Cannabis Industry & Marijuana Business Briefs

Marijuana banking bill appears headed to landmark US House vote

A measure that would enable financial institutions to serve the cannabis industry and ancillary companies without fear of federal punishment could be put to a historic full vote in the U.S. House of Representatives later this month.

House Majority Leader Steny Hoyer, a Maryland Democrat, intends to put the SAFE Banking Act to a vote before the end of September, a staff member confirmed to Marijuana Business Daily on Friday.

The House Financial Services Committee advanced the bill earlier this year by a resounding 45-15 vote, and cannabis industry officials believe the full House will approve it as well.

Hoyer “said at the Whip meeting (Thursday) that he intends to move it this month,” Mariel Saez, Hoyer’s deputy communications director, wrote in an email to MJBizDaily.

“We’re discussing it with members, but it (the vote) hasn’t been scheduled just yet,” Saez added.

“Mr. Hoyer sets the floor schedule in consultation with other House leaders and Committee Chairs and with feedback from our members.”

A likely vote on the SAFE Banking Act in the Democrat-controlled House, which has been expected for some time, coincides with the chair of a key Senate panel expressing keen interest in advancing the issue as well.

Senate Banking Chair Michael Crapo, an Idaho Republican, told Politico this week that he wants his committee to vote on a marijuana banking bill by year-end.

But Crapo indicated his office might craft its own bill instead of trying to advance the SAFE Banking Act, which was initiated in the House by Rep. Ed Perlmutter, a Colorado Democrat, with the Senate version spearheaded by Jeff Merkley, an Oregon Democrat.

Neal Levine, CEO of the Cannabis Trade Federation, wrote in an email to MjBizDaily on Friday that the industry lobbying group “is delighted the U.S. House of Representatives is on the brink of passing a landmark piece of cannabis policy legislation that modernizes our antiquated banking laws to reflect the will of the people.”

Currently, the state legal marijuana industry struggles getting bank accounts and financing and, as a result, deals mostly in cash. That raises public safety and other concerns.

Don Murphy, director of federal policies at the Marijuana Policy Project, described cannabis banking reform now as a possible “photo finish as the House and the Senate appear to be both moving to get bills to the floor before the end of the year.”

But he wrote in an email that if the Republican-controlled Senate is going to pass a bill, he would expect it to pass its own measure rather than the House-initiated SAFE Banking Act.

Jeff Smith can be reached at jeffs@mjbizdaily.com

Teva Israeli subsidiary signs cannabis distribution deal

A subsidiary of multinational pharmaceutical giant Teva Pharmaceuticals signed a deal with Israeli medical marijuana company Canndoc to distribute its products to pharma customers that include pharmacies and hospitals.

While the deal is not exclusively for products in Israel, it will start there and move to other countries once it becomes logistically legal to do so, according to a Canndoc news release distributed Friday.

Israel’s medical marijuana market has roughly 46,000 patients.

Teva’s Israeli subsidiary Salomon, Levin, Elstein (SLE) agreed to work with Canndoc, whose chair is former Israeli Prime Minister Ehud Barak.

The initial agreement will span for three years and can be extended in two-year periods after that.

News of the transaction was first reported by Forbes.

Teva, based in Petach Tikva, Israel, trades on the New York Exchange under the ticker symbol TEVA.

For more on this story, click here.

For analysis and in-depth looks at the investment trends and deals driving the cannabis industry forward, sign up for our premium subscription service, Investor Intelligence.

Marijuana industry donations to DC lawmakers already top 2018

The cannabis industry donated more than $305,000 to U.S. congressional members in the first half of 2019, exceeding last year’s total of about $248,500 by more than 20%.

The data was collected from federal filings by Smart Approaches to Marijuana (SAM), an organization that actively opposes marijuana legalization, The Hill reported.

SAM said in a blog that its database now includes donations from lobbying firms that work for the marijuana industry.

Lobbyists include Brownstein Hyatt Farber Schreck for the Cannabis Trade Federation and Squire Patton Boggs for former House Speaker John Boehner’s National Cannabis Roundtable.

The top recipients for those donations in the first half of 2019:

  • Rep. Earl Blumenauer, Oregon Democrat: $103,500
  • Rep. Kathleen Rice, New York Democrat: $76,800
  • Sen. Rand Paul, Republican from Kentucky: $50,300
  • Sen. Catherine Cortez Masto, Democrat from Nevada: $32,600
  • Rep. Dave Joyce, Ohio Republican: $29,700

Blumenauer and Joyce are longtime marijuana reform advocates who also have tried to ensure that state lawful cannabis programs are protected from federal interference.

Although higher than last year, the donations to individual lawmakers pale in comparison to what the cannabis industry is spending on lobbying on Capitol Hill.

Leading marijuana industry associations and companies spent roughly $2 million in the first half of this year to fight for reform in Washington DC. That includes meeting with lawmakers from both sides of the aisle.

And in Florida, Curaleaf and Surterra have contributed a total of $1.1 million to push for recreational marijuana legalization in the state.

For more on this situation, click here.

Senate panel chair wants cannabis banking vote by year-end

Senate Banking Chair Mike Crapo wants his committee to vote on a marijuana-related banking measure this year, in what would be a landmark development for the marijuana industry.

The Idaho Republican, in an interview with Politico, indicated, however, that he might craft his own bill rather than bring the SAFE Banking Act up for a vote.

“We’re working to try to get a bill ready,” by year-end, Crapo told Politico.

SAFE, which would enable financial institutions to serve the cannabis-related industry without fear of prosecution, has been pushed for years by U.S. Rep. Ed Perlmutter, a Colorado Democrat.

The Senate version was introduced by Jeff Merkley, an Oregon Democrat, and Cory Gardner, a Republican from Colorado.

Crapo’s comments were consistent with the impression he left during a milestone committee hearing on the issue in July.

At that time, said the case was made “pretty strongly” for resolving cannabis banking issues, but he added that it “is an important, complex issue that we need to get right.”

Crapo told Politico he wanted to act partly because of how ancillary companies also have been affected by banking restrictions.

But he said he remained opposed to legalizing marijuana federally.

It’s unclear whether the Republican-controlled Senate Banking Committee will advance any cannabis banking measure this year.

During the July Senate committee hearing on the issue, Crapo was the only Republican present of the 13 GOP committee members.

For more on this story, click here.

Denver police warn marijuana businesses of ‘uptick in burglaries’

The Denver Police Department warned Colorado cannabis businesses that it’s seeing an increase in burglaries at dispensaries and is encouraging operators to report any suspicious activities.

In an online bulletin, the department wrote, “Dear Marijuana Industry, (the DPD) is seeing an uptick in burglaries at marijuana facilities.”

The letter outlined several suggested steps, both proactive and reactive, that businesses can take to try to prevent burglaries and how to respond safely if a robbery is in progress.

“Help us help you,” the bulletin notes.

Some of tips include:

  • Ensure a business has an alarm-use permit issued by the city’s Department of Excise and Licenses. Without one, police will not be dispatched to respond to an alarm.
  • Lock up cannabis products in a safe overnight.
  • Place video cameras strategically to ensure video of every entrance, any area where vehicles may approach the building and on the inside of buildings so faces are captured.
  • Install motion detectors as a backup to video cameras and other security measures.
  • Make sure the entire security system is equipped with a failure notification so owners will know if the system isn’t working.
  • Report any suspicious activity to police.
  • If a business suspects it’s being robbed, do not search the building, since suspects may be armed.

For more details on the posted warning, click here.

Oregon cannabis retailers pulling vaping products in wake of health scare

Marijuana stores in Oregon began taking vaping products off their shelves and offering returns on previously purchased vape pens.

The move comes amid a nationwide scare over severe lung illnesses and deaths tied to electronic cigarettes, the latest sign that the health-care scare is having an impact on the vaporizer industry.

Vaping sales have pulled back in the wake of multiple deaths and illnesses that emerged over the summer.

Kind Leaf Pendleton, a cannabis retailer that claims the largest inventory in Oregon, said it already pulled 68 vaping products from 15 brands, responding to uncertainty over what is causing some vaping consumers to become extremely sick.

“What would really hurt is having someone purchase a product and die from vaping,” said Erin Purchase, director of operations at Kind Leaf.

U.S. health officials say there are 380 confirmed and probable cases of vaping-related breathing illnesses in 36 states and one territory, including six deaths.

Most of the people who became sick said they vaped products containing THC, the compound in marijuana that causes a high. Some said they vaped only nicotine, while others said they used both THC and nicotine.

Kind Leaf said it identified all products on its shelves that listed “non-cannabis derived terpenes and artificial and natural flavors” on the label.

Terpenes are the building blocks that give a plant its aroma and flavor, such as lavender or tea tree oil.

When Kind Leaf tracked down the companies that sold non-marijuana terpenes to makers of vape pens, they noticed that some of them also make and sell the so-called cutting agents, or thickeners, that have come under scrutiny.

“We can’t prove that those products are not in these vape pens because we’re retailers, not processors,” Purchase said.

– Associated Press and Marijuana Business Daily

For more of Marijuana Business Daily’s ongoing coverage of the vaping crisis, click here.

Aurora plots ‘significant’ US marijuana entry in ‘very short period’

Canada’s largest medical cannabis company by revenue and production is planning to make a “significant” splash in the near future on another point of entry in the U.S. market, one of the company’s executives said in an interview.

Aurora, based in Edmonton, Alberta, already has arms-length involvement in the United States through Australis Capital, a Las Vegas-based investment group it spun off a year ago.

In a conference call with investors a day after releasing its earnings, CEO Terry Booth said Aurora is “laser focused” on exploring opportunities in the U.S. involving CBD derived from hemp.

Aurora’s strategic partners and Australis “are helping us talk to some of the top companies in the world,” he said on the call.

Chair Michael Singer added, “We see the U.S. market as a tremendous opportunity. This is a key objective in fiscal 2020. We expect … that we will have a significant footprint in the U.S. in the coming quarters.”

Canadian companies have made big investments in the United States since the Farm Bill was passed last year.

Industry heavyweights Canopy Growth, Tilray and Cronos Group have already laid out plans to spend hundreds of millions of dollars.

Aurora Chief Corporate Officer Cam Battley said the Alberta company is not ruling out anything.

“What I do expect is within a very short period of time we’ll be entering into the U.S. with another point of entry, and a significant one,” Battley told Marijuana Business Daily in a phone interview.

“We’re learning what the strengths and weaknesses are of (multistate operators) and other business models, so we are definitely laser-focused, short term, on CBD derived from hemp, because that can be done now. It’s fully permissible now.

“We’re also looking at stuff that may be more complicated and may require for us to be clever along the lines of what Canopy did.”

Battley was referencing Smiths Falls, Ontario-based Canopy’s deal to acquire Acreage Holdings, a New York cannabis firm, if and when the United States legalizes marijuana production and sales nationwide.

Aurora also disclosed expectations for outdoor production.

The company plans to harvest its first outdoor crop in Canada in the coming week and is weighing outdoor production beyond Canada.

“We know we’re going to use outdoor grow as a piece of the puzzle in multiple parts of the world,” Battley told MJBizDaily.

The Canadian outdoor production will not be used for commercial sales and – for now – is intended to facilitate research into cultivation techniques.

Aurora says it is weeks away from adding two more European Union Good Manufacturing Practice (GMP) certifications in Canada.

EU-GMP certification – the accepted seal for international quality compliance – is key to accessing international medical cannabis markets through exports.

Aurora’s international sales have been hampered by a shortage of export-grade medical marijuana.

Global medical sales were only 4 million Canadian dollars ($3 million) in the previous quarter.

The two facilities – Aurora Vie in Pointe-Claire, Quebec, and Aurora River in Bradford – together have a production capacity of 32,000 kilograms (70,548 pounds) per year.

“EU-GMP is becoming an international standard, rightly, not just in the European Union, but elsewhere in the world,” Battley said. “That’s good for us as an industry. It’s good for us to have tight regulation. Regulation is a good thing. We should embrace it.”

Australis trades on the Canadian Securities Exchange as AUSA.

Aurora’s shares trade as ACB on the New York Stock Exchange and the Toronto Stock Exchange.

For analysis and in-depth looks at the investment trends and deals driving the cannabis industry forward, sign up for our premium subscription service, Investor Intelligence.

Matt Lamers can be reached at mattl@mjbizdaily.com

Medicine Man Technologies announces 11th cannabis buy

Denver-based Medicine Man Technologies on Thursday announced its 11th marijuana business acquisition of the year – a $5.1 million cash and stock deal for Canyon, an infused edibles manufacturer.

Medicine Man Technologies will pay no more than $2.6 million in cash for the 10-year-old Canyon, which also is based in Denver.

The number of shares paid will be ironed out in a formal agreement between the companies.

Each share will be valued at $3.07.

The final price may be adjusted.

The privately held Canyon expects to generate gross revenues of $3.3 million in 2019.

Andy Williams, the CEO and co-founder of Medicine Man Technologies, said in a news release that “Canyon has been on our radar for several years.”

Medicine Man Technologies has been on a buying spree this year.

Earlier this week, it announced it will pay $31 million for another Colorado company, Strawberry Fields.

Williams said in the release that the “latest series of (acquisition) announcements have been predicated on building out our footprint of retail dispensaries.”

The two companies have worked with each other for years.

Medicine Man Technologies trades on the over-the-counter markets as MDCL.

For more on this story, click here.

For analysis and in-depth looks at the investment trends and deals driving the cannabis industry forward, sign up for our premium subscription service, Investor Intelligence.

MedMen, Surterra put up $1 million for adult-use marijuana push in Florida

MedMen and Surterra each contributed $545,000 to a campaign to legalize recreational cannabis in Florida.

The two cannabis companies are backing Make it Legal Florida, which is seeking to collect the 766,000 signatures needed to put a constitutional amendment on the 2020 ballot.

Their contributions, totaling $1.09 million, were first reported by Florida Politics.

Surterra, based in Atlanta, has the second-largest market share in THC/CBD sales per milligram among Florida’s medical marijuana businesses.

But Surterra’s 13.7% share lags far behind Trulieve, which has nearly a 50% market share, despite both companies being tied with the most dispensaries at 31 each.

Surterra hasn’t done much in the smokable flower market yet, holding less than a 3% share of sales.

MedMen would appear to have a lot at stake in the drive to legalize recreational marijuana in Florida.

The California-based company, which paid a reported $53 million to acquire a vertically integrated medical marijuana license from Treadwell Simpson Partnership, only recently opened its first dispensary in Florida.

To read more about the company’s campaign contributions, click here.

Jeff Smith can be reached at jeffs@mjbizdaily.com

Maryland’s medical cannabis commission chief resigns

Joy A. Strand, the executive director of the Maryland Medical Cannabis Commission, is stepping down, effective Oct. 1.

Strand, a health-care executive, led the commission for almost two years.

The commission oversees the regulations and implementation of the state’s medical marijuana program.

No reason was given for Stand’s resignation, The Baltimore Sun reported.

Strand was hired to oversee the cannabis commission in December 2017. She replaced Patrick Jameson, who resigned as commission chief for undisclosed reasons in November 2017.

Will Tilburg, the agency’s director of policy and government affairs, will serve as acting executive director.

Strand is leaving as the commission closes in on awarding one of Maryland’s 14 new growing and processing licenses, which are intended to increase diversity in the state’s MMJ industry.

For more on this story, click here.

Ohio balks at adding anxiety and autism for medical marijuana

The Ohio medical board dealt a blow to the state’s medical cannabis industry when it rejected petitions seeking to add anxiety and autism spectrum disorders as qualifying conditions.

The board voted down those additions Wednesday after a Medical Board committee last month backpedaled on an earlier recommendation to add the conditions.

The board determined that while marijuana could provide temporary relief for anxiety it also could cause panic attacks and affect children’s brain development.

A frustrated Ohio Medical Cannabis Cultivators Association (OMCCA) said the board’s decision is overly restrictive compared with other markets and is constraining patient access.

“Ohio’s decision not to follow in the footsteps of the 10 states who already allow medical marijuana for anxiety and 22 states that allow it for autism harms patients in need,” Thomas Rosenberger, associate director of the OMCCA, said in an emailed statement.

Earlier this summer, the panel rejected depression, insomnia and opioid addiction as qualifying conditions.

Board spokeswoman Tessie Pollock said the state body could reconsider adding anxiety and autism to the list of 21 qualifying medical conditions if new studies or petitions are submitted.

– Associated Press and Marijuana Business Daily

Illinois providing safety training to adult-use cannabis sellers

Illinois officials authorized 26 businesses to provide health and safety training to recreational marijuana retailers, including existing medical cannabis operators, in advance of the adult-use program launch on Jan. 1.

The Department of Financial and Professional Regulation announced the list of “responsible vendors.”

A statement from the agency said “at least half” the approved providers are minority-owned.

Many are based in Illinois, while others are from Florida, Iowa and Texas.

Small amounts of recreational marijuana products will be available starting Jan. 1, with existing licensed MMJ businesses getting the first crack at operating retail stores.

Regulators recently awarded the first five licenses.

Operators of retail outlets must be trained on properly dispensing cannabis, checking buyers’ identification, identifying signs of impairment because of marijuana use and other health and security concerns.

Existing medical cannabis outlets must receive the training by Nov. 30.

Marijuana Business Daily projects that the Illinois adult-use market could generate up to $2.5 billion in annual sales when it matures.

– Associated Press and Marijuana Business Daily