Big news in the cannabis space occurred over the past week when tobacco giant Altria made a $1.8 billion investment into Canadian marijuana producer Cronos Group Inc. (NASDAQ:CRON). The investment will give the makers of Marlboro cigarettes a 45 percent stake in the company, with the option to increase that to 55 percent over the next five years.
Reports of a potential Altria-Cronos deal surfaced early in the week sending Cronos Group investors into a buying frenzy. Not everyone was buying it, however. The naysayers were proved wrong only days later.
— Cronos Group (@CronosGroupMJN) December 4, 2018
Altria's stock fell nearly 25 percent throughout 2018. Shares of Altria rose 2 percent in early trading Friday while Cronos soared more than 30 percent.
"Altria is the ideal partner for Cronos Group, providing the resources and expertise we need to meaningfully accelerate our strategic growth," said Cronos CEO Mike Gorenstein in a statement.
Barr eyed as Sessions’ replacement
The cannabis industry and advocates breathed a sigh of relief at news of the departure of Jeff Sessions from the Justice Department. Sessions’ interim replacement is Iowa's, Matthew Whitaker. President Trump is currently expected to name William Barr his next attorney general. Barr help the role under President George H.W. Bush from 1991 to 1993 and although he is expected to be a steady and experienced director at the Justice Department, his stance on cannabis could be harsh considering his track record as one of the architects of the War on Drugs.
Sen. Cory Gardner of Colorado had some comments for the next attorney general last week noting that he feels that President Donald Trump remains committed to a state-based solution to cannabis policies.
Gardner told the Denver Post, "Whoever comes after him is going to face some pretty tough questions about where they stand on states’ rights and making sure they will stand up for states’ rights,”
Gardner and Massachusetts senator Elizabeth Warren introduced the STATES act, a bill which would hand the regulation of cannabis over to U.S. states. Gardner said, “I am going to demand that the new attorney general side with the president because the president is right on states’ rights.”
Michigan lights up
Michigan, the first Midwestern U.S. state to legalize the recreational use of marijuana officially lit up its recreational marijuana program on December 6, as the Michigan Regulation and Taxation of Marijuana Act, or Proposal 1, takes effect.
The initiative passed with 56 percent of voters showing support for the measure. Michigan is the 10th U.S. state and the second-most populous one to legalize marijuana for adults 21 and older and the ninth state to mandate the creation of a regulated and taxed market for adult-use marijuana.
While smoking is prohibited in public under the new law, residents and visitors to the state are allowed to carry up to 2.5 ounces of dried flower or store up to 10 ounces at home — that’s about $2,500 worth, or enough for about 500 joints, give or take. A limit of 12 plants is set for home grows, and a provision in the measure allows landlords, businesses, and campuses to prohibit smoking.
Although it is now officially legal for adults 21 and older to grow and possess marijuana, it’s going to be some time before most of the state’s residents can purchase the drug at a licensed retail outlet without a medical marijuana card.
Cannabis around the globe
Just days after a medical marijuana ballot initiative was approved by Utah voters, stakeholders have already begun fighting over the implementation.
In the days leading up to the election, a compromise was reached between a coalition of medical cannabis advocates, along with political and religious stakeholders in Utah. The meeting resulted in the guaranteed implementation of an medical marijuana bill regardless of the outcome of the election. While the ballot measure allowed for patient "home grows" and the establishment of 20-plus dispensary groups, the compromise plan bans home grows and calls for a state-run dispensing program with about six licensees.
Voters approved the original initiative. Then on December 2, stakeholders met at the state capital to draft implementation rules. The very next day proponents of the initiative filed a lawsuit citing the voter's passage of the measure as setting the precedent.
Matthew Schweich, MPP's Utah leader, one of the coalitions who crafted the compromise argued, "This bill is undoubtedly inferior to the law enacted by voters in November. However, Proposition 2 would very likely have been defeated without the compromise deal, which prevented an onslaught of opposition spending. Advocates made the responsible decision to negotiate with opponents and ensure that patients were not left without any access to medical cannabis."
The courts are expected to decide on the matter within days.
A New Jersey recreational marijuana bill is so close you can smell it. At the end of November, in a move that took many by surprise, committees in both the state’s Senate and Assembly voted to advance the “Cannabis Regulatory and Expungement Aid Modernization Act.” The bill cleared the Senate budget committee by a vote of 7-4 with two abstentions. The Assembly budget panel voted 7-2, with one abstention.
In a likely best-case scenario for advocates, the bill will have enough votes to pass both the Assembly and the Senate and Gov. Phil Murphy will sign the bill. If this scenario happens, New Jersey will be the second U.S. state to legalize marijuana for adult use by an act of the legislature, and the first to set up a regulated and taxed market for cannabis.
Government officials in Luxembourg have signaled their intention to pursue full legalization in that European Union member state. Portugal, Czech Republic, Holland, Spain and Germany have all moved ahead with robust medical marijuana or decriminalization measures.
Reporter Marguerite Arnold notes that Luxembourg hosts EU clearinghouse duties for public cannabis company stocks. Arnold predicts a probable shift in the German stock exchange (the Deutsche Börse) to allow the clearance of certain kinds of cannabis stocks in Frankfurt and other German exchanges. The state of legality in Luxembourg, home to the clearing arm of the Deutsche Börse, is critical to how stocks may be listed and cleared in Germany." She concludes, "This development is also likely to push the issue of full reform forward across Europe.
EAZE pledges $20,000 matching donation to MPP
California delivery giant EAZE has made a special end-of-year financial commitment to industry advocacy. The company said it will match all national donations to Marijuana Policy Project through the end of the year, up to a maximum donation of $20,000. For more info visit mpp.org/support/donate/.