The Week In Cannabis: SAFE(er) Banking, New Jersey, Seth Rogen, Walgreens And Earnings
The cannabis world received mixed news last week. On the one hand, the House Financial Services Committee voted in favor of a bill that would allow marijuana businesses to work with banks and credit unions, the SAFE Banking Act, allowing it to advance to the House floor. On the other hand, the state of New Jersey cancelled its vote on a bill that would legalize recreational cannabis due to a lack of support from legislators.
“There have been so many advancements in cannabis, that many in the industry just feel like there will be no barriers in the way,” Debra Borchard, CEO of Green Market Report, told Benzinga. “However, New Jersey was a good reminder that there are still lots of people with concerns. It's still an infant industry with a long way to go.”
Commenting on the SAFE Banking Act, Kyle Detwiler, CEO of Northern Swan Holdings said, “This is a great step forward for the industry as a whole, and this should improve efficiency and worker safety… We hope this is a stepping stone towards full legalization which will allow greater competition, product innovation and patient health.”
Morgan Fox, spokesperson for the National Cannabis Industry Association (NCIA), noted that, “The strong bipartisan support for the SAFE Banking Act in this committee is a good sign of how it will perform when it comes up for a vote on the floor of the House. The legal cannabis industry isn't going anywhere, and as more states regulate cannabis it is increasingly important that it be able to access financial services for the safety of businesses and their employees, to increase transparency, and to make more capital available to small businesses and communities that have been most harmed by prohibition.”
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Marijuana Stocks & ETFs
Over the last five trading days, the Horizons Marijuana Life Sciences Index ETF (OTC:HMLSF) (TSE:HMMJ) lost 3.8 percent, while the ETFMG Alternative Harvest ETF (NYSE:MJ) tumbled 1.25 percent. The SPDR S&P 500 ETF Trust (NYSE:SPY) closed the period up almost 1.2 percent.
Here are some of the top marijuana stocks (market cap above $400 million) in U.S. exchanges and how the performed over the last five trading days:
• Acreage Holdings (OTC:ACRZF): down 6.2 percent
• Aphria Inc (NYSE:APHA): down 2.2 percent
• Aurora Cannabis Inc (NYSE:ACB): up 0.3 percent
• CannTrust Holdings Inc (NYSE:CTST): down 19.4 percent
• Canopy Growth Corp (NYSE:CGC): down 2.3 percent
• Cronos Group Inc. (NASDAQ:CRON): down 4.2 percent
• Curaleaf Holdings Inc (OTC:CURLF): down 5 percent
• Green Growth Brands Inc (OTC:GGBXF): down 1.7 percent
• Green Organic Dutchman Holdings Ltd (OTC:TGODF): up 1.3 percent
• Green Thumb Industries Inc (OTC:GTBIF): down 3.2 percent
• GW Pharmaceuticals PLC- ADR (NASDAQ:GWPH): down 0.15 percent
• Hexo Corp (NYSE:HEXO): up 4.1 percent
• Harvest Health & Recreation Inc (OTC:HRVSF): down 1.3 percent
• iAnthus Capital Holdings Inc (OTC:ITHUF): down 5.6 percent
• Marimed Inc (OTC:MRMD): up 1 percent
• MedMen Enterprises Inc. (OTC:MMNFF): down 5.15 percent
• OrganiGram Holdings Inc (OTC:OGRMF): down 1.75 percent
• Scotts Miracle-Gro Co (NYSE:SMG): up 2.8 percent
• Tilray Inc (NASDAQ:TLRY): down 2.4 percent
In Other News
Ignite International, the cannabis company founded by Dan Bilzerian, announced the hire of Curtis Heffernan as its new SVP and global head of sales. Heffernan, who previously held tenured positions at Procter & Gamble Co (NYSE:PG) and Mondelez International (NASDAQ:MDLZ)’s Cadbury Schweppes, will fully manage revenue sales streams and will be responsible for overseeing all sales activities.
“I am very excited to be joining the Ignite team and driving the company's mission to become the first global super-premium cannabis and CBD brand. I'm thrilled to have the opportunity to work with Ignite's top tier management team and leverage my experience to grow the Ignite brand within an industry that is primed for explosive growth,” said Heffernan in a press release.
The U.S. subsidiary of iAnthus Capital Holdings announced the acquisition of CBD For Life, a national brand of CBD products, in an all-stock deal valued at $13.7 million.
Cronos Group reported 250-percent revenue growth for the fourth quarter, albeit amidst a big net loss.
Canopy Growth announced a collaboration with actor Seth Rogen and his writing partner Evan Goldberg, to launch an adult-use cannabis cultivation brand, Houseplant.
Feals launched a “digitally-native” CBD and wellness brand focused on delivering the highest-quality, premium CBD right to consumers’ doorsteps. The company seeks to usher a new approach to the far-reaching benefits of this powerhouse ingredient to the masses with a D2C platform that brings quality ingredients, transparent sourcing practices, and an education and data-backed conversational commerce hotline to show customers a better way to feel better using CBD.
“Our hemp is hand harvested from family farms in CO and Oregon following organic farming practices. We take a conscious approach to every Feals product made, providing only pure, high quality ingredients and third party testing every step of the way,” said co-founder Drew Todd.
California-based Grupo Flor developed what it claims is the cannabis industry’s first commodity trading desk, to connect buyers and sellers for the purchase and sale of raw cannabis materials. Traders began using the platform this month in the California THC market, executing several million dollars worth of trades. The desk rapidly expanded into the national CBD market using the company's established network of farmers in Colorado, Kentucky, North Carolina, South Carolina and West Virginia, and will soon add Colombia as the first international sourcing pipeline.
“We created a more efficient exchange for buyers and sellers by solving two critical problems,” said Grupo Flor CEO Paul Henderson. “Buyers are sourcing raw materials from an array of entities and many of the products are inconsistent and unreliable. On the flip side, these sellers don’t have the support and logistics infrastructure to efficiently sell and transport their product. We believe this trading platform is a win-win for the entire industry.”
Shineco Inc (NASDAQ:TYHT) announced a partnership with Heilongjiang Zhenye Agricultural Technology Development Co. to construct the largest planting and processing base for industrial hemp in China. A potential acquisition of Zhenye Agricultural is also in the books.
The Minority Cannabis Business Association (MCBA) announced plans to score the effectiveness of social equity policies recently implemented by the city of Los Angeles, which are designed to help communities, families and individuals who have been harmed by the War on Drugs. Years of systemic racism, harsh drug sentencing laws, and disproportionate policing have all heavily contributed to the detriment of communities of color and social equity programs are designed to reinvest in those communities and help those most harmed with entering the industry.
The case study utilizes an “Equity Equation,” which provides a grading system to rate the effectiveness of municipal social equity programs based on several separate factors that have been determined to play a major role in the success or failure of these policies. While these social equity programs are being implemented in cities across the country, their intended outcomes are often not being met.
One factor commonly cited as a barrier to entry for people of color to find a place in the cannabis industry, regardless of policies in place, is a lack of available capital. A similar equity study was recently conducted in Oakland, Sacramento and San Francisco, and will soon be conducted in Denver. The goal is to reexamine those policies and to revise them until they meet those intended outcomes in an effort to develop an effective and repeatable model.
“As is the case with any policy in this country, if it's not working to meet its intended outcome, we must revisit it and rework it unit it does," said Kayvan Khalatbari, MCBA Board Chair. "The same is true for these social equity policies in the cannabis industry which, to be fair, are being implemented for the first time in history so it's easy to understand why they aren't perfect out the gate. We do need to hold them accountable though, because these communities that for decades have been thrown under the bus by the War on Drugs deserve it.
"L.A.'s equity program doesn't just affect communities of color in that city, but in cities across the country that will look to L.A. as an example of how to implement their own programs. We must get this right, and this case study is intended to encourage that investigation and ongoing conversation."
CannTrust posted record fourth-quarter revenue, but still fell short of analyst expectations.
Vireo Health International (OTC:VREOF) announced its expansion into two new medical marijuana markets.
On Monday, Vireo announced its acquisition of Arizona Natural Remedies, a vertically integrated operator with a dispensary in Phoenix. On Thursday, Vireo followed that announcement by disclosing their second acquisition of the week, this time in New Mexico. In New Mexico, Vireo purchased Red Barn, a holder of one of New Mexico’s medical cannabis licenses and owner of dispensaries in Santa Fe and Gallup.
“Vireo is excited to expand our operations into the Southwest region. Arizona and New Mexico’s well-established medical cannabis markets present us with fantastic opportunities to help more patients,” CEO Kyle Kingsley told Benzinga. “Both Arizona Natural Remedies and Red Barn are well-respected operators and we look forward to welcoming them into the Vireo Family and continuing to provide their patients with top quality cannabis products and unrivaled patient experiences.”
Cannabinoid R&D company AXIM Biotechnologies Inc. (OTC:AXIM) was issued a Notice of Allowance for a patent from the U.S. Patent and Trademark Office for a topical cream containing cannabinoids for the treatment of atopic dermatitis (eczema).
Abacus Health Products Inc (OTC:ABAHF) launched CBDMEDIC, a family of topical medications containing pharmaceutical ingredients with CBD from hemp extract and other natural ingredients. The line consists of 10 over-the-counter pain relief products, including solutions for sports-related joint and muscle pain, back and neck pain, arthritis-related pain, stiffness and swelling, and muscle and joint pain. CBDMEDIC products are available across the U.S., including select CVS locations.
“CBDMEDIC is leading a new category of innovative, high quality topical medications and offering consumers completely safe – non-psychoactive, non-addictive – effective and superior pain relief. Abacus Health Products is prepared for this shift to mainstream national retail outlets and looks forward to helping people find relief in their daily lives,” said Perry Antelman, CEO of Abacus Health Products.
Walgreens Boots Alliance Inc (NASDAQ:WBA) said it will start selling CBD products in over 1,500 stores across select U.S. states. The move came just one week after CVS Health Corp (NYSE:CVS) made a similar announcement.
Medical cannabis health care network Compassionate Certification Centers forged a partnership with MarijuanaDoctors.com to distribute a co-branded line of CBD products. THC-free and made in the U.S., the CBD line contains premium botanical oils made from organic, all-natural ingredients. The products will be available for purchase at MarijuanaDoctors.com, and as a wholesale offering for its national network of medical practitioners.
TheWeedTube, a digital video platform founded by a group of deleted YouTubers to celebrate cannabis, will roll out a new app for iOS and Android devices on April 20. The social network site and now app gives creators a safe space to share their cannabis-focused content and connect with one another. The website has become one of the fastest growing platforms in cannabis, and besides providing a protected content hub catered to an adult demographic, it is the first video-based social network to provide monetization options to cannabis influencers and to offer cannabis companies commercial-style advertising.
GrowLife Inc. (OTC:PHOT), an indoor cultivation product and service providers, announced the launch of a subscription service for consumable cloning supplies as part of its EZ-Clone commercial propagation equipment line. Through its e-logistics platform, commercial cannabis and hemp cultivators will be able to subscribe to monthly shipments that include all of the products necessary to clone plants.
“We have observed a spike in demand for commercial cloning systems and this subscription service allows us to service these customers without additional overhead cost,” said GrowLife Executive Vice President of Sales and Marketing Joe Barnes. “This subscription service allows us to offer the best price on these packages while creating a strong consumer base. Specifically, hemp cultivators are turning to cloning as a way to meet production goals with healthy and consistent plants.”
Driven Deliveries Inc. (OTC:DRVD), announced a new cannabis delivery model, Driven Direct, which will mirror Amazon.com, Inc. (OTC:AMZN)’s delivery model. The company will initially launch Driven Direct in highly-populated cities across California.
Cannabis retailers are eager to establish last-mile delivery for their products to reach more consumers across the state. Driven aims to solve this unmet need by providing a reliable cannabis delivery platform with the company's current and future retail partners, as well as name brands who want to deliver their products directly to the consumer.
“As we continue to scale our business by expanding our partnerships with cannabis retailers across California, we are confident that Driven Direct's last-mile delivery will become a constantly used service,” Chris Boudreau, CEO of Driven Deliveries, told Benzinga. “We aim to benefit local cannabis retailers and consumers.”
Helix TCS, Inc (OTCQB:HLIX)’s leading seed to sale and cannabis point of sale company, BioTrackTHC, received a one-year contract extension to continue providing Hawaii’s medical cannabis tracking system until June 30, 2020, which oversees the state's entire cannabis supply-chain. The company operates nine government cannabis tracking contracts across seven states, Puerto Rico, and the city of Arcata, California, and announced a two-year extension to the Delaware cannabis tracking contract just two weeks ago.
“This extension is yet another testament to our ability to effectively manage legal cannabis programs, with this being our 2nd government contract extension this month and 3rd overall,” said Zachary L. Venegas, Executive Chairman and CEO of Helix TCS. “We look forward to playing a critical role in onboarding new legal cannabis programs and ensuring smooth expansions to existing programs.”
Flow Kana launched a its Limited Edition 2018 Emerald Cup Winner Collection, featuring six award winning, organic, sungrown micro-batches from the master cultivars of 2018. BDS Analytics’ sales data shows that California consumers continue to prefer sungrown cannabis from the Emerald Triangle region where the area's rich soil and Mediterranean climate are to cannabis what the geology of the Napa Valley is to wine. Flow Kana Limited Edition will be available at California retailers by mid-April.
Cresco Labs (OTC:CRLBF) said it had been pre-qualified for a cultivation and processing license by Michigan's Department of Licensing and Regulatory Affairs Medical Marijuana Licensing Board.
Colorado-based software development company Best In Grow launched its cannabis retail management solution. The startup is looking to revolutionize the way cannabis is sold in retail outlets. As one of the few agriculture-based industries to truly break out in this decade, the tech world is embracing it and infusing it with high-market strategies and processes that have made worldwide products out of fast food and soft drinks.
Cannabis software as it is known streamlines a number of processes including Budtenders, the person at the counter, Cannabis brands, as well as end users—the customers. While they say that their product is without competition, there are a number of similar products targeted at similar customers including-Wurk, LeafLink, Cova Software, Treez, BDS Analytics, and Headset.
More From Benzinga Cannabis
Here are some of the most interesting cannabis-related stories from this week.
Jeff Siegel, co-founder and managing editor of Green Chip Stocks, delivered its weekly “Bulls And Bud Of The Week” column. This week, he highlighted New Jersey's Billion-Dollar Weed Market And Glacé Edibles.
A new report from Leafly revealed the number of full-time jobs in the legal U.S. cannabis industry is now at 211,000, and should reach, surpassing jobs from the mining and brewing industries.
Hannah Genig shared a sneak peek into the upcoming Cannabis Capital Conference in Toronto, April 17-18.
Green Tank Technologies, a Canada-based manufacturer of vaporization hardware completed its Series A financing round, securing C$14 million ($10.44 million) in funding.
Flowhub and BDS Analytics partnered up to integrate their API to provide dispensaries with accurate market insights.
Check out these and many other cannabis stories here.
Interesting Data & Information
Analytics and research firm Brightfield Group issued a report arguing Europe's CBD market could reach $416 million. The report forecasted the continent's CBD market is expected to grow $1.7 billion by 2023, with its 2019-2023 CAGR totaling 42 percent.
The Drug Policy Alliance (DPA) revealed it was the force behind the viral campaign for the Country Club Cannabis (CCC), a private social club seemingly for the 1 percent. DPA partnered with creative agency Virtue for the thought-provoking campaign with the tagline Legalize It Right, which was conceived to educate the public on the inequity of marijuana laws.
The satirical “Club” boasted dress and hairstyling guidelines and a vetting system for applicants which included criminal background and credit checks – drawing attention to the importance of prioritizing equity and repairing the harms of mass criminalization. The campaign also highlighted the need for New York State’s proposed cannabis legislation to include a meaningful equitable program so that a vacuum is not created for the fake Country Club Cannabis to become a reality. Those measures include:
- Automatically clear criminal records and address the devastating impacts of prohibition on immigration and family law, housing and employment;
- Ensure an equitable and diverse industry by having an equity program from the outset, supporting small businesses and farmers over large corporations, and providing real banking and capital solutions; and
- Use revenue from marijuana legalization to reinvest in communities that have been most impacted by criminalization.
A recent study conducted by biopharma company, GB Sciences Inc (OTC:GBLX), showed only three chemical varieties of cannabis were sold in the Nevada dispensaries between January of 2016 and June of 2017, despite nearly 400 different “strain names” appearing on product packaging. What consumers see is not what they get, the company warned.
“There is no protection for patients from inadvertent or intentional mislabeling of cannabis strains. Many cannabis samples with vastly different chemical profiles were labeled with identical strain names. And identical samples were often labeled with a huge variety of strain names,” said Dr. Andrea Small-Howard, CSO of GB Sciences in a press release.
March 29–30: The NoCo Hemp Expo will gather hemp industry people at the Crowne Plaza DIA Convention Center in Denver. Morris Beegle, founder of NoCo Hemp Expo told Benzinga, “The sheer industry response and anticipation for this year's NoCo Hemp Expo has been off the charts. We have expanded our Business Conference and Farm Symposium programming by 50 percent, added a new Investor's Forum, and we sold out of exhibition space within 25 days of opening registration.”
April 8–10: Cannabis Science Conference will host its first east coast event at the Baltimore Convention Center in Baltimore, Maryland. The Cannabis Science Conference, organized by CSC Events, LLC, will feature television icons and cannabis advocates, Montel Williams and Ricki Lake, along with over 75 expert presenters.
April 10: Denver, Colorado, is getting its monthly CIA meet up. But it’s not what you think. This is a Cannabis Industry Associates Meet Up.
“I was new to the cannabis industry and wondered what others did in the space so I started a monthly networking group on Meet Up called CIA about a year and a half ago. Today we have grown to over 1,000 members with approximately 45-75 people in attendance each month. The group represents a wide spectrum in the cannabis space from attorneys to chefs, bankers, dispensary owners, sales reps, investors, insurance reps, etc. No agenda, no featured speakers, just a place to gather, meet and connect others to those that may need their services or are looking to get into the space,” said Karen Thomas, the event organizer, and executive project manager at Medicine Man Denver.
April 17–18: The Benzinga Cannabis Capital Conference, the premier gathering of cannabis entrepreneurs and investors in North America, returns to Toronto, Canada. Keynote speakers include Giadha Aguirre de Carcer, Cam Battley, Alan Brochstein, Jon Najarian, Danny Moses, Jeanne M. Sullivan, Tim Seymour, and many more! Find all the info you need at bzcannabis.com
April 25-26: The CannaMéxico World Summit returns to Centro Fox, in Leon, Mexico. Hosted by former President of Mexico, Vicente Fox, the conference elevates a safe and legal global cannabis market. More than 2,000 attendees are expected to converge at CannaMéxico 2019, as well as high-profile speakers, including Montel Williams, scientist Inbar Maymon-Pomeranchik, and vice president of NORML Canada Deepak Anand.
May 7: DCM will host its inaugural Cannabis Technology Summit, CannTech 2019, designed to accelerate the cannabis technology industry by bringing together entrepreneurs, industry executives and investors from all across North America. The agenda includes discussions on the most salient topics in the industry — such as regulation, distribution, and financing — and culminates in a startup pitch competition with a $30,000 prize to showcase some of the most exciting companies in the space. Featured speakers include Eaze CEO Jim Patterson, Pax CEO Bharat Vasan, and Dosist CEO Gunner Winston, with more to be announced. CannTech is scheduled for May 7th in San Francisco.
“We've been optimistic about the cannabis industry for a while now, starting with our seed round investment in Eaze in 2014 which made DCM the first firm on Sand Hill Road to get in the space. We created CannTech to be a launchpad for emerging cannabis professionals to get funded, educated, and connected, and we're excited to hear the ‘big ideas’ brought to the table,” said Kyle Lui, Partner at DCM.
May 28 – June 1: The Cons is a gathering of three trade and fan shows, the Cam Con, the Cannabis Con, and the Inked Con, all under one roof, at the SLS South Beach Hotel in Miami Beach, Florida. The Cons 2019 will offer a variety of seminars with top industry panelist, networking parties and performance displays to benefit the industry’s content providers, models and affiliates. While these industries have differences, in many ways they overlap.
May 30–31: The Concentration Expo is coming to San Diego. Concentration is a Cannabis extraction conference and event assembling the entire specialty cannabis extraction and analytical science spectrum in one connected space that’s focused on providing real solutions with proven success. Attendees will connect firsthand with industry leaders offering tangible ideas and practical applications for all areas of cannabis extraction and analytical science.
June 7–9: The Women Grow 2019 Leadership Summit is coming to the East Coast. Dr. Chanda Macias, the CEO of the woman-focused organization, will welcome multitudes to her hometown of Washington, D.C. for the largest cannabis event-of-its-kind.
“We look forward to amplifying our message of cannabis legalization, inclusion, and equality here in our nation’s capital,” said Dr. Macias. “Being steps away from the U.S. Capitol, where we have witnessed an influx of women assuming leadership positions, is sure to inspire our community as a whole to connect, educate, and empower female leaders in this space.”
Traveling: CBD Expo Tour is kicking off. The events feature more than 70 exhibitors, along with a substantial lineup of speaker presentations and panel discussions from experts in the research, production, globalization, and sale of CBD products.
“We're taking it into a hard working area of America where the population is seeking natural pain relief. We will be continuing to educate on the benefits of CBD wellness and why the pharmaceutical companies, as well as the FDA's suppression efforts are self-serving,” said Celeste Miranda, Founder of CBD Expo Tour and CEO of MACE Media.
Photo by Javier Hasse.
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