California Opens for Recreational Cannabis
If you somehow missed the news over the holiday season, recreational marijuana sales in California officially began January 1. The most populous state in the nation, California is home to nearly 40 million people–and expectations are high that the state’s marijuana market will earn billions of dollars.
On a national scale, the end of marijuana prohibition in California is a watershed moment, reflecting changing attitudes and acceptance of cannabis around the country. The number of states legalizing medical and/or recreational marijuana keeps growing. As tax revenue from pot sales fill the coffers of state and local governments (California expects $1 billion annually in taxes), it seems increasingly unlikely that federal authorities will crack down on the industry.
However, the launch wasn’t without hiccups: the computer system designed to track marijuana and prevent it from entering the black market wasn’t online, so dispensaries have been forced to keep track of transfers and sales of marijuana manually.
On top of that, California’s Bureau of Cannabis Control, charged with issuing temporary licenses to retailers and distributors, issued businesses licenses to eighty-eight stores–leading to long lines and supply issues at dispensaries.
Temporary adult-use retail licenses have currently been granted in 34 cities, representing 12% of California’s total population. The licenses are only good for 120 days, so businesses will need to reapply for a permanent license. There are currently 1,400 pending license applications for retail sales, distribution, and testing facilities.
Charles Boldwyn, chief compliance officer of ShowGrow in Santa Ana, said that the delay in finalizing rules and issuing business licenses could lead to a shortage of cannabis products.
“We’re looking at … hundreds of licensed cultivators and manufacturers coming out of an environment where we literally had thousands of people who were cultivating and manufacturing,” Boldwyn said in an interview with the Associated Press. “So the red tape is a bit of a bottleneck in the supply chain.”
San Diego, San Jose, and Sacramento are the largest cities in California where recreational shops have opened their doors. Los Angeles and San Francisco are expected to begin recreational sales sometime early this month.
Goodbye 2017: A Year in Weed Review
2017 began with Attorney General Jeff Sessions vowing to end legalized marijuana, but just days away from the start of a new year, the weed industry is growing faster than ever.
Here’s a roundup of all the major cannabis news in 2017:
Get ready for your jaw to drop: the legal marijuana industry is expected to reach $10 billion in sales in 2017, up 33 percent from 2016. Much of that growth is due to new cannabis markets opening for recreational and medical sales.
Washington state generated $436 million in retail sales this year, while Oregon generated $175 million. Nevada, which opened to recreational marijuana sales in July, hasn’t released sales numbers yet, but in July retail dispensaries made $27 million.
In eight months, Colorado made more than $1 billion in recreational and medical marijuana sales, with $512 million generated during the first half of 2017–more than any other legalized state. Most industry experts anticipate that California will eclipse the Colorado market when recreational sales begin in 2018.
Tax revenue from the 2016-2017 fiscal year brought more than $105 million to Colorado’s “Marijuana Cash Fund,” which supports health programs in public schools, housing for at-risk populations, and treatment programs aimed at combating the opioid epidemic.
Colorado has continued to blow through previous revenue records, and 2017 was the year that $100 million of cannabis sales per month in Colorado became the new norm.
Denver Says ‘Yes’ to Social Cannabis Use
Denverites voted to become the first city in the country to allow public cannabis use. The problem of where to consume legally purchased cannabis has been a problem in Colorado since recreational marijuana sales began in 2014. However, “public” might be overstating things a bit–there are still plenty of regulations in place limiting where and how people are allowed to toke. Earlier this month, the Coffee Joint in west Denver became the first business in the city to apply for a social use license.
Cannabis, the Great Uniter
2017 has been a year of deep partisan divide in U.S. politics, but marijuana has proven to be the one issue both conservatives and liberals can get behind. In February, a group of bipartisan lawmakers launched the Congressional Cannabis Caucus. Republican congressmen Dana Rohrabacher (California) and Don Young (Alaska) joined Democrats Earl Blumenauer (Oregon) and Jared Polis (Colorado) got together with the goal of easing tensions between federal and state drug laws and supporting the growing cannabis industry.
Relief for the Opioid Epidemic
The extent of the opioid epidemic in the U.S. is staggering. More than 64,000 people died from drug overdoses in 2016, and about 175 people die in the U.S. every day due to opioid overdose. But some researchers think that that cannabis might prove to be a lifesaver.
Both opioids and cannabinoids, like THC and CBD, block pain signals in our nervous system. Unlike opioids, cannabis is non-addictive and has comparable therapeutic effects with none of the dangerous side-effects. Plus, CBD can reduce drug cravings and withdrawal symptoms, helping to reduce the likelihood of relapse.
A study published by in the American Journal of Public Health found that legal marijuana leads to fewer opioid-related deaths. Since the start of recreational cannabis sales in Colorado, the state saw a 6.5 percent drop in the number of opioid deaths.
Additionally, researchers found that in states with a medical marijuana program, prescriptions for medications like painkillers, antidepressants and anti-anxiety medications dropped sharply. They also found that a nationwide medical marijuana program would save taxpayers about $1.1 billion on Medicaid prescriptions annually.
Nevada Recreational Market Opens
On July 1, Nevada dispensaries opened their doors for legalized recreational marijuana sales. Nevada was the fifth state in the U.S. to end marijuana prohibition and the first to declare a state of emergency when weed supplies ran low.
Less than two weeks after recreational sales began, dispensaries were running out of product to sell. In an effort to make concessions to the liquor industry, Nevada marijuana laws require that wholesale alcohol distributors have the exclusive right to transport cannabis from grows to dispensaries. The problem was, the state hadn’t approved a single distribution license–meaning that while there was plenty of cannabis to go around, there was no way to transport cannabis from point A to point B. The state of emergency allowed Nevada officials to adopt regulations to alleviate the shortage.
Enrollment Jumps for New Mexico’s Medical Marijuana Program
New Mexico’s medical marijuana program launched in 2007, but this year the state has seen a record number of enrollees. The state saw a 77 percent increase registered medical marijuana patients, bringing the total number of patients to 45,347 as of Nov. 30. That’ a net gain of 19,650 patients.
It’s the largest increase in the number of registered patients over a one year period, and the number could easily reach 50,000 by the end of the year.
This is despite the ongoing confusion surrounding enrollment numbers from the New Mexico Department of Health (NMDOH). Over the past three years, thousands of patients have been disenrolled from the medical marijuana program. Department of Health officials blame so-called “legacy data” that needed to be removed from the state database. The NMDOH and the vendor responsible for program data have confirmed the ongoing reporting concerns.
“The challenge we run into, as we have stated several times, is these reports keep having staggering changes in numbers,” Andrea Sundberg, NMDOH Patient Services Manager, told the Las Cruces Sun-News. “Last year we had a change of 5,000 active enrollees in a one month period that nobody could ever explain. Then last month (September 2017) we ran the report and the numbers by county and condition were different than the active count by over 7,000,” Sundberg said. “These type of issues two years into the system are not appropriate and only lead to greater confusion about our valid data.”
In April, New Mexico’s medical cannabis board voted to expand the list of eligible medical conditions beyond the current 20 acceptable ailments. The addition of qualifying conditions would expand the patient pool significantly, which could be a boon for the state’s cannabis businesses, but disagreements between the New Mexico Medical Cannabis Advisory Board and New Mexico Health Secretary Lynn Gallagher.
Denver Coffee Shop First to Apply for Social Pot Use
More than a year after Denver voters approved social marijuana use at licensed businesses, the city has received its first application.
The Coffee Joint in west Denver will be the first in the city to allow vaping and the consumption of edibles. City regulations prohibit smoking cannabis indoors. As part of the licensing process, owner Rita Tsalyuk was required to get approval from the local neighborhood association.
“I really feel comfortable,” said Aubrey Lavizzo who is part of the neighborhood association which met with the owners of the Coffee Joint.
“Our main concerns where whether or not they are going to be good neighbors,” said Lavizzo. “But they were coming to our meeting and answering all their questions.”
Denver finalized rules for social use five months ago, but many local businesses complained that the city’s regulations are so restrictive that they discourage businesses from applying. In addition to receiving approval from local neighborhood associations, social cannabis use businesses are required to adhere to a host of regulations. Rules include operating at least 1,000 feet from schools, as well as restrictions to keep social use shops at least 1,000 feet away from daycares, public recreation — public parks and community pools — and alcohol and drug treatment facilities. The application fee is $1000.
A public hearing will be held in the next two or three months. In the meantime, the Coffee Joint plans on opening at the end of the year as a regular coffee shop. Tsalyuk expects to open the shop for marijuana consumption in March 2018.
“I want it to have a Starbucks feeling, but more like the Highlands,” said Tsalyuk. “They’ll watch TV, listen to music, do art, there will be lessons, educational events, just no cannabis… yet.”
Denver’s social use regulations prohibit marijuana dispensaries from applying for a social use license, so plan to BYOM (bring your own marijuana). Luckily, the Coffee Joint is neighbors with an a existing recreational cannabis shop.
Once the Coffee Joint opens for social cannabis use, there will be a $5 admission fee that includes coffee and tea.
Recreational Marijuana Sales Begin in California Jan. 1
2018 is just around the corner, and California’s recreational marijuana program is set to launch on January 1. The state is expected to become the country’s largest marijuana market, generating $4.5-$5 billion in annual sales.
Ahead of the Jan. 1 launch of recreational cannabis, here’s what you need to know about the California market:
Who can purchase recreational cannabis?
California is following the lead of other states with recreational marijuana programs and regulating cannabis like alcohol. Recreational marijuana can only be purchased by those 21 or older. Medical marijuana regulations will remain unchanged, and you must be 18 years or older with a valid doctor’s recommendation.
How much marijuana can you possess and can you grow your own marijuana plants?
- You can possess 28.5 grams of flower, or 8 grams of cannabis concentrate.
- Individuals can grow up to six plants.
- Driving while high is illegal, as is using marijuana in a moving vehicle or having an open container of cannabis in the car.
- Smoking is prohibited in public, including in restaurants, bars, or concert venues. You can smoke in your home or backyard; however, if your lease prohibits smoking, you can’t smoke cannabis in your rental unit.
When and where can Californians buy recreational marijuana?
That’s a little bit more difficult to answer. California is implementing a dual-licensing system between state and local governments. That means that while recreational marijuana will be legal statewide, dispensaries won’t receive a business license unless they have the approval of their city and/or county government. Local governments will be responsible for setting cannabis regulations, and they have the ultimate say in whether or not adult-use cannabis sales will be allowed.
Unfortunately, many local governments are behind in issuing regulations. California’s five largest cities–Los Angeles, San Diego, San Jose, San Francisco, and Fresno–are at varying stages in setting guidelines. Depending on where you live, you might have to travel to find a recreational marijuana dispensary.
Additionally, cannabis businesses can only sell or deliver weed between 6 a.m. and 10 p.m., so don’t expect to purchase weed at the stroke of midnight on New Year’s Eve.
Las Vegas MJBizCon Brings Record Numbers
MjBizCon, the annual conference aimed at marijuana professionals and investors, wrapped up its sixth year earlier this month and established itself as the fastest-growing trade show in the country.
This year’s conference was the first in Nevada since recreational marijuana was legalized, and the event drew a record number of vendors and attendees.
- 678 companies exhibited at the event, a 111% increase from last year. Exhibiting companies spanned all sectors of the industry, from banking, security, packaging and marketing firms to consultants, cultivation equipment manufacturers and infused product companies.
- 18,000 cannabis professionals attended the convention, a new record and up 67% from last year’s event.
- Nearly 11% of all conference attendees – 1,932 in total – hailed from outside the U.S. Canada had the largest International presence at the show, accounting for over 75% of the non-domestic audience.
The convention’s four keynote speakers included former Apple and Tesla executive George Blankenship, Jeanne Sullivan, a dot-com era investor in tech companies, Marijuana Business Daily vice president of editorial Chris Walsh, and Chief White House Correspondent for U.S. News & World Report Kenneth T. Walsh.
Chris Walsh, who was also one of the event organizers, said that interest in the conventions was so great that they had to cut some of the exhibitors because there wasn’t enough room.
“You have people who were probably against marijuana at some point in their lives and then said maybe it isn’t that bad,” Chris Walsh said. “Or maybe try to get in on it on the business side, now that it’s becoming legal, it’s not the devil weed people said it was.”
“You have people who are ambivalent, who are here for the same reasons and then you have business people from the mainstream business world who were successful in other industries looking for their next project.”
“Cannabis is here to stay,” Sullivan told attendees. She urged companies in the marijuana industry to focus on positioning themselves favorably for potential acquisition by larger corporations, such as pharmaceutical and agricultural industries.
“These companies are not going to miss out,” Sullivan said, referring to the industry entrances of Scotts Miracle-Gro, liquor distributor Constellation Brands, and Netflix.
Blankenship was equally optimistic about the future of the cannabis industry. “Sooner or later, you’re going to be able to say, ‘Alexa, send me an eighth of flower.'”
Advertising Still Difficult for Cannabis Industry
Entrepreneurs in the cannabis industry face different challenges than companies in virtually every other sector. Unlike other industries, cannabis businesses don’t have the same access to banking and advertising, forcing them to MacGyver their way through day-to-day business operations.
When it comes to advertising, cannabis companies are struggling to find good ways to promote themselves. Most mainstream media outlets are hesitant to accept marijuana-related ads, often because they have a stereotypical view of the marijuana industry or they fear a crackdown from federal regulators.
Further complicating the situation, billboards, TV spots, and other mainstream marketing options are prohibitively expensive–a hurdle for any young business. The cannabis industry is still in its infancy, and companies just starting out often don’t have a large marketing budget.
That leaves cannabis businesses forced to adapt and to find ways to promote themselves with nothing more than a metaphorical Swiss Army knife, duct tape, and a roll of twine.
So, how do marijuana businesses promote themselves effectively?
Data collected for the Marijuana Business Factbook 2017, found that developing an online presence and making connections within the cannabis community are key to compelling cannabis marketing and positive word of mouth, both online and off.
The data shows that for both plant touching businesses and ancillary cannabis businesses, word of mouth and social media are the most useful ways to market their companies, showing that good marketing and branding is essential for a cannabis business to capture an audience organically.
33.7% of plant touching businesses found that social media was the single most effective marketing/advertising method for their company, followed by 27% of plant touching businesses who found word of mouth most effective.
Ancillary cannabis businesses found the most success in marketing through word of mouth, at 38.2%; 17.8% of ancillary companies found that social media was most effective. Both plant touching and ancillary businesses cited the internet as their primary marketing tool, at 19.6% and 19.7%.
Of course, marketing on social media has its challenges as well. The rules are hazy when it comes to what kind of ads social media platforms like Facebook or Twitter allow typically only allowing advertisements that can prove “advocacy or community building”. Plus, it’s not unusual for social media pages promoting cannabis businesses to be taken down without explanation.
CU Boulder Awarded Grant to Study Cannabis Use & Behavior
The National Institute on Drug Abuse (NIDA) has awarded $5.5 million to two University of Colorado professors to study how cannabis legalization has impacted human behavior.
The study, led by behavioral geneticist John Hewitt and psychiatry professor Christian Hopfer, MD, will collect data from 1,000 sets of twins in Colorado and Minnesota ages 23 to 29 over a period of five years. They’ll be examining self-reported cannabis use and any changes in mood or behavior.
“It’s probably not a lot different than you would have seen when you moved from prohibition to alcohol becoming available again,” Hewitt told 5280. “You would expect that for many people it would be a neutral thing (legalization wouldn’t impact their behavior), for others, there’d be some benefit (to legalization) and for others, there’d be some adverse consequences.”
Recreational marijuana has been legal in Colorado since 2014, so twins in Minnesota, where recreational cannabis is still illegal, will act as the control group. Hewitt says that they hope to find out if legalization has increased cannabis use, and whether cannabis use impacts the frequency of using alcohol or other substances. They’ll also monitor any changes in the study participants as far as mood, employment status, family functioning, and educational completion.
The study is the first and only of its kind in the nation, but some are skeptical of the study because of where the funding is coming from. Allen Shackelford, a physician, medical marijuana administrator, and CDPHE Medical Marijuana Research Grants Program board member, explained that “NIDA has a history of funding studies that are intended to support their preconceptions about whether something is dangerous or not.”
Hewitt, however, said that their study is set up to look at any correlation between cannabis use and mood or behavior changes, rather than causation. Hewitt and Hopfer will be studying both identical and fraternal twins, which will help determine if there’s a correlation between genetic makeup and any changes in behavior that can be attributed to cannabis use.
“What we often find in the kinds of studies we do is that actually both the twin who uses the substance and the one who doesn’t are equally likely to show the apparent consequence (of behavior or mood changes),” Hewitt said. “…we are probably in a better position to shoot down a causal relationship than we are to establish one.”
Ken Gershman, who manages the Colorado Department of Public Health and the Environment (CDPHE) thinks that the study will contribute to the conversation around cannabis.
“Although there is much existing research on the negative cognitive and mental health effects of MJ use, much of it pre-dates (recreational) MJ legalization,” Gershman wrote to 5280 in an email. “…I think this study will contribute to and inform policy discussions.”
Hewitt plans to start recruiting sets of twins in January, and while the study is slated to last five years, he expects to begin publishing preliminary findings in one or two years.
Is Cannabis the Answer to America’s Opioid Crisis?
An editorial published by the Los Angeles Times on Monday posed a question that no one seems to be asking about the nation’s opioid epidemic: why aren’t we talking about medical marijuana as an alternative?
More than 64,000 people died from drug overdoses last year, and that number is rapidly increasing. In 2016, the number of overdose deaths rose more than 22 percent over the 52,404 drug deaths in 2015, and it’s the leading cause of death for Americans under 50.
Opioids include drugs like oxycodone, hydrocodone, fentanyl, and heroin. As highly effective painkillers, opioids are one of the most prescribed drugs in the U.S. Unfortunately, they’re highly addictive and effective pain relief requires increasing doses, raising the likelihood of overdose.
The risk of addiction and overdose associated with opioids is staggering, but there’s evidence that cannabis could be an effective substitute. Both opioids and cannabinoids, like THC and CBD, block pain signals in our nervous system. Unlike opioids, cannabis is non-addictive and has comparable therapeutic effects with none of the dangerous side-effects. Plus, CBD can reduce drug cravings and withdrawal symptoms, helping to reduce the likelihood of relapse.
Amanda Reiman, a researcher at University of California, Berkeley, released a survey earlier this year examining the opioid-based and non-opioid based pain medication. 97% of respondents agreed or strongly agreed that they could decrease their use of opioid painkillers when consuming cannabis. And 92% said that they agreed or strongly agreed that they prefer cannabis to treat their medical condition.
“The treatment of pain has become a politicized business in the United States. The result has been the rapidly rising rate of opioid-related overdoses and dependence,” she said. “Cannabis has been used throughout the world for thousands of years to treat pain and other physical and mental health conditions.”
Marijuana has negligible overdose risk and has shown a host of medical benefits, especially in treating chronic pain, yet it remains an illegal, schedule I substance. States that have legalized medical marijuana show decreased opioid use and decreased opioid overdose deaths.
About 175 people die in the U.S. every day due to opioid overdose–are the risks worth any beneficial effects provided by the drug? Should opioids even be categorized as a medicine?
Cannabis Industry is Slowly Gaining Banking Services
Since the early days of cannabis legalization, providing banking services to marijuana businesses has been fraught with uncertainty and confusion.
29 states plus the District of Columbia have legalized cannabis for medical and/or recreational use, but financial institutions are still bound by federal law, making working with cannabis companies a legal risk. In turn, cannabis companies are forced to operate entirely with cash, putting businesses and employees at risk of theft or other crime.
However, it looks like support for cannabis legalization has reached a tipping point, and the benefits or working with the industry are starting to outweigh the risks for financial institutions. Earlier this year, the Financial Crimes Enforcement Network (FinCEN) reported that banks providing services to marijuana businesses increased 22% since March 2016. At the end of March 2017, nearly 300 banks and around 50 credit unions were providing banking services to cannabusinesses. Add to that the $7.2 billion netted by the cannabis market in 2016, and it’s no wonder that more banks are engaging with the marijuana industry.
The increase is transactions between cannabusiness and banks is significant because financial institutions have to perform a balancing act: complying with federal laws and FinCEN guidelines with very little legal protection.
The only buffer banks and marijuana businesses have from regulatory and criminal enforcement is a DOJ memo issued in 2013, that holds little or no legal weight. Known as the Cole Memo, the directive acknowledged that while marijuana continues to be illegal under federal law, the Justice Department would essentially look the other way as long as marijuana businesses were compliant with state laws.
In 2014, FinCEN laid out additional guidelines for financial institutions on how to maintain compliance with the Banking Secrecy Act (BSA) and marijuana enforcement priorities under the Controlled Substance Act (CSA). FinCEN’s guidelines put the responsibility of determining whether or not any cannabis business they work with is complying with a host of requirements, including determining if the marijuana-related business is laundering money, engaging in interstate activity, or demonstrating the legitimacy of business operation or investment source.
Robert Rowe, chief legal counsel for the American Bankers Association, said “it flips the responsibility back on the bank,” and that one banker said, “the only way he could feel comfortable is if he had an employee embedded in that business 24/7.”
At the beginning of October, Hawaii became the first state to require cashless-cannabis sales. The state is using a debit app based in Colorado called CanPay, and it enables medical marijuana patients to make cannabis purchases with their smartphone.
Marijuana Leads to Fewer Opioid Related Deaths
In the two years following the start of recreational marijuana sales in Colorado, a new study published by the American Journal of Public Health (AJPH) found that opioid deaths in the state fell by 6.5 percent.
Addiction to opioids, often prescribed by doctors to treat chronic pain, is higher than ever. The Centers for Disease Control and Prevention reported that more than 64,000 people died from drug overdoses in the U.S in 2016–that’s more than the number of American lives lost during the entire Vietnam war. The number of overdose deaths last year saw a 21 percent increase from the previous year. Approximately three-fourths of all overdose deaths are attributed to opioids.
There’s a growing body of evidence that marijuana is beneficial to opioid users and effective at treating chronic pain. Marijuana essentially has zero chance of fatal overdose. The University of Michigan published a study in 2016 that found that chronic pain sufferers who used marijuana saw a 64-percent drop in opioid use.
The increasing availability of marijuana across the country could have the added benefit of reducing the number of people turning to opioids as a painkiller.
The AJPH researchers behind the new paper stress that their findings are preliminary and that more study is needed. And while there’s a correlation between cannabis and reduced opioid-related death, it’s not enough to say that cannabis is the cause.
“Given the rapidly changing landscape of cannabis and opioid policy in the United States, the need for evidence of the diverse health effects of these laws is increasing,” the researchers wrote.
Robert Valuck, who coordinates the Colorado Consortium for Prescription Drug Abuse Prevention, told the Denver Post that while opioid-related have gone down, deaths from heroin in the state are on the rise–the fear being that people are trading one opiate for another.
“The whole thing is so convoluted, with so many different things going on in the marketplace, it’s virtually impossible to assign cause and effect or credit and blame to any one thing,” Valuck said.
AJPH researchers examined monthly overdose fatalities in Colorado before and after recreational marijuana was legalized in 2014. The researchers charted deaths from opioid painkillers from 2000 to 2015.
The DARE Program Attempts to Make a Comeback
Gorilla Glue Settles in Trademark Suit vs. Cannabis Strain
In what may be a sign of things to come, the adhesive brand Gorilla Glue Co. has reached a settlement with the Las Vegas-based cannabis company behind Gorilla Glue #4 (as well as #1 and #5).
The Gorilla Glue Co. filed a trademark infringement suit against GG Strains back in March of this year. The glue company said that the cannabis company was infringing and diluting its “famous, valuable brand.”
The settlement comes after months of negotiations.
According to The Cannabist, under the agreement GG Strains will have to transition away from the Gorilla Glue name, imagery and any other similarities to Gorilla Glue Co.’s trademarks by September 19, 2018. The cannabis company will also shut down gorillaglue4.com and transfer the domain to Gorilla Glue Co. by January 1, 2020.
The marijuana company’s website says the strain names will change as follows:
- Gorilla Glue 4 is now GG4 and or Original Glue
- Gorilla Glue 5 is now GG5 and or New Glue
- Gorilla Glue 1 is now GG1 and or Sister Glue
- LVPK x GG4/Purple Glue & Gluchee remain the same
Don Peabody, the grower behind the sticky strain, was trimming his harvest when his phone rang. After the call, Peabody went to hang up the phone, but it was stuck to his hand. It reminded him of the super-strong adhesive, so he dubbed the strain Gorilla Glue.
Cannabis has a tradition of naming strains after things or people in pop culture. There’s Skywalker OG, Girl Scout Cookies, Bruce Banner, and Charlotte’s Web, just to name a few.
Before widespread legalization, cannabis breeders and growers didn’t need to worry about things like trademark infringement. But with more social acceptance also comes with more scrutiny, and as the market grows, more companies will want to protect their names.
The dispute and rebranding effort is estimated to cost the cannabis firm $250,000.
Ross Johnson, one of the founders of GG Strains, said about the settlement, “We’re going to survive; we’re going to overcome it. Is it a setback? Most definitely it is a setback. But it’s all behind us now, and it’s allowing us to move forward.”
California: A Testing Ground for E-commerce Weed Delivery
Tech company Eaze is hoping to use e-commerce to bring the weed industry into the future. The San Francisco startup was formed in 2014, and the company’s app allows patients to connect with dispensaries to order cannabis for delivery.
California doesn’t require dispensaries to have a storefront, and in a state that’s an economic powerhouse with a population of nearly 40 million people, it’s uniquely placed to become the testing ground for e-commerce weed delivery. And when recreational marijuana sales begin in 2018 the potential for growth is huge.
New Frontier Data, a cannabis data analytics firm, projects that California’s cannabis sales at about $2.8 billion in 2017. The firm expects that as the cannabis market matures, that number could climb to 6.6 billion by 2025.
John Kagia, New Frontier’s executive vice president of industry analytics, thinks that “California is going to be the most important and the largest single market in the world (for the cannabis industry).”
Colorado has so far opted out of cannabis delivery, fearing that it would invite increased scrutiny from federal enforcement agencies. In Oregon, the city of Portland has legalized delivery services. Nevada is looking to venture into the delivery business, as well.
Despite being federally illegal, Eaze operates in more than 100 cities. The company also has a line of vaporizers, and they’re planning to create private-label cannabis brands, and offers low-cost marijuana recommendations under EazeMD.
Eaze has secured $24.5 million in venture funding from investors including rapper and entrepreneur Snoop Dogg, as well as a number of well-known Silicon Valley venture-capital firms. Earlier this month Eaze received an additional $27 million in investment capital.
By fiscal year 2020, Eaze is aiming to ship rough equivalent of a 33-foot-cube of marijuana–nearly three joints for every registered voter in the U. S.–to consumers in legal markets.
Sheena Shiravi, head of Eaze’s public relations, said that the growth of e-commerce is “not unique to cannabis. I think that (e-commerce) is the wave of the future…What we see in California is hopefully a pilot for federal regulation.”
Coloradoans Increasingly Turn to Marijuana for Relief
Sometimes it feels like people don’t agree on anything these days, so it’s reassuring to find that, in Colorado at least, there’s still one thing that can bring people together: weed.
At least according to a new survey released by Consumer Research Around Cannabis.
Consumer Research compiled data from Denver and Colorado Springs, the state’s two largest cannabis markets. They found that despite differences in city size, demographic makeup, and overall political affiliation, more than half of the respondents approved of recreational and medical marijuana use.
Jeff Stein, Vice President of Consumer Research Around Cannabis, said the survey results show that “Denver leads Colorado Springs, 58% to 52%, in acceptance of medical and/or recreational marijuana, but the two regions reflect each other almost identically when looked at through a political lens. In both areas, nearly 75% of liberals, about 60% of independents, and roughly 35% of conservatives approve of legal usage.”
Colorado Springs is home to 725,00 adults and was rated the fourth-most conservative major city in the country in 2014, while Denver, with at population of 3.2 million adults, was rated the 19th most liberal city.
On top of high marijuana approval rates, respondents from both cities reported having similar reasons for using cannabis. More than 40% of respondents said that they used marijuana to help them sleep, followed closely by those who use it to treat chronic and recurring pain.
One notable difference in the data was the percentage of people who used cannabis to treat “temporary or minor pain” in Colorado Springs at 17.2%, making it the city’s third most important reason for using cannabis. Lumping together chronic and temporary or minor pain means that about 67% of cannabis use in Colorado is as a painkiller.
“Over the long run, It will be interesting to see how marijuana use affects sales of traditional pharmaceuticals for these kinds of ailments,” said Stein.
The survey didn’t identify how respondents consumed cannabis: whether flower, concentrate, or edible.
Hawaii the First State to Require Debit-Only Cannabis Sales
Beginning Oct. 1, Hawaii will be the first state in the U.S. to require cashless-only cannabis sales.
A Colorado-based credit union will permit dispensaries in Hawaii to open bank accounts, and a debit app called CanPay will enable patients to purchase cannabis with their smartphones. The app is currently in use in six states, but Hawaii will be the first to use it exclusively for medical marijuana transactions.
Because marijuana is still illegal under federal law, most banks and credit card companies refuse to work with cannabis industry. As a result, marijuana businesses are forced into cash-only transactions, making day-to-day operations tedious and putting dispensaries and employees at risk for robberies and other crime.
To put the amount of cash floating around the marijuana market in perspective, consider that Colorado consistently makes $100 million in pot sales every month (with California expected to dwarf that number)–that’s a lot of physical money, and most businesses don’t to have anywhere to put it.
Having access to banking is a big deal in the cannabis industry–and widespread access probably won’t happen until Congress decides to deschedule marijuana.
Hawaii was one of the first states to legalize medical marijuana in 2000, but dispensaries weren’t legalized until 2015.
The state Department of Health delayed the roll-out of medical marijuana until this year because the state didn’t have a certified lab–putting dispensaries in the unenviable position of growing and harvesting plants that they weren’t allowed to sell.
So far, there are eight licensed dispensaries in the state: Three on Oahu, two on Hawaii Island and two on Maui. The state’s first two medical marijuana dispensaries opened last month.
Alaska’s Adult Use Cannabis Market Sets New Sales Record
Cannabis sales are booming in Alaska: in July the state sold more weed in one month than the 3-month sales average.
The Alaska Department of Revenue reported that they collected nearly $600,000 in marijuana tax revenue during July–which equals about a third of the total marijuana tax revenue brought in last fiscal year. The figures are the highest to date in Alaska since recreational sales began last October.
During the last fiscal year that ended on June 30, the cannabis industry generated $1.7 million in marijuana tax revenue for the state. In Alaska, state taxes are collected from cannabis farms rather than retail dispensaries.
The Juneau Empire reported that Fairbanks had a total of 12 cannabis farms returning tax revenue, the most of any city in the state. Anchorage came in second with seven farms. Soldotna was third with four farms, and Juneau ended tied for fourth with multiple cities having three farms.
Kalley Mazzie, Alaska’s excise tax supervisor, reported that there was no revenue from outdoor marijuana farms in July, “but it shouldn’t be much longer before we start seeing those crops make their way to market.”
In July, 612 pounds (280 kilograms) of cannabis bud and 369 pounds (170 kilograms) of stems or leaves were sold. The state collects $50 per ounce of bud and $15 per ounce for trimmings.
Despite the record sales, the figures were lower than the state expected. In fiscal year 2017, the state expected $2 million in revenue, but failed to meet the mark. In fiscal year 2018, the state expects $10.6 million in marijuana tax revenue, or an average of $883,000 per month.
Mazzie expects similar numbers when August figures are published in October.
Denver Gets Ready to Issue Cannabis Social Use Licenses
The problem of where to consume cannabis in Colorado has been an issue since recreational marijuana use was approved by voters in 2012. Now, five years later, the city of Denver is ready to become the first in the nation to launch a program allowing businesses to set up social marijuana consumption areas.
Initiative 300, the ballot proposal to create a four-year social cannabis pilot program was approved by Denver voters last November.
As of August 24, Denver’s department of Excise and Licenses began accepting applications from businesses interested in getting in on the growing cannabis industry. Private, invitation only cannabis clubs are already legal, but the new program allows more conventional businesses, like art galleries, coffee shops, concert venues or yoga studios, to wade into the cannabis industry.
A committee of 20 people from the marijuana industry, city council members, and community groups were responsible for hammering out the details of the program.
Some of the rules that the committee came up with were expected: Social use clubs or venues will be strictly 21-and older. Businesses with a social use license will not be allowed to sell cannabis on site, so expect to bring your own weed. Additional restrictions require social use licensees at least 1,000 feet from schools, as well as distance restrictions to keep them at least 1,000 feet away from daycares, public recreation — public parks and community pools — and alcohol and drug treatment facilities.
Additional rules require obtaining backing from a nearby neighborhood or business group, making sure the site isn’t within 1,000 feet of restricted sites, putting together extensive supporting documents and plans, and paying the $1,000 application fee.
However, not everyone is happy with the committee’s final rules. The drafters of the initiative have publicly criticized the results, arguing that the rules don’t reflect the will of voters and undermine existing cannabis laws in Colorado that regulate marijuana like alcohol–Emmett Reistroffer and Kayvan Khalatbari, the creators of the initiative are planning to sue the city.
“Nothing has changed,” Khalatbari says of a potential lawsuit. “All of my comments about this inequality between how they’re treating alcohol and cannabis are the same. We’ve even had a lot of conversations with the mayor’s office since then, and they continue to say there was consensus, and that’s bullshit.”
Many fear that the committee’s rules are so restrictive that businesses will be discouraged by the extensive requirements to obtain a social use license.
Adding to the difficulty, Khalatbari and Reistroffer explain that the distance requirements will make it extremely difficult for businesses to find a space suitable for a social cannabis use.
Reistroffer, who was on the Social Consumption Advisory Committee explains, “Now the pilot program is set up to fail, because there is such little space available in Denver where permits are eligible and none of the original businesses that supported our campaign are able to apply. This means the issue of private consumption clubs and events will continue to proliferate throughout the city without any oversight from the city or feedback from neighbors — and public consumption will continue to occur in public places like parks and sidewalks because there will be no safe access to permitted consumption areas.”
Mountain High Suckers Participates in the Clinic’s Charity Classic 2017
We are so privileged to live in amazing state with safe legal access to cannabis and great organizations like our friends at the Clinic who put on their annual Charity Classic Golf Tournament at Arrowhead Golf Club this year. Cheers to all the local cannabis and non-cannabis businesses that sponsored their time and money to give to such a great cause.
In the last 8 year’s this even has raised over $400,000 dollars for the National Multiple Sclerosis Society of Colorado/Wyoming. We’re very proud to sponsor this extremely fun event which managed to raise over $100,000 this year!
We’re also very happy to help MS patients get safe, natural access to cannabis medicine like our infused suckers.
Cannabis has demonstrated effects on immune function that have the potential of reducing the autoimmune attack that is thought to be the underlying pathogenic process in MS. Many MS patients report that cannabis has a startling and profound effect on muscle spasms, tremors, balance, bladder control, speech and eyesight. Many wheelchair-bound patients report that they can walk unaided when they have smoked cannabis.
We’re blessed for the opportunity to participate in such a great cause!
Justice Department Blocks DEA Cannabis Research
A year after the US Drug Enforcement Agency (DEA) began accepting applications to grow cannabis for research it appears that the Department of Justice (DOJ), with the pressure of Attorney General Jeff Sessions, are blocking researchers from moving ahead with their proposals.
The DEA has received 25 research proposals, but so far none of them have been able to move forward. As part of the approval process, researchers must get final sign-off from the DOJ–and it’s no secret that Sessions is not a fan of weed.
“They’re sitting on it,” one law enforcement official told the Washington Post, “They just will not act on these things.”
A senior DEA official said that, “the Justice Department has effectively shut down this program to increase research registrations.”
The marijuana that researchers currently have access to is not what most people would consider weed. Since the late 1960s, all marijuana used in clinical research is required to come from a single government-run marijuana farm at the University of Mississippi. The problem is that the marijuana grown there doesn’t even really resemble the weed that’s sold at dispensaries, making it difficult for researchers to reach conclusions that are applicable to real-world use.
The quality of the government grown cannabis was so bad that Johns Hopkins University, which planned to begin a multiyear clinical trial studying cannabis and PTSD, backed out of the study.
One of the researchers who submitted a proposal to the DEA is Lyle Craker, a professor at the University of Massachusetts at Amherst. Craker submitted his last application in February but hasn’t heard back on his yet. He’s hoping to do research into whether other parts of the cannabis plant have medicinal value.
“I’ve filled out the forms, but I haven’t heard back from them. I assume they don’t want to answer,” said Craker. “They need to think about why they are holding this up when there are products that could be used to improve people’s health. I think marijuana has some bad effects, but there can be some good and without investigation we really don’t know.”
Hawaii Opens First Medical Marijuana Dispensary After 17-Year Wait
After a 17-year wait, Hawaii’s 18,000 medical marijuana patients will finally have a place to shop.
Maui Grown Therapies is set to open next week, having been the first dispensary to receive approval from the Department of Health to begin selling medical cannabis.
“Clearly this is a historic day not just for Maui but for the state of Hawaii. This is the first time in Hawaii that patients will be able to buy lab-tested, quality-assured medical cannabis from a state-licensed dispensary. We’re so excited,” said Teri Freitas Gorman, Maui Grown’s director of community relations and patient affairs.
Hawaii legalized medical marijuana in 2000, but dispensaries weren’t legal in the state until 2015. Eight other medical marijuana dispensaries have also been granted licenses (three on Oahu, two on Hawaii Island, and two on Maui), but sales were delayed until this year because the state didn’t have a certified lab–meaning that dispensaries who had begun growing and harvesting plants were unable to sell it.
Maui Grown had a “soft opening” yesterday, limiting sales to pre-registered patients by appointment only. Freitas Gorman said that they made 22 transactions and encountered a few software glitches, but she said patients were very excited. Flower was sold for $20 per gram and $90 to $125 for a quarter-ounce, depending on the strain. Regular hours and walk-in sales will begin with the official opening on Tuesday, August 15.
Registered patients and caregivers can purchase up to 4 ounces of medical marijuana during a 15 consecutive day period and purchase a maximum of 8 ounces over a 30 consecutive day period.
“This is an important day for qualified patients and caregivers on Maui who now have assurance the medical cannabis they purchase at Maui Grown Therapies has been thoroughly tested and is safe for them to use,” said Virginia Pressler, director of the state Department of Health, in a statement. “Implementing a new health program is always challenging, and the dispensary program was no exception.”
Aloha Green in Honolulu will open on the heels of Maui Grown Therapies. They’ve received the go-ahead from the Department of Health and expect to open Wednesday.
New Jersey Senator Introduces Bill to End Cannabis Prohibition
New Jersey Sen. Cory Booker introduced the Marijuana Justice Act this week, a bill that would end the federal prohibition on marijuana, as well as begin to address social justice issues that have resulted from the war on drugs.
“I believe the federal government should get out of the illegal marijuana business,” Booker said. “You see what’s happening around this country right now. Eights states and the District of Columbia have moved to legalize marijuana. And these states are seeing decreases in violent crime in their states. They’re seeing increases in revenue to their states. They’re seeing their police forces being able to focus on serious crime. They’re seeing positive things come out of that experience.”
Booker argues that marijuana enforcement disproportionately targets poor and minority communities, creating what he calls a “poverty trap.”
“You see these marijuana arrests happening so much in our country, targeting certain communities — poor communities, minority communities — targeting our veterans,” Booker said in a Facebook Live session following the introduction of the bill. “We need to seek not just to change the law, but be agents of restorative justice.”
The bill would legalize marijuana at the federal level and withhold federal money from building prisons, along with other funds, from states whose cannabis laws disproportionately incarcerate minorities.
If the bill were signed into law, it would:
- Remove marijuana from the Controlled Substances Act
- Encourage states to legalize cannabis locally through incentives
- Retroactively expunge Federal convictions for marijuana use and possession
- All individuals serving in federal prison for marijuana use or possession could petition the court for resentencing
- Cut federal funding for state law enforcement and prison construction if a state disproportionately arrests and/or incarcerates low-income individuals and/or people of color for marijuana offenses
- Create a “Community Reinvestment Fund” of $500 million to provide grants to communities most effected by the war on drugs. The fund would support job training, reentry services, community centers, health education programs, and more.
Plus, cannabis legalization could actually help the current opioid epidemic and reduce overdose deaths, and Booker dismisses prohibitionists’ argument that cannabis is a gateway to heavier drug use.
“The evidence that it’s a gateway drug just is not compelling, and the reality is, as I said with the challenges of opioid addiction, there’s some great medical studies that have come out that have shown that actually having the availability of marijuana actually lessens the chances you’re going to have overdose deaths,” Booker said.
Colorado’s $100 Million/Month of Cannabis Sales the “New Norm”
Another month, another record-breaking amount of cannabis sales in Colorado. The cannabis industry achieved a milestone in May, with $100 million in pot sales for the 12th consecutive month.
“I think that $100 million a month (in sales) are the new norm,” said Bethany Gomez, director of research for Brightfield Group, a cannabis market research firm.
Over 12 months, Colorado saw monthly sales reach $1.4 billion the state collected nearly $223 million in taxes and license fees. Since recreational marijuana was legalized four years ago, recreational sales have consistently counted for two-thirds of the monthly pot sales totals.
In May, recreational-use sales accounted for about $90.1 million and those from medical marijuana contributed just over $37.5 million. The industry’s 2017 cumulative sales through five months neared $620 million, generating close to $96 million in state revenue from taxes and fees.
However, Colorado is seeing a slow-down of growth in the industry as more states legalize recreational marijuana. Sales in Nevada–where dispensaries made about $3 million in sales and the state made about $1 million in tax revenue between July 1 and July 4–prompted the governor to declare a state of emergency as marijuana supplies ran dry. Recreational marijuana sales launch in California in 2018.
In Colorado, the market is still growing, but Gomez said that the market is approaching maturity.
“What you’re seeing in Colorado is similar to other industries, we’re starting to see lower double-digit growth rates, rather than the triple-digit growth rates,” she said. “That time of massive growth expansion in Colorado, I think, is over.”
Signs of market maturity includes the increased demand for concentrates and edibles, as well as a decrease in overall number of medical marijuana patients. New Frontier Data, a cannabis analytics firm, said that falling prices have reduced the incentive for patients to apply for medical marijuana prescription.
As of May 31, 2017, a total of 86,964 patients had an active medical marijuana registration, according to the Colorado Department of Public Health and Environment. A year before, that figure was 106,066.
Since recreational use began in 2014, the products that cannabis users have evolved. Consumers have shifted from dried marijuana flower to infused products, edibles, and concentrates.
“There is increased innovation in the product category, and that’s continuing,” she said. “Consumption patterns haven’t really settled in the recreational market yet; people are still experimenting. There is still a lot of room for change there.”
Massachusetts Court Rules Employees Can’t be Fired for Using Medical Cannabis
Following up on a hot button issue this week: In a first of its kind ruling, the Massachusetts Supreme Judicial Court decreed on Monday that employers in the state cannot fire employees for medical cannabis use.
Cristina Barbuto was fired after her first day at Advantage Sales and Marketing after she testing positive for marijuana. Barbuto has a prescription for medical marijuana to treat Crohn’s disease, something she disclosed to the company after being told that she would need to take a mandatory drug test. Barbuto’s supervisor told her twice that her cannabis use shouldn’t be a problem, as long as she didn’t use it before or during work.
But after she’d completed her first day of work, an HR representative told her that her employment was terminated because, “We follow federal law, not state law.”
Barbuto filed suit against the employer, claiming that her termination violated state anti-discrimination laws. The case reached the state supreme court after being dismissed in 2015. Similar cases have been filed in the past, but have often ruled against the employee.
In this ruling, the state supreme court said that, “the use and possession of medically prescribed marijuana by a qualifying patient is as lawful as the use and possession of any other prescribed medication.”
Similar cases have been tried in Colorado, California, Washington, and Montana. In each, the court ruled that employers could fire workers for legal, off the clock, cannabis use because it is still illegal under federal law.
“I can’t stress this enough, it’s the first case of its kind in the country,” said Dale Deitchler, a shareholder at world’s largest labor and employment law firm and an expert on marijuana issues in the workplace.
“Massachusetts is not a state where such protections are written in the law so this is really significant,” Deitchler said. “The court created law.”
The ruling means that the case will be sent back to the Suffolk County Superior Court, the court that initially dismissed Barbuto’s suit.
The justices concluded that, “An employee’s use of medical marijuana under these circumstances is not facially unreasonable as an accommodation of her handicap.” However, “it does not necessarily mean that the employee will prevail in proving proof of handicap discrimination”, If accommodating an employee’s medical cannabis use, “would create undue hardship” on an employer.”
“Undue hardship” would apply, for example, in the transportation industry, where cannabis use would impair an employee’s ability to do their work or endanger public safety. Past cases have been with employees with less physically stressful jobs so this ruling has not yet applied. Let’s hope this means a step forward for cannabis patients’ rights!
Nevada Governor Declares State of Emergency After Weed Runs Low
There’s a first for everything, especially when it comes to the cannabis industry, so perhaps it’s not surprising that a lack of weed has led the governor of Nevada to declare a state of emergency.
Less than two weeks after recreational marijuana sales began, dispensaries report that they’re running out of product to sell. The state of emergency will allow state officials to decide on new rules to help alleviate the shortage.
The problem is that when Nevada approved recreational marijuana last November, the ballot measure stipulated that for the first 18 months of recreational marijuana sales, wholesale alcohol distributors would be granted the exclusive right to transport cannabis from grows to dispensaries.
However, the Department of Taxation hasn’t approved a single distribution license–and dispensaries are unable to restock their shelves. The department says that they haven’t issued any licenses because of incomplete applications and zoning issues.
“The business owners in this industry have invested hundreds of millions of dollars to build facilities across the state. They have hired and trained thousands of additional employees to meet the demands of the market. Unless the issue with distributor licensing is resolved quickly, the inability to deliver product to retail stores will result in many of these people losing their jobs and will bring this nascent market to a grinding halt. A halt in this market will lead to a hole in the state’s school budget,” said Department of Taxation spokeswoman Stephanie Klapstein.
The Nevada Dispensary Association estimated that dispensaries made about $3 million in sales and the state made about $1 million in tax revenue between July 1 and July 4. Over the next two years, Nevada tax officials expect cannabis sales to generate $100 million in revenue.
The Nevada Tax Commission will vote on regulation to expand the pool of eligible distributors on Thursday.