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1.
   

Canopy Board Sacks Bruce Linton

Getty

On Wednesday, Canopy announced in a press release that founding co-CEO Bruce Linton was "stepping down." Within hours, Linton clarified to CNBC that he was fired as co-CEO and member of the company's board. He said in a statement, "The board decided today, and I agreed, my turn is over.”
Financial Post, CNBC

A Canaccord Genuity analyst suggested Constellation wants a CEO from a blue-chip company to replace Linton, while Toronto financial CEO Neil Selfe said, "The skillset that’s required to get a company off the ground is different than running a company in the long term."
Bloomberg

Linton said he knew the Constellation deal might be the beginning of the end for him, "But we would have been fools not to bring in a $5-billion cash infusion just so we could keep our jobs."

Quick Hits

  1. Globe columnist Barrie McKenna argued cannabis may never be a major profit-making industry in Canada, where the cannabis market is "small, highly regulated (as it must be) and vastly oversupplied."
    Globe and Mail
  2. Industry people want the government to invest in educating the public about the coming slate of soon-to-be-legal cannabis products.
    Global News
  3. The C-45 Quality Association called for cultivators and regulatory people to join their quality/compliance organization, which is working to develop best practices and standards for the Canadian cannabis sector.
    C45 Association

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2.
   

Where Next, Canopy?

Felicity Aston

MarketWatch's Max Cherney wondered what will happen to Linton's plans to give employees options and to keep Canopy headquarted in Smith's Falls. He added, "Does Constellation have any idea how to run an early stage pot company? I mean Canopy can't even sell edibles or vapes yet."
Twitter

Quick Hits

  1. Marketwatch charted the beating short sellers employing questionable methods delivered to LP Cannabis One, which has sunk 83% since April thanks in part to "naked" short selling, which is legal in Canada but not in the US.
  2. The Wildfire Collective, a collective of small-batch outdoor organic growers, soft-launched with a video on Canada Day.
    Twitter
3.
   

50 New Ontario REC Stores plus Lottery, Round Two

The Ontario government announced it willthe Alcohol, Gaming and Gaming Commission of Ontario will hold a second lottery for 42 REC retail license, while the government itself will develop eight REC retailers in First Nations on a first-come, first-served basis. The combined 50 new REC retailers will begin opening in October. An infographic explains the timeline, while the rules are over here.
Ontario Gov, AGCO, National Post, The Star Twitter, AGCO

  • The new lottery will take place on August 20, but Expression of Interest applications must be submitted between August 7 and 8:00pm August 9.
    The Leaf
  • The application period for eight stores in First Nations stores begins earlier, on July 31, and requires the support of a Band Council resolution approving a REC store in the community. Aspiring REC retailers on Reserve would require no working capital or letter of credit.
  • Those who participated in the last lottery will not get priority, and will have to submit new applications and pay new fees.
    Twitter—Matt Columbro
  • Lottery applicants must show a bank letter stating they have access to $250,000, another bank letter showing they can get a $50,000 line of credit, and a letter securing retail space. They'll also be vetted to make certain they're ready to open a store. Vetting will take place between August 10 and 19, and the lottery will follow on August 20.
    Bloomberg
  • Vetting will not be merit-based.
    Globe and Mail
  • Brock University's Michael J Armstrong said, "This time, the government’s rules will screen out most of the unprepared entries that seemed common in the first lottery. One side effect is that they’ll screen out ‘mom and pop’ entrepreneurs who have retail experience but little liquid cash; i.e. the classic small retailer."
    Globe and Mail
  • Ontario has not yet finished opening its first 25 stores, which were all supposed to open on April 1. With news this week the Oshawa REC store previously known as Tripsetter, then as Fabulous Leaf, received a license to open as Tokyo Smoke Oshawa.
  • That brings Ontario's total REC retailers to 23.

The lottery for 42 non–First Nations REC retail licences will be broken into five geographic segments.
AGCO

  • The AGCO notified existing REC retailers they'll be able to sell their stores after December 13.
    Twitter—Matt Maurer
  • The Ontario government continues to stress it is limited in the number of stores it can open by what it calls "federal supply issues." Reuters
  • Bill Blair argued there was plenty of REC available in the rest of the country. In a statement, Blair said, "With the notable exception of Ontario, the rest of the country has made steady progress in displacing the illicit market with licensed and regulated retail stores. While the rest of the country made progress, the Ford government made excuses. [… The Ontario government spent] months of blaming an inept approach on a non-existent supply shortage."
    CBC News

Quick Hits

  1. Saskatchewan and Manitoba allow private REC retailers to operate online stores—which means those provinces will be the first to offer same-day REC delivery. Some services like Pineapple Express handle delivery directly, while others, like Super Anytime, connect retailers with such services.
    Financial Post
  2. In the years leading up to legalization, BC residents consumed far and away the most cannabis in Canada. Between 2013 and 2017, 23% of BC residents above the age of 15 reported using cannabis, versus the national average of 15%.
    604 Now
  3. Inuvik, NWT, passed a bylaw prohibiting REC retailers in its "downtown corridor," which is what it's calling the stretch of MacKenzie Road between the Inuvik Hospital and Ingamo Hall. The goal is to keep REC retailers away from youth heading to and from school.
    CBC North
4.
   

REC Retail a Challenge to First Nations

Jesse Staniforth

Ontario's move to license eight REC stores in First Nations may the beginning of a broader attempt to limit unlicensed stores in those communities, though any aggressive move in that direction threatens complex jurisdictional challenges. First Nations have no governance relationship with provinces and some resist any intrusion from provincial governments, laws, and police.

  • A few First Nations leaders hailed the opportunity for legal REC on their land.
    CBC Thunder Bay
  • All REC retailers must buy provincially and federally taxed legal REC, but First Nations do not pay taxes and many refuse to collect taxes on behalf of any government except their own.
  • Last month, Ontario Chiefs voted to control all cannabis within First Nations. AFN Ontario Regional Chief RoseAnne Archibald said, "Limiting those number of stores is contrary to what we call community sovereignty."
    Global

Quick Hits

  1. Out of 257 inspections of MED LP facilities in the fiscal year ending in March 2018, Health Canada gave "noncompliant" ratings to three producers, as well as two "critical observations," and 63 "major observations."
    MJ Biz Daily
  2. The Nova Scotia Liquor Corporation, which sells REC through its liquor stores (the only province to do so), requested $3M in additional funding to prepare its liquor stores for edibles. Last year the agency retrofitted 12 stores to sell RECbut this year they'll be renovated to prepare for legalization 2.0 products.
    The Star
  3. Global News reporter Patrick Cain reported employees at a Sackville Cannabis NB store said they get border-crossing customers from Nova Scotia, where cannabis is sold through the NSLC. They "want to talk to people who work in a dedicated cannabis store, as opposed to people who are mostly liquor store clerks who now sometimes also sell weed," Cain said.
    Twitter
5.
   

Alberta Expects
200 REC Retailers by Fall

Alberta, which has a population roughly a third of Ontario's, is on track to open 200 REC retailers by the end of the summer.

Quick Hits

  1. BC premier John Horgan said there was a "glitch in the system" causing the slow rollout of REC retail licenses. "I thought we had adequate time to get this up and running. Clearly the system is not moving at the pace the private sector needs," Horgan said.
    Radio NL
  2. Grower Ryan Lee suggested the slow REC rollout might be deliberate on the part of the BC government, which recognizes how much of its provincial economy is tied up in the illicit cannabis industry. Lee noted, "Small town BC couldn't exist without the Cannabis $ infusion. Everybody knows a grower, a trimmer, a broker."
    Twitter
  3. Victoria City staff oppose a pilot project for cannabis consumption-sites (lounges). City clerk Chris Coates recommended the city not adopt the project because such sites are under provincial review, and allowing them might lead to conflict with the province or with Ottawa.
    Victoria News
  4. A Victoria restaurant plans to eventually serve infused food and drinks. Trees: Island Grown is operated by Trees Cannabis Company, which is operating illegally while it waits for licensing, and Tress CEO Alex Robb is optimistic that within a year to eighteen months, BC will begin allowing cannabis in restaurants.
    CBC Victoria
6.
   

MED User Wins, Loses Right to Possess 1KG in Public

A judge found in favour of Allan Harris, a MED user prescribed 100 grams per day who complained the 150-gram public possession limit for MED users (the public possession limit for REC users is 30 grams) prevented him from being able to travel anywhere for more than a day. The next day the Federal Court of Appeal overturned the decision.

  • The initial decision would have granted MED patients the right to possess one kilogram of cannabis in public. Federal Court of Appeal Justice David Near said Harris should find other ways to find MED when he's away from home, and that if Harris were granted a constitutional exemption, other MED users would have that as well, which he said could lead to theft, violence, or diversion.
    CBC Politics
  • NextLeaf Labs president "Canna Tom" Ulanowski suggested an alternate headline to stories stressing the 100-gram daily prescription: "Patient who uses arbitrary amount of cannabis granted right to possess a higher arbitrary amount of cannabis, relative to what is arbitrarily allowed."
    Twitter
  • Lawyer Kirk Tousaw noted, "Prior to 2014 Harris could have possessed a 30 day supply or 3kg." He added, "My goal is no personal possession limits. For REC or MED."
    Twitter
  • Harris said he will continue to fight for the right to three kilograms. "There's no other medication that's based on amount," he said. "Why am I able to get 30 days of any narcotic, but I can't have 10 days or 30 days of my cannabis? I can smoke myself to death, I can eat myself to death or I can drink myself to death and the government doesn't do anything about it. But when it comes to cannabis, then we've got to be protected."

Quick Hits

  1. A 60-year-old BC woman said she's given up three prescriptions since turning to MED and will file a complaint with the BC Human Rights Tribunal to challenge her condo development's anti-cannabis bylaw.
    Canada.com
  2. Cronos Group CEO Mike Gorenstein said Health Canada's regulations will prevent the emergence of global brands and MED patients decried Health Canada's 10mg THC caps on edibles, while the Star editorial board argued protecting children from accidental consumption merits "a safe and stodgy strategy."
    Bloomberg, Botaniq, The Star
  3. Producers of non-cannabis Natural Health Products (NHP) are using the trendiness of the endocannabinoid system to promote products like ginger, echinacea, and clove, believed to promote endocannabinoid function.
    Victoria Times Colonist
7.
   

Scheer Promises Cannabis Research if Elected

Canadian Museums Association

Federal Conservative leader Andrew Scheer reiterated his party will not recriminalize cannabis if they win the October federal election. (Polls suggest the Conservatives are in the lead to at least win a minority government, if not a majority.)
Kelowna Capital News

  • "We want to make sure the federal government is not just a partner but is leading the way on that as we learn what the ramifications of what legalization will mean for our society going into the future," Scheer said.

Quick Hits

  1. Cannabis and mental health scholars published an op-ed in the Globe arguing the debate about psychosis and cannabis is built on anecdotes rather than stable data and discounts the variety of other facts known to increase risk of mental illness, like poverty, trauma, abuse, and stress. "By ignoring these important contexts," the authors argued, "we are framing the onset of mental-health issues as a result of someone’s personal choices, and thereby further perpetuating stigma around these conditions for individuals experiencing psychosis or with schizophrenia.
    Globe and Mail
  2. Employers and workers can't agree on what constitutes cannabis impairment, and unions argue some aggressive policies (such as the Transport Canada policy that cabin crews and air-traffic controls not consume cannabis for 28 days before work) constitute a total ban on the substance.
    Globe and Mail
8.
   

No Increase in Cannabis Charges

https://www.flickr.com/photos/45710499@N04

Though Edmonton police reported last week the number of drivers they've charged with drug-impaired driving has increased since legalization, Calgary police chief Mark Neufeld said there's been no increase in such charges in Calgary, or in other sorts of infractions. "I don’t think it’s had the impact that we thought it would," Neufeld told the Calgary Herald. "A lot of people out there are being responsible with it."
Calgary Herald

Quick Hits

  1. A Toronto condo board demanded condo-owners who planned to smoke cannabis in their units sign up for a registry maintained by the board. Residents say such a registry is an infringement on their privacy, while a real estate lawyer argued it wasn't a practical solution to odour problems that create the most friction between residents.
    CBC Toronto
  2. Sales of home-cultivation equipment are booming.
    Globe and Mail
  3. Canadian LPs aren't interested in the social and cultural context of cannabis in Jamaica when they go there looking for MED export deals. Locals worry Canadian and other foreign cannabis businesses will replicate the history of the colonial sugarcane industry on the island.
    Financial Post
9.
   

Calgary Stampede Allows Cigarettes and Beer, Not Weed

https://www.flickr.com/photos/34024493@N00

The Calgary Stampede will not allow attendees to consume cannabis, but they will be allowed to smoke tobacco (and drink beer) on site. Attendees may carry cannabis with them, but they will have to leave to use it and re-enter.
GrowthOp

  • MED users are considered an exemption under Calgary's bylaw banning public cannabis consumption, but there is no such exception in the Stampede's rules.
    CTV News
  • "Leaving the site to medicate is not always an option for people who are severely ill," said the Calgary Cannabis Club's Gordon Hayes, who suggested restrictions on MED consumption could violate the Charter of Rights and Freedoms.

Quick Hits

  1. In a survey commissioned by Canadians for Fair Access to Medical Marijuana (CFAMM), the Arthritis Society and the Canadian Pharmacists Association (CPhA), a quarter of MED users said MED is harder to get since legalization. Supply issues or increased prices, or both, have forced 64% to under-dose and sent 37% to the illicit market.
    NewsWire
  2. In Toronto, 86% of the city's illicit REC stores have been closed, either by raids, or by owners getting out of the business.
    Toronto Sun
  3. Rolling Greens, a cannabis-friendly rebranding of links previously known as the Lombard Glen Golf Course, will hold its grand "BYOB" opening this weekend in Smith's Falls, where Canopy is also headquartered (for now?).
    CTV Ottawa
10.
   

Organigram VP Calls for Government Support

https://www.flickr.com/photos/35558130@N00

Organigram VP public affairs Cameron Bishop pressed Ottawa to support the cannabis industry or lose it to other countries. In a Twitter thread, he wrote,

  • "I've never seen this before. A $100B-$200B industry and our federal government won’t take a bow???? Or work to promote it??? What?!!!! We need a medical #cannabis export strategy NOW.
  • "We need to transfer some degree of promoting and enhancing this industry to [Innovation, Science, and Economic Development Canada] and [Global Affairs Canada]. When we lose our first mover advantage because #cdnpoli views the potential of this industry with disdain, what then?
  • "[…] Honestly: I want one #cdnpoli leader to point me in the direction of a new sector of the economy with as much potential as #cannabis. Cripes the @bankofcanada had to revise their growth estimates because of their strength of this sector!

Quick Hits

  1. The source of LP investments is shifting from Bay Street to the UK, where family offices, funds, and private placements have been eager to contribute millions.
    Financial Post
  2. Sundial Growers, the largest privately held LP in the country, bought UK plant, flower, and herb producer Bridge Farm Group for an undisclosed amount. The acquisition will give Sundial a foothold in the UK's booming CBD market.
    Globe and Mail, Sky News
  3. UK newspaper the Evening Standard profiled both legal and illicit REC retailers in Toronto.
    Evening Standard

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