Canopy Growth’s acquisition spree

Marijuana
Workers harvest a fresh crop of marijuana at the Loving Kindness Farms in Los Angeles.

Welcome to Insider Cannabis, our weekly newsletter where we’re bringing you an inside look at the deals, trends, and personalities driving the multibillion-dollar global cannabis boom.

Sign up here to get it in your inbox every week.

Happy Friday readers,

The news cycle slowed somewhat from last week’s madness, but one thing we’re expecting as New York and other states ramp up their cannabis markets – more deals.

On that front, this biggest M&A news in the industry this week was Canopy Growth’s purchase of Supreme Cannabis.

That deal, Canopy CEO David Klein told me, is all about pushing for profitability at home in Canada before stepping into the US.

But Klein thinks that step is coming soon, saying that federal “permissibility” (not legalization, for what it’s worth) is coming like a “freight train.”

What else?

Yeji and I will be covering everything you need to know about cannabis in New York. How the policies shake out, stocks to buy, people to know and watch, and who’s benefiting – and losing out – from how the industry develops.

If you want to talk, reach out to us.

– Jeremy (@jfberke) and Yeji (@jesse_yeji)

Here’s what we wrote about this week:

The CEO of Canopy Growth lays out 3 reasons his acquisition spree will help the world’s largest cannabis company dominate the lucrative US market

Canopy Growth is buying Supreme Cannabis in a $346 million mostly stock deal. Canopy’s CEO said the deal targets the premium end of the market and lays the groundwork for US expansion.

Analysts called the deal a positive for Canopy but not “transformational.”

Under-the-radar cannabis company Columbia Care could pop 200%, according to analysts

Analysts at the investment bank PI Financial say Columbia Care is their top pick in the sector. The analysts say the stock could pop more than 200% from the current price.

Columbia Care has a large presence in New York’s medical-marijuana market.

Cannabis startup Fyllo just raised $30 million as mainstream investors place more bets on tech

Fyllo is a cannabis-focused software company. The company just raised a $30 million Series B round.

Fyllo says it’s expanding into the mainstream – both in investors and clients.

The ultimate guide to US marijuana legalization: The key dates to know, and which stocks could benefit the most

New York’s governor signed legislation legalizing marijuana in late March. Democrats control the presidency and Congress.

This tracker explains state legalization timelines and which companies are best positioned for new markets.

Executive Moves

  • Cannabis edibles company Hervé announced on Monday that cannabis veteran Ryan Hunter would be joining the company as chief strategy officer.
  • Green Thumb Industries announced that investor Swati Mylavarapu would be joining the company’s board of directors.
  • Evan Augustine has been promoted to chief revenue officer at cannabis tech company Wurk.
  • Chirali Patel is joining the cannabis tech fund Digital Venture Partners as a managing partner and chief compliance officer.

Deals, launches, and IPOs

  • Canopy Growth announced it was acquiring The Supreme Cannabis Company for approximately $346 million in cash and stock.
  • Florida cannabis giant Trulieve announced that it would be acquiring three dispensary locations from Pennsylvania cannabis company Anna Holdings in a $60 million cash and stock deal.
  • Organigram announced it had acquired Edibles & Infusions Corporation for $22 million.
  • Canadian cannabis company Golden Leaf Holdings acquired a majority stake in Fifth & Root, Inc, a US CBD company, for $1.68 million.
  • Mercer Park Brand Acquisition Corp. announced on Thursday it would be acquiring California cannabis company Glass House Group for $567 million.
  • Merida Capital Holdings and cannabis art company Califari are launching NFT cannabis strain trading cards.

Policy moves

  • Virginia passed adult-use cannabis on Wednesday. Starting from July 1, adults over the age of 21 will be allowed to possess, consume, and grow cannabis in the state. The bill does not yet allow for recreational sales, which are expected to launch in 2024.
  • Mexico lawmakers said on Thursday that they are considering yet another extension to hammer out the details of its adult-use bill.
  • Sen. Majority Leader Chuck Schumer said in an interview with Politico that the Senate would act on marijuana legalization, with or without the White House.

Research and data

  • A new study from the National Institute of Justice finds that there is little evidence correlating a specific THC level with impaired driving, and standard field sobriety tests are not effective in determining marijuana intoxication.

Earnings roundup

  • Planet 13 released its Q4 results on Monday, reporting $20.1 million in revenue and a $2.9 million net loss.
  • Verano Holdings released its full year 2020 results on Thursday, reporting $355 million in revenue and $245 million in profit for the full year.
  • Kushco Holdings released its fiscal Q2 2021 results on Thursday, reporting $32.9 million in revenue and a $5 million net loss.

What we’re reading

Marijuana will be legal in Virginia on July 1, years earlier than planned (The Virginian-Pilot)

Is it possible to create an ethical psychedelics company? (VICE)

Delaware marijuana activists stage boycott of medical dispensaries that testified against legalization bill (Marijuana Moment)

Koch-backed group joins marijuana push after Zoom with Snoop Dogg (Politico)

Marijuana users work out even more than their nonsmoking counterparts, study suggests (Insider)

Ohio employers quietly grapple with workplace marijuana policies (Crain’s Cleveland)

Read the original article on Business Insider

Insider Cannabis: New York finally legalizes adult-use marijuana

marijuana cannabis
Employees tend to medical cannabis plants at Pharmocann, an Israeli medical cannabis company in northern Israel.

Welcome to Insider Cannabis, our weekly newsletter where we’re bringing you an inside look at the deals, trends, and personalities driving the multibillion-dollar global cannabis boom.

Sign up here to get it in your inbox every week.

Happy Friday readers,

What a week.

The big news was New York’s legalization of adult-use cannabis. The day after state lawmakers released an updated version of the MRTA over the weekend, New York’s legislature voted to pass the bill in both the State Assembly and Senate. Hours later, on Wednesday morning, Gov. Andrew Cuomo signed the legislation into law.

We’ve got you covered on all the different angles of this and how it’ll affect current operators. While stocks remained relatively unchanged the day the bill passed in New York’s legislature, they saw big gains after Cuomo signed the bill.

More regulations are expected to trickle in as the Office of Cannabis Management and a Cannabis Control Board begin to create a more detailed framework for recreational cannabis. But we’ve got you covered in the meantime with the key takeaways every investor should know.

Outside of the vacuum suck that was New York legalization, some companies announced deals to increase their presence in the US. Greenlane and KushCo announced they were merging in an all-stock deal while Verano Holdings announced an acquisition in Pennsylvania and Ayr Wellness closed a deal in Ohio.

Plus, check out my colleague Andrea Michelson’s story on delta-8 THC, a cannabis compound with a hazy legal status that’s growing in popularity. She explains what it is, and tried a latte loaded with the substance.

My canna buddy Jeremy will be back on Monday after a well-deserved vacation. We’ll have more news coming your way very soon. Let’s get to it.

– Yeji (@jesse_yeji)

Here’s what we wrote about this week:

Cannabis companies are giddy as people use their stimulus checks to stock up on marijuana

Cannabis companies are gearing up for a boost in sales as stimulus checks start hitting people’s bank accounts. Ben Kovler, Green Thumb Industries’ CEO, says “it’ll be as simple as people will buy more weed.”

A top Wall Street analyst lays out 5 cannabis stocks to buy now that could pop as New York legalizes marijuana

Pablo Zuanic, an analyst at the investment bank Cantor Fitzgerald, laid out five cannabis stocks earlier this month that would see a boost if New York lawmakers legalized cannabis for all adults.

3 New York cannabis companies told us they’re planning to ramp up cultivation and prepare for wholesale now that the state has legalized recreational marijuana

GTI, Columbia Care, Curaleaf told us they’re looking to ramp up cultivation to meet demand. They also say they’re generally happy with the law but are waiting as more regulations come to light in the coming months.

The key details every cannabis investor needs to know about New York marijuana legalization, including the stocks to buy now

New York’s new legal market is nuanced and complex. We’ve got you covered with the key takeaways investors should know, including which stocks to buy, deals to expect, and how taxation will look as sales begin.

New York cannabis legalization will give the state’s 10 existing operators a big leg up – and that could be good news for investors

New York’s adult-use law gives huge advantages to cannabis companies that already have a foothold in the state. The 10 operators in New York’s medical market will be able to transition into adult-use and be some of the few players to be vertically integrated.

Here are the prime acquisition targets and the types of deals you can expect as New York legalizes cannabis.

The vast majority of the 10 operators currently in New York are multistate operators with deep pockets. A select few, however, are either private or financially struggling. As newcomers look to enter New York, here are the kind of deals you can expect to see.

A timeline of when New Yorkers can smoke marijuana, grow it, and sell it legally

Some aspects of NY’s cannabis legalization bill take effect immediately, while others are delayed. Here’s what we know about what’s allowed now and when you can expect to be able to home grow and buy products in dispensaries.

Executive Moves

  • Cannabis data and analytics company New Frontier Data announced changes to its C-suite on Tuesday. Founder and former CEO Giadha A. DeCarcer will now be executive chair. Gary Allen, former COO, is now CEO.
  • Psychedelics company Cybin announced executive changes on Tuesday. Co-founder and former COO Paul Glavine will become chief growth officer, and co-founder and former SVP, Business Development John Kanakis will become chief business officer.

Deals, launches, and IPOs

  • Psychedelics company Wesana Health announced that it closed a C$16.1 million private placement to fund trials of psychedelic-assisted therapy to treat traumatic brain injury (TBI).
  • Greenlane and KushCo announced on Wednesday that they were merging in an all-stock deal in which KushCo will become a wholly owned subsidiary of Greenlane.
  • MSO Verano Holdings announced on Wednesday that it agreed to acquire The Healing Center in Pennsylvania, adding three Pittsburgh-based dispensaries.
  • Ayr Wellness announced that it closed on its acquisition of Ohio Medical Solutions, Inc. On Tuesday, the company closed the acquisition of medical marijuana company Parma Wellness Center.
  • Canopy Growth said on Thursday that it closed its acquisition of Ontario-based cannabis brand Ace Valley.

Policy moves

Earnings roundup

  • Harvest Health & Recreation released Q4 results, reporting $69.9 million in revenue and a $7.4 million net loss. The company guided to $380 million in revenue for 2021.
  • Clever Leaves Holdings released Q4 results, reporting $3.3 million in revenue and a net loss of $11.6 million. The company said it expects 2021 revenue of $17 million to $20 million.
  • Greenlane Holdings released its Q4 results, reporting $36.3 million in sales and a $10.9 million net loss.
  • Agrify released its Q4 results, reporting $4.4 million in revenue and a $13.1 million net loss.

What we’re reading

Investigation: Illegal cannabis operation looks for roots in Indigenous communities (High Country News)

Chicago-based marijuana giant part of federal pay-to-play investigation (Chicago Tribune)

Read the original article on Business Insider

Insider Cannabis: Stocks to bet on for New York legalization – Cannabis on Capitol Hill – Dutchie’s $1.7 billion valuation

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As the legal cannabis market grows in the US, there are many ways for investors to gain exposure to the industry.

Welcome to Insider Cannabis, our weekly newsletter where we’re bringing you an inside look at the deals, trends, and personalities driving the multibillion-dollar global cannabis boom.

Sign up here to get it in your inbox every week.

Happy Friday readers,

The cannabis news machine was cranking on all cylinders this week.

First, the SAFE Banking Act was reintroduced in the House by a bipartisan group of lawmakers. The Senate version will be introduced next week. We read through the bill and pulled out all the most important details.

The SAFE Banking Act, a relatively narrow cannabis reform bill, has a really good chance of becoming law. The same cannot be said for more widespread decriminalization bills, at least in this Congress, as we reported with our colleague Kimberly Leonard in DC.

President Biden, for his part, will not likely be a friend to cannabis reform efforts – recent reporting from The Daily Beast shows that the White House fired staffers who admitted to past cannabis use. Bob Dylan may have said it best: The times are a-changing, but not quite as quickly as some may have hoped.

It’s important to keep in mind the more pernicious impact of punitive cannabis policies, though: It’s on people of color. Ninety-four percent of marijuana-related arrests by the NYPD last year were people of color.

In other news, check out my panel on cannabis reporting for SXSW online with some of the other folks on the beat. You can watch it anytime before Saturday.

-Jeremy (@jfberke) and Yeji (@jesse_yeji)

Here’s what we wrote about this week:

The CEO of a $1.7 billion cannabis-tech startup shares how he convinced Tiger Global and DFJ to bet on the spread of marijuana legalization

Dutchie closed a $200 million Series C funding round led by Tiger Global. The monster round gives Dutchie a valuation of $1.7 billion.

Cannabis tech is one of the few areas that mainstream investors are allowed to bet on – and cannabis is hot.

A top Wall Street analyst lays out 5 cannabis stocks to buy now that could pop if New York races ahead to legalize marijuana

New York Gov. Cuomo said he expects to strike a deal to legalize cannabis ahead of the April 1 budget. Cantor Fitzgerald analyst Pablo Zuanic picked five companies to bet on that are set to benefit.

The bankruptcy risk of every major cannabis company, ranked

Cannabis companies that survived a tumultuous 2019 and 2020 are seeing their fortunes improve. Insider looked through data from CreditRiskMonitor to see the risk of bankruptcy for major cannabis companies.

The good news is that cannabis companies have generally seen their financial situations improve over the past year. The bad news is that many still remain at risk and in the “red flag” zone.

Several Democratic senators say they’re against cannabis legalization, busting claims that the filibuster is the only obstacle in the way of reform

Democratic leaders want to federally legalize weed, an exciting prospect for the industry. But six Democratic senators on Capitol Hill told Insider they had reservations about doing so.

Insider’s interviews with several senators on Capitol Hill show Democrats aren’t united on the issue, and the prospect of decriminalizing marijuana at the federal level this Congress isn’t as high as the industry envisions. Republicans tend to oppose the matter, but some would like legislation to support cannabis shops.

A House bill would help cannabis companies work with big banks and let you use your credit card when shopping for marijuana. Here are 7 things to know about the bipartisan plan.

House lawmakers introduced a modest cannabis reform bill this week that has a good chance of becoming law, because it has bipartisan support. Insider read through the SAFE Banking Act and chose the top takeaways from the legislation.

Executive Moves

Deals, launches, and IPOs

  • California cannabis company MWG Holdings Group announced it closed a $10.8 Million Series B preferred private placement.
  • Psychedelics company Field Trip announced it closed a $78 million bought deal financing.
  • Cannabis real estate firms NewLake Capital Partners and GreenAcreage Real Estate Corp are merging, to create what the companies say would be the largest cannabis real estate firm with a combined portfolio of $325 million across 9 states.
  • Publicly traded cannabis tech company Akerna will acquire Viridian Sciences, a business management platform geared toward dispensaries in an all-stock transaction. The company did not disclose the size of the deal.

Policy moves and politics

  • Dozens of White House staff have been sidelined for their past cannabis use, according to The Daily Beast. Press Secretary Jen Psaki on Friday said that only five people who started working at the White House are no longer employed.
  • Sens. Chuck Schumer, Cory Booker, and Ron Wyden held a discussion on Facebook Live to underscore their support for the SAFE Banking Act and federal marijuana decriminalization.
  • A deal to legalize recreational cannabis in New York is “very close” according to state lawmakers and Gov. Cuomo. Senator Liz Krueger, a co-sponsor of the MRTA, said in a radio interview this week that she is “extremely pleased” with the agreement that Gov. Cuomo and other lawmakers have reached in regards to growing pot at home and social equity funding.
  • The New Mexico Senate Judiciary Committee passed HB12, a bill that would legalize cannabis in the state, on Thursday. The bill could become law as soon as this weekend.
  • A bipartisan group of lawmakers introduced the SAFE Banking Act, a bill that would allow cannabis companies to access banking services. Read our story here.
  • Sen. Bob Menendez reintroduced the CLAIM Act, a bill that would allow cannabis companies to access insurance.

Research and data

  • A report from the nonprofit Tax Foundation found that the value of marijuana sales – if projections hold – may be twice that of firearms and ammunition and three times bigger than McDonald’s sales revenue by 2023.
  • Between 2010 and 2019, there were eight times as many marijuana-related arrests of Black and Latinx people as there were of white people in New York City, according to a report from the nonprofit Drug Policy Alliance and the City University of New York’s Public Science Project.
  • People of color made up 94% of arrests by the NYPD last year, according to the department’s data.

Earnings roundup

  • Columbia Care released its Q4 and full-year results, reporting a combined revenue of $76 million and a $73.7 million net loss for the quarter.
  • Green Thumb Industries released its Q4 and full-year results, reporting net revenue of $177.2 million and $22.5 million in net income.
  • Sundial released its Q4 and full-year results, reporting net revenue of C$13.9 million and a net loss of C$64.1 million.
  • Hexo Corp released its Q2 results, reporting net revenue of $32.8 million and a net loss of $20.8 million.

Chart of the week

Cannabis jobs have been growing rapidly across the US in recent years. The industry has averaged 27.5% growth each year, according to Leafly’s 2021 Jobs Report. In 2021, there are now 321,000 legal cannabis jobs in the country:

Total cannabis jobs in the US

What we’re reading

Investors Are Debating Who Should Own the Future of Psychedelics (Vice)

‘Chopped’ Takes on Cannabis and Generation Z in New Editions for Discovery Plus (Variety)

Can Magic Mushrooms Heal Us? (NYT)

Biden White House Sandbags Staffers, Sidelines Dozens for Pot Use (The Daily Beast)

Does smoking marijuana cause cancer? (Discover Magazine)

The data on legalizing weed (NPR)

No One Knows Where President Biden is on Marijuana (The News Station)

Mexico’s move to greenlight marijuana may pressure Biden (Politico)

Read the original article on Business Insider

A psychedelic renaissance

flow cannabis institute product marijuaan
Welcome to Insider Cannabis.

Welcome to Insider Cannabis, our weekly newsletter where we’re bringing you an inside look at the deals, trends, and personalities driving the multibillion-dollar global cannabis boom.

Sign up here to get it in your inbox every week.

Happy Friday everyone,

There were lots of major, market-moving deals in the industry this week – and with Mexico becoming the fourth country (and the one with by far the largest population) to legalize cannabis, there’s lots of room to be optimistic about the future.

British American Tobacco agreed to pour $175 million into a 20% stake of Canadian cannabis producer Organigram, a portend of future tobacco and cannabis tie-ups, according to analysts. I spoke with Organigram’s CEO, Greg Engel, about the deal yesterday.

He told me that while the focus is on US CBD – that’s so far the largest legal addressable market – he said “the majority of the work we do is transferrable to THC.”

“We’re tackling the big near-term market opportunity first, and then we’ll be able to pivot,” Engel told me.

In other news, Curaleaf is the first US cannabis company to push into Europe, agreeing to pay $285 million, mostly in stock, for EMMAC Life Sciences. You can read my story on Curaleaf’s international ambitions here.

Last, despite all the room for optimism, the cannabis industry is still reeling from the effects of overly ambitious growth.

We got the scoop on Acreage Holdings cutting 11 senior employees from its corporate office earlier this month. And Canopy Growth is laying off 75 employees and closing its facility in Denmark.

As a reminder, if you want to get in touch with a confidential tip, reach out to us at jberke@insider.com, or ylee@insider.com. Signal number for encrypted messages upon request.

-Jeremy (@jfberke) and Yeji (@jesse_yeji)

Here’s what we wrote about this week:

New York cannabis retailer Acreage Holdings quietly laid off 11 senior employees, sources say

Acreage Holdings laid off 11 corporate employees last week as part of a restructuring, two sources familiar with the matter told Insider.

The layoffs included several senior employees, such as the director of compliance and VP of communications, among others. The move was billed as a corporate-wide restructuring effort, the people said.

The CEO of the biggest cannabis company in the US lays out how he’s preparing to profit from the spread of legal marijuana around the world

Curaleaf will become the first US cannabis company to expand into Europe through its acquisition of European cannabis company EMMAC Life Sciences in a $285 million deal. CEO Joseph Bayern told Insider he believes Europe will evolve to become a cannabis market that will rival the US.

Wealthy donors are fueling a psychedelics renaissance as universities vie for funding to study ‘magic mushrooms’ and MDMA

Within the past two years, around half a dozen universities have established centers focused on researching the use of psychedelic substances as medical treatments. The trend, researchers say, is in large thanks due to increasing evidence around the compounds as well as wealthy philanthropists have caught the “psychedelic bug.”

Deals, launches, and IPOs

Policy moves

  • Lawmakers in Mexico passed a bill to legalize adult-use cannabis on Wednesday night. The legislation is expected to pass the Senate before landing on President Andrés Manuel López Obrador’s desk.

Science and research

Earnings roundup

  • Curaleaf released its Q4 and full year results, reporting revenue of $233.3 million and a net loss of $35.3 million for Q4.
  • Acreage Holdings released its Q4 and full year results, reporting revenue of $31.5 million and a net loss of $36.9 million for Q4.
  • Ayr Wellness released its Q4 and full year results, reporting revenue of $47.8 million and a net loss of $143.6 million for Q4.

What we’re reading

Canada weighs tighter rules for grow-your-own pot producers (Reuters)

So many people visited the website for Seth Rogen’s new marijuana and home-goods company that the site crashed (Insider)

New cannabis coalition wants to influence how – not if – weed is legalized (Politico)

Canopy Growth, others formed JV ‘solely’ to pump marijuana stock, refiled CA$500 million lawsuit alleges (Marijuana Business Daily)

Seth Rogen Is All Fired Up (New York Times)

For Nearly a Year, Teenagers Have Been Robbing Portland Dispensaries. Then Somebody Shot a Budtender. (Willamette Week)

Read the original article on Business Insider

Top cannabis stock picks for 2021

Marijuana Cannabis
Welcome to Insider Cannabis.

Welcome to Insider Cannabis, our weekly newsletter where we’re bringing you an inside look at the deals, trends, and personalities driving the multibillion-dollar global cannabis boom.

Sign up here to get it in your inbox every week.

Happy Friday readers,

Never a dull week in the cannabis (and psychedelics industry). The biggest headline news this week is Atai’s monstrous $157 million raise. CEO Florian Brand told Yeji the company is “doubling down” on its strategy – you can read her report here

Beyond that, I asked Jason Wild of JW Asset Management for his top cannabis picks for 2021. In short, he’s bullish on US cannabis

And last, I had the chance to chat with five-time NBA All-Star Chris Webber about his new $100 million cannabis equity fund and his push to make cannabis more inclusive from the start. 

“I don’t know of any other industry where this type of vested interest has been made to make change,” Webber told me. “It hasn’t been in tech – tech is lucrative. It damn sure wasn’t in cotton, it wasn’t in transportation.”

You can read more from him here

-Jeremy (@jfberke) and Yeji (@jesse_yeji)

Here’s what we wrote about this week:

The biggest private psychedelics company in the world just raised a record $157 million, pushing psychedelics further into the mainstream

Just months after breaking the record for the largest funding round in the psychedelics field, Atai Life Sciences has raised another $157 million to continue to develop treatments for mental illnesses like depression, addiction, and anxiety. CEO Florian Brand told Insider the money will be used to “double down” on the company’s strategy.

A hedge-fund manager who returned 146% last year shares the 6 cannabis stocks he’s betting on now and why he’s bullish on the industry

Jason Wild had a pretty good year last year.

His hedge fund, JW Asset Management, returned over 146% in 2020 – buoyed by significant investments in the cannabis industry. In an interview, Wild shared the six cannabis stocks he’s betting on, including Trulieve and TerrAscend, Green Thumb Industries, and more. 

Former NBA All Star Chris Webber is launching a $100 million fund to help minority entrepreneurs get ahead in cannabis. He told why it’s crucial to build an inclusive industry from the start.

Former five-time NBA All-Star Chris Webber has a new mission: Helping minority entrepreneurs access the economic boom created by the wave of cannabis legalization sweeping the US.

Webber is launching a $100 million fund to invest in Black and other minority cannabis entrepreneurs. He told Insider he has a unique opportunity to ensure that the cannabis industry is inclusive from the start.

Executive Moves

  • Private MSO Parallel announced on Monday that Walgreen’s veteran Jeremy Kunicki would be coming aboard as the company’s new CFO.
  • California cannabis distributor HERBL said on Wednesday that it had appointed Chemistry Holdings founder Josh Held as chief strategy officer.
  • Psychedelics company NovaMind has appointed Joseph Braganza as an SVP in charge of the company’s M&A strategy.

Deals, launches, and IPOs

Policy moves

Science and research

Chart of the week

Psychedelics companies saw a rush of private funding in 2020, according to data from CB Insights. In 2020, private psychedelics startups raised $448 million globally, compared to just $95 million in 2019. Insider rounded up the 14 psychedelics startups that raised the most capital in 2020:

Capital flooded into the psychedelics space in 2020

What we’re reading

MedMen co-founders Bierman, Modlin return to cannabis industry with different California company (Marijuana Business Daily)

Pot or Alcohol, Barron’s Has Never Favored Prohibition (Barron’s)

Merrick Garland, cannabis policy, and restorative justice (Brookings)

Aphria-Tilray cannabis merger talks overcame pandemic pause, rival bidder and other hurdles, proxy reveals (Marijuana Business Daily)

Should marijuana legalization limit THC? Probably not, but it’s happening (Forbes)

Read the original article on Business Insider

Insider Cannabis: WallStreetBets comes for weed – Cannabis hedge funds post eye-popping returns – What to know about psychedelics

medical marijuana cbd hemp weed smoking joint leafly flowers cannabis cox 96

Welcome to Insider Cannabis, our weekly newsletter where we’re bringing you an inside look at the deals, trends, and personalities driving the multibillion-dollar global cannabis boom.

Sign up here to get it in your inbox every week.

Happy Friday readers,

This week’s volatility was brought to you by the WallStreetBets forum on Reddit. As “meme stocks” like Gamestop and AMC fell back to Earth, the forum’s users turned to a new target: cannabis stocks.

The trading frenzy saw shares of Canadian cannabis companies like Sundial and Tilray surge on Wednesday, and slump on Thursday.

We’ve got you covered on the implications of all this – and where you should be putting your money instead. 

Beyond that, we have a look at how hedge funds with significant investments in cannabis weathered the crash of 2019, and profited in 2020. One fund, JW Asset Management, ended the year up a whopping 146%. You can read that story here.

Yeji took a dive into the emerging psychedelics space, breaking down the top players, their business models, and when to expect their medications to hit the market.

-Jeremy (@jfberke) and Yeji (@jesse_yeji)

Here’s what we wrote about this week:

What to know about the major public psychedelics companies, including a guide to their business models and when they expect to sell medications

A year ago, there were just a handful of publicly traded psychedelics companies.

Today, the landscape looks drastically different as psychedelics companies have made the jump into public markets, seeking more capital to develop drugs for regulatory approval, build out networks of clinics, or cultivate and extract psilocybin from mushrooms.

Insider identified the biggest companies in the industry, most of which have gone public within the past year. Here’s what to know about them, including a guide to their business models and when they expect to sell medications

Reddit traders are piling into cannabis stocks and driving up valuations, but experts say they’re betting on the wrong companies

The traders who hang out on the Reddit forum WallStreetBets have a new target as GameStop shares fall back to Earth: cannabis. 

But investors say those looking to bet on US legalization are looking in the wrong place: They should be investing in US companies directly.

Three hedge funds that focus on cannabis generated eye-popping returns by betting on the US, according to exclusive documents

Three hedge funds that have significant holdings in the cannabis industry, including dedicated cannabis funds, shared returns exclusively with Insider. The documents show that after steep losses in 2019, investors who held on were rewarded as the industry recovered.

JW Asset Management led the pack, gaining a whopping 146% in 2020. 

Here are the cannabis stocks that experts say you should bet on now

The biggest cannabis stocks had a wild week. They got slammed on Thursday, after soaring on Wednesday, in part thanks to retail traders spurred by Reddit forum WallStreetBets.

Insider talked to analysts who said that the stocks that are currently experiencing volatile trading aren’t the right companies to bet on. Instead, they said, look to US MSOs. 

Executive Moves

Deals, launches, and IPOs

Policy moves

  • Former HHS Secretary Kathleen Sebelius joined the National Cannabis Roundtable as co-chair. Sebelius, also the former Democratic governor of Kansas, will be heading the industry group alongside former Republican House Speaker John Boehner. Read more here from Politico.
  • Wisconsin Gov. Tony Evers unveiled a plan this week to legalize marijuana through the state budget, reports Marijuana Moment.
  • Marlboro-maker Altria registered to lobby on cannabis legalization in its home state of Virginia, where lawmakers passed legalization bills last week. Altria has a significant stake in Canadian cannabis company Cronos Group. 

Earnings Roundup

  • Canopy Growth reported Q3 earnings on Tuesday, reporting C$152.5 million revenue and an C$829 million loss. CEO David Klein said on a call with investors that he expects Canopy to enter the US market later this year and said that he predicts the company will turn a profit by 2022. 
  • Aurora Cannabis reported its Q2 earnings on Thursday, reporting C$67.7 million in revenue and an adjusted EBITDA losses of C$16.8 million. 
  • cbdMD reported its Q1 earnings on Tuesday, reporting $12.3 million in net sales and a $9.4 million loss.
  • Canopy Rivers reported its Q3 earnings on Wednesday, reporting net income of C$1.4 million. The company said its revenue increase was driven by its investment in US cannabis company TerrAscend.
  • MedMen and Green Thumb Industries are scheduled to announce earnings next week.

Science and research

Chart of the week

The largest cannabis markets in the US will be California, Illinois, Florida, Michigan, and Colorado, by 2025 according to data from New Frontier Data. The data assumes no additional states pass legalization measures and there are no significant federal policy changes:

Legal cannabis market share estimates in 2025

What we’re reading

How Tobacco Giant Altria Is Becoming A Cannabis Company (Forbes)

The Half-Legal Cannabis Trap (Politico)

Can a Company Patent the Basic Components of Psychedelic Therapy? (VICE)

Many think weed is already legal in N.J. But cops still make arrests as Murphy, lawmakers haggle over bills. (NJ.com)

Read the original article on Business Insider