Cannabis news briefs: FDA head resigns, Safe Harbor banking bill reintroduced, CannTrust backs into CSE, and Harvest Health acquires Verano
U.S. Food and Drug Administration head, Dr. Scott Gottlieb, announced his resignation last week, leaving stakeholders in the CBD market to ponder the potential negative impact on the swift and favorable development of rules for CBD-in-foods.
“Despite holding out hope for action from the new FDA Office of Dietary Supplements, a complete understanding of the unadulterated CBD issue may be lost on the incoming FDA head,” says CBD industry analyst, Dr. Lloyd Covens, in his most recent insider newsletter. “A natural delay will be felt for months as a new FDA commissioner is nominated, confirmed, then stays busy getting acclimated to the agency.”
Lawyer Steve Mister, president of the Council for Responsible Nutrition, told SuperMarket News he’d be surprised if any significant progress toward clarity will happen between Gottlieb’s departure next month and the appointment of a new commissioner. “Taking action on CBD would be too much to expect without a commissioner in place,” said Mister. He went on to say, “Anytime an agency is without its head, you are less likely to see those kinds of bold actions."
Covens says the FDA, a division of the Department of Health and Human Services, also has issues of greater importance; some championed by Gottlieb, such as lower prescription drug pricing and rampant teen vaping of nicotine.
Harvest Health & Recreation to acquire Verano Holdings of Chicago for $850 million
Arizona-based Harvest Health & Recreation (CSE: HARV) has announced the signing of a binding agreement to acquire Verano Holdings of Chicago for $850 million in stock—the largest acquisition inked in the U.S. cannabis industry to date.
The previous record for a U.S. acquisition in the cannabis industry was MedMen’s $682 million all-stock purchase of PharmaCann in October. Verano has stakes in 10 operating facilities across the United States and more than 45 licenses under development.
According to the press release, the deal with Verano gives Harvest a total of 123 dispensaries in 16 states, including Illinois, Maryland, Nevada, and Oklahoma. Under the terms of the deal, Harvest will acquire licenses and operations in 11 states and territories, including seven cultivation licenses and 37 retail licenses plus portfolios of proprietary brands with more than 150 product SKUs sold in 150 retail locations.
Harvest is on pace to have more than 70 dispensaries, 13 cultivation facilities and 13 manufacturing facilities operating by the end of 2019, according to a news release from the company.
CannTrust’s plan to back into Canadian Securities Exchange
CannTrust said it has filed a prospectus seeking up to $700 million in debt and equity for expansion of its licensed producer business. Gaining access through a Canadian reverse shell, Denver-based "One Cannabis" says it is set to list on the Canadian Securities Exchange in April and could be valued at as much as $250 million. Principal Chris Hagaseth had been the proponent of a $30 million cannabis "Fun Park," which was proposed to be built near the city's airport.
Another study shows cannabis as safe and effective for the elderly
According to a newly released report, patients over the age of 75 who took medical marijuana report substantial reductions in pain. Researchers at the Dent Neurologic Institute in Amherst, N.Y. studied the use of capsules, tinctures and vape pens by 204 elderly patients. One-third of those patients were able to reduce their use of opioid painkillers.
Conditions being treated in the study included chronic pain, cancer, neuropathy, multiple sclerosis, epilepsy, and Parkinson’s disease. Researchers claimed that approximately 7 out of 10 patients experienced some symptom relief, while half said their chronic pain diminished.
According to the report, participants in the study were prescribed products containing various ratios of THC and CBD. A 1-to-1 ratio proved most effective and produced the least side effects.
Levi’s to make hemp jeans
Blue jeans maker, Levi’s, has partnered with sustainable fashion brand, Outerknown, to develop a denim fabric made from a blend of cotton and hemp. “We partnered with fiber technology specialists to create a ‘cottonization’ process that softens the fiber—using very little energy or chemical processing—to make it look, and more importantly feel, almost indistinguishable from cotton,” reads an announcement from Levi’s.
In Las Vegas, Nevada, mega-dispensary Planet 13 continues to be the city's number one legal cannabis attraction. The company says it is now building out Phase 2 of its expansion which includes the addition of a bistro/pizzeria and coffee shop in its entertainment complex. Planet 13 served 1,712 customers on average per day during the first 26 days of February, at an average ticket of $89.33. Actual foot traffic, including tourists from all over the country and the world, has averaged 2,465 people per day since Jan. 1, creating powerful branding opportunities. Meanwhile, Nevada's December cannabis sales came in at $51.8 million in gross sales, with about $8 million of that figure coming from medical customers.
Marijuana growers in New Mexico are applauding the Health Dept. for approving an increase in growing limits from 450 to 2500 plants.
Tennessee is seeing a huge surge in the number of licensed hemp growers now numbering 2,780. According to the Tennessee Department of Agriculture, that’s more than 12 times than the 226 licenses in operation last year.
North Carolina has been experiencing record-breaking rain this year, and it’s threatening the state’s CBD-rich hemp crops with problems such as mold. Rain and mold were also a big problem last year in the state.
North Dakota Governor Kristi Noem will have to decide on whether or not to sign a hemp bill which includes the legalization of CBD. Noem spent weeks telling the Legislature to hold off on the bill. HB 1191, should it be signed, would legalize industrial hemp and CBD oil. The House recently signed off on Senate amendments to the bill which were suggested by Gov. Noem with no debate. Noem, who is against legalizing CBD, has not specifically said that she would veto the bill.
Colorado lawmakers are looking further into licensing social consumption venues. House Bill 19-1230, introduced in the Colorado Legislature on March 8, would create a regulated system for cannabis consumption in social settings starting in January 2020. It would allow for limited on-site sales and consumption and also allow cannabis businesses to offer tours of their operation.
A recreational marijuana bill has passed through the New Mexico House of Representatives. If passed, the measure would set up a system of state-run stores which would operate much like liquor stores. Also under the bill, consumers would be required to carry a receipt for their weed to be legal. The bill incorporates major provisions of a Republican-backed Senate bill that emphasizes aggressive regulation. Democratic Gov. Michelle Lujan Grisham has expressed limited support with reservations related to child safety and other common issues.
Visitors to Hawaii will now be allowed to purchase their medical cannabis while vacationing there. The Hawaii Department of Health announced a new 10-minute, online registration process, as long as you qualify for medical marijuana in another U.S. state or territory. The state will charge a fee of $49.50, and patients will only be able to apply twice per year.
Under a proposal before the General Assembly, doctors in Delaware would have wider discretion to prescribe medical marijuana to patients. Currently, the state’s program only allows the use of medical marijuana for a short list of particular medical conditions that include chronic pain, cancer, MS, and HIV. The proposed measure will enable doctors to certify a patient for medical marijuana use for "any other medical condition or treatment" for which marijuana "is likely to provide a therapeutic or palliative benefit."
According to the Ohio Medical Marijuana Control Program, marijuana sales in the state have passed the $1.8 million mark since dispensaries opened their doors two months ago. According to the report, 5,465 patients have purchased medical marijuana so far. More than 22,000 patients have qualified for medical marijuana cards. In their first day, dispensaries sold $75,000 of cured flower totaling 8.7 pounds. Meanwhile, the first cannabis processing license has been granted in the state. Grow Ohio in Muskingum County has been approved to open a 600,000-square-foot marijuana processing facility to manufacture edibles, tinctures, topicals, and other products.
In Illinois, where legislators are debating whether or not to legalize marijuana, a new report claims that demand for marijuana in the state could be between $1.69 billion and $2.58 billion annually, or a total of 350,000-550,000 pounds of cured flower. Estimates were based on Colorado’s experience with legalized marijuana. Two separate proposals are being considered by lawmakers, both of which would make marijuana legal in short order.