It will be moderated by Lance Blundell, Esq. General Counsel for cbdMD. Owen Bennett from Jefferies, Rupesh Parikh from Oppenheimer & Co, and Ashok Kumar from Think Equity will have a Q&A with Daniel Fabricant, PhD, president and CEO of Natural Products Association.
To help clarify the CBD landscape for investors, the Natural Products Association (NPA; Washington, D.C.) board member cbdMD is hosting an invitation-only virtual investor conference, “Regulatory Roadmap for The CBD Industry,” on Oct. 21, 2020 at 10 a.m. It will be moderated by Lance Blundell, Esq. General Counsel for cbdMD. Owen Bennett from Jefferies, Rupesh Parikh from Oppenheimer & Co, and Ashok Kumar from Think Equity will have a Q&A with Daniel Fabricant, PhD, president and CEO of Natural Products Association (NPA; Washington, D.C.).
NPA has been actively lobbying FDA to regulate CBD since 2017; it has testified on a number of occasions and held several meetings with top FDA officials regarding CBD. NPA also helped craft legislation passed by the U.S. House of Representatives that would have provided resources so FDA can perform a Health Hazard Evaluation and set a safe level of CBD for consumers to use each day.
Invitation-only requests can be made through the sponsors, Jefferies, Oppenheimer & Co, and Think Equity. A transcript of the conference will be made available to the public on Oct. 26, 2020.
Seasonal probiotic developers Jetson released its reformulated probiotic Mood. The product is designed to help with the transition from summer to fall with strains for mood enhancement such as L-Theanine. The Mood Probiotic also features Vitamin D3 and B12 to support Seasonal Affective Disorder and fortify immunity. After hearing feedback, removed melatonin from the formulation and increased DE111 to aid the metabolism and decrease bloating.
The company also launched the Fall and Winter iteration of Jettie, seasonal probiotics for kids and babies.
Jettie Baby and Jettie Kids aim to address the needs of darker, colder, sicker months, while encouraging the development of young microbiomes. Both are colorless, flavorless powders that can be stirred into milk or water.
Jettie Baby, created for children under two years old, is designed to support immunity, improve sleep and reduce crying time as cold and flu season approaches. Jettie Kids, designed for children between the ages of two and thirteen, also aims to reduce anxiety as the season changes. Key ingredients of Jettie Fall/Winter are chamomile flower, D3: HMO (Jettie Baby), bifidobacterium infantis VK2 (Jettie Baby), L-theanine (Jettie Kids), rhodiola root extract (Jettie Kids) and bifidobacterium lactis Bl-04.
The products are sold on wearejetson.com and Amazon. Mood is $35/month and the Jettie products are $25/month.
NXT Water launches AKESO Hemp Powered Hydration
NXT Water announces the official launch of AKESO Hemp Powered Hydration, the company’s new 12mg broad spectrum CBD water. The beverage integrates hemp-derived CBD and electrolytes in 100% pure still water with zero calories, flavor or sugar.
CBD/hemp extract products packaged and sold as dietary supplements are of course ubiquitous on the US market. According to the US Food and Drug Administration, though, that doesn’t mean they’re legal.
Not a legal dietary ingredient
FDA has ruled that the development of GW’s drug, Epidiolex, precludes the use of CBD as a supplement ingredient, as the pharmaceutical development process preceded the market entry of the supplement forms of the ingredient. The reverse case is allowed under federal law, as can be seen in the omega-3s market, where supplement and drug forms of the same base ingredient exist side by side.
Omega-3s had been on the market for decades before pharmaceutical companies started to work on developing ultra high concentration forms to sell via prescriptions.
GNC steers clear of CBD supplements
GNC, which is in the midst of Chapter 11 bankruptcy organization with Chinese company Harbin as the designated buyer, has declined to offer CBD except in products meant for topical use. Cosmetics regulations are less stringent than those for ingestibles when it comes to hemp derived products.
But along with other major retailers that have made the same decision because of legal liability grounds, GNC would like to get a piece of the burgeoning hemp/CBD market. According to Brightfield Group that market is expected to reach as much as $16.8 billion in 2025. These sales at the moment are going to smaller, less risk averse companies selling online and in a variety of channels including dispensaries, small, dedicated storefront outlets and even convenience stores and gas stations.
Iowa-based organic beauty brand, Eco Lips, just launched its first broad spectrum CBD line, CBD ME. They introduced the new line with three lip balm flavors: lavender orange, lavender mint and natural.
Each balm is made with Hemp-derived broad-spectrum CBD extract, sustainably grown through regenerative agriculture practices and CO2 extracted in Oregon by Klersun. It is thoroughly tested by 3rd party labs to qualify concentration levels and contains 0.0% THC.
The balms also contain Organic Hemp Seed Oil, which delivers a natural balance of essential fatty acids (EFAs) and amino acids for skin care applications.
The three lip balms are soothing, moisturizing and nutrient-rich to protect lips.
In 1971, philosopher John Rawls came up with the “Veil of Ignorance.” The concept is pretty simple: You start with the idea that you know nothing of your circumstances at birth—wealth, gender, education, etc.—and then ask yourself if you would be ok with the current social contract in which you live.
Let’s conduct this thought experiment for the current cannabis industry: Imagine you do not know anything about your current situation—capital, abilities, partners, etc. Would you sign up to make a go of it in today’s cannabis industry with its poorly implemented regulations, federal illegality, non-experts peddling their expertise, and the still thriving illicit market? Probably not. But, given you are reading this you are most likely in the cannabis business (as we are), and the best course forward is to deal with the cannabis world as it is, not as you want it to be.
Here are the six lessons we wish we had learned prior to our entrance into the cannabis industry in hopes that they might lead you to better outcomes.
1. Be wary of “experts.”
The order in which you learn your hard-knock lessons depends on your circumstances. Sooner or later, you learn not to trust experts with steering your business decisions. Whether lawyers, accountants, consultants, or your stoner uncle, do not take advice without a heavy dose of skepticism. Take the advice as input into your decision process. Ask around for multiple opinions. Even on a hard and fast legal matter on which you are being advised has no maneuvering room, allow for the possibility the expert might be wrong.
In our experience, there are no experts in legal cannabis, just a bunch of people in this newly created legal industry with differing levels of ignorance. Illicit-market operators going legit have a lot to offer, but keep in mind they might not have any experience operating in a regulated environment. Additionally, newly minted experts, as a rule, do not have significant expertise in newly morphing industries.
2. Be mindful of the most expensive inputs into your business.
There are three inputs into your cannabis business that are company killers: the cost of labor, the cost of real estate (whether purchased or leased), and the cost of the inevitable mistakes you will make (yes, this is an input).
This last input usually is ignored when making a budget and therefore no margin of error is calculated in go-to-market timelines and capex budgets. Delayed regulatory time frames or hiccups in the first flower or extract batches can completely shatter even the most detailed budget if you don’t leave yourself any room to breathe.
When it comes to real estate, the lowest cost option that satisfies your business plan is the best option. Leave your ego out of where your business is located if you can meet your pro forma (which, by definition, is usually wrong, as it is a single projection in time without much information from hard-to-get comparable company data in a new industry).
Labor also is a highly disruptive expense. If you overpay your employees, then when you can’t meet payroll (which, for many in this industry, is inevitable), you will lose the very people you need to run the business. This is especially true in cannabis, a developing industry subject to so many risks. The overall comp package is more important to most people than whether they are maximizing base salary. Equity participation and other benefits go a long way and give a deserved sense of ownership to all employees.
Courtesy of High Desert Flower
3. Do not personally guarantee anything.
This lesson should really not have to be pointed out, but the level of enthusiasm we’re seeing among people eager to enter the business often blinds them to the concept of contingent liabilities that can destroy their financial lives and potentially their personal lives.
Bankruptcy is a process overseen by the U.S. Department of Justice that allows companies and people to start over if they followed all the rules and just got over their heads in legitimate activities. Because cannabis remains federally illegal, bankruptcy is not an option for your business. When you personally guarantee a repayment of any kind, you have no backdoor by which to get out of your situation.
Compounding this is that many landlords and their attorneys insist on getting personal guarantees in order to “keep people focused on the business.” This counter-intuitive idea causes businesses to implode much more quickly if a cannabis operator is backed into a corner. It makes no sense to create a limited liability entity, whether corporation or LLC, only to personally sign to repay an uneconomical debt. It is much better to work into a lease or any other contract remedies such as asset forfeitures and receivership provisions so that all parties going in understand the risks.
If you get a sense, for example, that your landlord does not understand the cannabis business, then being aware of these issues is paramount to your survival. All cannabis businesses eventually hit financial bumps in the road. Lay the groundwork to not wreck your life.
4. Understand the revenue cycles of your particular cannabis businesses.
Each business has a different revenue cycle. A revenue cycle starts with the first day an input to the business is put to work until the last day when that original input is monetized into cash. The cycle restarts when you use that cash to purchase additional inputs. .
A grow operation needs a long lead time to get started. Location selection, licensing, and finally that initial planting. An outdoor crop gets planted in the spring and sold in the fall. Assuming the crop doesn’t go bad and is sold, the cycle is around 8 months (planting, growing, drying, curing, sales, and collections).
When you start up a grow operation from scratch and add the timelines of start-up to planting and from planting to cash back in your hand, 18 months easily can elapse. We’ve never seen a pro forma for a cultivation start-up admit to this timeline. Usually the presenter shows “Month 1” with immediate sales and, more surprisingly, profit. Obviously grows done in greenhouses and indoors turnover more (4 to 6 times a year).
Oil extraction is a much shorter cycle. Raw material in, process to oil or distillate, then sell. Assuming the buyer gets net terms of 14 days, the cycle can be as little as 30 days.
For a dispensary, you can literally bring in product, on terms, and sell the same day.
These are the main verticals—testing labs and wholesalers also have their own revenue cycles. You should pull together all your revenue and expense cycles into an Excel pro forma model. Most businesses, once up and running, are driven by a handful of variables (say, revenue, labor, yield, etc.) and understanding their sensitivities to changes will make you a much smarter operator.
„This industry is hard enough without you making it worse for yourself.”
5. Understand your state and local regulatory landscape.
One of the traps newly minted cannabis entrepreneurs fall into is spending too much time looking at the federal level, following minor bills in Congress with only a few co-sponsors, chatting about what this politician said or what that public figure stated. None of it means anything unless actions, laws, and regulations are implemented in your state.
Spend your time close to home learning the nitty-gritty of your state’s licensing process, your local approval requirements, the ebb and flow of raw product in the market, and anything else that will come into play in your day-to-day decisions. Figuring out how you are going to sell your flower to the 20 dispensaries within half a day’s drive from your grow is a much better use of your time than what some politician said about banking regulation.
Time management is not a concept that really works in cannabis. You won’t be able to manage everything in the time you have during waking hours. The key is priority of time expenditure. Meaning, what tasks can you focus on today that will give you the biggest return for your time invested by getting you closer to your goals? Not everything is going to help you move toward your objective.
6. Expend the necessary energy obtaining a cannabis bank account.
Nothing screams legitimacy and offers a higher level of validation than a depository institution taking your cannabis company on as a client. The accounts are not easy to get, and sometimes it requires a concerted effort not only to find an institution that works with cannabis companies, but also to get through the application process and the quarterly reviews.
While the monthly fees can be high, it is still worth it. Having a bank account helps you keep better books, and makes it easier to pay your bills and manage a payroll system. Probably the most important reason to get a bank account is a lot of third-party investors won’t even consider you for investment without an account. To an investor, your ability to pass the state’s and depository’s hurdles to get and keep an account makes it easier for them to conduct due diligence on your firm and your directors.
Dedicate one person on your team to getting a bank account for the business. Even if it takes months, the person should stick to constantly working on this objective.
Wrapping It Up
The above is not an exhaustive list of the lessons that we learned too late. But by spending time avoiding what we, the battled-scarred authors can attest, have observed and experienced, you increase your chances of not committing unforced errors
This industry is hard enough without you making it worse for yourself. Remember your high school-level risk management math. If you need to succeed in five critical areas to have long-term success, and each of those areas has a 80 percent success rate, you do not have an 80 percent chance at success. Compounding risk is a multiplicative function, meaning your chance of success is 32.8 percent (0.8^5), or a 1 in 3 chance of making a successful go of it in cannabis. Something to keep in mind when deciding where to focus your efforts.
Loren Picard is CEO at High Desert Flower Inc. in Oregon.
Andrew Olsson is vice president at High Desert Flower Inc. and is the co-founder of Engineered Extracts LLC, also in Oregon
PARIS, Ky., Sept. 30, 2020 (GLOBE NEWSWIRE) — Enhanced Pet Sciences (EPS) and AgTech Scientific are pleased to announce the first of a dozen anticipated publications from its multi-year clinical studies on cannabidiol (CBD). These studies are being undertaken with the University of Kentucky and in collaboration with other leading universities. The initial publication which studies the impact of treats containing CBD on canine responses to “noise-induced fear” can be found at the link below in Frontiers Veterinary Science:
EPS has been also been working in parallel with UK’s Gluck Equine Research Center to study the impact of CBD on equine inflammation. The Gluck Center aims to publish the data from the initial phases of the study by the end of this year. This research, that began in late 2018, is expected to provide valuable qualitative and quantitative information on safety, dosing, delivery methods, and efficacy of CBD in equine applications.
With respect to the canine study, EPS points to the following quote from the article:
“Consumption of food and treats, consistency of stool, frequency of elimination, activity during exercise, mucus membrane color, and other indicators of general health status were monitored twice daily by research personnel. Evidence of any adverse event—defined as any symptom occurrence that would not be expected in normal dogs—was also monitored. However, no adverse events were observed in any dogs following the administration of CBD treats during this study.”
Reid Parr, Head of Research and Development at EPS, is looking forward to publishing subsequent trials currently under way, stating: “Our focus now with the canine research is to provide further clarity on areas highlighted in these initial studies for further inquiry, particularly related to dosing and contraindications.” He notes the following quote from the canine study as an example of some of the insight gained from the peer reviewed research:
“It may be inadvisable to administer CBD concomitantly with other products or medications as the results from this study highlight potential drug interactions associated with CBD use. Considering the increased interest of CBD use in companion animals, continued research is essential to understanding the mechanisms by which CBD may exert anxiolytic effects as well as possible risks, like drug interactions, associated with CBD administration.”
Michael Joseph French, President of EPS, is pleased with the progress on both the canine and equine studies stating: “EPS was founded as a research driven company. Our vision was to understand the true benefits of CBD and hemp derived products through clinically proven research, for the benefit our four-legged friends and humans further down the road. We are pleased to publish these first trials. I am more enthusiastic about the future of CBD and hemp derived products than ever before. We believe our studies will prove helpful to researchers, regulators and pet parents alike.”
About AgTech Scientific
The company is truly virtually integrated with indoor and outdoor farming, agricultural processing, extraction of CBD and other key ingredients, and the manufacturing of consumer packaged goods
In 2017, a master agreement was signed with the University of Kentucky. We believe the multi-year studies will prove helpful to researchers, regulators and the general public to better understand the effects and potential benefits of hemp derived products.
The company is based in Paris, KY and has two facilities. The 2,000,000 square foot ultra-modern greenhouse and Ag processing center allows for premium growing and production year-round. The new 50,000 square foot Extraction and Manufacturing Center is just minutes away from the greenhouse. This new facility allows for extraction, formulation, and consumer packaged goods manufacturing in a custom-built environment.
Safe Harbor Certain statements herein relating to the Company constitute “forward-looking statements” within the meaning of applicable securities laws, including without limitation, statements regarding future estimates, business plans and/or objectives, sales programs, forecasts and projections, assumptions, expectations, and/or beliefs of future performance, are “forward-looking statements.” Such “forward-looking statements” involve known and unknown risks and uncertainties that could cause actual and future events to differ materially from those anticipated in such statements. Forward-looking statements include, but are not limited to, statements with respect to commercial operations, including production and/or sales of hemp derived products, quantities of future hemp products production, anticipated revenues in connection with such sales, the overall projected size of the market, completion and/or expansion of production facilities, and other information that is based on forecasts of future results, estimates of production not yet determinable, and other key management assumptions. Actual results may differ materially from those expressed or implied by such forward-looking statements and involve risk and uncertainties relating to the Company’s historical experience with regulatory changes, timeliness of government approvals for the granting of permits and licenses, changes in hemp products prices, actual operating performance of facilities, and other uninsured risks. The Company assumes no responsibility to update or revise forward-looking information to reflect new events or circumstances unless required by law. Contents are provided for general information purposes only and do not constitute an offer to sell or a solicitation of an offer to buy any security in any jurisdiction. The information in this news release is qualified in its entirety.
In 1971, philosopher John Rawls came up with the “Veil of Ignorance.” The concept is pretty simple: You start with the idea that you know nothing of your circumstances at birth—wealth, gender, education, etc.—and then ask yourself if you would be ok with the current social contract in which you live.
Let’s conduct this thought experiment for the current cannabis industry: Imagine you do not know anything about your current situation—capital, abilities, partners, etc. Would you sign up to make a go of it in today’s cannabis industry with its poorly implemented regulations, federal illegality, non-experts peddling their expertise, and the still thriving illicit market? Probably not. But, given you are reading this you are most likely in the cannabis business (as we are), and the best course forward is to deal with the cannabis world as it is, not as you want it to be.
Here are the six lessons we wish we had learned prior to our entrance into the cannabis industry in hopes that they might lead you to better outcomes.
1. Be wary of “experts.”
The order in which you learn your hard-knock lessons depends on your circumstances. Sooner or later, you learn not to trust experts with steering your business decisions. Whether lawyers, accountants, consultants, or your stoner uncle, do not take advice without a heavy dose of skepticism. Take the advice as input into your decision process. Ask around for multiple opinions. Even on a hard and fast legal matter on which you are being advised has no maneuvering room, allow for the possibility the expert might be wrong.
In our experience, there are no experts in legal cannabis, just a bunch of people in this newly created legal industry with differing levels of ignorance. Illicit-market operators going legit have a lot to offer, but keep in mind they might not have any experience operating in a regulated environment. Additionally, newly minted experts, as a rule, do not have significant expertise in newly morphing industries.
2. Be mindful of the most expensive inputs into your business.
There are three inputs into your cannabis business that are company killers: the cost of labor, the cost of real estate (whether purchased or leased), and the cost of the inevitable mistakes you will make (yes, this is an input).
This last input usually is ignored when making a budget and therefore no margin of error is calculated in go-to-market timelines and capex budgets. Delayed regulatory time frames or hiccups in the first flower or extract batches can completely shatter even the most detailed budget if you don’t leave yourself any room to breathe.
When it comes to real estate, the lowest cost option that satisfies your business plan is the best option. Leave your ego out of where your business is located if you can meet your pro forma (which, by definition, is usually wrong, as it is a single projection in time without much information from hard-to-get comparable company data in a new industry).
Labor also is a highly disruptive expense. If you overpay your employees, then when you can’t meet payroll (which, for many in this industry, is inevitable), you will lose the very people you need to run the business. This is especially true in cannabis, a developing industry subject to so many risks. The overall comp package is more important to most people than whether they are maximizing base salary. Equity participation and other benefits go a long way and give a deserved sense of ownership to all employees.
Courtesy of High Desert Flower
3. Do not personally guarantee anything.
This lesson should really not have to be pointed out, but the level of enthusiasm we’re seeing among people eager to enter the business often blinds them to the concept of contingent liabilities that can destroy their financial lives and potentially their personal lives.
Bankruptcy is a process overseen by the U.S. Department of Justice that allows companies and people to start over if they followed all the rules and just got over their heads in legitimate activities. Because cannabis remains federally illegal, bankruptcy is not an option for your business. When you personally guarantee a repayment of any kind, you have no backdoor by which to get out of your situation.
Compounding this is that many landlords and their attorneys insist on getting personal guarantees in order to “keep people focused on the business.” This counter-intuitive idea causes businesses to implode much more quickly if a cannabis operator is backed into a corner. It makes no sense to create a limited liability entity, whether corporation or LLC, only to personally sign to repay an uneconomical debt. It is much better to work into a lease or any other contract remedies such as asset forfeitures and receivership provisions so that all parties going in understand the risks.
If you get a sense, for example, that your landlord does not understand the cannabis business, then being aware of these issues is paramount to your survival. All cannabis businesses eventually hit financial bumps in the road. Lay the groundwork to not wreck your life.
4. Understand the revenue cycles of your particular cannabis businesses.
Each business has a different revenue cycle. A revenue cycle starts with the first day an input to the business is put to work until the last day when that original input is monetized into cash. The cycle restarts when you use that cash to purchase additional inputs. .
A grow operation needs a long lead time to get started. Location selection, licensing, and finally that initial planting. An outdoor crop gets planted in the spring and sold in the fall. Assuming the crop doesn’t go bad and is sold, the cycle is around 8 months (planting, growing, drying, curing, sales, and collections).
When you start up a grow operation from scratch and add the timelines of start-up to planting and from planting to cash back in your hand, 18 months easily can elapse. We’ve never seen a pro forma for a cultivation start-up admit to this timeline. Usually the presenter shows “Month 1” with immediate sales and, more surprisingly, profit. Obviously grows done in greenhouses and indoors turnover more (4 to 6 times a year).
Oil extraction is a much shorter cycle. Raw material in, process to oil or distillate, then sell. Assuming the buyer gets net terms of 14 days, the cycle can be as little as 30 days.
For a dispensary, you can literally bring in product, on terms, and sell the same day.
These are the main verticals—testing labs and wholesalers also have their own revenue cycles. You should pull together all your revenue and expense cycles into an Excel pro forma model. Most businesses, once up and running, are driven by a handful of variables (say, revenue, labor, yield, etc.) and understanding their sensitivities to changes will make you a much smarter operator.
„This industry is hard enough without you making it worse for yourself.”
5. Understand your state and local regulatory landscape.
One of the traps newly minted cannabis entrepreneurs fall into is spending too much time looking at the federal level, following minor bills in Congress with only a few co-sponsors, chatting about what this politician said or what that public figure stated. None of it means anything unless actions, laws, and regulations are implemented in your state.
Spend your time close to home learning the nitty-gritty of your state’s licensing process, your local approval requirements, the ebb and flow of raw product in the market, and anything else that will come into play in your day-to-day decisions. Figuring out how you are going to sell your flower to the 20 dispensaries within half a day’s drive from your grow is a much better use of your time than what some politician said about banking regulation.
Time management is not a concept that really works in cannabis. You won’t be able to manage everything in the time you have during waking hours. The key is priority of time expenditure. Meaning, what tasks can you focus on today that will give you the biggest return for your time invested by getting you closer to your goals? Not everything is going to help you move toward your objective.
6. Expend the necessary energy obtaining a cannabis bank account.
Nothing screams legitimacy and offers a higher level of validation than a depository institution taking your cannabis company on as a client. The accounts are not easy to get, and sometimes it requires a concerted effort not only to find an institution that works with cannabis companies, but also to get through the application process and the quarterly reviews.
While the monthly fees can be high, it is still worth it. Having a bank account helps you keep better books, and makes it easier to pay your bills and manage a payroll system. Probably the most important reason to get a bank account is a lot of third-party investors won’t even consider you for investment without an account. To an investor, your ability to pass the state’s and depository’s hurdles to get and keep an account makes it easier for them to conduct due diligence on your firm and your directors.
Dedicate one person on your team to getting a bank account for the business. Even if it takes months, the person should stick to constantly working on this objective.
Wrapping It Up
The above is not an exhaustive list of the lessons that we learned too late. But by spending time avoiding what we, the battled-scarred authors can attest, have observed and experienced, you increase your chances of not committing unforced errors
This industry is hard enough without you making it worse for yourself. Remember your high school-level risk management math. If you need to succeed in five critical areas to have long-term success, and each of those areas has a 80 percent success rate, you do not have an 80 percent chance at success. Compounding risk is a multiplicative function, meaning your chance of success is 32.8 percent (0.8^5), or a 1 in 3 chance of making a successful go of it in cannabis. Something to keep in mind when deciding where to focus your efforts.
Loren Picard is CEO at High Desert Flower Inc. in Oregon.
Andrew Olsson is vice president at High Desert Flower Inc. and is the co-founder of Engineered Extracts LLC, also in Oregon
It is safe to say by now that most of those who follow the what’s what in the grand scheme of the marijuana movement have encountered just about every fathomable medical claim associated with cannabis. All one needs to do is get into a quick Google search to find several sources suggesting that medical marijuana is useful in the treatment of severe health conditions from Alzheimer’s disease to pain.
And there always seems to be a new study emerging onto the scene, telling the tale about how legal marijuana “might” have all sorts of secondary benefits like curbing the opioid epidemic, reducing minor consumption rates, and increasing property values.
But at the end of the day, while the majority of the United States population appears open to the possibility that cannabis might be a miracle plant, there still isn’t much evidence showing it is. So we have to ask: Do cannabis products over promise and under deliver?
The cannabis industry spends a lot of time trying to convince their customers that marijuana is something they can use to be more productive during their waking hours as well as help them get uninterrupted sleep once the day is done. Many cannabis companies have developed a variety of strains and products, promising that they will either increase the user’s energy level or toss them into the ultimate state of relaxation. The desired effect, or so they say, really comes down to two cannabis classifications: Sativa or Indica. Sativa strains are known for providing users with a chatty, take over the world buzz, while Indica is supposed to be its ultra-chill counterpart.
But is this real?
Researchers from the University of British Columbia say, probably not. They published a study in the fall of 2018 showing that cannabis strains, regardless of their names and purported effects, are all basically the same. Surprisingly, after both classes of weed were put under a microscope, researchers found that THC and CBD ratios had very little to do with the effects of the strain. Many times, they said, Indica strains have just as much THC as those breeds claiming to be Sativa.
“The THC content can be identical between these two classification groups,” the study authors wrote.
Okay, so, if cannabis strains do not have distinguishing characteristics like we’ve been told are so important — we need THC to feel it, and CBD to do everything else — how could they be producing different effects?
Researchers said that we might not be giving enough credit to the 100 or so other cannabinoids in any given strain. The study suggests that unsung cannabinoids like Cannabichromene (CBC) and Cannabinol (CBN) might be responsible for more of the therapeutic benefits than anything else. But nobody sells cannabis based on these silent components.
Legal states only require pot producers to publish the THC and CBD content on their packaging. Therefore, it is safe to say that the average budtender doesn’t have enough plant knowledge to guide the customer into the perfect strain for his or her specific condition. It is almost as though the industry is out here guessing and hoping for the best.
And that’s probably true.
What we know so far is that cannabis has the potential to treat minor (we repeat, minor) health conditions. The National Academies of Sciences, Engineering and Medicine, which consists of some of the country’s leading scientific minds, came forward last year with a detailed analysis over the health effects associated with the use of cannabis. After examining some 10,000 studies on the subject of medical marijuana, the group concluded that cannabis is beneficial in the treatment of some pain conditions, nausea associated with chemotherapy, spasms and insomnia.
But that’s about it. They found no evidence that it can cure cancer or even ease the symptoms of epilepsy. Furthermore, the research also showed that smoking cannabis comes with an increased risk of heart disease and stroke. Americans are being promised a “safer” medicine with cannabis, but are we really getting it?
Well, we just need to calm down a little and perhaps stop being so quick to buy into the hype. Much more research is needed before we have a grip on the healing powers of cannabis. We could one day learn that the therapeutic reach of medical marijuana is stronger than we ever imagined. On the other hand, we could just as easily find out that the herb possesses no more medicinal superpowers than a can of beer.
Cannabis consumers, especially the newcomers hoping to find a cure for their specific condition, should manage their expectations when using this plant. Because all of the exciting promises made by the cannabis companies might not deliver as advertised.
NEW YORK, Sept. 30, 2020 /PRNewswire/ — The development of the cannabis industry has made new products accessible in the marketplace, causing sales and demand to grow. Notably, CBD is having a major impact on global markets because it offers a number of therapeutic benefits without the psychoactive effects of THC. There has also been a substantial growth in demand for cannabidiol (CBD) products around the globe in recent years, mainly in developed countries such as the U.S., France, Canada and the Netherlands. Part of the spike in interest can be attributed to the passage of the 2018 Farm Bill, which legalized production of industrial hemp, transforming it into a mainstream agricultural product. Shortly after, numerous categories of CBD products started to appear. Perhaps not surprisingly, hemp and CBD products are potentially stealing market share from other markets, such as tobacco for example. According to data provided by the Brightfield Group and published by Hemp Industry Daily, a survey of more than 5,000 CBD users in the U.S. reveals that 24% have used it to help quit smoking and quitters are often replacing cigarettes with either smokable hemp or vaping. Additionally, 41% of quitters have entirely replaced their tobacco with hemp CBD. Kaival Brands Innovations Group, Inc. (OTC: KAVL), Taat Lifestyle & Wellness Ltd. (OTC: TOBAF), 22nd Century Group, Inc. (NYSE: XXII), Green Thumb Industries Inc. (OTC: GTBIF), Aurora Cannabis Inc. (NYSE: ACB)
According to the World Health Organization (WHO), the leading global risks for mortality in the world are high blood pressure (responsible for 13% of deaths globally), tobacco use (9%), high blood glucose (6%), physical inactivity (6%), and overweight and obesity (5%). Nevertheless, the tobacco industry is a major market, and in some aspects, it is evolving to adapt to a new demographic. Next generation products, such as new forms of e-cigarettes and heated tobacco products, are coming in the market. These products are exhibiting technological innovation and change, which the tobacco industry has not experienced in many decades. Nevertheless, the attempts of governments to reduce tobacco consumption have seen mixed results. According to the WHO’s report from last year, for the first time, the organization projects that the number of males using tobacco is on the decline, indicating a powerful shift in the global tobacco epidemic. Despite the optimistic numbers, progress in meeting the global target set by governments to cut tobacco use by 30% by 2025 remains off track.
Kaival Brands Innovations Group, Inc. (OTCQB: KAVL) announced earlier this week, „the formation of a new wholly-owned subsidiary, Kaival Labs, Inc., a Delaware corporation („Kaival Labs”), that will own and develop the patent.
The U.S. patent and international patent applications protect the utilization and creation of controlled preparations of synthetic nicotine that are greater than 99.5% pure with specific ratios of (R, S, and R-S)-isomers for cessation purposes. As such, the product will meet the purity requirements described for nicotine in the United States of America’s USP monograph.
Niraj Patel, CEO of Kaival Brands, sees incredible potential with the nicotine cessation patents and stated, 'The science behind these patents has discovered that within the nicotine molecule the S-isomers control the addictive properties, whereas the R-isomers control the beneficial qualities of the nicotine that a user enjoys. The exclusivity is that the patents allow us to control the specific ratios of each isomer in the final synthetic nicotine molecule we produce for cessation products. We can now create completely unique products for smoking cessation and nicotine addiction therapy that remain effective and satisfying for the user, but are free from nicotine’s addictive traits.’
’Pursuant to the Agreement, Kaival Labs will own the patented science to create a pure, yet non-addictive synthetic nicotine for the development and production of smoking cessation and nicotine replacement therapy products. Tobacco-Free Nicotine (TFN) is a certified clean, pure, non-tobacco-derived synthetic nicotine, and a key ingredient in numerous products like nicotine patches, lozenges, gums, e-cigarettes, e-liquids and more,’ Patel added.
Kaival Brands will acquire the patent and international patent applications for a total purchase price of $3 million from Next Generation Labs, LLC, („NGL”) the only specialized manufacturer of the patented TFN brand synthetic nicotine in the United States. NGL is to be paid upon two events: (i) a portion of the purchase price will be paid upon the completion of the Company’s future public offering of its common stock; and (ii) the remaining portion of the purchase price will be paid upon the successful creation of any commercialized product utilizing the patents.
’Billions of smokers and tobacco users worldwide are looking for an answer and real solution to their nicotine addiction problems. Imagine patent-protected products, either approved pharmaceutically or made available over-the-counter, that offer a way to truly ease a user off their addictive cravings for nicotine without losing any of their accustomed benefits along the way. We are excited to develop these innovative patents and bring effective, enjoyable smoking cessation products to an expanding market, helping all nicotine users lead healthier and higher-quality lives,’ expressed Patel.
According to a Global Smoking Cessation Market Analysis 2019, the smoking cessation market is projected to reach $63.99 billion by 2026, growing at a CAGR of 16.9% during 2018 to 2026. The study defines smoking cessation as the process of discontinuing tobacco smoking and includes products such as chewing gum, inhalers, lozenges, patches, sprays, and sublingual tablets and therapies such as nicotine replacement therapy (NRT), non-NRT therapy and e-cigarettes.”
Taat Lifestyle & Wellness Ltd. (OTC: TOBAF) announced on September 22nd that its processing facility in Las Vegas, NV has received a large shipment of base material for Beyond Tobacco™, which is to undergo the Company’s proprietary fourteen-step process after being trimmed and prepared for refinement, which is set to yield a net quantity of 3.2 tons of usable material. Subsequently, the finished Beyond Tobacco™ base material is to be transported to the Company’s manufacturing partner for production of the first „distribution-ready” batch of Beyond Tobacco™. Under the terms of its agreement with the Company providing favourable pricing terms for producing Beyond Tobacco™, the Manufacturer’s name cannot be publicized. The Company estimates a lead time of approximately six weeks for this batch of base material to be refined in-house and transported to the Manufacturer, with the Beyond Tobacco™ product packaged in the industry-standard „pack and carton” format and stored shipment-ready on pallets in the Manufacturer’s warehouse.
22nd Century Group, Inc. (NYSE: XXII) announced on April 30th that the Company and North Carolina State University („NCSU”), have completed successful research field trials that have validated new non-GMO (genetically modified organism) methodologies for reducing nicotine in tobacco plants. The research was partially funded by 22nd Century and was conducted by NCSU’s Department of Crop and Soil Science with project oversight provided by 22nd Century’s R&D team. „We are very pleased with the outcome of the research field trials completed in collaboration with NCSU, which demonstrate that non-GMO methodologies can be applied reliably to reduce nicotine levels in tobacco plants by up to 99%. To further validate our research, 22nd Century and NCSU will conduct larger scale and more extensive field trials in additional geographies,” said Juan Sanchez Tamburrino, Vice President of Research and Development for 22nd Century.
Green Thumb Industries Inc. (OTCQX: GTBIF) announced on May 26th, the expansion of its retail footprint in Illinois with the opening of Rise Niles, the company’s eighth store in Illinois and 45th in the nation, on May 28th. This is the third adult-use only store Green Thumb has opened in Illinois this year. The company has opened a total of six stores across the country year-to-date. „We are thrilled to open our eighth store in our home state of Illinois and look forward to being active community partners and good neighbors in Niles,” said Green Thumb Founder and Chief Executive Officer Ben Kovler. „Our team remains nimble, diligent, and committed to fulfilling our responsibility for a safe and successful adult-use program in Illinois. We have continued to move forward through the ongoing COVID-19 crisis to provide jobs and much needed access to well-being through the power of cannabis during these difficult times, as demonstrated by the opening of Rise Niles, our fourth opening since the crisis began. Our retail team has pivoted quickly and efficiently as regulations evolve and we are profoundly grateful for their dedication and service to our customers.”
Aurora Cannabis Inc. (NYSE: ACB) announced on May 28th that it had completed the previously announced acquisition of Reliva, LLC a leader in the sale of hemp-derived CBD products in the United States for approximately USD 40 Million of Aurora common shares. The transaction also includes a potential earn-out of up to a maximum of USD 45 Million payable at Aurora’s option in shares or cash contingent upon Reliva achieving certain financial targets over the next two years. Reliva is a leader in delivering high quality hemp-derived CBD products to consumers. Reliva has grown to become one of the largest retail CBD brands in the U.S. Supported through long-term partnerships with leading national wholesalers and retailers Reliva’s products can be found in over 20,000 retail stores.
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