to sort of partly attribute that at least to federal policy, the VA, you cannot get medical cannabis if you are in the care of the VA. And there’s obviously a prohibition if you are active duty military, you can’t consume cannabis. What do you think of all of the sort of federal policies that have been launched and introduced and kicked back, right? Defeated. Which one do you think might help veterans most as it relates to cannabis, CBD, THC, especially dealing with PTSD?

Jason Ambrosino: It’s a tough question because it’s almost like we’re so far away from a solution with regards to the VA and how they handle veterans with cannabis that it’s hard to even start the conversation. Because federal prohibition essentially precludes them from doing anything with it. Because the minute that they say, okay, well it’s okay for veterans, now, federally, we still have this thing sitting on schedule one. It doesn’t work like that in the federal government. You can’t have it one way and have it the other. It has to be consistent policy across the board.

So, really we got to back up and say, okay, what do veterans need? What’s going to help them? And then the answer is going to be, well, really it’s a self determining thing where you’ve got to take the time to dial in what’s going to work for you. And it’s not necessarily going to work for everyone. And doctors and psychiatrists, they hate to hear that. They hate that. They hate the fact that they can have two patients that have the exact same conditions and they can use cannabis and one succeeds with it and one doesn’t. But one still succeeded with it. So, rather than dismissing it all together we say, okay, well this is an option and if it works it works. Rather than saying, okay, well these are the 47 different psychotherapeutic drugs that we’re going to put you on. And, oh, by the way, you’re going to feel like a zombie for the rest of your life.

There’s a lot of bad information out there with regards to veterans and cannabis. I recently had a gentleman come up to me. He wanted to believe he knew what he was talking about right now in the team, and the reason he couldn’t use cannabis was because he would lose his VA benefits. That’s just simply not true. The VA is not going to strip your VA benefits away from you if you have decided that you’re going to use cannabis. They’re not going to pay for it but they’re not going to strip your VA benefits away from you. If they’ve got you on a whole lot of painkillers, a lot of opiates, yes, you’re going to be under a larger microscope because they want to make sure that one’s not potentiating the other because we know that there’s things that can happen when these things are mixed. So there’s a reason for it. But they’re never going to come up to you and say, “You know what, this is working for you but we’re going to take away all your benefits.” It’s just not the way it works.

That’s where costs comes into it. And you made a comment, well, what’s going to work for you? Is it CBD? THC? What’s it going to be? And I think the answer is always, it depends. We may find that we can get a one-to-one strain, which … one part THC to one part CBD and that’s going to work amazingly well for anxiety but to handle your night pain at night, to handle it so you can sleep through the night, you might need something that’s ten parts THC and one part CBD. All of these kinds of change depending on what we need.

So whatever the solution is and wherever we go with it … And this is nationwide, state by state, the CBD market and the THC market, and they need to grow together. They need to be dealt with policy together at the same time. And we also have to go back and we have to wipe our minds of the way that we’ve been taught to think about medicine because, yeah, this is a medicine, but at the same time it’s also a plant. It’s an herb, and we have to go back and we have to look at, we’ve got all these other herbs that are in existence and we know they have far-reaching effects, and they’re not treated like cannabis because they’re not mainstream. I mean, that’s the only reason. It’s simply doesn’t make much sense. I don’t think it makes much sense to anyone.

But you have all of these little craft markets, all these little craft niche industries, that are popping up. Then you’ve got big states, like New York, for example, that wants to hold everything consolidated and essentially … don’t want you to grow your own. They don’t want you to do any of that. Well that’s the old pharmaceutical industry mind, because the idea is: well, if we have all of our plants that are grown all the same way, they’re all the same strain, then we know exactly what the product is that we’re going to get going in from the beginning and out to the end. But we know that cannabinoids don’t work that way, and that variety is basically the spice of life because a Trainwreck strain that’s working for you one day might not work for you three weeks down the road. You might have to switch to a Pineapple Express.

And those varieties have to be out there and they have to be available to you. And you have to know that at a certain point in time you’re going to have to bring in some different variety in order to help you. The craft marketing attributes to that. They quality’s there, everything’s there. But unfortunately in places like New York, we’re kind of dismissing that. And it’s important to, again, talk about it in, “Hey, here’s CBD, here’s THC. At the end of the day, they’re grown the same way, which means that they’re going to have that same characteristic with regards to building tolerance, and things like that.”

And I have people come to me all the time and they say, “This tincture oil, this CBD tincture oil right here, this is the one that I had. It started working, then it just stopped working.” And they get the idea that, well, it worked for me and then it stopped; it must be in my head. No, that’s not necessarily what happened. What probably happened is that your body got used to those cannabinoid profiles, and you needed to take a tolerance break, or you needed to go to a different company and get their oil because their biomass is made from hemp that was harvested in Vermont and the one that you’re using is hemp that was harvested in Kentucky. Obviously, if it’s a full spectrum, they’re not going to have the same cannabinoid profile or the same terpene profile. It’s like we’re forgetting all these things.

And I’m getting a little bit off topic, but I think it’s all related because it’s almost like too much regulation could cause more harm than good, which means that ending prohibition could possibly cause more harm than good when we’re talking about people having access to their medicine.

TG Branfalt: It’s very sort of upstate New York philosophy, though, that more regulation might not be good for the industry. And I want to talk to you about New York’s hemp industry. We’ve had the pilot program for a couple of years now. I think it’s a thing that’s going on four or five years. And with the passage of the farm bill, obviously it sort of blew up. Two years ago, you could not find any hemp flower in New York state. Impossible. Now you can buy hemp-derived product literally at a mall. I’ve had products … Your products, I’ve had … my friend owns a CBD dispensary. I’ve had his products. I’ve lived in Vermont and I noticed a great disparity between the CBD products that I had in Vermont and New York.

I mean, most of the ones I had sort of over the counter in New York weren’t very good, right? And then compared to the stuff I would get that was grown in Vermont, even in New York. So sort of tell me about the state of New York’s hemp industry. Why do you think that they’ve sort of lagged behind on the overall quality of the products that enter the space? And tell me a bit about your products. I’ve had, like I said, one of your pre-rolls, it was a diesel. It was great, to be honest with you. I smoked some and I felt a little sleepy, which is what I like CBD for. It always calms me down pretty good. So it was a good experience for me. But tell me about the New York industry, what you’re experiencing and why we are seeing those disparities from, say, New York to Vermont.

Jason Ambrosino: In New York state, everything is about money, and-

TG Branfalt: Ain’t that the damn truth.

Jason Ambrosino: In New York state, everything is about money and it revolves around politics. And a lot’s changed since 2014. The entire program has gotten rewritten since 2008, since the farm bill came out, or at least they’re attempting to rewrite it. But what New York did was just kind of what we already mentioned: they limited the number of permits that were out there and they basically gave them to friends and allies and buddies and campaign donators. And they said, “Okay, well here’s your permit for CBD hemp.”

Now a lot of these people they gave permits to, they don’t know anything about it. They didn’t know how to grow with, they didn’t know what it was used for. Heck, most of them probably didn’t even know what equipment they were going to need to grow it, but they took the permits. And what we saw with one of them, which was a permit that was given to the Falone brothers, who had made a a nice fat $40,000 campaign donation. Oh, and on top of that they got a $200,000-plus grant for building a facility through a grant program that was never supposed to award more than $100,000 per entry.

TG Branfalt: No shit.

Jason Ambrosino: So they get this grant, they buy this land just south of Binghamton, right on the Pennsylvania border, and they say, “Okay, we’re going to build the largest processing facility in the country,” because that’s what every single processor says. Every processor will tell you that they’re the largest vertically integrated processor. It’s kind of a joke in the industry. So they put all this public information out, they never even break the ground. Their shovels never break the ground, and they sell off the license. They sell off the land … And actually two licenses, processing and growing; and they sell off their entire business model to Canopy Growth.

And that is pretty much where New York wants its CBD industry to go, if you talk to the regulators. They want one big company to come in here who basically can control the products. They don’t want any smokable product in the state. That’s why you didn’t see the development of flower. That’s why right from the get-go when we went to … I consult at a number of farms, and I will go to these farms and I would tell them, “I don’t know what you’re doing. This is not how you grow this, because basically all you’re doing is harvesting it and turning it in … taking that, what we call biomass, when it’s all harvested and chopped up, washing it with ethanol and selling off the oil, or the crude, or what have you.”

And that’s what I used to tell these guys was, “Look, the money is in the flower, because people want what they’re familiar with and the benefits of smoking or vaporizing, they’re undeniable.”

But New York doubled down, and I’m sure you heard the decriminalization bill that went through, which you know … but what they didn’t see was the little bit of language that they decided to throw in at the end of that with regards to the CBD industry. And it kind of goes like this … And mind you, this is a law now that’s supposed to take effect in 90 days. So what I’m about to tell you, I would highly recommend your listeners, they contact their elected officials, because this is pretty much outrageous and it puts companies like me pretty much out of business in 90 days.

So New York passed the law that said if you grow hemp in New York state, you have to be licensed. We know that. Now if you want to grow CBD hemp in New York state, you can only sell your CBD hemp to a New York state processor. And if you’re a New York state processor, you can only sell it to a New York state formulator or manufacturer, which is what we do, we formulate and manufacture. And that did not exist. There is no license for that. It doesn’t exist, the framework was never there. We never needed a license for it. So they said, “You can only sell that processed hemp to a New York state licensed manufacturer or formulator, and then that manufacturer or formulator can only sell it to a store that’s licensed, like a liquor license, to sell CBD and hemp products.” And it also outlaws smokable hemp. It also … vape cartridges, edibles. It’s all gone.

In 90 days, technically, based on how the law is written right now, those products will no longer be able to be sold in New York state stores. And to take it one step further, if you order offline as a consumer and you buy CBD products from out of state, you’re breaking the law, and the company that sells it to you and sends it to you is technically breaking the law because the 2018 farm bill basically made it an agricultural product, but it was still secondary to whatever those state’s laws were.

Now there’s not a lot of people out there that even know that this is happening, and that’s why a lot of those folks like me are getting pushed over to Vermont because we’re not here to make a mass quantity product for everyone. We’re not here to sell you a bottle of tincture that’s 300 milligrams of CBD and isn’t going to do a dang thing for you. That’s not what we’re here for. We’re here to help people. If we want to help people, we’ve got to do things a certain way. New York state wants to just commercialize it and market it because, I don’t know, it must be they think that there’s a recreational market for it, but there’s not. People that are buying it, need it. And that’s the worst part about it. We are making it more difficult for the consumers … get medicines that they need simply because, well, we do things a little backwards in this state, I guess.

TG Branfalt: So I mean, backwards sounds like exactly it. So if what I’m hearing and telling it correctly is that they would need to pass some sort of regulations in order to license people to sell CBD and manufacture this in 90 days, which anyone who lives in New York knows abso-fucking-lutely nothing happens in 90 days.

Jason Ambrosino: Yeah. [ They don’t need to pass anything. They’ve already passed the law.

TG Branfalt: Well I mean, they’d have to issue regulations, right, like the Department of Ag, or-

Jason Ambrosino: All of that regulatory guidance, it doesn’t need to be passed. It’s something that can be added after. But what their intentions are, and this is coming from Albany, coming from the contacts I have in there, their intentions are to roll the CBD industry into the recreational marijuana bill. And that’s why they did not include regulatory language because all the regulations of the CBD market are going to be conducted by the marijuana regulators.

TG Branfalt: So potentially, if they were to pass legislation next year recreational, which everybody expects to happen, they would include CBD in that legislation in order to regulate it and get rid of the gray market now with that decriminalization, that amendment probably added the decriminalization bill?

Jason Ambrosino: Right, and they recognize that, and this is why they want to create a state-run monopoly because they recognize that the gray market has got a better quality. The gray market is cheaper. The gray market’s coming from people that other people trust. Now granted, there is a big market out there, gray market, that is manipulating and taking advantage of people. I would argue that the fee structures that they’ve created and for violations of those laws, which is $1,000 for the first offense, $5,000 for the second offense … I can’t remember what the third offense is, but for six grand, I can get slapped twice.

Now if I’m a gray market company and the only thing I care about is making money and making it as fast as I can, I’m just going to continuously change the name of my product. I would put crappy product out there and I’m going to make as much money as possible until I get slapped with a $1,000 fine. What’s $1,000 if you’ve made $100,000? So they want to stop the gray market, but at the same time, the structure that they put in place, the mechanisms to do so, really aren’t robust enough to do that. All it’s going to do is affect companies like us, where a $1,000 or a $5,000 fine is going to be enough to make us stop.

We’re not.  What we’re going to do is we’re just going to move out of the state, which is going to hurt. It’s going to hurt people in the state because they’re no longer going to be able to get those products. So going back to the smokeable, there’s a question of whether or not smokeable is even going to be legal in New York State, in the rec market. Nevermind the CBD market. So it all ties together. The governor is huge on not allowing smokeables in the state. He’s dead set against it. But that’s because that’s somebody who doesn’t necessarily understand the plant, or why the different methods of intake are important for the patient.

TG Branfalt: Well, and he was anti-tobacco, I mean-

Jason Ambrosino: He’s whatever the public wants him to be at the time.

TG Branfalt: So fucking true. So, moving away from state policy a little bit, we don’t have a ton of time, and I want to discuss this issue with you briefly. I know that you’re talking about, might having to move your company to Vermont. A buddy of mine, as I said, open up a CBD dispensary right near you in Schenectady. And they had a ribbon cutting ceremony for his business. He’d been at several chamber events. Have Cohoes’s official, local officials in the community, how has your company been received by them?

Jason Ambrosino: We operate kind of under the radar. We don’t have a big sign on the door. Kind of the shows and the festivals and the things that we do, and how we engage the public in response or public events, that’s how we ended up getting received. Cohoes has been great. We haven’t really had too many experiences. Clifton Park was awful. We were supposed to open the store in Clifton Park, and Stephen Barrow I think is his name. He’s the supervisor. He was a belligerent… It was ridiculous, enough to where Kirsten Gillibrand’s office got involved. But you don’t want to go where you’re not wanted. So we ended up going to Cohoes.

But let me talk about how we’re received by the places that we’re going. We’re going to Cracked Bears. We’re going to New York State sanctioned events. We’re going to regular fairs. These are family events. And these people couldn’t be happier to have us there because, when we go to these places, we go there with the intent of selling enough product to cover our sponsorship costs. We go there with the intent of educating. And there’s this huge lack of education and knowledge right now in the general public. Because going back to the very first things we talked about, is that for 70 years they were told that they can do things a certain way. And now they’re coming to the realization, we were wrong. And you would not believe how many elderly folks, between the ages of 60, 70, and 80. They come by the booth. They’re so happy to finally have an opportunity for someone to tell them, the reality of what they’re taking. There’s so much confusion when they go to the store.

They know their buddy. He got some CBD and it seems to be helping him. So he wants to try it out, but we’re too scared. So these places really have been supportive of us, just because of the education that we’re giving alone. We are really excited to get invited to the Blues Festival, which is a New York State sanctioned event. I have to thank Syracuse and the police department in Syracuse because the very first thing we did when we got there was we handed out 150 CBD joints. Which for anybody who smokes them knows that they smell, they look just like marijuana. But part of what we do when we go to these things is we put flower out on the table. We will sit there and we’ll fan the smell all over the place. To desensitize people to the smell and the sight.

And that’s kind of what we were doing with the 150 joints. We were trying to get people to relax a little bit, so that they weren’t so concerned about having something that looked like something that was illegal in their hands. And I can say that not once, not a single time, over three days, did the police bother us, or bother any one of our customers. We’re a sponsor of the event, so I’m sure they knew what was going on. But a lot of times, we don’t think in terms of how law enforcement is viewing all of this. And they’re put in a really difficult situation because, no matter what you think of law enforcement, they’re just doing their job. They’re just doing what we hired them to do. And what we wrote down on paper and told them was the law. Regardless of the fact if it’s a bad law or not.

So hemp most certainly makes their jobs more difficult. But just because something makes somebody’s job more difficult, doesn’t mean that you ban it or you go after it. You figure out ways that it doesn’t make their job more difficult. And luckily that’s kind of the direction it seems we’re going. Syracuse most certainly seems to be going in that direction. Yeah local communities have been great. And I think…

TG Branfalt: I met you guys at the Saranac Lake Street Festival. And as I said, I bought some flower, pre-rolls. And I mean it’s got to be a really interesting experience to be in rural upstate New York like that, because you have both people who are very conservative and don’t understand and don’t want to understand. But also you have the libertarian minded. You’ve got a lot of local sheriffs out here, very libertarian minded. So tell me about doing that in upstate, in a rural community.

Jason Ambrosino: I think rural communities are the best places for it. And it’s because at least when… My wife does a very good job as well because she listens to me talk all the time. But I’ve written a few papers about the dairy industry, and one of them was called Death oo the Dairy Farmer. When I go to these rural communities, it’s like being home because I know what they’ve gone through. I know that they’ve gone through dilapidated infrastructure coming from the leather and the paper mills. I know that they’ve had their dairy farms ripped out from under them because of the milk co-ops that were supposed to help them. So when I am able to engage these folks, I target that audience and I start talking to them about the opportunities of hemp. The opportunities for the farmers, the opportunities for the business owners in the area. And what I’ve found more than anything is people have never been… They’ve never had a problem with marijuana. They’ve never had a problem with cannabis. They’ve had a problem with breaking the law.

And it almost seems like it’s been universally accepted now that cannabis is an okay thing, but for whatever reason, our laws haven’t caught up for them. And there’s some people who just don’t want to break the law. They don’t want to do anything wrong that’s going to get them in trouble. And it’s valid for them to understand that. But, they see it everywhere now. So you either going to accept it, or you’re going to have to avoid it. And we’re finding that more and more are accepting. They want to come up, they want to ask questions, and they want to learn. And that’s a positive force.

TG Branfalt: So what about the local farmers that you’ve spoken to about cultivating hemp? What’s the most common question you get? Tell me about those interactions.

Jason Ambrosino: Generally it starts with a few off color jokes about some kid in their high school years planting marijuana in the middle of their corn fields. But when we were seriously getting into the conversation, and I start talking dollars to them. And I’d say, okay, well if you grew this CBD hemp, and you grew it the way that I tell you to grow it. You’re talking $67,000 per acre. And we didn’t even get into talking about fiber, and we didn’t talk about seed. If you grow fiber, that’s 12 to $15,000 an acre. If you want to grow seed, that’s 15 to $18,000 an acre. All of those numbers are vastly more than they’re making, doing whatever they’re doing now. I can’t remember what soy is, but it’s way less than that.

And these guys are businessmen. These farmers are businessmen. And if they can do something that doesn’t go against their morals, and doesn’t go against their ethics, and it’s not illegal, they’re on board. But we can’t protect the farmers right now, because what’s happening is we’re having these big companies come in, like Canopy. And Canopy is going around the state, and they’re going to farmers and they’re telling these farmers, look. I’m going to lease X amount of acres. I’m going to pay for the seed, everything else to come in. And they’re tying up all this New York State farm land. And these farmers are getting the short end of the stick, because at the end of the day, Canopy’s making the final decision of what that harvest is worth. And that’s why this New York State monopoly is so, so dangerous because if they’re focused on just a couple processing facilities, and Canopy happens to have this gigantic processing facility. And they’re the ones that are going to handle all the hemp coming in from the state. Guess who’s going to set the price and what they’re paying for that?

So now a New York State farmer could possibly go down to Pennsylvania or Massachusetts, and they could get $3 and 50 cents per pound, per percent of CBD on their biomass. Whereas they’re stuck in New York State only selling to Canopy, who says, we’re only going to pay you $2 and 50 cents. And it’s the exact same thing that happened with our milk co-ops. So when I’m talking to farmers, that’s what we’re talking about. Staying independent. Avoiding these contracts, which look good on paper. But at the end of the day, you end up cutting your own throat, because six years down the road, these guys are setting your prices. And now all of a sudden you’re growing products for, you’re selling it to them for less than it cost you to grow. It’s literally milk all over again. So we have to be very, very vigilant and watch that.

TG Branfalt: So, you’re in a very interesting position. You’re a veteran. People listen when you speak. And you’re very well spoken. Your product does speak for itself. It is very good. And I’m not a guy who really like those glowing reviews ever on this thing, but I was very happy. The price was great. You have a very unique sort of outlook on this industry just given your history. What advice would you have for entrepreneurs who might be looking to enter the hemp and CBD space?

Jason Ambrosino: Call me. Honestly, I consult. Consulting is one of the things that I do. I own another company called American Veteran Enterprise Team. And no, it’s a company that’s growing 2700% in just the past three years. So I like to build companies, and I like to build companies that grow fast. And I like to help people be successful in the businesses that they grow. So when I say call me, I’m not even kidding. You need someone to help guide you in this industry, because you will get taken advantage of. You will. The bad players are out there. If you don’t know who the bad players are, then you’re being taken advantage of. So find someone who knows what they’re talking about. Be very, very careful. Be conservative, and don’t take no for an answer. I think those are probably the best three pieces of advice I can give someone.

TG Branfalt: I like the cut of your jib man. Where can people, tell them to get in touch with you. How do people get in touch with you? Where can they find out more about your various enterprises?

Jason Ambrosino: Sure, they can check us out at www.veteranshempmarket.com. It’s www.veteranshempmarket.com. And we’re also on Facebook. We’re also on Instagram. Veterans hemp market will pull us up. And of course you can always just go back to www.veteranshempmarket.com and find all the information right there. We’ve got a fantastic wholesale program. Our wholesale program, you put $500 worth of stuff in your cart, set up for the wholesale program, you’re going to get a promo code sent to you, and you’re getting a 50% off your order. $250 worth of stuff for $500. So let us know what you think.

TG Branfalt: He’s Jason Ambrosino. He’s the owner of Veterans Hemp Market. He’s a former Army officer. I can’t thank you enough for coming on the show. And I can’t wait to see you at more upstate New York fairs, man.

Jason Ambrosino: Great. Thanks for having us.

TG Branfalt: You can find more episodes of the ganjapreneur.com podcast in the podcast section of ganjapreneur.com, and in the Apple iTunes store. On the ganjapreneur.com website, you will find the latest cannabis news and cannabis jobs updated daily, along with transcripts of this podcast. You can also download the ganjapreneur.com app in iTunes and Google play. This episode was engineered by Trim Media House. I’ve been your host, TG Branfalt.

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Nevada’s First Cannabis Tasting Room Opening on Tribal Land

Nevada’s first cannabis tasting lounge is opening Saturday on sovereign Paiute Tribal land, according to a 3 News report. Cannabis company NuWu did not require permission from the state as the land is subject to tribal authority. 

Alfreda Mitre, a Paiute Tribe Councilwoman, said the lounge will mirror a craft brewery, but with cannabis flights. Patrons will be allowed to smoke, vape, and consume edibles.

“There is a time limit that will be in place. We do have bud tenders to do that that expertise and will be able to gently nudge the customer when they think their needs will be met.” — Mitre, to 3 News

She added that NuWu would be working with ride-heralding and taxi companies to ensure that people are not driving under the influence. 

Last year, Gov. Steve Sisolak (D) signed a measure that imposed a two-year hold on cannabis lounges in the state so the Cannabis Control Board could conduct a study on the potential social and health impacts of social cannabis use.

“The cannabis control board… will strictly regulate the cannabis industry to protect public health and safety, as well as create a stable, predictable business environment to promote economic growth,” Sisolak’s office said in a statement to 3 News.

Only Alaska permits state-wide social cannabis use, while social consumption was approved by Denver, Colorado voters in 2018 and regulators approved permanent rules in February. In California, localities can approve social cannabis use; the state’s first cannabis cafe and restaurant opened on October 1 in West Hollywood. 

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75% of Canadians Say Legalization Had No Impact on Workplace Safety

According to an ADP Canada study, three out of four Canadians believe cannabis legalization has not had an impact on health and safety incidents at the workplace. A strong majority of respondents said that legalization has also had no impact on productivity (74 percent), absenteeism (71 percent) or work quality (70 percent).    

A survey in 2018 found 46 percent of Canadians expected legalization would lead to a drop in productivity, while 43 percent said it would lead to a decline in work quality, 40 percent expected an increase in absenteeism, and 55 percent believed it would lead to a spike in health and safety incidents.  

Hendrik Steenkamp, director for HR Advisory, ADP Canada, said after “a lot of uncertainty” prior to legalization the reforms have “not had a noticeable impact on the workplace or on workplace performance.”

“Although only a fraction of Canadian workplaces allow cannabis during the workday, it’s important for every organization to develop proper workplace guidelines and policies, as well as provide training to identify and manage impairment.” — Steenkamp, in a statement  

In all, 86 percent of respondents indicated that their employer doesn’t permit cannabis use before, during, or after work — 8 percent said cannabis use was allowed during the workday. In the 2018 survey, just 6 percent of respondents thought they would be allowed to use cannabis at work.  

Of those 8 percent whose employer allows cannabis use, 67 percent are using it before work, 47 percent are using it during work, and 72 percent are consuming it after work. Among the working Canadian public, just 4 percent are using it during work, with 5 percent using it before work and 6 percent after work.

Fifty-five percent of those surveyed said that they did not believe their workplace policies would change following the impending legalization of edibles and other “alternative” cannabis products, such as concentrates and topicals. 

The survey also found a 22 percent increase among respondents who said legalization has led them to have a more positive perception of cannabis. 

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CartHook Announces Square Partnership, Enabling Shopify for CBD Brands

The checkout optimization platform becomes the bridge between Shopify and Square

Portland, Ore. (October 4, 2019)CartHook, the leading checkout optimization platform for ecommerce merchants on Shopify, announced a partnership with payment processor Square, which makes it possible for CBD merchants to sell their products online with confidence and peace of mind.

CartHook helps ecommerce merchants optimize their checkout journey with a customizable one-page checkout to boost conversion rate and post-purchase upsells to maximize average order value.

Square helps millions of sellers run their business, from secure card processing to point of sale solutions. Yesterday, the company announced it would support payment processing for CBD merchants for the first time.

“CartHook is proud to be the bridge between Square, which is now a leading payment processor for CBD merchants, and Shopify, the world’s best ecommerce platform. As a result, our partnership with Square makes selling CBD online an easy, secure process. We’re proud to bring relief and peace of mind to thousands of online merchants, who’ve lived in fear of not being able to securely sell their products online and process payments from their customers,” said Jordan Gal, founder and CEO of CartHook.

“Square believes partners like CartHook are important to building innovative commerce solutions for sellers,” said Pankaj Bengani, Square Global Partnerships Lead. We are excited for CartHook to provide CBD sellers with an ecommerce solution powered by Square payments.”

To get started with CartHook, please visit CartHook.com/CBD, where you can apply to work with us.

About CartHook
CartHook helps Shopify ecommerce merchants optimize their checkout journey with a customizable one-page checkout to boost conversion rate and post-purchase upsells to maximize average order value. Merchants process over $500 million annually through CartHook using the world’s leading payment providers, and they can integrate with apps for subscriptions, tracking, email marketing, abandoned cart recovery, and more. To learn more, visit CartHook.com.

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Nebraska Sherriff’s Office Finds Method of Differentiating Hemp from Cannabis

The Douglas County Sheriff’s Office in Nebraska has reportedly developed a test to differentiate hemp from THC-rich cannabis. The sheriff’s office said the test can determine whether “plant material is marijuana if it contains more than approximately 1 [percent] THC.” 

According to a release, the procedure is based on a method developed by the federal Drug Enforcement Agency and was validated by the sheriff’s laboratory. The method was “developed in accordance with ANSI National Accreditation Board (ANAB) Forensic Accreditation requirements and falls under the lab’s current scope of accreditation,” the agency said. The lab conducts drug analysis for more than 20 local, state, and federal law enforcement agencies. 

While some law enforcement agencies in Nebraska indicated they would cease low-level cannabis prosecutions following the legalization of hemp because they were unable to tell the difference between the two, Douglas County Attorney Don Kleine said in August that he would continue trying the cases using the previous state law that only allowed University of Nebraska-Lincoln researchers to possess hemp.  

Other law enforcement agencies throughout the U.S. where cannabis remains outlawed have indicated they would stop making arrests for low-level possession due to hemp legalization, with some saying they do not have access to labs that can test the THC content of a product.

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Hemp & Farming Advocates Call on EPA to Approve Hemp Pesticides

The National Industrial Hemp Council and American Farm Bureau Federation is asking the Environmental Protection Agency to approve 10 submitted pesticide applications for hemp production. In comments to the agency – which is considering which pesticides will be approved for use on hemp – the groups said they also “fully support EPA’s stated position that public notification is unnecessary for ‘future pesticide registration applications that are similar to these applications and that are expected to be submitted with more regularity.’”

“It is our hope that EPA can similarly approve additional applications that hopefully will be presented to expand the range of approved pesticides and provide our members with lawful options for pest control.” – NIHC, AFBF, public comments to EPA, Sept. 23, 2019

The environmental agency has received applications from companies seeking approval to use their pesticide products on hemp from:

  • Argo Logistic Systems (four products)
  • Marrone Bio Innovations (two products)
  • Hawthorne Hydroponics (four products)

The EPA indicated that the agency had called for comments as hemp applications “may be of significant interest to the public.” The agency did not have to seek public comments since the products being considered are already legal for use on outdoor crops and “contain active ingredients for which EPA previously determined the residues will be safe under any reasonably foreseeable circumstances.”

In their comments, the hemp and farm groups called EPA’s approach to the issue “encouraging.”

“The NIHC therefore encourages EPA to approve all ten applications to add hemp uses to the label promptly,” the groups said in their remarks. “It is essential to the industry that key crop protection tools for hemp production are in place for the 2020 growing season and beyond.”

The groups said they expect the industry to experience “billion-dollar growth … over the next few years” which would “lead to a demand for effective pesticides.”

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Many pounds of cured and trimmed cannabis bagged up inside of a large plastic bin.

10th Circuit Agrees: FLSA Applies to Cannabis Workers

The 10th Circuit Court of Appeals has upheld a lower court’s decision, saying employers in the Colorado cannabis industry must adhere to the Fair Labor Standards Act (FLSA), despite cannabis’ federally prohibited status under the Controlled Substances Act (CSA).

The case involved Robert Kenney — a former security guard for Helix Inc, a cannabis security company — who claimed Helix refused to pay him, and other guards,  overtime. Helix sought to dismiss the case, claiming the FLSA did not cover cannabis due to its illegality. The court disagreed on the grounds not complying with the FLSA would give the cannabis industry an unfair advantage over other employers, thereby encouraging employers to ignore regulations to compete. They also noted courts have long held the view that illegal activities such as gambling or employing undocumented immigrants are still covered under the FLSA.

Senior Judge Stephanie Seymour wrote, “The district court correctly reasoned and case law has repeatedly confirmed that employers are not excused from complying with federal laws just because their business practices are federally prohibited.” 

Additionally, the court pointed out the FLSA has been amended since the CSA was passed to exclude various labor practices, but working in the cannabis industry has not been one of them. 

“Congress has actually amended the FLSA many times since the enactment of the CSA without excluding employees working in the marijuana industry, despite specifically exempting other categories of workers.” — Excerpt from the 10th Circuit Court brief

The ruling covers other labor standards like minimum wage and is applicable nationwide. 

 

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Delaware Expands Medical Cannabis Patient Access

Delaware Gov. John Carney (D) has signed a law allowing physicians to certify patients who do not have a qualifying condition under the state’s medical cannabis regulations, WBOC reports. Patients must have a severe and debilitating condition, there must be grounds that cannabis could provide a therapeutic benefit to the patient, and all standard care practices must be exhausted.

The measure also allows parents and guardians of patients under 18 to attest to the underage patient’s consent to try a medical treatment that does not have medical evidence of effectiveness – which includes cannabis.

A previous version of the bill would have allowed a physician to recommend a patient’s eligibility for medical cannabis for any condition if they believed it could benefit the patient.

In Delaware, patients with cancer, terminal illness, glaucoma, post-traumatic stress disorder, AIDS, ALS, and autism with aggressive behavior can qualify for medical cannabis use. In 2017, Carney signed a bill allowing PTSD patients to get medical cannabis certification from any properly licensed physician rather than just a licensed psychiatrist.

At the end of the last fiscal year, Delaware had issued 6,625 patient, caregiver, guardian, and agent registration cards – 85 percent more than in 2017; 4,389 of those were new patient cards, according to state Office of Medical Marijuana figures. The majority of the state’s patients are enrolled in the program for severe pain. According to the Dover Post, there were 7,370 medical cannabis cardholders in the state as of May.

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Dutch Cannabis Legalization Trial Period to Require ‘Unattractive’ Packaging

Cannabis sold in The Netherlands next year will be in plain, “unattractive” packaging, according to an NLTimes report. The packaging changes are the start of a regulated cannabis experiment set to roll out in 10 Dutch municipalities in 2021.

The trial is expected to last four years, during which the government will license cultivators to provide cannabis to so-called coffee shops. The plan was first announced last year after a broad legalization proposal failed to pass Dutch Parliament. Under current Dutch law, cannabis is not legal in The Netherlands – contrary to popular belief – but rather tolerated. The nation’s drug policy prosecution guidelines allow individuals to possess up to 5 grams and grow up to five plants, while coffee shops can store up to 500 grams at a time.

The government has not yet announced who will grow the cannabis for the approved retailers. The new rules give cultivators two wrapping options: transparent or opaque packaging. The labels are not allowed to make any claims about the effects of cannabis but must contain health warnings and must cover at least 30 percent of the packaging — only black Helvetica font can be used. Cultivators are not allowed to change the packaging during the four-year trial.

According to the NLTimes, the trial is being conducted in Breda, Tilburg, Almere, Groningen, Maastricht, Nijmegen, Arnhem, Zaanstad, Heerlen, and Hellevoetsluis. Retailers in Breda, Maastricht, and Heerlen will not be permitted to sell cannabis to foreigners due to their status as “border municipalities;” the government hopes to prevent cannabis tourism.

Amsterdam did not sign up to participate since they are home to about 170 coffee shops and the trial requires that all sellers cooperate with the experiment.

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NCIA Releases Guidelines for Federal Cannabis Regulation After Legalization

Report urges Congress to remove cannabis from the Controlled Substances Act; suggests classifications for different cannabis products, most appropriate federal agencies and methods to regulate them.

WASHINGTON, D.C. – On Tuesday, the National Cannabis Industry Association (NCIA) announced the release of a paper providing extensive guidance on how cannabis should be regulated at the federal level. The paper highlights the need to have a clearly defined regulatory approach and structure prepared as the nation moves closer to making cannabis legal for adults, and identifies the existing agencies best suited to regulate the wide variety of cannabis products available in state-regulated legal cannabis markets.

The full paper, which was produced by NCIA’s Policy Council, is titled “Adapting a Regulatory Framework for the Emerging Cannabis Industry” and can be found here.

“As a country, we are starting to move past whether we should end cannabis prohibition, and need to put serious consideration into how we do that and what a post-legalization world looks like in terms of federal regulatory policy,” said Aaron Smith, executive director of the National Cannabis Industry Association. “The recommendations outlined in this report build on successful methodologies by assigning regulatory duties to existing agencies, while avoiding restrictions that would not be appropriate for cannabis as well as some of the missteps that have occurred with other products. We look forward to working with Congress to overturn our outdated federal marijuana laws and begin implementing this structure to help ensure public safety and displace the illicit cannabis market.”

The variety of products that contain cannabis means that a “one-size-fits-all” regulatory framework would be ineffective. Under such a framework, some products would be overregulated, while others might be underregulated. Instead, different regulatory structures, or “lanes,” should be utilized based on the characteristics and intended uses of the products to leverage existing federal regulatory expertise. This will lead to an effective and efficient review process for existing government agencies, specifically the Food and Drug Administration (FDA) and the Alcohol and Tobacco Tax and Trade Bureau (TTB), that avoids unnecessary bureaucracy, costs, and delays for cannabis companies or the government. Because human consumables are already regulated by the federal government through a variety of regulatory lanes designed for these purposes, most cannabis products could simply follow analogous products already being sold legally through these lanes, which the paper defines as follows:

  • Lane #1 — Pharmaceutical drugs (eg: Epidiolex; Marinol)
    (Regulated Like Prescription Drugs; Lead Federal Regulator: FDA)
  • Lane #2 — Ingested, inhaled or topically applied products with more than de minimis amounts of THC (+0.3%)
    (Regulated Like Alcohol; Lead Federal Regulator: TTB)
  • Lane #3 — Ingested and inhaled products with de minimis amounts of THC (<0.3% THC)
    (Regulated Like Food/Dietary Supplements; Lead Regulator: FDA)
  • Lane #4 — Topically applied products with de minimis amounts of THC (<0.3% THC)
    (Regulated Like Cosmetics; Lead Federal Regulator: FDA)

The paper also explains some of the reasons why removing cannabis from the Controlled Substances Act, rather than moving it to a different schedule, is necessary for the effective implementation of federal regulations.

“This approach will help us protect consumers, foster research, and provide guidance for the growing number of states that are regulating cannabis for adult and medical purposes as we work to repair the harms caused by prohibition,” continued Smith.

Cannabis is legal for adults in 11 states as well as the District of Columbia and the territories of CNMI and Guam, and 33 states as well as several territories have comprehensive medical cannabis laws. The substance is legal in some form in 47 states. Last week, the House of Representatives overwhelmingly approved the first standalone cannabis legislation to receive a vote in Congress, the SAFE Banking Act, which would allow financial services providers to work with state-legal cannabis, hemp, and ancillary businesses.

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The National Cannabis Industry Association (NCIA) is the largest cannabis trade association in the U.S. and the only organization broadly representing cannabis-related businesses at the national level. NCIA promotes the growth of a responsible and legitimate cannabis industry and works toward a favorable social, economic, and legal environment for that industry in the United States.

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San Diego Considers Limiting Cannabis Billboard Ads

San Diego, California is considering cannabis-industry reforms, including limits on billboard advertising, loosening limits on where cannabis operations can open, and changing the word “marijuana” to “cannabis” in all city codes and documents, the San Diego Union-Tribune reports.

Under the new rules, billboards advertising cannabis would have to be 1,000 feet away from schools, playgrounds, public parks, daycare centers, and youth centers. The state law already prohibits cannabis advertising within 1,000 feet of “sensitive uses” but does not include parks. Councilman Chris Cate, who proposed the ban, had included churches, libraries, and residential care facilities, along with barring them within 100 feet of residential housing in the proposal, but those locations were not included in the adopted rules.

The goal of changing “marijuana” to “cannabis” in the city code is an effort to align the language used in the 2016 ballot initiative and the language used by the state with city regulations.

The city’s plan to soften its 1,000-foot zone between cannabusinesses and sensitive areas heralds back to when the city began allowing medical sales in 2014 and the distance was based on a straight line from the businesses to the sensitive use building without taking into account barriers such as canyons, and constructed barriers like freeways. Officials are planning to use the most direct and legal pedestrian path of travel between property line.

Cannabis industry attorney Gina Austin suggested to the Union-Tribune that business owners “may get a few extra feet” out of the changes.

The San Diego Planning Commission is set to consider the changes on October 24. If approved by the commission and city council, they could be implemented by year’s end.

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Scientists Create Industrial Quantities of Psilocybin via Metabolic Engineering

Researchers at Miami University in Oxford, Ohio have created bacterium capable of sustainably producing industrial quantities psilocybin, the primary chemical found in psychedelic mushrooms.

The findings will be published in the December issue of the journal Metabolic Engineering.

According to Assistant Professor J. Andrew Jones, who led the study, it’s a significant step towards solving the issue of mass-produced psilocybin, which naturally occurs in the mushroom Psilocybe cubensis, known more commonly as magic mushrooms. Mushroom cultivation, Jones noted, would be an expensive and inefficient method of mass-producing psilocybin for research and drug development.

“We are taking the DNA from the mushroom that encodes its ability to make this product and putting it in E. coli. It’s similar to the way you make beer, through a fermentation process. We are effectively taking the technology that allows for scale and speed of production and applying it to our psilocybin producing E. coli.” — Study lead Andrew Jones, in a statement

Psilocybin — which remains a Schedule 1 substance under the Controlled Substances Act alongside heroin, crystal meth, and cannabis — has been shown to have major potential in the treatment of depression and other mental health afflictions, including PTSD and addiction.

A psilocybin research institute was recently unveiled at Johns Hopkins University. Meanwhile, at least one medical psilocybin initiative is being planned for the Oregon 2020 elections, while voters in Denver, Colorado approved a ballot initiative earlier this year decriminalizing psychedelic mushrooms in the city.

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Cannabis Contributed $8.26B to Canadian GDP Post-Legalization

The Canadian cannabis industry contributed $8.26 billion to the nation’s gross domestic product as of July, an increase of $1.24 billion from last October when cannabis was legalized throughout the country, according to Statistics Canada. The agency estimates that illicit cannabis output has fallen 21 percent post-legalization as the legal industry grew 185 percent.

The growth in the sector comes as Canada sees a decline in other, traditional, industries including mining, quarrying, and oil and gas extraction industries (-3 percent), construction (-0.7 percent), and manufacturing (-0.1 percent).

Canada did see a rise in other sectors, including wholesale trade (1.1 percent), real estate (4.2 percent), and retail trade (0.6 percent); but no sector reached the double-digit growth seen in the cannabis industry.

The cannabis industry will likely be able to maintain its growth as the nation plans on legalizing edibles and other “alternative” cannabis products – such as topicals and concentrates. Consulting firm Deloitte estimates that alternative cannabis products could add $2.7 billion a year to the space. Lift & Co. and Ernst and Young anticipate alternative cannabis product sales will grow the industry by about 65 percent.

An August report from Statistics Canada found that the cannabis industry added 6,570 jobs from the same month last year, representing a four-fold increase. Of those jobs, about 60 percent were in cultivation, harvesting, processing, manufacturing, and administration, while 20 percent were in the packaging, marketing, and sales sectors.

The GDP increase does not include the hemp industry, and the Statistics agency suggests that hemp production in the nation will double from 41,200 acres last year to 82,500 this year.

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Oregon State University Hemp Research Center Nets $1M Private Donation

The Oregon State University’s Global Hemp Innovation Center has received a $1 million gift from Oregon CBD whose founders, brothers Seth and Eric Crawford, graduated from the college, the Corvallis Gazette-Times reports. The GHIC was launched in July and includes 40 faculty members from 20 disciplines.

The funds from Oregon CBD will be used to explore hemp genomics to help better understand how hemp can be used in industrial applications, consumer goods, and health products.

Seth Crawford, a former OSU sociology professor, told the Gazette Times that “understanding genetics” is key to unlocking the “tremendous amount of possibility” with the crop.

“Philosophically, we believe the public land grant university needs to be the epicenter of that research so that all can benefit from the findings. We believe OSU is the right place to lead this research.” – Seth Crawford, to the Gazette-Times

Eric earned a horticulture degree from OSU and has worked as a naturalist at Mount Rainier National Park and owned a landscape architecture firm in Eugene.

According to the report, it’s the first major private donation to the center, which plans to publicly share its data and collaborate with other researchers and industry operators to study hemp.

Jay Noller, a professor of crop and soil science, said the center’s team has been “overwhelmed by the outpouring of support and interest” in the work of the GHIC.

Alan Sams, dean of the College of Agricultural Sciences, said the investment will accelerate the center’s leadership and help establish the college “at the forefront in genomic research in hemp.”

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Dr. Mechoulam Unveils Synthetic Cannabinoid Acids Discovery

Dr. Raphael Mechoulam — the Israeli cannabis researcher credited with the first synthesis of tetrahydrocannabinol (THC), as well as the discovery of the endocannabinoid system — may have made cannabis history again. Last week, at the annual cannabis research conference CannMed in Pasadena, California, the 88-year-old organic chemist and his research team unveiled their latest discovery: the ability to synthesize stable cannabinoid acids for medicinal research and drug production.

The discovery was, according to an NBC report, a combined effort by Dr. Mechoulam and his team; cannabis startup EPM; six universities throughout Israel, Canada, and the United States; a topical cream manufacturer; and a testing lab.

“This is exciting and unprecedented research. We have taken the unstable molecules of the cannabis plant and synthesized them to provide a stable, consistent basis for researching new therapies across a wide range of medical needs – from CNS disorders to inflammation and many more. In addition, we have provided several delivery mechanisms including tablets, topical applications and others to facilitate several approaches. Our work is a catalyst for the development of potential new therapies from a source long thought to have huge potential.” — Dr. Raphael Mechoulam, head of research for EPM, in a press release

The development is critical because cannabinoid acids are significantly more potent than typical cannabinoids (CBDA is about a thousand times more potent than CBD, for example), but the plant’s naturally occurring acids are very unstable and had so far eluded chemical synthesis.

“For the first time ever, pharmaceutical companies will have access to a wide variety of patent protected, stable cannabinoid molecules synthesized to provide stability and consistency for use in developing new medicines, with numerous potential therapeutic applications,” Reshef Swisa, the chief executive officer for EPM, said in a press release.

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West Hollywood Cannabis Cafe Opens for Business

The first true cannabis cafe in the U.S. — where open cannabis consumption, which includes smoking, vaping, and/or the consumption of edibles, is allowed — opened its doors today in West Hollywood, according to the Los Angeles Times.

The newly opened Lowell Cafe is billed as a functional restaurant but where servers also double as budtenders, and patrons will be offered a menu of in-season cannabis flower instead of wine or other alcoholic beverages (nonalcoholic beverages, however, are perfectly allowed). The menu will include both infused and non-infused food items, and consumption is allowed both in the dining area and outside on the restaurant’s open-air back patio.

Patrons will need to present valid ID showing they are 21+ before entering. Visitors will be allowed to bring their own cannabis products, including edibles to eat or flower to smoke, if they pay a small “tokage” fee, similar to a restaurant’s corking fee for wine. Patrons can also bring their own pieces but will have the option of renting a pipe or bong from the establishment.

“We wanted to break the stigma against cannabis so we wanted to create an environment where people could comfortably consume and also enjoy a really fantastic meal.” — Lowell Cafe’s general manager Lily Estanislao, in a KABC report

The starting menu includes:

  • Miso-glazed pork belly,
  • Jalapeño mac and cheese bites,
  • Vegan nachos,
  • Sticky tamarind wings,
  • House-made pickles, and
  • Avocado and white bean hummus.

Each item has a recommended cannabis flower pairing.

Lowell Cafe received unanimous approval from West Hollywood city regulators after promising and delivering a sophisticated air filtration system to keep the restaurant’s air clear of smoke and vapors.

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The Chicago, Illinois city skyline photographed from distance.

Illinois Awards First Adult-Use Cannabis Grow Licenses

Cresco Labs, PharmaCann, Ascend Illinois, and Columbia Care are the first companies awarded licenses to cultivate cannabis for the adult-use market in Illinois, the Chicago Tribune reports. Currently, there are 17 cannabis cultivators in Illinois that operate 21 facilities.

The state’s new law, approved earlier this year, gives current operators the first shot at adult-use cannabis cultivation licenses. 

Jeremy Unruh, director of public and regulatory affairs for PharmaCann, told the Tribune the approval allows the company to “put the pedal down in terms of producing” as adult-use sales are set to commence on January 1. Unruh said the company is working to more than double its production at its Dwight facility in preparation for the new year.

Cresco spokesman Jason Erkes said in a statement that the company is expanding its Joliet operations for the recreational crop but that Cresco had received approval for all three of its facilities. Last week, the company announced it was selling its Joliet and Kankakee facilities to Innovative Industrial Properties for about $46.3 million but would be leasing them back as part of the deal.    

Applicants have to pay a $100,000 application fee and commit to participating in the social-equity program included in the law. The 55 medical cannabis dispensaries currently serving the state’s patients can apply to sell adult-use cannabis products from the same facility. So far just five dispensaries have netted the approval. All of those dispensaries are owned by Green Thumb Industries.

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Kentucky CBD Processor Sues Oregon Distributor Over ‘Male’ Seeds

Kentucky-based CBD company Elemental Processing is suing HP Farms, which is based in Oregon, alleging that the company sold them 6 million hemp seeds that were mostly male instead of feminized as promised, the Oregonian reports. In the lawsuit, Elemental Processing claims that male seeds sell for less than a penny each whole feminized seeds cost at least $1 each because they produce cannabinoid-rich flowers.

The plaintiffs claim that the worthless hemp seeds ruined their 2019 crop and the male plants prevented the females from flowering, leading to $44 million in lost profits. Elemental paid $352,000 in advance for the seeds and agreed to pay another $3.5 million or 15 percent of the profits from the harvested plants’ flowers. 

According to the report, the plaintiffs sold the seeds to farmers throughout Kentucky who “had no choice but to plow underneath” the plants, the lawsuit says. The farmers found out about the problem with the plants only after they had sprouted.  

Oregon and Kentucky are among the national leaders in hemp crop cultivation. Last year, at least 50,000 acres of hemp were planted in Oregon, while Kentucky farmers registered 56,000 acres for hemp production — agriculture officials, however, do not yet know how many acres were actually used for hemp cultivation. In 2016, just 6,700 acres were planted after 16,100 acres were registered, according to agency statistics.

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The Connecticut Capitol Building in Hartford, Connecticut.

Connecticut Moves to Add Chronic Pain to Cannabis Program

The Connecticut Board of Physicians has approved chronic pain and Ehlers-Danlos syndrome as qualifying conditions for the state’s medical cannabis program, according to a WFSB report. Ehlers-Danlos syndrome affects connective tissues, according to the Mayo Clinic

The board also considered adding night terrors/parasomnia but it was ultimately not recommended for the program.

Final approval for the conditions are still required by the Regulations Review Committee of the state General Assembly. In June, the state Department of Consumer Protection approved interstitial cystitis, a chronic bladder pain syndrome; intractable neuropathic pain that is unresponsive to traditional medical treatments; medial arcuate ligament syndrome, which causes severe abdominal pain; Tourette syndrome; and vulvodynia and vulvar burning, which causes pain in female genitalia.

If the two conditions are approved by the General Assembly, the total number of qualifying conditions will be 38.  

As of September 29, there are 36,653 medical cannabis patients in the state with just four producers, 14 dispensaries, and 1,117 recommending physicians. 

Lawmakers in the state are considering recreational cannabis legalization. Last week Gov. Ned Lamont and New York Gov. Andrew Cuomo met to discuss legalization as the Democrats are pushing for a uniform regional approach to the reforms, the Hartford Courant reports. The states are bordered by Massachusetts which legalized cannabis sales for adults last year.

 

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cbd oil for anxiety

CBD Oil for Anxiety: Does it Work?

We can all agree that the stigmas surrounding both mental health and cannabinoid treatments are dissipating. According to the National Institute of Health, 46.6 million U.S. adults reported having some type of mental illness in 2017, with the highest prevalence of individuals aged 18-25.

CBD, meanwhile, is the fastest growing industry in the wellness sector by far, and the recent legalization of hemp has only further kickstarted the CBD movement into action. 

This article will address and summarize the current and ongoing research as it relates to CBD, which continues to grow in popularity, and how it may interact with the symptoms of anxiety.

How Does CBD Help with Anxiety?

There is a growing body of research that suggests the treatment of CBD oil for anxiety. Researchers think this is because CBD acts on receptors in the brain called 5-HT receptors, otherwise known as serotonin receptors. Serotonin is a neurotransmitter that is responsible for many biological processes including learning and memory, appetite regulation, and sleep. You have probably heard of serotonin as it relates to depression, as most antidepressants and some anti-anxiety drugs act on neurons responsible for serotonin release.

A study conducted in 2018 by scientists at McGill University found that administering 5 mg/kg of CBD to rats for 7 days decreased anxiety-like behavior. They discovered this by measuring the firing rate of 5-HT neurons in an area of the brain called the dorsal raphe nucleus (measuring the firing rate can tell you how active those neurons are). This brain area provides a majority of serotonin transmission to other regions of the brain like the frontal cortex. Essentially, the study showed that repeated CBD administration seemed to increase the firing rate of these neurons, which led to a decrease in anxiety when these rats were behaviorally tested. This mechanism could explain CBD’s anti-anxiety and anti-depressant-like effects.

Other research focuses on CBD’s action at TRPV1 receptors. TRPV1 are proteins present in certain parts of the brain and peripheral nervous system responsible for regulating stress and pain modulation (it is also known as the capsaicin receptor, which is in charge of spicy sensations!). Scientists found TRPV1 receptors and cannabinoid receptors in the dorsal periaqueductal grey of rats, a region that plays a part in anxiety and panic responses. Because cannabinoid receptor activation in this region is anxiolytic (anxiety-reducing) and TRPV1 activation is anxiogenic (anxiety-inducing), some researchers speculate that anxiety can come about from an imbalance or dysregulation of CB1 and TRPV1 signaling in this area. This speaks to the presence of CBD’s unique dose-response curve, as CBD could potentially activate TRPV1 (thus increasing anxiety) in high doses. 

Mice with their TRPV1 gene knocked out experience lessened anxiety; thus, some scientists predict that the use of both CBD and a drug that would block TRPV1 could be a new line of research for exploring CBD as an anxiety treatment.

The cannabis and hemp industries are expanding each year, despite federal restrictions that continue to hamper researchers in their quest to further explore cannabinoid therapies. Photo credit: Brian Jones

How Much Should I Take?

CBD has a tendency to follow what scientists called an inverted, U-shaped dose-response curve. This means, if you imagine an upside-down U on a graph, CBD is effective for most conditions at those median doses (aside from epilepsy, which requires a higher dose). Researchers in Brazil simulated a public speaking task for human subjects to test this. They dosed humans with an inactive control drug, a benzodiazepine, and a variety of CBD doses (100 mg, 300 mg, and 900 mg). They found that only the 300 mg dose of CBD had anxiolytic effects on the subjects during their public speaking task.

If you are looking to use CBD oil to treat your anxiety, it is important to take into account a multitude of factors:

  • Does the product contain any THC?
  • Are there terpenes present, or is it a CBD isolate?
  • What is your history with drug-taking and are you on any other medications?

Many factors can affect how CBD works or how you may feel after taking it; clean cannabidiol is something pro-cannabis legislators are still trying to regulate, and somethings scientists are continuing to examine. Smoking CBD or consuming it via a tincture provides quicker and a more potent relief compared to taking it orally because it reaches your bloodstream faster. Specialists suggest starting at a low dose when starting to experiment, and slowly increase the dose until you’re comfortable or to match your growing tolerance. 

Possible Side Effects

The most common side effects reported from cannabidiol are fatigue, weight gain, and nausea. Side effects also depend on the factors listed previously, i.e. your typical drug-taking habits, other medications that could interact with the CBD, etc. Everyone’s body and brain tends to process drugs a little bit differently, which is largely why results can vary.

Possible interactions between CBD and other drugs may exist because CBD is metabolized by a class of enzymes in the liver called CYP450 enzymes. These are responsible for breaking down all drugs in the body. However, many other drugs follow this same metabolism pathway, including some anti-epileptic medications, benzodiazepines, and beta-blockers. If both drugs are “competing” for the same receptors, therefore, it will be harder for them to be broken down and can lead to more of the drug in your bloodstream.

Research shows CBD can render CYP450 enzymes inactive, which further informs necessary trepidation when combining drugs.

As with any drug, take precautions before you begin dosing. Studies show CBD is nonaddictive, but that does not mean it can’t bew psychoactive. We will learn more as restrictions continue to be lifted — the 2018 farm bill, which federally legalized industrial hemp, was a start — but, for now, we can only be informed by what we know today. And today’s research shows that CBD can be helpful for anxiety with the correct dose and after considering potential side effects and interactions with other pharmaceuticals.

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CDC: Most Vape Illness Patients Used Unregulated THC Products

The Centers for Disease Control and Prevention said the majority – 77 percent – of the people affected by the vape-linked pulmonary illness used products containing both THC and nicotine but they still have not figured out the compound in the vape products that is causing the sickness.

The agency found that 16 percent of affected patients used only nicotine-containing products while 36 percent used just THC-containing products. In an analysis of data from Wisconsin and Illinois, the CDC found that “nearly all” cannabis vape products linked to patients were obtained from “friends, family members, illicit dealers, or off the street.” Wisconsin does not allow adult cannabis use or sales, while Illinois passed legalization legislation earlier this year but the infrastructure is not yet in place for legal sales.

“CDC is committed to finding out what is causing this outbreak of lung injury and death among individuals using vaping products. We continue to work with FDA and state partners to protect the nation from this serious health threat.” — Robert R. Redfield, MD, director of the Centers for Disease Control and Prevention, in a statement.

So far, the CDC has confirmed 805 cases of vape-linked pulmonary illness in 46 states and the U.S. Virgin Islands, along with 12 deaths. The median age of patients is 23-year-old and about 62 percent of the patients are 18 to 34-year-old.

In New York, the Health Department linked Vitamin E acetate to the illnesses in the state after nearly all of the vape products linked to the illness tested by the agency showed “very high” levels of the compound. New York does allow vapeable cannabis products as part of its medical cannabis program but the agency did not find Vitamin E acetate in any of the legal vape products.

Massachusetts Gov. Charlie Baker announced a four-month ban on all vape product sales in the state that applies to both nicotine and legal cannabis products.

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Hemp Farm

Hemp Applications Open Next Month in Kentucky

Applications for hemp cultivation and processing in Kentucky open November 15 after the agency approved 56,000 acres for hemp last season. Agriculture Commissioner Ryan Quarles said the state “continues to be the tip of the spear” on restoring the hemp crop.

“Challenges persist, ranging from federal uncertainty regarding cannabinol to banking and lending issues. Any business venture – especially in a new industry – carries risk, and the hemp industry is no exception. It is important that our growers and processors remain clear-eyed about the opportunities and challenges ahead of us in the years to come.” – Quarles, in a statement

According to agency figures, from 2018 to 2019 hemp cultivation acreage in the state grew more than three times – from 16,100 acres to 56,000 acres – after only seeing a 4,000-acre rise from 2017 to 2018. The Ag Department does not yet have numbers for how much of that 56,000 approved acreage was actually used for hemp but in 2016, just 6,700 of the approved 16,100 acres were used, with just 6,000 of those acres harvested. Of that, 61.5 percent was grown for CBD, 18 percent was used for used for grain or seed production, 14 percent was cultivated for a combination of grain and CBD, while 4 percent was used grown for fiber and 2.5 percent for grain and fiber.

The agency is holding a hemp summit for those interested in the industry on December 4 at the Kentucky Exposition Center in Louisville.

The agency indicates that the hemp industry has created 281 new full-time jobs in the state last year and hemp processors paid growers about $17.75 million.

The application deadline is March 15, 2020.

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A cannabis worker plucks a leaf from the stem of a fully grow commercial-grade marijuana plant.

GW Pharma Enters Cannabis-for-Autism Study Partnership

GW Pharmaceuticals is partnering with New York’s Montefiore Medical Center to study the effectiveness of the cannabinoid cannabidivarin (CBDV) — which is a homolog to CBD — for autism, CNN reports. GW Pharma produces the cannabis-derived, FDA-approved epilepsy drug Epidiolex, which was recently approved for use by European Union regulators.

Dr. Eric Hollander, director of the Autism and Obsessive Compulsive Spectrum Program and Anxiety and Depression Program at Montefiore Hospital, said there is hope for CBDV for treating autism because of its success for treating seizure disorders. Hollander said that other studies have found that anticonvulsants “decrease the electrical activity [and] some of the disruptive behaviors, or the irritability, actually get better.”

“And that was one of our thoughts, why this CBDV could be helpful. Because if it helps with epilepsy and it helps in terms of decreasing the spike activity, we might also get improvement in the some of the aggression, or the self-injury, or the temper tantrums.” – Hollander, to CNN

Hollander added that in animal models similar to autism CBDV “had important effects on social functioning, on decreasing seizures, on increasing cognitive function, and in reducing compulsive or repetitive behavior.”

Dr. Alexander Kolevzon, clinical director of the Seaver Autism Center at Mount Sinai, who is not involved in the study, said that CBD “may benefit different people in different ways” but said the “challenge is to figure out which patients are likely to respond, and which symptoms are most likely to improve.”

The study was launched in April and aims to enroll 100 participants aged 5-18-years-old for 12 weeks of treatment through June 2021; results are expected in Sept. 2021.

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