WeedWeek

POLITICS
   

No Tax Relief for MED Patients

https://www.flickr.com/photos/us_mission_canada/

Despite months of efforts from MED activists, the Liberal government’s 2019 budget did not repeal the MED excise tax. I spoke to the federal Ministry of Finance about the decision and wrote about responses to the budget from industry and activists on the WeedWeek website.
CBC, Twitter—Canadians for Fair Access to Medical Marijuana

Fewer May Be Pardoned

Ministry of Public Safety spokesperson Sean Bardsley, said only 4% of the 250,000 Canadians convicted for possession of less than 30 grams of cannabis would be likely to access record-suspension under the Liberals’ proposed system. (Many others have died, have received pardons already, or have other criminal charges.) Bardsley predicted the number of possible pardons would be around 10,000, which the Globe reports “is considerably smaller than the 70,000 to 80,000 people Organized Crime Reduction Minister Bill Blair said earlier this month Canada could expect to apply.” Globe and Mail

  • Globe reporter Mike Hager noted Bardsley also said, “"These estimates should be treated as a guess, not a definitive count. There is no way to know how many people will be eligible and will apply before the policy is in place.” Twitter
  • Lawyer Kirk Tousaw said, “10,000 is far too small a number. That’s less than half of the number of people arrested for simple possession in one year. It barely scratches the surface of 100 years of prohibition injustice and racial and class based discrimination.” Twitter
  • Lawyer Kirk Tousaw said, “10,000 is far too small a number. That’s less than half of the number of people arrested for simple possession in one year. It barely scratches the surface of 100 years of prohibition injustice and racial and class based discrimination.”

Substance-Use Scholars: Cap THC Max Lower for Edibles

Stephen Depolo - https://flickr.com/people/10506540@N07

Substance-use scholars Dr. Rielle Capler and Dr. Jenna Valleriani called on Health Canada to choose a safe standard THC-dose for REC edibles (and create a second, stronger stream of edibles for MED users inaccessible to REC users).

Health Canada: Typing Your Age is Enough, Clicking a Button is Not

Health Canada clarified its position on website age-gates, which it criticized last week as ineffective at blocking minors from sites displaying cannabis advertising. They specified they were referring to websites that have only one question (like “Are you of age to access this website?”) rather than those that ask users for their day, month, and year of birth.

  • Health Canada told MJBiz Daily websites could become compliant by demanding users enter a full birth date, introducing pop-ups telling youth they can’t view promotional content, and displaying pop-ups reminding youths they’re not allowed to buy cannabis. MJ Biz Daily
  • Lawyer Trina Fraser said, “Let’s get real...it does nothing to exclude minors, but annoys legit adult consumers to the point where some may choose another option.”
    Twitter
  • The Globe’s Mike Hager noted some time ago that Postmedia properties like the Financial Post and the GrowthOp allowed him to access advertising with no age gate. A Hexo representative told him, “You were served the ads as a result of previously interacting with cannabis-related content and going through an age-gate.”
    Twitter
  • Lawyer Trina Fraser said, “Let’s get real...it does nothing to exclude minors, but annoys legit adult consumers to the point where some may choose another option.”
  • The Globe’s Mike Hager noted some time ago that Postmedia properties like the Financial Post and the GrowthOp allowed him to access advertising with no age gate. A Hexo representative told him, “You were served the ads as a result of previously interacting with cannabis-related content and going through an age-gate.”

Psychiatrist: Teens
Will Assert Cannabis Choices

A BC child and adolescent psychiatrist said it’s important for parents to balance the risk of harm to the developing teenage brain against teens’ need to assert their own choices about using cannabis. “The conversations really should be like having a conversation about alcohol: what does it do to your body, how are you going to stay safe?” CBC British Columbia

  • Drug Free Kids Canada released videos to coach parents in more effectively talking about cannabis with their teenagers.
  • Jenna Valleriani pointed out that most young cannabis users don’t use in a high-risk (daily or near-daily) frequencies, and parents shouldn’t worry about brain-development issues except in cases of heavy use.
    The Leaf

Quick Hits

  1. A study by research company Insights West, in partnership with Valens GroWorks, found 16% of established users have increased their cannabis use since legalization.
  2. A 2013 RCMP report argued the Hells Angels, Mexican cartels and other organized crime organizations were all interested in entering the MED business. “The RCMP’s initial background check of applicant ventures have turned up significant hits and raised significant alarm bells inside the Federal Policing program,” the report said. The Star
  3. Monthly spending at REC stores declined in January for the first time since legalization. The 4.7% drop cross-country was starkest in Northwest territories (29.8% fewer sales) and Newfoundland and Labrador (25.6% fewer sales). Yahoo Finance
  4. Consultant Kyle Hamilton called pre-rolled joints—which are packed with odds and ends left over from other cannabis processing—the hotdogs of the cannabis industry. LinkedIn
  5. The Leaf breaks down how to understand Health Canada–mandated cannabis packaging. The Leaf
  6. Following recent reports noting correlation—but not causation—between solo cannabis use and psychosis, Leafly published a defence of getting high alone. Leafly
  7. MED-referrals firm Natural Health Services—Canada’s largest MED-referral network—reported files containing clients’ personal health records had been breached multiple times between December 4 and January 7. Attackers did not access patient prescriptions, but they could have accessed diagnoses, encounter notes, referrals, and allergies. Calgary Herald
  8. Mainstream media has yet to hire designated cannabis critics, leaving it to prolific amateurs like PancakeNap—identified in this article as Brad Martin, director of cannabis market research company Cann Standard. This week, Martin reviewed a 0.5-gram pre-roll of Organigram’s Wabanaki cultivar and found that 0.19 grams—nearly half of the cannabis—consisted of dozens of seeds and stems. WeedMaps, PancakeNap
  9. Canada’s first-ever cannabis-friendly golf course—in Smith’s Falls, outside Ottawa—will obviously open on April 20. GrowthOp

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HelloMD: The largest online community of health and wellness cannabis consumers
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Spencer Vodnoy
CEO, Critical Mind Inc. Adelanto, CA

Affiliations: CA State Bar; Board Member, Adelanto Growers Association
Critical Mind, Inc. is a Medical Cannabis Cultivation and Manufacturing Facility located in Adelanto, CA. Providing the highest quality Cannabis products. Compliance without Compromise!
criticalmindinc.com

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BUSINESS
   

Organigram CEO Calls
for Crackdown on Illicit Cannabis

Public Domain

Organigram CEO Greg Engel called for police to crack down on the illicit market. He argued, “We continue to hear stories about online or same-day delivery people in major cities in Canada going around and giving out free product with their website address and phone number. They are doing things that we would never do […] They just see cannabis as legal.”
Yahoo Finance

  • Social media did not respond favourably, with one respondent saying, “This is really pathetic. They were handed the industry on a platter. They fumbled it. Now they are crying for the cops to make it better.”
  • · Cannabis social media consultant Unity Marguerite argued Organigram should “ […] stop hiring people from alcohol & pharma as sales reps, brand ambassadors and community engagement specialists. There’s a legacy of BC People who understand cannabis & this province. Hire them!”
    Twitter—Various

Ascent in Descent

Public Domain

Ascent Industries, along with Agrima Botanicals and its other subsidiaries, entered into an asset purchase agreement with BZAM management (part of Gulf Bridge International) for a price that will become public when the court approves the purchase. Last week, Health Canada court documents revealed Ascent’s licenses were suspended due to sales of oils and other concentrates by the company, which was neither licensed to extract oil nor to sell to clients or other LPs.
NewsWire, Twitter—MMJ Investing

  • Vancouver-based BZAM Management is building “a premium cannabis brand alongside a growing portfolio of subsidiary LPs,” and will fulfil Ascent’s obligation to buy a greenhouse in an area outside Vancouver. Proactive Investors

Tilray’s Revenue and Losses Climb

Tilray more than doubled its revenue year-over-year for Q4, but expansions meant its net loss jumped to US$31M from US$3M last year.

  • Much of the $153M generated from its IPO last summer has been invested in acquisitions like hemp foods producer Manitoba Harvest and Leamington cannabis cultivator Natura Naturals Holdings. CBC Business
  • The company will continue to expand, though CEO Brendan Kennedy said, “We will not purchase or invest in what we believe to be overpriced supply assets in Canada, which we believe will erode in value in (the) medium- to long-term as the market normalizes” The Star
  • A Jeffries analyst called the decision to focus on Europe and the US over Canada “a risky strategy near term given its multiple, especially as investors will be increasingly looking to Canada as evidence of a company's ability to execute.”
    Business Insider
  • The company expects its 2019 revenue to triple its 2018 earnings, but a Piper Jaffray analyst said, “The Canadian market may become profitable as it ramps up, but we do not expect positive total company EBITDA over the next five to seven quarters.”
    Bloomberg
  • The company will continue to expand, though CEO Brendan Kennedy said, “We will not purchase or invest in what we believe to be overpriced supply assets in Canada, which we believe will erode in value in (the) medium- to long-term as the market normalizes”
    The Star
  • A Jeffries analyst called the decision to focus on Europe and the US over Canada “a risky strategy near term given its multiple, especially as investors will be increasingly looking to Canada as evidence of a company's ability to execute.”
    Business Insider
  • The company expects its 2019 revenue to triple its 2018 earnings, but a Piper Jaffray analyst said, “The Canadian market may become profitable as it ramps up, but we do not expect positive total company EBITDA over the next five to seven quarters.”
    Bloomberg
  • A Jeffries analyst called the decision to focus on Europe and the US over Canada “a risky strategy near term given its multiple, especially as investors will be increasingly looking to Canada as evidence of a company's ability to execute.” Business Insider
  • The company expects its 2019 revenue to triple its 2018 earnings, but a Piper Jaffray analyst said, “The Canadian market may become profitable as it ramps up, but we do not expect positive total company EBITDA over the next five to seven quarters.” Bloomberg
  • The company expects its 2019 revenue to triple its 2018 earnings, but a Piper Jaffray analyst said, “The Canadian market may become profitable as it ramps up, but we do not expect positive total company EBITDA over the next five to seven quarters.” Bloomberg

Quick Hits

  1. Health Canada approved four more LPs this week for a total of 163 license-holders.
    Twitter—Government of Canada Health
  2. Between October 17 and the end of 2018, Canadian REC retailers sold 15,694 kilograms of cannabis—4,518 kilograms in October, 5,586 in November, and 5,590 in December. That’s enough to roll 31.4M joints.
    CTV News
  3. Canopy acquired American hemp producer AgriNextUSA, and signed a two-year extraction and processing agreement with Victoria’s Hollyweed Manufacturing & Extracts.
    Financial Post
  4. Canada’s Smartest Kitchen, which handles R&D for the Culinary Institute of Canada, has partnered with Organigram to develop edibles.
    CBC PEI
  5. After marking its first involvement in a cannabis transaction last week as an advisor on Hexo’s acquisition of Newstrike, the Royal Bank of Canada loaned $18.7M to female-owned LP Eve & Co. to support expanding its production facility by 1M feet.
    CBC London
  6. Aurora’s 700,000 kg annual harvest is produced at 11 separate production sites.
    Motley Fool
  7. How hard is it to get a micro-cultivation grow op started and licensed? CBC North offers some answers.
    CBC North
  8. One reason supply is short, said brand advisor Rachel Colic, is that LPs who’ve invested mightily in production sites may not be able to turn out the quality of cannabis they set out to achieve. “Many took for granted that this is a living organism that can’t be told what to do,” Colic said. “It’s not a widget, or plastic… it’s not something where when we don’t get the production we want we can just add an extra overnight shift.”
    BotaniQ
  9. REC retailers report customers are frustrated with legal REC products’ price and quality, while store owners themselves are annoyed there aren’t more CBD products available to meet consumer demand. REC retailers are confident shortages are just part of the supply chain finding its balance and will be worked out within a year to 18 months.
    Financial Post, Cannabis Retailer
  10. Most LPs believe edibles will be legally allowed for sale by early 2020, though no one can be certain since the government hasn’t set a date.
    CityNews

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PROVINCIAL
   

ALBERTA

Deepak Anand told the Harvest Investor that Alberta “is the perfect breeding ground for large, retail [cannabis] corporations to be born not just on the Canadian landscape but also on the international landscape”—provided the province drops its moratorium on new REC stores. Harvest Investor

Edmonton police are threatening unlicensed CBD sellers with jail time, which is frankly a little much, especially since retailers can’t figure out what the rules about CBD actually are. The Star

Calgary leads Canadian cities in the number of REC stores—it has 24, and has approved business development permits for 167 more. Calgary Herald

Public Domain

Calgary hosted the first Canadian Cannabis Wedding Expo. “There are more ways of incorporating it than just smoking it,” organizer Laureen Cauryn-Cameron said. “You can do it aesthetically in the flowers, you can have it as a wedding favour. It can be anything from adding a few drops of CBD oil, which is non-psychoactive, into your tea or smoking up a cannabis cigar. There are different alternatives to what people can think of as a cannabis wedding.” Global News

BRITISH COLUMBIA

Store owners and police don’t like frosted windows for both safety and business reasons: they hide what’s happening inside stores while discouraging passers-by from coming in. However, provincial regulations demand “a cannabis retail store must be located in a permanent building or structure and be enclosed by floor-to-ceiling walls that are not transparent.” As a result, municipalities around British Columbia are changing laws demanding all stores have transparent windows.
Business in Vancouver

Cannabis producers are flocking to the Okanagan valley around Kelowna, and discovering local zoning hostile to cannabis greatly limits where they can build facilities. Globe and Mail

The first licensed REC retailer opened in Victoria. CTV News

ONTARIO

With less than two weeks before the April 1 deadline for REC retail lottery winners to open their stores, winners are working desperately to avoid serious fines for delaying. But it remains uncertain how many stores will open in time. The Star, CTV news

London REC lottery winner Chris Comrie hired consultancy Ontario Cannabis Holdings to help him get his store open in the last two weeks before the April 1 deadline. London Free Press

Despite REC lottery rules mandating that LPs and cannabis retailers could not enter, many or most winners will be opening franchises of major brands including Tokyo Smoke (owned by Canopy), Tweed (also Canopy), Canna Cabana (owned by Aurora subsidiary High Tide), Choom, and Fire & Flower. Twitter—Abi Roach, Ottawa Citizen

A number of seniors were hospitalized in Parry Sound, Ontario, after they unknowingly ate brownies containing THC. Police said if they were deliberately served THC-infused products, the personal responsible could face charges. Vancouver Sun

Hamilton police charged 19 in raids on three illicit MMJ Canada dispensaries. Global News

https://commons.wikimedia.org/wiki/User:SatyrTN

Police stopping cars in the Orillia region (north of Toronto) on St. Patrick’s Day to test for impaired driving discovered 64 pounds of illicit cannabis. Orillia Matters

QUEBEC

A tipster informed Journal de Montréal cannabis reporter Annabelle Blais that the base salary for the director of the Société Québécoise du Cannabis is $290,000.

Gatineau police say they have an entire team of detectives hunting illicit cannabis in the region. It is part of a project under the provincial ministry of public safety and receives provincial funding. Ottawa CItizen

MARITIMES

A major Halifax children’s hospital, IWK Health Centre, said the number of excess-cannabis cases it has treated last year tripled to an unknown number from 2015, and called for regulations on the safe storage of cannabis products (particularly edibles) in the home. Canada.com

JustLiza [CC BY-SA 3.0 (https://creativecommons.org/licenses/by-sa/3.0)]

It’s up to PEI hotels and other tourism operators to decide whether or not cannabis will be allowed on their property—and if so, whether it should be allowed in rooms, in a designated space, or outside. CBC PEI

PRAIRIES

Saskatchewan expects cannabis excise tax revenue will generate $5M. Regina’s mayor is calling for a portion to be diverted to municipalities. The Saskatchewan Government and General Employees Union said the number should be a lot higher.CBC Saskatoon, CTV News

Manitoba selected 7 rural communities in which to set up private REC retailers.

THE NORTH

https://commons.wikimedia.org/wiki/User:Skeezix1000

Some Nunavut MLAs supported in-person cannabis stores as an economic driver for local business. However, the territory has not yet developed regulations for private cannabis retail, and it remains uncertain when they will be finished.
Nunatsiaq News

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