The capitol building of North Dakota.

Questions Abound in North Dakota About Enacting New MMJ Law

Officials in North Dakota are working toward implementing the medical marijuana referendum approved by voters on Election Day, which requires that the measure be enacted within 30 days of its passage, the Minot Daily News reports. The text of the law is 33 pages, filled with stipulations and some provisions could be subject to interpretation.

Arvy Smith, deputy state health officer for the Department of Health, indicated that enacting the law within the 30-day window is “not possible” due to issues with staffing and how some sections of the law were written.

“More importantly, we need some legal clarification with the measure. Some of those prevent us from moving forward,” Smith said in the report. “It will take a two-thirds vote of the next legislative session to make the corrections.”

That super-majority requirement is of great concern for state Sen. Oley Larson, who anticipates the program will “be a free-for-all when it gets rolling,” and will need to be amended by lawmakers – who will have some time because cannabis won’t be available for at least the nine months it takes to grow the plant from a seed.

“I think it’s going to be implemented but our law is pretty loose,” he said. “I thought it was for cancer and maybe four applications but, from what I’ve been reading, if you have a prescription from anywhere you can get it when it’s here.”

The Health Department, who is tasked with overseeing the program, estimates they will need at least $2.7 million over the next two years to implement the law. Additionally, the measure requires that products be laboratory tested before they are made available for sale. Larson said he is unaware of any testing facilities in the state that can perform the mandatory tests.

It’s been 15 days since the passage of the law.

End


Patira Data Science: Data Mining in the Cannabis Industry

Cannabis has been on a big upswing since the first adult-use legalization bills were passed in Washington and Colorado, and marijuana pundits, business owners, and advocates are seemingly in agreement that this upwards trend is molding cannabis into a mainstream industry — with mainstream attention, however, comes the modernization of a formerly unregulated business landscape.

Enter Patira Data Science, an innovative, Ohio-based company that is dedicated to helping entrepreneurs improve their bottom line by offering an entirely new understanding of their business. As a data analytics service, Patira Data Science has served companies working in real estate, marketing, insurance, and many other industries — though the company is now offering professional data analysis to entrepreneurs in the cannabis space.

Stephen, a data scientist with Patira Data Science, says the company was first turned onto the industry when they were approached by a dispensary owner about doing a price analysis for their dispensary, comparing it to some of its competitors.

“He asked me, ‘Is there anything we can do to improve our bottom line?’ So I asked him, ‘What type of data do you have?'” Stephen said.

It turns out, even in an industry as nascent as legal marijuana, there is a lot of available data, according to Stephen. And much of that information — pricing specifics, customer satisfaction, and the types of products being offered — might normally be glossed over by business owners, but these are the data points which Stephen and his team look at to determine business strategies for a cannabis company.

Much of the data needed to analyze success patterns for a dispensary or cultivation company is publicly available through that company’s website, though Patira Data Science will sometimes rely on a dispensary’s profile on a cannabis dispensary directory such as Weedmaps.com or Leafly.com to corroborate that data. However, it takes an expert’s eye to glean actionable information from that data mass.

Through professional data mining and analysis, Patira Data Science returned to their first dispensary customer with information-based advice covering the predicted popularity of certain products, how to price things competitively in the current marketplace, strategies optimized for appealing to cannabis customers, and more.

For more information about data mining and analysis, or to learn how Patira Data Science’s services could benefit your own cannabis venture, visit PatiraDataScience.com or reach out to the company directly at http://www.patiradatascience.com/contact.html.

End


Slot machines inside of a 21+ casino.

Public-Use and No-Smoking Policies Prohibit Cannabis in Massachusetts Casinos

Cannabis use will not be permitted in Massachusetts casinos, due to language in the law that bars public-use and the fact that casinos are already non-smoking establishments, according to a MassLive report. The Gaming Commission is, however, trying to determine whether the law will have any impact for casinos operating in the state.

“That’s a very big change in the cultural, social and possibly economic landscape,” Commission Chairman Stephen Crosby said in the report. “We should think about whether there are any implications for that for our operations.”

Crosby says, specifically, that the commission needs to address questions about whether guests at casino-owned hotels would be allowed to use cannabis in rooms that permit smoking — an issue that could be addressed by the state Legislature if they amend the law, which is likely.

The commission plans on reaching out to regulators in other legal states that have both legal cannabis and casinos, such as Colorado, Nevada, and Oregon. They also plan on asking for feedback from casino license-holders and having a public comment period on the potential regulations.

The Treasurer’s Office is responsible for overseeing the implementation of the program and could choose to devise rules clarifying the matter without relying on lawmakers.

End


Indoor Sungrown Cannabis - Fleurish Farms

Fleurish Farms: Perfecting Sungrown Indoor Cannabis

It takes a lot of energy to grow cannabis indoors, and as the legal industry has gained momentum, much attention has been paid to the energy footprints of producers who run indoor grow facilities. While arguments between indoor & outdoor growers have existed for some time, a regulated market brings a new level of public scrutiny to the issue. But what if growers could have the best of both worlds? What if you could bring sunlight indoors to combine natural lighting with the benefits of a controlled environment?

This is the question that Fleurish Farms, a cannabis cultivation firm based in Sonoma County, has set out to answer. In the latest episode of the Ganjapreneur.com podcast, our host TG Branfalt interviews Dr. Jonathan Cachat and Dr. Joshua Earlenbaugh about their unique DSS Supplemental Sunlight™ systems which employ Solatubes, a form of tubular skylight that has existed for decades, to harness sunlight and beam it into an indoor environment. This method of indoor growing is not a new kind of greenhouse: using Solatubes, Fleurish Farms is able to have much better control over humidity and temperature than a greenhouse typically affords.

In this interview, Cachat and Earlenbaugh discuss how they came from academic backgrounds to pursue opportunities in the cannabis industry, how they first contacted Solatube about using their skylights for growing cannabis indoors, and how they have worked to perfect their systems so they can achieve comparable results using only 20% of the energy typically used by grows that employ artificial lighting.

Listen to the podcast below or scroll down for the full transcript!

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Read the transcript:

TG Branfalt: Hi there. I’m TG Branfalt and you are listening to the Ganjapreneur podcast where we will bring you essential cannabis business news and insights by speaking with stakeholders, experts and entrepreneurs who are focused on normalizing and demystifying the cannabis industry.

I’m joined by Dr. Jonathan Cachat, the CEO and Dr. Joshua Earlenbaugh, the COO and Director of Production from Fleurish Farms, a Sonoma County California patient research firm specializing in cannabis products, including sungrown indoor flower, pure flower oil rosin and innovative and energy efficient growth solutions. How you guys doing today?

Josh Earlenbaugh: Great. Thanks for having us.

TG Branfalt: So today’s show is a little bit different than our usual format because we have two guests. I’m sure our audience is very curious to learn about the technology you use, but before we get into that, I’d like to ask each of you about your personal background and how you came to apply your experience to growing cannabis.

Josh Earlenbaugh: This is Dr. Josh Earlenbaugh. I was finishing my PhD in Analytic Philosophy at the University of California Davis, and I started hobby growing for my own medicinal purposes. I was getting some pretty cool results with LEDs at the time. They weren’t really big for commercial at the time, but I was getting interesting results so I kept playing with them. I ended up starting a delivery service my last year of my PhD, and started moving some of that stuff through there to get market feedback. I just fell in love with growing things for the market at that point. At GHC, that’s where I met JC.

Jonathan Cachat: Yeah, so this is Dr. Jonathan Cachat. I have a PhD in Behavioral Psychopharmacology, meaning that during my graduate school years, I was licensed by the DEA to handle and research Schedule I-IV drugs. Our goals were to build new models of zebrafish affective disorders, and it’s some pretty interesting stuff. If you go to PubMed, or Amazon and search for “zebrafish on LSD” you can see some of my papers.

Post PhD, I went into data science, so I started a post-doc at the University of California Davis, in the data science department looking to integrate neuroscience data. Then through the delivery service, GHC, ran into Josh. I think it’s safe to say that we hit it off. Josh shared some ideas that he’d been playing around with, with growing plants underneath sun tubes, and I sort of looked at him and said, “Let’s do it. Let’s try it.” That was about two years ago.

TG Branfalt: I know a lot of cannabis entrepreneurs find their way into the industry from an academic background, but to some people that might seem like a big leap. What would you say initially caused you to make that leap?

Josh Earlenbaugh: This is Josh again. Like I said, I was using it medicinally. I was kind of out of the closet on that, because I had to use a lot of it. It helped me with my ADHD, to actually get my PhD finished so I could focus on it. Anger issues, stuff like that. It would just help with the type of environment that I always put myself in, and high stress. I believed in it a lot. There was other people in the neighborhood that I felt like could use similar types of medicine. Like I said, I was getting good, cool results with my LEDs that were helping with my particular condition, so I wanted to let other people have a shot at it.

Jonathan Cachat: Yeah, I think we can certainly attribute some of the analytical approach to the philosophy, too, in designing light recipes for over all that time Josh was using LEDs like over the last seven years, the developments there have been significant and vary a lot. I think his analytical mind … it’s not necessarily that the … I think that the path, the degrees that we took, got us here on purpose, I guess I should say.

Josh Earlenbaugh: For me, it was an understanding that if I wanted the opportunity to learn about cannabis, and endocannabinoids and the endocannabinoid system, basically at this point we understand that it regulates homeostasis in almost every organ of your entire body. It’s like a thermometer of your entire room. Turns things up when it’s too cold and relaxes things if they get too excitatory, like epilepsy for example.

In order to further our understanding of seemingly one of the most important signalling systems within our biology, it just occurred to me that I could pursue such research faster in a consumer market, because really what we’re trying to do is understand how different cannabinoid profiles or terpene profiles relates to a patient’s symptoms and symptomology.

It was a desire to enter a space that was rapidly growing that could handle innovative ideas and would allow us to not only further the treatment of our loved ones and ourselves, in some way, but those who then join into the collective. And bigger than that, furthering endocannabinoid research and knowledge, as well as tackling one of the bigger and more interesting problems of the amount of energy consumed in an indoor grow.

TG Branfalt: Okay. So let’s get right into that, because I’m sure our audience is eager to learn more. I know our editor Graham and our COO Noel saw your display at the New West Summit in San Francisco a few weeks ago, and they were really blown away by the concept.

I have yet to see one in person, but as I understand it, you’re using Solatubes, or a unique kind of skylight that harnesses the sunlight into a tube and beams it into a room. Not a greenhouse, but actually an indoor structure. Can you walk us through how this all works, and what sets it apart from other indoor lighting methods?

Josh Earlenbaugh: The sun tubes are a pretty simple idea. My dad was putting one in his bathroom years ago, and I asked him what they were. He was like, “It’s a tubular skylight, and this light from outside travels down through it, it’s pretty reflective material. Then you have some light in your bathroom for free. I was like, “Well that’s interesting.” I had just started growing with LEDs, and I was like, I wonder if I could use that to supplement the photo energy, the power. Eventually I looked into it more and found Solatube. That was about the time when I met JC.

We basically reached out to Solatube. Said we wanted to perform some research, that we were both PhDs in Davis, and they had technology, and had developed patented protected technology to capture, transfer and deliver natural sunlight indoors. They have a patented material called Spectralight Infinity. This limits the amount of light lost due to diffuse reflection. Scientific story short, it allows us to send in 99.7% of the sunlight’s natural spectrum into a room without IR, which is what heat is. We dissipate the heat before we bring it in, and limiting UV to a pretty big … a large extent, for a good reason. I think we can explain later.

If you can imagine walking into a room that’s completely dark, and then these dimmers open up, and all of a sudden you’re in this completely dark space, but lit by natural sunlight. The color rendering indexed in that room, how it makes you feel when you have the natural light on your skin. When we say, “sungrown indoor,” we really do mean we’re utilizing the rays from the natural sun in order to support the plant growth inside of the environment.

TG Branfalt: You use soil for your indoor grows as well, right?

Josh Earlenbaugh: We use soil to an extent right now. The first grow we did was about 15 to 20% soil, mixed in with cocoa that was amended. Then I recycle all of that, so the next run is the same cocoa amended with more of the farm dirt. I’m trying to find out how much natural native soil I can get into before it gums up the system, because indoor is pretty difficult to keep irrigations if you’re going all probiotic and organic the way we’re doing it.

Jonathan Cachat: I think too, that the approach to growing with soil indoors, you’re right to point out, is not very popular at the moment. What we’re trying to do and where the fundamental belief comes from is that, the relationship between the soil and plants and the organisms within there, the diversity of growth and flora basically work together in concert through signalling molecules to try say okay, I need some more potassium, and this one just knows where the potassium is and come back and get it.

It’s more of a preventative or probiotic approach, rather than, I think, what you can get into without the plants in the room having their natural immunities as rapid infestations that then require very, sometimes harsh, quick reactive measures. Everybody knows that balance of trying to hold them steady. But by bringing in the indoor soil, using things like cover crop, we’re allowed to diversify the plants that the insects are attached to. We can help the soil retain moisture more than without, and the fauna and flora that live in there communicate with the plant to grow a really healthy plant.

TG Branfalt: I want to backtrack here for a second. As I understand it, the company that produces these skylights, Solatube, is a mainstream residential brand that does not have much to do with agriculture, and certainly not cannabis. How did that first meeting go when you reached out to them? Were they receptive to the idea of the product being used in this way? Were they shocked? Did they threaten to call the cops? How did that conversation play out?

Josh Earlenbaugh: I think that it is something that Solatube was not unaware of, or I guess they were very well aware that there’s people calling them pretty regularly wanting to use their products to grow plants. You gotta understand that Solatube, the work that they do and the amount of light measurements that they do are in lux, or foot candles. How much light can come down from a 35 foot tall warehouse ceiling so someone’s desk three feet off the ground is properly illuminated.

When the people that wanted to grow plants underneath that started asking them questions about well, how much power can I get, what are the power measurements? The people at Solatube really weren’t equipped, nor did they have the data to get some accurate information about that.

The first call between us and them was pretty interesting. I told them I was a researcher at UC Davis. We were interested in using them for indoor agriculture. I think the first guy I talked to said, “Okay. All right, all right. Well, if you’re going to grow with cannabis, just let me know because we get a lot of people that like to call and beat around the bush, but we definitely know what they’re calling about.” I sort of said, “Yeah, we’re going to try to grow cannabis under there and would like to see if it works, because if it does work, it could be a real paradigm shift and a real godsend to the energy impact that the newly onboarding regulated cannabis market can bring.

Since that interaction it’s just been nothing but growing better from there. They have some very strong expertise in light physics and the way that it interacts with different materials and wavelengths. I think that through our credentials, but then also our very serious approach to data collection and actually measuring and monitoring the … data and that light moves through the space, they really knew that we were doing it correctly and that we were getting good results.

Now we have in place with them an agreement where anybody who calls them about the use of the tube in an indoor space, they send them to us first, foremost so we can design systems that have worked. There’ve been plenty of systems that people have put together that just don’t achieve anything close to commercial results. The plants will grow, yeah, but are the buds going to be good enough for a jar? Probably not.

We’ve built a system, so now they come to us. We’re able to take in their needs like their growing style, where they’re located, how many rooms they’d like to do, and build them out a whole preliminary analysis of how our system would, of which the tubes are a component, work together for them.

TG Branfalt: Let’s talk about the Solatubes for a second. How durable are they? What is the expected life-time on them? What is the maintenance like? Overall, what are the associated costs with getting set up and running a grow?

Jonathan Cachat: In terms of their durability and quality in the product that’s built, Solatube, all of their products are ISO-quality, certified, all the manufacturing processes are. The best details I can get into are on the collector there’s a set of four straps, and those are called the hurricane straps. If you can take winds in a hurricane and not budge, then it’s pretty strong stuff.

In terms of the maintenance, that’s an interesting question because if we’re making a comparison against HPS, or any other light for that matter, you’re going to have to have an annualized budget for replacing the bulbs. With the Solatube, there are no mechanical parts, so there’s not very much to break or wear down … The one exception being the dimmer. But the maintenance for us is really every two weeks or so, we’ll send somebody up with a microfiber cloth, clean off the front of them and just make sure they’re shiny, and come back down.

TG Branfalt: What kind of yield do you get from this technology, and what is the time comparison to more traditional type grows?

Josh Earlenbaugh: We’re getting about the same time, as far as that goes. It also will depend on what type of artificials that you’re using. We’re using LEDs because that’s what I know how to use. I figured that I would be able to control the spectrum, and blend it in with the sun tube spectrum more.

What was the first question?

TG Branfalt: Yields.

Jonathan Cachat: Yields. I have been extremely happy so far. First run, we scaled up at 27, 26 grams?

Josh Earlenbaugh: Yeah, per square foot.

Jonathan Cachat: Per square foot. It looks like the next one will be 30 to 35. So it looks like it’s going to comfortably get up to what we want, which is like 50, 60, 70, in the normal amount of time you’d expect from a grow room.

Josh Earlenbaugh: Six months to a year.

Jonathan Cachat: We got about a pound to a pound and a half per light. If you were to compare that to an HPS, you know, that’s on par. We need to dial things in, so we’re hopeful that they’re going to continue to rise as well.

As Josh was noting with the LEDs, and in terms of the length, one of the other interesting things that we’re allowed to do, are able to do with the way that the grow room is set up, we fuel plant growth with the natural sunlight. We’ll get anywhere from 300 to 600 ambient par within the space, and then this hot dynamic spot that moves across the plant canopy that it can spike pars between 900 and 1300 par, so just a great amount of par in that space, natural sunlight par.

So as that nice dynamic base is moving along, and fueling plant growth, we can very specifically and tightly regulate, okay let’s throw far red on these flowering plants at this point and reduce the amount that they’re vegging and stretching and growing and get them to build out those buds more. Okay, let’s pull that back now. Let’s do a week later, we’ll shift away from far red. So understanding how those LEDs are related to plant development in very specific ways allows us to then make decisions on how fast we actually would like to run that flower period for.

TG Branfalt: You’ve mentioned research several times. Have you run any trials to compare this process to other growing methods and if so, what was the outcome? Did you find that the sunlight via Solatubes was as effective as outdoor sunlight?

Josh Earlenbaugh: Sure, yeah. We ran a great big clone from a local nursery this year. I ran it outdoor … like a big one. She was about three pounds I think, outdoors. It was like a three month plant. Then I ran it inside as well. The most notable thing other than that there’s a clear quality difference from indoor and outdoor in general, and that was there, visually. Where one of them looks, a lot of people say, kinder. It’s just less weathered is really what it comes down to. The flesh of the plant, it hasn’t been beat up as much so usually it’s lighter green.

Of course we had all that, but what I was most blown away by was the average bud size. I mean the three pound plant was very large, but when it broke down, it didn’t really break down as big of buds as the indoors because they didn’t have to be broke down as much. Their average bud size was quite a bit bigger. That was probably the most visually stunning thing, other than the fact that it just looks a lot nicer because it’s indoor, and if you like that type of look, lighter greens and more vibrant oranges and more frosting, then it definitely is going to hit all those quality benchmarks that indoor growers are looking for.

Jonathan Cachat: In addition, too, we were able to compare the analytics, so the cannabinoid profile and the terpene profile of the same genetics grown outdoor, and one grown in the sungrown indoor room. SC Labs was able to do a pretty extensive panel for us and basically what we got back is that the outdoor and the sungrown indoor in terms of cannabinoid content are equally complex, higher or lower than each other, but pretty much equal, in terms of the number of cannabinoids, the CBG, THCB, CBN, those things, and then also just as complex and rich as the terpene profile.

So why I say this is that most testing labs that I talked to say that outdoor plants for certain have a more complex and slightly elevated cannabinoid profile compared to the same strain or genes grown indoors, presumably under HPS light. Initially I would have thought that that was the opposite, but that seems to be the truth.

What the analytics tell us at this point is that any affordances, or any benefits of growing outdoor by having the natural sunlight increase the diversity and complexity of the cannabinoid and terpene profile, we are also afforded those same benefits with the sungrown indoor room, because we have brought in that light spectrum.

TG Branfalt: That’s really incredible, but we have to take a short break right now. When we come back, we’re going to talk about energy efficiency. I’m your host, TG Branfalt.


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TG Branfalt: Welcome back. I’m TG Branfalt. I’m with Dr. Jonathan Cachat and Dr. Josh Earlenbaugh of Fleurish Farms, and we’re talking about your sungrown indoor flower growing technique.

I wanted to ask about your energy usage that you typically see using your approach. Is the sunlight from your DSS tubes able to offset a significant amount of energy compared to your average indoor grow?

Jonathan Cachat: Yeah, yeah. So let’s try to just paint a picture as an example here. So we got a 2,500 square foot grow room. It’s got 4×4 trays, maxed out as much as we can, and if that room had to have 150 HPS lights, 1,000 watt HPS lights, the electrical demand over that year for just turning the lights on in that room is about 700,000 kilowatt hours a year. The 2,500 square foot flowering room, you turn on your lights, you got about 700 kilowatt hours per year. 700,000 kilowatt hours per year. Using data that we’ve collected, based on how we can step up and step down the LEDs, a room the exact same size, 2,500 square foot, would need about 90,000 kilowatts per year. This is about 600 kilowatt hours per year that’s saved, or about $125,000 saved in just the electrical cost compared to turning on the HPS lights. We haven’t even gotten into the HVAC and the other necessary controls.

Maybe if you would approach that from a different angle too, Josh.

Josh Earlenbaugh: Yeah, actually or just even a follow up, right? Because our numbers there are figured in, that’s not just light losses, right? The 291. So it’s like I’d say it’s about 10 times. I’d say at the end of the day if you’re talking 2,000 watts per square meter we’re at about 200. That’s for everything. That’s including the HVAC, the dehumidifier which reclaiming water, all of everything. Including the thing that’s capturing the data itself … the computer that’s actually doing that. We’re including all those things in our …

Jonathan Cachat: Yeah, a lot of people like to talk about grams per watt. There’s a number of different ways that you could do that. Grams per total watts, in one cycle, throughout the whole cycle. Grams per light watt, if you have 1,000 watt light, you just do 1,000 light watts … there’s a number of different ways to do it. You mentioned I think earlier, we hit about one gram per watt for the entire watts consumed in the entire ship, about two grams per watt in terms of light watts. To sum it all up, though, we’re basically able to sustain commercial production levels with an 80% reduction in the energy demand.

TG Branfalt: Which is huge. I mean not only is that good for energy efficiency and saving energy, but it also reduces the overhead costs for your business, correct?

Jonathan Cachat: Indeed, especially the farmers, as well. As we enter into a regulated market here in California, getting used to paying licensing fees and taxes and having other people take parts of your margin, we think really the best way … and what most people are doing at this point anyway, are trying to reduce their cost of goods as much as they can without affecting quality.
By bringing in natural sunlight, and fueling plant growth with that, we’re able to achieve reductions in the cost of goods sold unmatched by any other solution on the market.

TG Branfalt: In your guys’ opinions, do you think that the energy usage that’s associated with cannabis production could derail the industry? I mean there’s already provisions in California’s initiative that aim towards reducing the amount of water. Right?

Jonathan Cachat: Right. Water’s definitely an important thing. We didn’t touch on that very much in our … the DSS sungrown indoor technique, 82% of the water that went in was reused and reclaimed, so our net water use was about six gallons per plant over the whole eight week flowering cycle. But that’s … saving water in California is very important.

Do we think that electricity is going to be a concern? Well, I know that it already is in several places in California. For one, for example, Desert Hot Springs. Many of our listeners are probably familiar with the amount of cultivation licenses and that city’s very welcoming approach to the growth of this industry. They’ve offered so many permits now at this point, that the power cannot simply be delivered. Their demands cannot be met by the infrastructure at that place. In those cases, a solution like ours can really reduce that load demand, and perhaps allow those businesses to continue forward.

I also think that you’re seeing in places like Berkley and Lake County, limits on mixed lightings situations, so this could be like a light dep greenhouse, or a greenhouse which would have some supplemental lights. In the mixed light category, we’re probably going to get to a place, and the legislature may pick this up next year, that they’re going to start limiting the amount of artificial light lots that you can have in a space.

So yes, I think energy conversation is definitely coming and it’s starting now. The water discussion is always been around and I think will be, but also there’s other reasons why you’d want to do it in places like places that have high amount of sunlight, like Nevada or Arizona, for example. But it’s extremely hot.

Growing in a greenhouse there, the amount of HVAC you’d have to have in a greenhouse would really take a dent out of your electrical bill. But if you were able to bring that natural free sun into a fully insulated indoor environment that you’re able to keep it a stable temperature, and environmental range, then it becomes another interesting use case and application.

TG Branfalt: What are the implications for large scale indoor agriculture beyond cannabis using this technology?

Josh Earlenbaugh: One of the reasons that it fits with cannabis at this point is because there’s enough distinct … market distinctions. People can tell the difference between indoor and outdoor cannabis. It’s difficult for them to tell the difference between indoor and outdoor tomatoes to the extent that it’s ever worth doing your tomatoes indoor. So really market is why I would say one of the reasons that hasn’t happened much.

Where I could see it start happening is places that don’t have outdoor as an option. Because they could grow year ’round urban farming style with these types of things. As things get hotter in harsher climates then I think maybe we’ll want to grow indoors more and more because we won’t be able to predict what’s going to happen outside … hurricanes and whatnot, like we were saying earlier, these are hurricane proof. It makes it to where you can count on your crops a lot more than you traditionally can outside.

I think that while it doesn’t scale right now, there’s definitely room for it in the future.

Jonathan Cachat: When I think about how we approach that, and I would say that large scale agriculture is being done either outside or in greenhouses. You know, the central valley of California provides like 90% of our almonds, and 10 other nuts and agricultural products. Large scale agriculture in that way is done outside or it’s done in a greenhouse, and the fact that the planet’s surface temperature has been continuing to rise and rise and rise … Monsanto and these other seed companies, they see the writing on the wall, and I think that their biggest focus right now is how to develop heat tolerant and drought tolerant plants.

At one point, Josh and I will joke around this late at night when we’re just reminiscing on things, but at some point, it honestly might be too hot on the surface of the planet to be able to sustain growth of corn or plants. What will happen now, dig these fields underground and pipe the sun in with the tubes.

The cannabis is driving agriculture innovations, certainly. Everybody with the best minds, the best ideas, it’s all coming together at such an exciting and diverse time in the industry. But who knows what the implications are beyond this? We hope that our industry will be able to develop into socially conscious, public benefiting companies and really redefine the role of what a capital market can look like.

TG Branfalt: With all of these benefits and the potential benefits that are still being discovered, why aren’t more people getting on board with this method?

Jonathan Cachat: I think because it’s never been done successfully, there’s been a few hurdles, right? We had to get through those hurdles ourselves, first. Do the plants respond well to this light? Okay, check. That worked. The next series of projects and proof of concepts went to how can we push them to their limits? What can we get in terms of yield?

Josh Earlenbaugh: I was just going to say when you first think about, oh just pop the light in, the reason a lot of these don’t work is because the amount of par, the amount of photosynthetic energy you need to drive plant growth to the extent that it makes sense to use indoor real estate to do that, is staggering.

One of the things that’s interesting is that you have to be able to fill the gaps. So when the sun’s not as powerful during the day, how do you keep that photosynthetic energy powerful? Oh you’ve got to use LEDs. Well how do you get them smart enough to know when to be on and when to be off? Those are all the things that we’ve put the time into to figure out okay here’s a whole technique. It requires all off these different things, because the sun is dynamic. Growing with it in June is not the same as growing with it in March.

Johnathan Cachat: The first thing when people walk back there, the people in the cannabis industry, and check them out, they’re just blown away. They’re, “I’ve been to cannabis farms all up and down the coast, but I’ve never seen anything like this.” Then they go in the room and see the quality of the light in that space, and, “Oh my gosh, these plants are beautiful and I can’t believe this is working.” Then consultants started calling, we’re speaking to people in Washington, Hawaii … They wanted to see the buds. They wanted to see the bud formation. Came out beautifully, and the Skywalker gene we’re carrying right now looks fantastic.

Data, data, data has gotten us to where we are now. The one argument that’s classic in the lighting discussion is well which one’s better? LED, plasma, HPS, the new ceramic ones? But everyone agrees that the sunlight is superior in every way. Now we just need to demonstrate, number one, that we can help reduce the cost of the project because the utility companies offer grants and rebates for projects like these, and because we can achieve that 80% reduction in energy demand compared to the same room if you would have gone with 1000 watt HPSs. You can get up to 30 to 50% of that entire project cost covered up front.

That’s really the next thing that we’re moving towards as well. We have plans to get a few going on our farm. We’re already in conversations with utility companies so then the hurdles to buying in are rapidly shrinking. I think the writing’s on the wall with this one.

TG Branfalt: Why don’t you tell me about some of those hurdles that you’d mentioned when starting out with this technology.

Jonathan Cachat: I would say building the light space was the first difficult part. How many of these do we need over what size of an area? How high do we want the roof to be? Where do we want to end that roof?
We went from the design with just one on top of 120 square foot shed to now with four. That’s been great. Then really just balancing and compensating when the light begins to dip outside to write the scripts to programs to have a teeter back up with the LEDs.

Integration, was with the help of Grownetics and Heliospectra really, that we were able to all come together and get all these systems integrated so nicely.

Josh Earlenbaugh: That’s key for moving forward is continuing to work with a whole team to be able to do this because although you can grow with the tubes alone, it’s just a lot more difficult and would require a much larger scale, and you might be relegated to only one part of the year, something like that. The artificials are very helpful, and I would say especially at this point, very important to get out there with the technology so that it doesn’t fail the way that people were worried about it failed before.

Jonathan Cachat: Seeing really is believing. A lot of those hurdles go away as soon as you step into one of these rooms with natural sunlight, man it’s really an amazing feeling.

TG Branfalt: In addition to your own production, you also do consulting to help growers get set up with their systems, correct?

Jonathan Cachat: Indeed. We have a process to take care of that. If they went to Bit.ly.dssform, you could start the process of a preliminary analysis. Basically we’re going to ask questions about where you’re located, what type of budget range you have, what your grow goals are, what experience you have with growing, are you using cocoa or pots on trays, how they get the trays … things like that. And also about your location, like the closest largest city to you.

We get that information and we churn it through a number of data algorithms that look at 15 years of historic weather data to give us an accurate prediction of how much light will be in that space at what time. We’re able to look at data across the year and get back to you if you’re interested in the feasibility of the project. We think that the system that you need would cost about $500,000, and you would be able to rely on the natural daylight for 80% of the months between x and y. We basically lay it all out in the preliminary analysis.

That would be for a retrofit, if someone had a warehouse or had a building and they were just now planning it all out. It’s interesting to note we can set up nurseries and clone rooms with these as well with a smaller amount of tubes.

We’re also in the middle of developing a 1,000 square foot option, so 1,000 square foot canopy in a 2,600 square foot building that has a clone room, and a bedroom, and equipment and an office. That’s going to be around $500,000. We love to hear from people who would like to get in and try it, whether they have a smaller unit or a bigger unit, we’re really out here to share our results and our successes, and inviting those who’d like to try to reach out.

TG Branfalt: I want to hear about some of the feedback that you guys have already gotten from some of the growers, but before I get into that, we gotta take another short break. I’m TG Branfalt. I’m here with Dr. Jonathan Cachat and Dr. Josh Earlenbaugh of Fleurish Farms. We’ll be right back.


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TG Branfalt: Welcome back. This is TG Branfalt and you are listening to The Ganjapreneur.com podcast. I’m here with Fleurish Farms and before the break we were discussing the consulting work you have done setting up indoor sungrown systems, the DSS systems, with other commercial growers. What kind of feedback have you received from the growers that you have worked for, setting up these systems?

Josh Earlenbaugh: Sure, yeah. It’s really interesting because you’ll get two kinds of feedback. One is like, “Oh, I really need that,” because they’re in an area where they don’t have a choice where the regulations are thus and so. But more importantly they’re skeptical because they want to know if it’s going to work. Growers are creatures of habit. They’ve had to be entrepreneurs themselves, indoor growers for a long time, so they can count on certain yields, certain flowers. And they’ve already got all their money invested in that. It’s difficult to have just a normal 1,000 square foot or want to just switch over real quick unless someone’s pushing them to want to care, given that everything’s going well.

You might think at first, like big operations like Canada, they’re very interested in doing these huge grows, but when you’re talking about California, or something like that, then you’re talking to some extent a smaller grower than that, so you really have to appeal to the ROI to make sure that makes sense, it’s not going to mess the money flow up.

I think that’s really what it comes down to. It’s like, “Oh I’m going to have to invest in this and it might not work. I really need to see that it works on scale before I can put any of my money into it.” I think that’s the mindset for a lot of people.

Jonathan Cachat: Yeah, I would say it comes down to a yields question. Everybody I talk to gets three a light, three a tray. That’s the yield. I don’t really see …

Josh Earlenbaugh: Maybe two a tray.

Jonathan Cachat: Yeah. I don’t see the data, I don’t see the data log books. It’s anecdotal at that point, but they probably are doing pretty well. I think the argument that we make though, is even if we’ve got 40% less yield, we still reduce the cost of goods by 80%. At some point, the cost prohibitive of a regulated market is going to come up against where HPS is no longer manageable from a business perspective I would say.
We’re very happy with the yield numbers that we’ve hit. We’re approaching a pound, pound and a half per tray. I think it’s only up from here once we get the strains dialed in. That equation now just doesn’t really make sense favoring HPS in terms of the reduction in the cost of goods sold.

TG Branfalt: You talk about most growers being entrepreneurs, and you guys are obviously leading the way in terms of this method and the research, and how data-driven it is. What have your biggest mistakes been getting into the space, and what advice might you have for other entrepreneurs who might be interested in doing what you’re doing?

Jonathan Cachat: It’s a good question. I would say the biggest mistake one could make is not getting involved, just not getting out networking and talking to people. As this industry just blows up and expands, the best advice I have to anybody that wants to get into it is just start getting involved. Start talking to people.

I would say if we … in terms of our biggest mistakes, make sure that you have accurate load calculations and your power infrastructure is where you need it to be. Having a solar system and a grow at the same time was … led to some miscalculations on ourselves. So work with professionals, certainly, when it comes to electrical codes and building codes and all that. It’s going to be more and more important to do things correctly and log and document all of those things.

Josh Earlenbaugh: Yeah. I would say those are it.

Jonathan Cachat: What about for the grow? Was there anything with the grow, like learning to play with the LEDs, or how much LEDs? Like dialing in the sensor system, I guess it was a series of trial and error, we had to dial it in.

Josh Earlenbaugh: Yeah, we had to dial the spectrums in. Especially relative to the different plants and how they like to grow. That’s what the LEDs really helped with. You can also offset some of the sun’s stuff, if I had to and there was a lot of far red from the sunset, but for some reason they were in a period where I wanted them to go longer, I could turn on extra far … like 660 far red, which actually made them turn more vegetative state. We have a lot of control.

TG Branfalt: In terms of networking and getting involved, can you point to a specific moment where you made a particular connection or established a particular partnership that really kind of took things to the next level or opened up new opportunities?

Jonathan Cachat: I would say that an interesting development was when we started pressing rosin for pure flower oil in a rosin. So we specialize in the solventless concentrate, pressed only from flowers. I would say because we’re out there, and political and networking and talking to people, the ability to find partners up in the Emerald Triangle that trust you and that’s able to work together and able to share common goals and values … It’s much easier to partner with other small businesses than to think that you could build an entire brand on your farm alone or with your team alone.

Josh Earlenbaugh: Exactly.

Jonathan Cachat: All of those partnerships that we’ve had, even through the California Growers Alliance, or CCIA or the Sonoma County Growers Alliance, attending the events and finding people that are like-minded, everybody’s looking onward and upward, really. Finding people that are on your same wavelength is really important.Try to avoid people that start questioning the possibility of what you’re doing. If you know you’re right, you’ve just got to get rid of the dead weight and keep on going.

Try to avoid people that start questioning the possibility of what you’re doing. If you know you’re right, you’ve just got to get rid of the dead weight and keep on going.

Josh Earlenbaugh: Get the data.

Jonathan Cachat: Collect the data.

TG Branfalt: Would you guys credit kind of your post-graduate work and the desire to kind of keep learning as part of the reason that this is such a data-driven process for you guys?

Jonathan Cachat: I would say yes, innately, we want to see the data, but going back to when we were discussing the hurdles, it’d be a really tough sale at this point if we couldn’t give you certified data of what we’re getting per square foot and the amount of electricity we consume to do that.

It was really a necessity to know that if we’re going to make an argument at some point that you need to not go from HPS, but you need to get LEDs and sun, that we need to have data to support that. And continually improving the process by monitoring our own iterations.

I’m a bit of a data nerd, sure, and Josh likes to crunch a whole bunch of numbers.

Josh Earlenbaugh: I like to crunch numbers.

Jonathan Cachat: Yeah.

Josh Earlenbaugh: Yeah. And I like to know if there’s an answer that you can get from the data. There isn’t always, but know why something’s happening the way that it is, because as an indoor grower, I want a certain amount of control so that I’m not constantly surprised by what’s going on. That gives you consistency and that makes you meet dates and deadlines and benchmarks and these kinds of things.

Jonathan Cachat: You can have a live dashboard to know when something’s … like the temperature’s going up two degrees, it lets you know, and you can fix it right away.

TG Branfalt: Yeah, you guys employ like an app or a smartphone technology to this thing, right?

Josh Earlenbaugh: That’s right.

Jonathan Cachat: Yes. Grownetics system. They’re out of Boulder, Colorado.

TG Branfalt: How early on or at what stage did you begin to employ that into your scheme?

Jonathan Cachat: That came in the second research build. Once we started putting four of the tubes into one space, we outfitted the entire thing with 25 different sensors, 8 of them focused just on light in the space. That was when we were trying to test the performance analytics. How much can we grow, and for how little electricity can we do it? The Grownetics system really allowed us to monitor that in real time, and then not only now we’re churning back through data to see where if there’s any abnormalities like a spike in the a/c that wasn’t controlled or saw that we could hone those down.

TG Branfalt: I wanted to go, just backtrack a little bit, we didn’t really talk too much about the rosin. Rosin’s really only been around since the hair straightener video, a little over a year ago. It was popularized and then the industry emerged from that. Why did you guys choose rosin over the other methods of extraction?

Jonathan Cachat: That one was pretty easy, actually. The writing on the wall from MRSA, the California’s Historical Regulations on the medical market here, defined manufacturing based on volatile solvents or non-volatile solvents. We were playing around with BHO at the time, but became very interested in rosin because it was solventless. In other words, it was certainly nothing inherently dangerous, nothing could explode. In fact, rosin is a more accurate representation of the essence of whatever is being extracted.

Of course we started with the hair straightener for sure. Got one of those from Target, tried that one night. Wow, this works. Cool. Moved on to a t-shirt press that we were going to go with one of the more popular presses that you can get on the market, there’s a few companies out there now, but decided instead just to manufacture our own press based on what our production goals were and our quantity and quality goals were. We have a pretty unique press up here, and we actually got a few new enhancements or adjustments coming on the way that I’m pretty happy about.

You’re right in that the rosin market is small, but I think that really seeing what it does is believing as well, so I recommend anyone who hasn’t tried rosin, get out there and go try it. Then try an AB test next to a BHO and see how you feel.

Josh Earlenbaugh: Especially I would say flower rosin in particular is what we specialize in. There’s definitely more and more kief and hash rosin coming out and some of it’s really good. The flower rosins are particularly reminiscent of the flower that they came from. I think that once people get used to that palate, they’re really going to prefer the rosin to the BHO. But we’ll see.

Jonathan Cachat: Farmers love rosin because-

Josh Earlenbaugh: Yeah that’s the thing we noticed.

Jonathan Cachat: … they can taste their fingerprint on the bud in the rosin form. The officianados and the growers like it. I think that they will just … Plus I think that BHO and CO2 and even ethanol extractions, unfortunately, in this first wave of regulations, are going to get pretty regulated out. I think rosin is going to be the new standard hopefully here pretty soon.

Josh Earlenbaugh: Yeah, especially as price comes down as well. We’ve been trying to scale up so that we could bring the price in the market down for flower rosin. As that happens, as you close the gap with the competitors like CO2 and BHO, then it’s more of a fair market comparison, because now someone who may not have bought rosin before is going to try it just because the price point makes sense for the first time. They might like it and switch over.

I think really growing the market is essential for continuing to do all rosin.

TG Branfalt: All right guys. We’re going to have to wrap it up here. Why don’t you tell the audience where they can learn more about your products.

Josh Earlenbaugh: Certainly, yes. On the web, it’s fleurishfarms.com, F-l-e-u-r-i-s-h farms dot com. Across social media channels we’re @fleurishfarms, and if you want some behind the scenes on the sungrown indoor, check out @fleurishfarmer, and of course you can always just send an email or fill out the contact box on our website, info@fleurishfarms.com.

TG Branfalt: Thank you so much for joining me.

Josh Earlenbaugh: Appreciate it Tim.

TG Branfalt: You can find more episodes of the Ganjapreneur.com podcasts in the podcast section of Ganjapreneur.com, and the Apple iTunes store. On the Ganjapreneur website you’ll find the latest cannabis news, product reviews and cannabis jobs updated daily along with transcripts of this podcast. You can also download the Ganjapreneur.com app in iTunes and Google Play. I’ve been your host, TG Branfalt.


Video edited by Carlos Cadenas
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The New York Stock Exchange in New York City, New York.

NYSE Approves IPO for Cannabis-Related Real Estate Investment Trust

The New York Stock Exchange has approved the initial public offering application of Innovative Industrial Properties, a real estate investment trust with medical cannabis property investment plans, making it the first cannabis-related company to be listed on the exchange, according to a Forbes report. It will be listed under the symbol IIPR.

The company, which does not “touch the plant,” plans to raise $75 million, offering 8.75 million shares at $20 a share, giving the San Diego, California-based firm a $202 million valuation. Currently, the company does not own any properties but is working on a deal with PharmaCann in New York which would see the trust purchase the company’s 127,000 square-foot building and lease it back to them for $30 million.

Jeremy Unruh, general counsel of PharmaCann, called the listing “every bit as important to the cannabis movement as the Rohrabacher-Farr Amendment…or the commitment of Scott’s Miracle Gro to the cannabis industry.” The Rohrabacher-Farr Amendment prohibits the Department of Justice from spending federal dollars to enforce federal law against canna-businesses in legal states.

“IIP’s publicly-traded REIT will be the very first opportunity for institutional investors to comfortably generate exposure to an industry that currently lacks the sort of transparency that SEC oversight provides,” Unruh said in the report.

The approval likely has much to do with the fact that the company is a real estate holding company and the NYSE doesn’t police any other REITs as to the nature of their real estate holdings.

Drug companies GW Pharmaceuticals and Insys Therapeutics, who use the cannabis plant in their drug development, are also listed on the NYSE but are viewed as biomedical firms, not cannabis companies.

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A sailboat silhouetted by the setting sun somewhere in the Cayman Islands.

Cayman Islands Gov. Signs Medical Cannabis Bill

Medicinal use of cannabis oil is now legal in the Cayman Islands for the treatment of conditions such as epilepsy and cancer and as a pain reliever for rheumatoid and osteoarthritis symptoms, according to a report from the Cayman News Service. The amendment to the island nation’s Misuse of Drugs Law was signed by Gov. Helen Kilpatrick last week with the full support of the Legislative Assembly.

The changes permit physicians to prescribe medical cannabis and for pharmacies to dispense it, but does not allow for cannabis to be grown in the Cayman Islands. According to a Cayman Compass report, last month the legislature passed laws allowing for the importation of cannabis oil, anticipating that Kilpatrick would sign the measure. According to the final version of the law, it is up to the Cabinet to devise rules and regulations governing the program, including importation issues, storage, and dispensing.

Dennie Warren, an advocate who pushed for the legislation after his wife was diagnosed with lung cancer, says he has identified ways to procure cannabis oil from Jamaica and Canada — a process he can start now that the law has been changed.

The measure makes no changes to the criminalization of other forms of cannabis nor possession or use.

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Inside the Maryland Senate chambers.

Maryland MMJ Commission Moving Forward with Licensing Process

The Maryland Medical Cannabis Commission is set to award preliminary medical cannabis dispensary licenses on Nov. 28, despite three lawsuits and threats by the leader of the Legislative Black Caucus to introduce legislation to start the process over again due to the lack of preliminary cultivation licenses to minority owned companies.

According to the Washington Post report, the dispensary applicants will be approved in the same manner as their cultivating counterparts — the applications will be scored by a third-party and their identities will be unknown to the board. The winners will be announced on Dec. 9.

The blinded process used by the board is partially responsible for the controversy that has marred the medical marijuana program in the state thus far. Maryland Del. Cheryl D. Glenn, the leader of the Black Caucus, has suggested that the commission has “no oversight” and “no diversity” and she is pushing for the process to be started over. Maryland Cultivation and Processing and GTI Maryland have sued the commission over their cultivation application denials, alleging that they were unfairly bumped from their initial high rankings over “geographic diversity” requirements in the law. Alternative Medicine Maryland, a minority-owned Annapolis-based company, has also sued the agency, alleging that they “ignored race and ethnicity throughout the licensing process in clear contravention of its authorizing statute.”

Vanessa Lyon, spokeswoman for the commission, said that businesses awarded preliminary licenses must pass additional vetting before they can begin operations and that it is “premature to characterize” the industry’s diversity before any company is fully approved to operate in the state.

“The commission believes it is in the best interest of sick people to move the pre-approval process forward, however, the commission is committed to working with the legislature on these complex issues,” she said.

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A sunny view of Seattle and Mt. Rainier.

Seattle Raises Dispensary Licensing Fees

Seattle’s City Council has approved a $500 increase in dispensary fees, raising them from $1,000 to $1,500 for the city’s existing 48 shops, according to a KIRO report. The hike is a compromise from the more than 400 percent increase proposed by local lawmakers two weeks ago. The increase also applies to out-of-town businesses selling supplies to Seattle dispensaries, who now must pay $750 for their license.

Logan Bowers, president of the Cannabis Organization of Retail Establishments and owner of #hashtag dispensary, said he was “pretty happy” that the city backed down from the proposed three-fold fee surge.

“While we are thrilled to work with them on the issue, there still is a lot more that needs to be done,” he said in the report. “It’s a reasonable compromise for now.”

The 400 percent increase was proposed by Councilmember Tim Burgess, who said the larger fee would help the city offset the costs of industry enforcement and regulations. Burgess indicated that linking the licensing fees to regulation costs is not off the table and the council could revisit the issue in the coming year, and that the council would likely confer with city accountants to determine if it would be better public policy.

“That’s a big question,” Burgess said, “whether or not the city should charge businesses the full cost of enforcement of business regulations.”

Seattle has raised about $2 million in revenue from the legal cannabis industry to date.

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Young cannabis plant with red-colored stem.

Fifth MMJ Company Will Begin Trading on the Australian Stock Exchange Tomorrow

Medical cannabis company Zelda Therapeutics will hit the Australian Stock Exchange tomorrow, according to a Proactive Investors report. Zelda will become the fifth medical cannabis company to be listed on the exchange, following a reverse takeover by Gleneagle Gold Ltd.

The move comes after the U.S.-based medical cannabis group – Aunt Zelda’s – was spun off and subsequently raised $4 million and transitioned into a publicly listed company, the report says. The funds will be used to continue its pre-clinical research and development, fund human clinical trials and expand the management and advisory teams.

Due to its success treating patients in California, Aunt Zelda’s boasts an extensive network on human data related to medicinal cannabis-based products and treatments; Zelda Therapeutics has been granted a worldwide, exclusive and perpetual license to this data and to other related systems, treatment protocols and formulations owned by the California-based firm. The flagship Aunt Zelda’s is continuing its California operations. The company has focused throughout the years on developing products for treating skin conditions, insomnia, and cancer.

Zelda Therapeutics has also forged partnerships with AusCann, the University of Madrid and New Frontier Financials.

Zelda will join Creso Pharma, MMJ Phytotech, MGC Pharmaceuticals, and Medlab Clinical as cannabis companies listed on the exchange.

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A bartender prepares a cocktail.

Colorado Revenue Department Bans Cannabis from Establishments with Liquor Licenses

The Colorado Department of Revenue has adopted new regulations preventing businesses that serve alcohol from obtaining a license to allow cannabis use at their establishment, according to a KCNC report. The rules are supposed to help clarify where cannabis consumption will be allowed following the passage of Denver’s social-use initiative.

The denial comes at the behest of the state Liquor Enforcement Division, who cited studies that showed dual consumption leads to higher impairment, which could increase the likelihood of traffic accidents for people under the influence of both cannabis and alcohol.

Peter Penzenstadler, a local bartender, said that he was on board with the regulations because mixing alcohol and cannabis could dangerous for some patrons.

“Alcohol messes up people well enough,” he said in the report. “[If you] add that marijuana to it, we can’t be in control of the customers for a safety standard as well.”

However, the rule throws a wrench into the rollout of Initiative 300. According to a Denver Post report, state law bars dispensaries from allowing on-site consumption, and while Marijuana Policy Project communications director Mason Tvert called the rule “absurd,” he said the decision “doesn’t completely hinder the entire law.”

“Remember that this whole thing kind of got started with the Colorado Symphony Orchestra fundraiser that was held in an art gallery,” he said. Due to the event’s cannabis theme, the city sent a letter to the event organizers warning them that their plan was illegal. It was later changed to an invite-only event.

“It is astonishing that the Department of Revenue is so openly fighting a turf battle on behalf of the liquor industry,” Tvert said. “This will not prevent adults from using marijuana and alcohol at the same time, but it will ensure that the marijuana gets used out in the alley or on the street rather than inside of a private establishment.”

City officials are currently developing plans to implement the new law.

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Maine and Mass. Legalization Could Affect Possession Laws in New Hampshire

A New Hampshire Democratic state Representative called the adult-use cannabis legalization in Maine and Massachusetts — two of New Hampshire’s border states — a “game changer,” saying it could pressure the state legislature to at least consider decriminalization of cannabis possession, according to a Seacoast Online report.

“There’s going to be a product that’s legally purchased and available to people on our borders,” Rep. Renny Cushing said in the report. “With that same product, someone goes to New Hampshire, they could have someone put in jail for a year.”

New Hampshire has a limited medical marijuana program, which does allow for out-of-state reciprocity for conditions listed on the state’s own qualifying condition list. According to an August report from the New Hampshire Union Leader, about 1,300 patients are registered under the New Hampshire program.

However, just because people could be driving through the state with cannabis legally obtained in either Maine or Massachusetts, at least one law enforcement official does not intend to increase efforts to arrest people for cannabis possession. Hampton Police Chief Richard Sawyer says he has more prominent priorities, such as the opioid crisis.

“In the world we live in today, there are much more serious issues we are dealing with,” Sawyer said in the report. “I have no intentions of increasing our efforts in that area.”

Nevertheless, Portsmouth Police Chief Davis Mara said until the legislature changes the state law regarding possession he would continue to make arrests.

“The bottom line is we have to enforce the law,” he said.

Seakbrook Police Chief Michael Gallagher suggested that people in possession of cannabis need to make sure they know where the New Hampshire border is because some roads weave throughout the borders.

Gov.-Elect Chris Sununu said he would support decriminalization legislation but that jumping “all the way to full legalization” was not a step the state should consider taking until it’s clear how other states deal with their new laws.

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Share Your Opinion on Marijuana Marketing

adistrylogo2Adistry and Ganjapreneur have teamed up to present The 2016 Cannabiz Marketing Survey. This report will benchmark the tactics, challenges, opportunities and priorities of marijuana marketers across the country.

We need your help:

All eyes are on America’s fastest growing industry — but how do companies guarantee that they get the right eyes on the many different cannabis brands and retail locations popping up?

This is your chance to help influence the current and future state of cannabiz marketing. Your shared knowledge and insights will help lead to the understanding of key trends and data points to help cannabis companies, and the industry as a whole, better engage canna-consumers in 2017.

Please take 5 minutes to fill out the 2016 cannabiz marketing survey. It’s only 10 questions and completely anonymous.

To show how much your feedback is valued, you will be entered to win awesome prizes like the Eco Stash Bag from Stashlogix, once you complete the survey. Winners will be announced the first week of January!

Plus, survey participants will receive the report before it is released to the general public.

You can take the survey here.

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Alaska's state flag.

First Dispensary Opens Today in Alaska’s Kenai Peninsula

The first recreational dispensary in Alaska’s Kenai Peninsula opens today, according to a report from the Alaska Dispatch News. The owners of Red Run Cannabis will be selling cannabis grown by Greatland Ganja as their first in-house products won’t be ready for sale until mid-January.

Marc Theiler, one of Red Run’s three owners, said they want to keep it “really simple” for their customers, opting to sell eight different strains in 1, 2 and 4-gram packages and pre-rolls.

“Our goal was to get the Kenai Peninsula legal ganja before Thanksgiving,” he said in the report.

However, Theiler said that in the early going keeping their supply of flower could be a challenge until “around Christmas” due to their own plants not being ready and the limited supply chain in the early stages of Alaska’s legal market.

“We built the cultivation and retail from scratch,” Theiler said. “With the retail we had a bunch of things fall into place.”

The shop will be open Monday through Wednesday but closed on the mid-week holiday. They plan on reopening on Friday and having regular business hours until they are sold out.

Nearly two years after voters approved an adult-use referendum, dispensaries have opened in Valdez and Fairbanks. Licensees in Anchorage indicated they will open in the coming months.

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Image Matters: Why Dispensaries and Cannabis Producers Should Invest in High-Quality Photography

Until the day that computers and mobile devices are capable of emitting a scent, dispensaries and cannabis producers must rely heavily on the visual element of their products in order to help them sell. High quality images of the product you are growing and selling not only reflect the quality of your business as a whole, but there is a huge opportunity to stand out among the competition with stunning photographs. It’s not hard to be mesmerized by the aesthetic elements of a beautiful cannabis plant and your customers will equate that beauty to a superior product.

Hire a local photographer

Unless you have a professional photographer on your team capable of macro photography, we recommend searching your community to find a photographer to either bring on to your team or to hire freelance whenever photography is needed. Cannabis photography is a growing industry, with companies and photographers specializing in cannabis imagery specifically. Place a job ad or search a photographer directory to find someone excited to work with you.

Explore stock image sites

If you are unable to find a local photographer, you might have luck finding appropriate images on a stock photo site. Traditional stock image sites like Shutterstock and Getty Images include cannabis photos, but you’ll likely find higher quality and more interesting photos on a marijuana-specific service like Stock Pot Images. We do recommend finding a photographer over using stock images, however, because a photographer will help you to portray your business and products more honestly and accurately.

Besides taking photos of cannabis and the products you sell, it’s also important to take quality images of the interior of your shop. Potential customers in this new industry want to get an idea of what the experience will be like before walking through your door. Will the experience be more like a pawn shop or like an Apple Store? Show them the personality and amenities of your shop through images.

Maximize your ROI

Once you’ve decided to invest in cannabis photography, you will want to maximize your return on investment. Here are some ideas of how to get the most use from each image:

  • Include photos of your products and store interior throughout your website.
  • Make your marketing efforts more effective by including the images in your email newsletters, social media posts and blog posts
  • Upload your images to directory sites like Weedmaps.com to make your business stand out among your local competition
  • Send photos along with your story pitches when you contact local media so that they have relevant images to print

With most businesses in any field, but especially in the cannabis industry, imagery is incredibly important. Every dollar invested in photography (as well as video) is money well spent because it can set you apart from your competition, persuade skeptical new customers to check out your shop, and enhance all of your marketing efforts.

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How to Find and Pitch Investors in the Cannabis Industry

Editor’s Note: Lately, we have been hearing from folks with start-up ideas all over the country, and they frequently ask us how they can connect with investors and what they should have prepared when it comes time to pitch. To answer these questions, we decided to recruit the best source possible — Francis J. Priznar, Chief Mentor at The Arcview Group — to help us understand what entrepreneurs need to do to successfully pitch investors. The Arcview Group is always seeking great ideas and entrepreneurs who want to raise capital from Arcview’s 550+ high-net-worth members, who have placed over $85M into more than 130 cannabis companies. The following is a list of questions that our readers have most commonly asked, followed by Mr. Priznar’s responses.


How can cannabis entrepreneurs meet investors?

After your personal contacts (friends and family), the best investors are most likely those who are already engaged in the cannabis market. Finding them, just a few years ago, used to be quite a challenge, but today an internet search will turn up many possibilities. Be careful, not all are equally qualified, nor appropriate, for you — so it makes sense to understand the investors’ track records, resources, specialties, and commitments to the industry.

An obvious source of quality accredited investors is my firm, The Arcview Group. We are the world’s leading cannabis deal-making platform. We welcome inquiries from any serious entrepreneur looking to launch a great idea or expand an existing business. We review up to 30 deals each week — ranking from cultivators, apps, hemp products, and more — and select those that meet our member interest criteria. If a deal is not “investment grade” some high potential early stagers might be referred to our successful partner Canopy — an accelerator with locations in CO and CA — for polishing.

As Chief Mentor for entrepreneurs at The Arcview Group, my advice to entrepreneurs is to try us first (or at least simultaneously) and if your deal is not right for us, we’ll often try to provide some feedback useful for retooling or moving in a different direction. We value all relationships with entrepreneurs and sometimes a bit of experienced and timely advice from experts such as us can be extremely helpful.

Likewise, you should actively seek to build relationships with investors and investor groups. That is because when you hear “no,” it usually means “not now.” You should always try to learn why your deal was not selected so you can pivot and return later if it makes sense.

Ganjapreneur, among other publications, lists investment sources other than Arcview. That is a start. If you take the same four-step approach with others as you do with us, you are on a good track:

  1. Make a great first impression: from your first call, to first pitch, to first in-person meeting.
  2. Seek useful feedback from seasoned investors.
  3. Build relationships. Investors can be helpful in important ways beyond funding.
  4. Think of fundraising as a marathon, not a sprint. It takes time.

And… repeat.

investorsupport2

What information should you have ready for investors?

The amount of information needed by entrepreneurs depends on the life cycle stage of the business. It’s understandable, for example, when conceptual startups cannot produce a cash flow analysis if they are not yet operating. Regardless, the more information the better and quality information is more important than quantity. The list below outlines an ideal information package but as previously stated is not always possible.

If you cannot produce these documents when requested by investors, it needs to be for a good business reason.

Business Plan

  • A business plan is a strategic document that communicates business goals and how they will be achieved. It’s often used to obtain investor funding and establish three- to five-year goals for a business.
  • You can customize important sections, such as the executive summary, market analysis, investment analysis, business operations, marketing strategy and more. A business plan is considered a “living document,” so it should be updated as your business evolves in order to provide internal and external guidance.

Investor Pitch Deck

  • Considered a modern condensed version of the traditional business plan, a pitch deck is a concise presentation that briefly describes your business to potential investors. The goal of the pitch is to clearly communicate your company’s value proposition and the customer problems it seeks to address and resolve.
  • Decks should be as short as possible, ideally fully presentable in less than 10 minutes, to ensure your audience remains attentive and engaged. Rather than reading off the slides verbatim, use the deck for supporting visual content, such as graphs, charts and key buzzwords, and develop a verbal pitch that supports the visuals. Pictures and graphs are more powerful that words here.
  • An investor pitch deck goes far beyond what you would include in a sales pitch deck. In a sales pitch deck, your focus is on the product or service and how it will be a value-add to the potential client. In an investor pitch deck, you have to address that but also address the competitive landscape, your investment offer and how it’ll be used to grow the business, the experience of the company leadership, and a host of other factors.
  • For more details, click here to watch a short presentation I gave on the essential elements of an ideal pitch deck.

Balance Sheet

  • Considered a “snapshot of a company’s financial condition,” a balance sheet is a basic financial statement that measures a company’s assets, liabilities and ownership equity. A company’s assets, such as physical property and intellectual property (see section on Protection), give investors an idea of how much a company owns. On the other hand, liabilities, such as payroll and debt, specify how much a company owes. Lastly, ownership equity indicates the amount invested by shareholders and the company’s retained earnings. Potential investors may ask to see an updated balance sheet to get a glimpse of your company’s financial condition, so it’s a good idea to have one handy.

Capitalization Table

  • A capitalization table is a record of all the shareholders of a company, along with their respective ownership percentages. It also outlines all of the securities issued by a company to investors throughout different investment stages (i.e. series or common/preferred shares and options/incentives), as well as the various prices paid for those securities.
  • This table specifies ownership shares on a fully diluted basis—if all convertible notes and stock options are exercised—therefore enabling a company’s ownership structure to be easily ascertained.

Term Sheet

  • A term sheet is an important document that a company seeking financing provides to potential investors. Many investors believe a deal is not investable if the entrepreneur fails to produce a term sheet on the first meeting.
  • Generally non-binding, a term sheet specifies the amount of financing sought, price per share, voting rights, redemption rights, closing details and more. Additionally, this document specifies the total number of directors that investors will be entitled to elect to the company’s board. Think of it as an executive summary for your investment offering – a top-level 1 pager that lists the most important details about your business and investment.

Income Statement

  • Also called a profit and loss statement, an income statement is one of three basic financial statements. It simply measures all of a company’s profits from all sources while deducting all of its losses during the same period of time. Comparing profitability to a prior period of time is vital since it helps investors determine whether a company’s profits have increased. This can be an important tool in making informed business decisions to free up cash flow and ensure profitability.

Cash Flow Statement

  • A cash flow statement measures the amount of cash a company generates and spends during a specific period of time. Since it helps investors determine how much revenue a company is generating, where it’s coming from and how it’s being spent, the cash flow statement is considered one of the big three financial statements.

Additional Documents

  • The following are useful but normally of secondary importance to investors:
    • Convertible Promissory Note
    • Corporate Director Agreement
    • Corporate Minutes
    • Discounted Cash Flow Projection
    • Share Subscription Agreement
  • Information on these documents and samples or templates are readily available on the internet.

investorsupport1

How should I talk about my idea?

Always remember you are selling a vision of a successful future. To do this, you should look and act the role today that you expect to be 3-5 years from now. For example, if you expect to be the CEO of a $25M software company in three years, you should look and talk like you are already in that role today.

Remember, you are asking for serious money and a commitment so you need to demonstrate you can be trusted, are yourself committed, and have the grit necessary to successfully get through many unforeseen challenges. This is about business and an investor relationship based on business first with authenticity and truth is a great starting point.

Being engaging is a plus. To do this, it is useful to be mindful that investors may know more about your business than you do. For all you know, the pitch an investor experienced immediately prior to yours was to solve the very same problem you are addressing. Or perhaps an investor has already invested in your competitors! A good approach is to be humble and seek advice… always ask for feedback. If an investor does not express interest in you, she/he is the only one who knows why and often you need to ask for an explanation and feedback. Honest and direct feedback is a gift.

How can I protect my idea?

As a startup, maintaining an edge over your competitors may depend on choosing the right strategy for intellectual property (IP) protection. If and when it is necessary to disclose this information, it’s useful to understand generally, there are two types of IP protection: patents and trade secrets. Each offers different types of protection with distinct benefits and risks.

Patents

  • Patents provide broad protection for invention and innovation on almost any novel aspect of technology or improvements on existing technology. A strong patent, or collection of patents, provides venture capitalists and angel investors assurance that the investment opportunity is protected and thus less risky. However, patent registration can require significant time and money to prepare and therefore could be an obstacle for investors.
  • Also, patents generally have a limited length of protection, with the patent owner receiving 20 years of protection from the time of filing or its earliest priority date. After this, anyone can legally copy or reproduce your innovation. Patents may also be expensive to defend against competitors and patent trolls.

Trade Secrets

  • Certain innovations may be more effectively protected if they are held as trade secrets instead of being disclosed to the world through the patenting process. One requirement for trade secret protection is that the invention must be kept secret. This requirement can make protection difficult to maintain because once a trade secret is divulged, it is no longer protected.
  • Trade secret protection involves protecting ideas simply by keeping them secret so it avoids the effort and expense associated with filing patent applications. Protection can remain for as long as the underlying technology (i.e. a secret sauce) is kept secret. Note that even technology that is available for purchase on the open market can be held as a trade secret so long as such technology is not disclosed, cannot be discovered, or reverse-engineered.
  • Obviously, it is vital that employees are educated on keeping information confidential and that a company plan is implemented to maintain secrecy.

What is the best cannabis vertical for creating new business opportunities?

No one can predict the future, so I will not even attempt to answer this question. However, the following general advice should be helpful:

  • Solve a real-world problem. Your solution then becomes the basis of a business.
  • Stay with what you know: if you are a software expert, look for software opportunities in the cannabis market.
  • Apply general business trends to the cannabis sector: for example, most sectors of the US economy are digitized — has cannabis kept up?
  • Focus on something you love: business ownership and management is very hard work. Many days you will likely not be making money, so loving what you’re doing helps a lot.

And remember, just because an existing solution is already addressing a need — you can still try to do it better, faster, and/or cheaper… or cooler. What if Twitter’s founders were convinced a short messaging solution was ridiculous because we already had text and email?


Information in this article, especially the simple overview of legal protection of confidential information, is offered as an introduction to the topic. Protecting IP is a serious matter affecting business valuation and investor attraction so experienced legal counsel should be sought for your individual situation. Nothing in this article should be construed as legal, financial, or investment advice.

Good luck!

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Senator Jeff Sessions of Alabama.

Anti-Cannabis Zealot Sen. Jeff Sessions Selected as Trump Attorney General

In a move that is certain to set off alarm bells throughout the cannabis community, President-Elect Donald Trump has tabbed Republican Alabama Sen. Jeff Sessions as the U.S. Attorney General, according to several news reports, including the New York Times.

Sessions, 69, served as U.S. Attorney for the Southern District of Alabama during the Ronald Reagan Administration and was elected to the Senate in 1996. In his role on the Senate Judiciary Committee he has opposed proposals to cut mandatory minimum sentences and during a 1986 confirmation hearing to determine Sessions’ possible appointment as a federal judge, former assistant U.S. attorney, Thomas Figures, testified that Sessions “only objected to the [Ku Klux] Klan because of drug use by its members.”

In 1999, Sessions voted yes on increasing penalties for drug offenses. In Jan. 2014, during a Senate Judiciary Committee hearing, Sessions said he was “heartbroken” when President Barack Obama said he didn’t think cannabis was “more dangerous than alcohol.”

“It’s stunning to me. I find it beyond comprehension….This is just difficult for me to conceive how the president of the United States could make such a statement as that,” Sessions said during the hearing. “Did the president conduct any medical or scientific survey before he waltzed into The New Yorker and opined contrary to the positions of attorneys general and presidents universally prior to that?”

During that hearing, Sessions argued that cannabis was not safer than alcohol because Lady Gaga said she was addicted to it.

Moreover, during an April hearing of the Senate Caucus on International Narcotics Control, called cannabis a “dangerous” drug, saying “you cannot play with it, it is not funny, it’s not something to laugh about” asserting, “good people don’t smoke marijuana.”

“The President-Elect has been unbelievably impressed with Senator Sessions and his phenomenal record as Alabama’s attorney general and U.S. attorney,” the Trump transition team said in a statement. “It is no wonder the people of Alabama re-elected him without opposition.”

Sessions received a grade of ‘F’ from NORML on their 2016 Congressional Scorecard.

Danielle Keane, legislative director for NORML who developed the scorecard, said that marijuana’s Election Day success proves that “marijuana law reform is an issue that is supported by solid majorities of Americans of all ages and political ideologies,” and the incoming administration needs to “read the pulse” of the electorate.

“Although Senator Sessions has been an outspoken critic of marijuana and President Obama’s hands-off approach to allowing states to reform their own laws, it’s clear that it wouldn’t be good public policy to try and overturn these laws,” Keane said in an email. “It remains to be seen whether or not the incoming administration identifies the political infighting these actions may create but we hope they think twice before stepping in to reverse policies that the majority of public opinion supports.”

NORML Executive Director Erik Altieri said the nomination “should send a chill down the spine” of Americans who support cannabis law reforms.

“[His] archaic mentality is not what we need from our nation’s Attorney General and we must put pressure on President-Elect Trump to ensure that Sessions upholds Trump’s campaign promise to not interfere with state marijuana laws,” Altieri said in a statement.

During a June 2007 vote on whether to declare English as the official language of the U.S. government, Sessions recommended voting ‘no’ on the measure, citing his support for states’ rights.

President-Elect Trump said on the campaign trail that he supported medical cannabis use “100 percent,” however it remains unclear as to whether or not the incoming president will decide to rollback any of the progress made in cannabis policy on both the state and federal levels.

The Obama administration has operated under the Cole Memo, declining to use federal funds to enforce federal marijuana laws in states that have legalized medical and adult-use cannabis.

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AXIM Biotechnologies Granted U.S. Patent for MMJ Chewing Gum Products

AXIM Biotechnologies, the maker of CanChew Gum, has been granted a Notice of Allowance by the U.S. Patent and Trademark Office for all natural and synthetic cannabinoids in its controlled-release chewing gum products, the company announced in a press release. A Notice of Allowance is issued after the agency determines that a patent can be granted from an application, which was filed by AXIM in April 2015.

George E. Anastassov, AXIM’s CEO, said the protection gives the company “exclusive protection” in the cannabis pharmaceutical and nutraceutical market, preventing attempts by other companies from introducing rival products “with the same delivery system made with any cannabinoids.”

“This new patent is paramount for our company as it provides us with the intellectual property protection to include any of the at least 85 different cannabinoid compounds found in the cannabis plant, including CBD and THC, into our multiple cannabinoid-containing controlled-release chewing gum products,” Anastassov said in the release “Acquiring this new patent is also strategically important for AXIM’s mission to find cannabinoid-derived solutions for health conditions with no known cure.”

The company also announced that it will begin clinical trials for its THC/CBD gum, MedChew, targeted for the treatment of pain and spasticity associated with multiple sclerosis. The product is expected to gain full registration with the Food and Drug Administration.

Another AXIM product known as AX-1602, which contains the cannabinoid CBG, is already undergoing clinical trials as a psoriasis and atopic dermatitis treatment.

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Molten chocolate, as used in many cannabis edibles products; the symbol displayed is Washington State's new marijuana edibles warning label.

Washington Cannabis Board Adopts Edibles Warning Symbol

The Washington State Liquor and Cannabis Board has adopted a “Not for Kids” Red Hand warning symbol to be placed on edible cannabis products, the agency announced in a press release. The board settled on the symbol over the “Mr. Yuk” symbol and other symbols that included the word “poison.”

The “Not for Kids” Red Hand symbol was approved after industry concerns over the inclusion of “poison” and cost concerns related to royalties on the trademarked “Mr. Yuk” symbol. The “Not for Kids” warning symbol was developed by a marketing firm working on behalf of the Washington Poison Center. Licensed operators are able to use the image at no cost and can either print them in-house or purchase them from the Poison Center. The symbol also includes a phone number for parents and consumers in the event of accidental ingestion.

“Along with education and outreach, similar to what was done with ‘Mr. Yuk’ when it was first developed, the WSLCB believes that the warning symbol will accomplish the goal of deterring accidental consumption by children,” the release states.

Anticipating the rule changes, some licensees began using the symbol on their products in advance of any requirement to do so.

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Young marijuana plant budding under a grow light.

Home-Growing Provisions of Massachusetts Legalization Law to Take Effect as Scheduled

In 28 days the portions of Massachusetts’ adult-use cannabis law take effect that allow individuals to grow their own cannabis, drawing concerns from current medical cannabis licensees about the potential quality and safety hazards, according to a State House News Service report.

“There’s a lot of soul searching that needs to occur to make sure this is done properly,” Nicolas Vita, CEO of Columbia Care, which has three medical cannabis licenses in the state, said in the report. “We’re sort of in a very grey zone here where we don’t really know what’s going on.”

Under the current medical cannabis law, products are tested for mold, mildew, non-organic pesticides, and heavy metals before they are sold in dispensaries. The home-grow allowance is part of the law that kicks in on Dec. 15, which also includes possession of up to 1 ounce by adults 21 and older outside of their homes, 10 ounces inside. Adults will be able to grow up to six plants and gift up to 1 ounce of cannabis to another adult.

Gov. Charlie Baker, who opposed the initiative, said that the Dec. 15 date was “one piece of the 6,000-word ballot question” that “a lot of people understood out of the gate.” He said it’s not likely that the legislature would meet before it’s scheduled to reconvene in January.

“Well, you gotta remember that when the Legislature is in informal session it just takes one (lawmaker) to stop something from getting done,” Baken said. “So, I mean, as a practical matter I think it’s pretty unrealistic to assume that that wouldn’t go into effect as it’s scheduled to go into effect in December.”

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Large, cured cannabis nug lying on its side.

Certain Cannabis Purchases Now Tax-Free in California

Certain medical cannabis sales in California are now exempt from sales and use tax following the passage of Proposition 64, the State Board of Equalization announced in a press release. The exemption applies to medical cannabis sales by patients who carry county-issued Department of Public Health medical marijuana identification cards — but tax-free sales are not applicable to those with only a paper recommendation from a physician.

Tax exempted products include flower, concentrates, edibles, and topical products. Currently, medical dispensaries pay 7.5 percent in state sales tax on purchases, and municipalities can tack on another 1 percent to 2 percent.

According to a TribLive report, California issued about 6,700 of the ID cards in the fiscal year that ended in June. Since then the state has issued another 2,200 of the cards, but some could be renewals.

Jerome Horton, a state board of equalization member, estimated that the revenue loss for the state during the tax holiday would be as much as $49.5 billion.

“Local cities who anticipate preserving their revenue from medical marijuana may get nothing since Proposition 64 provides for a complete exemption from medical marijuana,” he said in a San Francisco Chronicle report.

Richard Miadich, counsel for the Yes on 64 campaign, who drafted the Adult Use of Marijuana Act, disagrees with the board’s interpretation, calling it “inconsistent with the statutory language and … intent.”

The measure provides for a 15 percent excise tax on cannabis products, but that doesn’t take effect until Jan. 1, 2018.

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cannabis topicals

Report: High-CBD Sales Spike in Washington; Driven by Topicals, Capsules, Beverages

High-CBD cannabis product sales in Washington State have increased by 200 percent, according to a report by canna-business intelligence firm Headset. The analysis of 40,000 individual customers was conducted with information directly from integrated retail point-of-sale systems from Sept. 2015 through Sept. 2016.

According to the report, CBD products accounted for 2.8 percent of total sales, 2.4 percent of total units sold, and about $5.7 million of the state’s legal cannabis market. Topicals, capsules, beverages, tinctures and sublinguals, represent the lion’s share of the CBD market; with flower and pre-rolls comprising about 1 percent of high-CBD sales. Around 40 percent of topical sales are high-CBD, along with about 35 percent of both capsule and tincture sales, and roughly 20 percent of beverage sales.

Customers who buy CBD products more often buy in bulk, the report says, finding that 59 percent of CBD flower purchases are of 5 grams or more, compared to just 13 percent of low-CBD flower purchases. High-CBD products were also found to be more popular among non-traditional cannabis users, such as the older population and women.

“The percentage of overall sales going to high-CBD products increases steadily from a little over 2 percent in the 21-25 age group to over 5 percent in the 51-plus age group,” the report states.

And while just 5 percent of customers from June to September purchased a CBD product, those customers shopped slightly more often and purchased more items, on average, than customers who did not buy any CBD products.  Most customers (85.5 percent) who purchased high-CBD products also purchased a non-CBD product.

The authors anticipate that as customers become more educated about CBD the market share could expand due to increased interest by traditional consumers who are seeking to “enjoy the physical benefits of a traditional indica strain without getting ‘high.’”

“Either way, expect to see CBD become more and more a part of the cannabis conversation, as its therapeutic properties convert more and more users,” the authors conclude.

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Literature Review Finds Cannabis Effective for Addiction and Mental Health Therapy

A University of British Columbia study is the latest to report that cannabis can be utilized as a therapy for people suffering from some mental health and addiction issues, according to a press release from the university. Researchers found that medical cannabis use helps stem symptoms of depression, social anxiety, and depression in users, while helping some opioid addicts and alcoholics kick their dependence.

Zach Walsh, the study’s lead author and UBC associate professor of psychology, concluded that some people are using cannabis as “an exit drug” from more harmful substances. He noted that while cannabis is shaping up to be an effective therapy for some psychological issues it might not be efficacious for conditions such as psychosis and bipolar disorder.

“In reviewing the limited evidence on medical cannabis, it appears that patients and others who have advocated for cannabis as a tool for harm reduction and mental health have some valid points,” Walsh said in the release.

The researchers performed a comprehensive systemic review of mental health and cannabis academic journal articles, including studies on non-medical cannabis use — 60 in all. In addition to their findings regarding mental health and addiction, the authors concluded that cannabis use “does not increase the risk of harm to self or others.”

“There is currently not a lot of clear guidance on how mental health professionals can best work with people who are using cannabis for medical purposes,” Walsh said. “With the end of prohibition, telling people to simply stop using may no longer be as feasible an option, so knowing how to consider cannabis in the treatment equation will become a necessity.”

The study will appear in the Feb. 2017 edition of the Clinical Psychology Review.

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Dr. Sanjay Gupta appearing on Late Night with Seth Meyers.

Dr. Sanjay Gupta Says Denying Patients MMJ is ‘Immoral’ During ‘Late Night’ Appearance

During an appearance on “Late Night with Seth Myers,” Dr. Sanjay Gupta explained how he changed his mind on medicinal cannabis — he found research that was not funded by the U.S. Government.

“If you looked at all the studies, what you came to learn was that most of the studies were designed to look for harm as opposed to designed to look for benefit,” Gupta, the chief medical correspondent for CNN said. “…The whole system was sort of looking for that harm as opposed to saying this could be a legitimate medicine.”

Gupta explained that he once believed that people who were seeking medical cannabis were “malingering and just wanted to get high” but, after traveling the world and witnessing the research conducted on cannabis in other countries, he became a believer.

“But the truth is that, I think, for certain people not only does it work, it can be the only thing that works, and it would be immoral, perhaps even, to withhold that if it’s a therapy that can actually benefit people,” he said.

The doctor pointed to Arkansas, one of the four states in which voters passed medical cannabis referendum last week, as a sign that more people are beginning to embrace cannabis as a medicine.

“This is the only substance that has been, sort of, approved by the people,” Gupta said. “…I switched my mind on this after looking at the data and I just encourage other people to do the same thing.”

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Arkansas' state flag flying before a cloudless sky.

Arkansas Gov. Seeking $3M for MMJ Program Rollout

Officials in Arkansas have taken the first steps in the implementation of the state’s newly minted medical cannabis program, according to a Free Weekly report. Gov. Ava Hutchinson is asking for $3 million to fund the program’s rollout and over the course of the next month the governor, along with legislative leaders, will start appointing the five members to the newly formed Medical Marijuana Commission.

“The people voted this in and I intend to implement it according to the will of the people of Arkansas,” Hutchinson, a former DEA director, said in an Associated Press report. “But the people of Arkansas expect me to do it right, to do it in a way that protects our children and to do it in a way that minimizes the problems we’ve been very concerned about. That’s what the regulations are about.”

Under the law, the commission, along with the state Department of Health and Beverage Control Division, has to begin accepting dispensary applications in June 2017, leaving officials until about March to devise the program’s rules and regulations. The amendment permits for between 20 and 40 dispensaries, with no more than four in a single county, testing labs and cultivation licenses.

Just 12 conditions qualify for medical cannabis use in the state — including post-traumatic stress disorder, Tourette’s, Alzheimer’s, HIV/AIDS and cancer — and patients can apply for a state-issued certification allowing them to purchase cannabis from a dispensary. Patients could also choose to designate a caregiver to obtain their cannabis for them. Neither patients nor caregivers can purchase more than 2.5 ounces within a 14 day timeframe and the Health Department is responsible for adding any additional conditions.

Meanwhile, some opponents are shifting their focus from any repeal effort — which would require a two-thirds vote by the legislature — to adding restrictions on advertising and zoning options for municipalities.

The measure does not allow Lawmakers to pass any legislation to limit the number of dispensaries or rescind the voter-backed constitutional amendment.

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