WeedWeek edition / April 13, 2020
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1 CANNABIZ DEMANDS COVID RELIEF

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FDR Memorial, Washington D.C.

Amid widespread recognition that weed access is essential, federal relief for the industry is beginning to gain traction, at least with some favorably disposed politicians.

The cannabis industry has been broadly shut out of federal Covid relief programs. The industry, including most ancillary companies, is ineligible for the billions of dollars in forgivable loans being offered to most small businesses.

Pot shops are still hit by expanded paid sick leave requirements, and, of course, the financial challenges of operating in a pandemic.
MJBiz, Marijuana Moment, Los Angeles Times  

🍁Need the scoop on Covid relief north of the border? There's no place source than WeedWeek Canada

Quick Hit

  1. Anti-pot writer and former New York Times reporter Alex Berenson is becoming a go-to figure on the right for coronavirus skepticism. "There has been no surge," Berenson told Fox News host Sean Hannity, who made clear he does not share that view.
    Vanity Fair
  2. A group representing young voters called on presumptive Democratic presidential nominee Joe Biden to reconsider his opposition to REC legalization.
    Marijuana Moment
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2 IANTHUS DEFAULTS ON DEBT

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Shares in iAnthus fell 62% after the "deeply unprofitable" MSO defaulted on its debt.
Seeking Alpha

  • At Seeking Alpha analyst Jon Cooper says the company will likely need to renegotiate with its creditors, a process complicated by iAnthus currently suing one of its creditors.
  • MJ Biz wrote up the suit against Texas-based Oasis Investments.
  • iAnthus stock is currently trading around $.19 per share
  • iAnthus' main dispensary brand is Be. It recently became the first dispensary to open in New York City's Staten Island. 
  • The company also announced it is investigating potential conflicts of interest regarding CEO Hadley Ford. 
  • Equity Guru suggests the default could be a "tactic."
  • WeedWeek interviewed iAnthus CEO Hadley Ford a few months ago.
  • The company's largest creditor is Gotham Green Partners which has close ties to Canadian producer Cronos Group and has renegotiated MedMen's debt several times.
  • Do you have additional information? Email me at alex@weedweek.net. Sources will be protected.

At New Cannabis Ventures, Alan Brochstein looks at what the pandemic means for pot stocks.

Grizzle sees a potential bull market in "booze, smokes and pot."

Quick Hit

  1. California operator Caliva launched its new delivery service independent of former partner Eaze
    TechCrunch
  2. Green Market Report lists 11 top cannabis law firms.

3 POWER PLAYERS: TRULIEVE CEO KIM RIVERS

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Trulieve CEO Kim Rivers
Courtesy of Trulieve

Who says big pot companies can't be profitable? Last week, Trulieve, the dominant player in Florida's MED-only market posted big numbers. For this week's Power Players interview I spoke to CEO Kim Rivers about what it takes to make money in this business.

A few highlights: 

On building a dominant market position:

We launched and began building when the market in Florida was still CBD only. And, of course, as the market evolved, we're very active in ensuring that more conditions [qualified patients for MED]. We helped ensure that physicians understood what an opportunity this was for their practices.

On the possibility of ending mandatory vertical integration:

Having additional access for small businesses is a positive from a policy perspective. From our perspective, having the ability to do business with some smaller companies that are in specific niches of the market is a win-win.

On expansion to new states:

It's important that we can achieve some level of scale, and market penetration. Also, we look at markets that we feel want to do business with companies like ours. There's some markets out there that maybe don't. And that's okay. I think it's important to understand where we think our advantages are, and not trying to force ourselves where maybe they're not.

Read the whole thing.

Equity Guru looks at "the good, the bad and the ugly" earnings reports from Trulieve, KushCo and Canadian producer Hexo.

Quick Hit

  1. Longtime MED researcher Dr. Ethan Russo has a new company called CReDO Science which aims to develop "an eclectic range of cannabinoid centered innovations."
    Forbes-- Abbie Rosner
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4 A “LOST YEAR” FOR TRADE SHOWS

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Hall of Flowers, September 2019, Santa Rosa, CA

WeedWeek business columnist Dan Mitchell writes the pandemic has made tough times even tougher for cannabis trade shows, and the companies which rely on them:

When a trade show cancels, it creates enormous ripple effects, said Jessi Rae, chief operating office of CannaGrow Expo, which had a show scheduled for April 17 and 18 at the Marriott Marquis in Chicago. “AV teams, shipping people, decorators, food and beverage staff, temps, etc., all derive income from activities related to our events. And hundreds of companies make new deals at our shows that carry them through their fiscal year. This is as much of an impact to them as it is to us.”

Read the whole thing.

Quick Hit

  1. Insurance Journal has four ways the pandemic will change insurance for cannabis companies.
This week on the podcast
For CEO Alex Shah, Intelligence Is Central

From the onset of adulthood through 1995, guest Ashesh “Alex” Shah worked as a profiler for the CIA. Shah now runs Solo Sciences, a Boston company specializing in the authenticating weed products. He shares with Alex and Donnell the unclassified truth of his unlikely professional transition.

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5 VULTURE INVESTORS ARRIVE IN CALIFORNIA

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At Canna Law Blog, attorney Hilary Bricken discusses the arrival in California of so-called "Vulture investors:"

"Every cannabis market in which I’ve worked has experienced a period of extensive business failures, consolidations, and market stress. And it’s that time now for California cannabis (and that was already happening before COVID-19 struck)...

"It’s been nearly two years of licensing, and in a strong local control market like California, it’s no surprise that many cannabis companies (of all sizes) are either going under or headed that way...what that means is that enterprising investors experienced with distressed assets have significant opportunities before them."

🌴There's more in this weekend's stellar issue of WW California.

6 REC COMPANIES SUE MASSACHUSETTS GOV.

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No REC for Boston (At the Moment)
Photo by Alex Iby on Unsplash

A group of Massachusetts companies and consumers sued Gov. Charlie Baker (R) for his refusal to allow REC shops to open.In addition to five companies, the named plaintiffs include Stephen Mandile, an Army veteran who fears losing his federal benefits if he applies for a MED card.
Boston Globe

  • Baker, who opposed REC legalization, has said open shops would attract visitors from out of state, despite REC advocates saying sales could be limited to Massachusetts residents.
  • The suit came despite regulators allowing some REC businesses to supply MED shops.
  • The state will also require cannabis companies to file a report with the state when an employee tests positive for Covid.
  • More people in Massachusetts are acquiring MED cards.
    WBUR

Quick Hit

  1. In Arizona, the state's Republican administration could kill November's expected REC ballot initiative.
    AZ Central

7 SMOKING, VAPING POT PROBABLY ELEVATES COVID RISK

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Health authorities say smoking and vaping likely escalate risks associated with Covid-19, a respiratory disease. There's more data indicating that tobacco use is associated with Covid complications but doctors are advising "prudence" with regard to cannabis. 
New York Times

  •  “Inhaling combusted or vaped cannabis products can damage lung cells, may increase viral replication, and does affect the ability to fight off infection,” said Dr. Jonathan Winickoff, a professor at Harvard Medical School said. “Clean air is what the lungs should be inhaling, especially during a global pandemic.”

Leafly sums up cannabis and coronavirus, what you need to know.

Quick Hit

  1. At Salon, writer Alia Volz makes the case that MED is essential medicine.

8 WEED MEDIA IN CRISIS

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Photo by Elijah O'Donnell on Unsplash

The pandemic is taking a toll on the not especially healthy cannabis media world.

Hightimes Holding Corp. said it had suspended publication of Dope and Culture magazines which are typically distributed free in dispensaries.
Marijuana Moment

  • Six employees were furloughed across the brands including longtime High Times magazine editor Danny Danko.  

9 R.I.P. CHARLOTTE FIGI

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Charlotte Figi, the Colorado girl whose struggles with epilepsy ignited the global CBD craze, died at 13, likely of Covid-related complications. 
New York Times

  • At age 5, Charlotte, who suffered from Dravet syndrome, was suffering more than 300 seizures a week, about one every half-hour.
  • Charlotte's mother Paige researched CBD and found a grower who could provide it. They didn't know if it would work, but Charlotte's seizures were soon down to about one per month.
  • Her story attracted international attention after Dr. Sanjay Gupta featured her in his 2013 CNN documentary Weed. Dr. Gupta reflected on her life this week. "She changed my mind and opened my eyes to the possibility that this was a legitimate medicine. In the process she changed the world." 
  • In 2018, the U.S. Food and Drug Administration approved Epidiolex, a CBD drug developed by U.K. firm GW Pharmaceuticals for conditions like Charlotte's.   
  • From the obituary: "Charlotte was adventurous. She liked to hike and ride on the front of a tandem bike with her mother, and she enjoyed riding horses with her sister. But what was most important, Ms. Figi said, is that Charlotte was oblivious to the movement she started."
  • This week the DEA descheduled an oral formula of Epidiolex which will make it easier for patients to access.
    DrugTopics.com

Covid also took the great singer/songwriter John Prine.
Guardian

10 THE END OF PUFF, PUFF, PASS?

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Are you going to turn that down?
Photo by Ahmed Zayan on Unsplash

At BroBible, writer Mike Adams says good riddance to passing joints:

Some of you sickos are still out there slobbering all over the same joint like a pack of wolves fighting over a mountain goat. It’s like the cannabis scene didn’t get the memo informing them that the days of the puff, puff, pass are gone forever.

I’m not sure how sharing a joint with others ever became a thing, to begin with. Call me old fashioned, but swapping spit with people that I haven’t seen naked at least once, well, that’s just not my jam.

Quick Hit

  1. Ice cream maker Ben and Jerry's lists six of the more outlandish urban legends about the company.