The behind-the-scenes story of Rootz Research

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.

Hello everyone,

This week, the House Judiciary Committee passed the MORE Act, a bill that would federally decriminalize cannabis, on Thursday by a vote of 26-15, mostly along party lines.

In other news, Aurora Cannabis CEO Miguel Martin told us he thinks the cannabis industry and its investors are too focused on US recreational consumers and are missing a more profitable opportunity: medical marijuana.

“The fact that everyone is just so consumed by this idea that only rec cannabis matters, I think, is a fallacy,” Martin said in a recent interview. Aurora’s medical-cannabis business is a bright spot for the company. Medical sales increased 9% in the most recent quarter, while the company’s recreational sales tumbled 45%.

In other news, Insider’s cannabis team was at the Business of Cannabis conference in New York this week, where Jeremy moderated a panel on how the New York market would shape out as the industry begins to ramp up. We’ll be at a few others in the coming months, so feel free to say hello if you see us around.

– Jeremy Berke (@jfberke) & Yeji Jesse Lee (@jesse_yeji)

If you like what you read, share this newsletter with your colleagues, friends, boss, spouse, strangers on the internet, or whomever else would like a weekly dose of cannabis news.

Here’s what we wrote about this week:

Rootz Research claims it’s using insights from top Wharton professors to upend cannabis data. The real story is far more complicated.

The founder of Rootz Research told Insider he started the company with three Wharton professors. One of the professors told Insider the founder, Eric Spitz, had “grossly misrepresented” his role. The cannabis industry has its share of disingenuous founders and startup failures. Can Rootz chart a different path?

3 top VCs who’ve sunk the most cash into psychedelics say they prioritize data, deep expertise, and a clear market strategy when placing their bets

The top 3 VCs in the psychedelics space told Insider they’d seen hundreds of pitches from startups since early 2020. So we asked them two main questions: What makes a company stands out? What’s an automatic red flag?

A top psychedelics VC who’s evaluated 374 pitches shares the 2 red flags that turn him off every time

Sa’ad Shah, managing partner at the Noetic Fund, told Insider in a recent interview that he’s seen 374 different pitches from startups in the industry and that there are two major red flags he sees among companies in the space, which signal to him that he shouldn’t invest.

Aurora Cannabis is betting on medical marijuana, not the ‘fallacy’ of recreational pot. Here’s why.

Aurora Cannabis is doubling down on its medical business, CEO Miguel Martin told Insider. Aurora’s medical-cannabis business is a bright spot for the company. Medical sales increased 9% in the most recent quarter, while the company’s recreational sales tumbled 45%.

Executive moves

  • US cannabis company MariMed said on Monday that former Neptune Wellness executive Steve West would be joining the company as vice president of investor relations.
  • Cannabis tech company Flowhub announced on Wednesday that former Uber general manager Leandre Johns would be joining as chief operating officer.
  • Cannabis website Leafly said on Tuesday that finance and tech veteran Suresh Krishnaswamy would be joining the company as its new chief financial officer.
  • California-based cannabis company Glass House Brands announced on Wednesday that it had appointed finance and accounting veteran Mark Vendetti as its new chief financial officer.

Deals, launches, and IPOs

  • Trulieve closed its blockbuster deal with Harvest Health & Recreation. Trulieve also raised a $350 million private placement, at an 8% interest rate.
  • Psychedelics company Delix Therapeutics said on Monday that it had raised $70 million in a Series A round led by ARTIS Ventures, RA Capital Management, and OMX Ventures.
  • US cannabis company Jushi Holdings announced on Wednesday that it would be acquiring Nevada-based cannabis dispensary The Apothecarium.
  • Parallel, Beau Wrigley’s cannabis company, is no longer going public after the deal with Ceres Acquisition Corp, a SPAC, fell apart.
  • Former basketball star Chris Webber and his business partner Lavetta Willis are building out a $50 million cannabis facility in Detroit, reports The Detroit News.

Policy moves

  • The House Judiciary Committee passed The MORE Act, a bill that would federally decriminalize cannabis, on Thursday by a vote of 26-15, mostly along party lines.
  • US cannabis company Ascend Wellness Holdings said on Monday that it had reached its $1 million milestone in contributions to the Last Prisoner Project, a non-profit focused on advocacy for individuals with cannabis convictions.

Research and data

  • A new study in the journal Drug and Alcohol Dependence found that more cannabis stores led to more legal sales – without increasing the number of new users. “That’s about the best policymakers could have hoped for,” the study’s author, Brock University professor Michael Armstrong told Insider.
  • A new study in the Journal of the American Medical Association found that with legalization, Hispanic and White individuals increased their marijuana usage while Black individuals did not.
  • A new study from New Brunswick’s Research and Productivity Council found that illicit cannabis is more likely to contain contaminants like microbes and pesticides, and have inaccurate label claims when compared to legally purchased cannabis.
  • Cannabis-related arrests in the US saw a steep drop in 2020, according to new data from the US Federal Bureau of Investigation, which showed that arrest rates dropped 36% in 2020 compared to 2019. Read more at NORML.

Cannabis jobs

Earnings

  • Aurora Cannabis released its fiscal Q4 results on Monday, reporting C$54.8 million in revenue, and a net loss of C$134 million.

What we’re reading

Selling Marijuana on Tribal Lands, a Legal Gray Area (New York Times)

I tried a cannabis-friendly coworking space with smoking and a weed-infused menu. Here’s what it was like. (Insider)

Greener pastures: Marijuana jobs are becoming a refuge for retail and restaurant workers (The Washington Post)

Cannabis industry jobs are on the rise, fueled by the Great Resignation (Insider)

CBD drinks and edibles claiming to reduce anxiety and pain are mostly ‘pointless,’ according to a cannabis researcher (Insider)

Is It Ever OK to Get Stoned With a Client? And Other Questions as Pot Comes to Work (The Washington Post)

Read the original article on Business Insider

Civilized founders pushed out

GettyImages 1178310599
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.

Hello everyone,

In some respects, the fight over how to legalize cannabis is a microcosm of larger social debates, pitting social justice activists against more free-market-oriented folks.

Take the debate this week over the SAFE Banking Act.

The cannabis banking bill passed the House for the fifth time last night. This go-around, language from the bill – which would open up the banking system to cannabis companies and allow consumers to pay with credit cards – was shoehorned into the National Defense Authorization Act.

The NDAA usually passes the Senate without much fanfare. But Senate Majority Leader Chuck Schumer, Sen. Ron Wyden, and Sen. Cory Booker have their own more comprehensive cannabis bill, The Cannabis Opportunity and Administration Act. Booker has said that he opposes adding cannabis banking protections to the Senate’s version of the NDAA ahead of broader criminal justice reforms.

It remains to be seen whether SAFE will be included in the Senate’s version of the NDAA. Many cannabis activists say that the SAFE Act would only help banks and large cannabis companies make more money in the industry. They’d rather see full-scale legalization or at least record expungement and other criminal and social justice measures passed first.

But supporters of the SAFE Act say it’s a necessary tool to help protect and grow small businesses since many social equity license holders are unable to get loans or open lines of credit to start their businesses, and that dealing in all cash is a safety risk.

In other news, Amazon doubled down on its support for cannabis legalization and said it was lobbying the federal government for legalization. Aurora Cannabis closed a major facility and cut around 8% of its workforce. The company delayed its earnings until next week. Tilray closed its Nanaimo, British Columbia facility as well.

California will be adding a cannabis competition to its state fair, where farmers will show off their best buds.

I’ll be moderating a panel about the New York cannabis opportunity at the Prohibition Partners x Business of Cannabis conference in New York City on Wednesday, September 29. I’m looking forward to seeing many of you in person, and let me know if you’ll be around.

– Jeremy Berke (@jfberke)

If you like what you read, share this newsletter with your colleagues, friends, boss, spouse, strangers on the internet, or whomever else would like a weekly dose of cannabis news.

Here’s what we wrote about this week:

Investors are pushing out the founders of troubled cannabis startup Civilized. We got ahold of the full memo.

Investors are pushing Civilized founders Derek and Terri Riedle out of the company, according to a memo circulated among investors on Monday and obtained by Insider. The investors say the founders, Derek and Terri Riedle, saddled the company with debt.

A startup accelerator that’s worked with J&J and L’Oréal is getting into psychedelics as the industry goes mainstream

A new accelerator program is targeting early-stage ancillary startups focused on psychedelics, in the latest sign that psychedelics are entering the mainstream and that funding dollars are trailing closely behind.

The House just passed cannabis reforms as part of a defense bill. Here’s what would change for businesses and their customers.

The US House of Representatives has passed the Secure and Fair Enforcement Banking Act, or SAFE Banking Act, yet again.

Lawmakers tucked the cannabis banking bill into the National Defense Authorization Act that passed lower chamber on Thursday. It’s not clear whether the Senate will include cannabis reforms in its version of the defense package once the upper chamber takes it up.

Executive moves

  • New York Governor Kathy Hochul on Wednesday announced two more appointees – Reuben R. McDaniel, III and Jessica Garcia – to the board of the Office of Cannabis Management, the regulatory body responsible for building out the adult-use cannabis industry in the state.

Deals, launches, and IPOs

  • Cannabis tech company Dispense said on Tuesday that it had raised a $2 million seed round led by NextView Ventures and Poseidon Asset Management.
  • Michigan-based cannabis company SKYMINT said on Tuesday that it raised $78 million and acquired 3Fifteen Cannabis. Investors in the round include Tropics LP, an affiliate of Sundial Growers’ JV SunStream Bancorp Inc., and Merida Capital Holdings.
  • Christine De La Rosa, the CEO of The People’s Ecosystem, is raising a $50 million fund to invest in BIPOC and women-led cannabis businesses.
  • Psychedelics company Delic Holdings Corp said on Monday it would acquire Ketamine Wellness Centers Inc, increasing its footprint to 12 clinic locations across the US, in a $5 million cash-and-stock deal.
  • Crain Communications is acquiring cannabis financial media site Green Market Report. The terms of the deal were not disclosed.
cannabis legalization
Marijuana activists hold up a 51-foot inflatable joint during a rally at the U.S. Capitol to call on Congress pass cannabis reform legislation on Tuesday, Oct. 8, 2019.

Policy moves

  • The House of Representatives on Thursday passed the SAFE Banking Act, a cannabis banking bill, as part of the National Defense Authorization Act. It’s not clear whether the Senate will include cannabis reforms in its version of the defense package once the upper chamber takes it up.
  • Italy is expected to hold a referendum on legalizing cannabis early next year after organizers gathered the 500,000 signatures within a week, reports Reuters.

Research and data

  • A new report from the nonprofit Economic Policy Institute found that unionized cannabis workers could make $8,690 more per year than non-unionized peers.
  • Psychedelics company Atai Life Sciences said on Tuesday that its platform company DemeRx has started its early-stage clinical trials of ibogaine to treat opioid use disorder.
  • Cannabis data firm BDSA says in a report that cannabis sales will hit $31 billion this year, a 41% increase over last year. By 2026, BDSA expects cannabis sales to exceed $62 billion.

Earnings

  • MedMen reported its Q4 and FY21 results on Thursday. The company reported $42 million in revenue and a net loss of $46 million in Q4. For the full year, the company reported $145 million in revenue and a net loss of $157.6 million.

What we’re reading

Why Amazon wants to make sure everyone knows it’s totally cool with smoking pot now (Insider)

Lawyers, race and money: Illinois’ messy weed experiment (Politico)

‘Millions of pounds’ of legal marijuana diverted to underground market, California lawsuit alleges (MJ Biz Daily)

Getting high before exercise is the secret to sticking with a fitness routine, some athletes say (Insider)

Illegal marijuana farms take West’s water in ‘blatant theft’ (Associated Press)

Marijuana banking sponsor discusses path through Senate after House approves reform for fifth time (Marijuana Moment)

Read the original article on Business Insider

Teen marijuana use stays flat

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.

Hello everyone,

It was a short week this week and dealmaking in the industry slowed to a crawl after a head-spinning August – but we’re not expecting the quiet to last long.

We’ve got a ton of good stories for you in the works. Until then, enjoy your weekends!

– Jeremy Berke (@jfberke) & Yeji Jesse Lee (@jesse_yeji)

If you like what you read, share this newsletter with your colleagues, friends, boss, spouse, strangers on the internet, or whomever else would like a weekly dose of cannabis news.

Deals, launches, and IPOs

  • Psychedelics company CaaMTech announced on Wednesday that it had raised a $22 million Series A funding round, led by the Noetic Fund, to advance its compounds into clinical trials.
  • Psychedelics company Journey Colab said on Tuesday that it had raised a $12 million Series A funding round.
  • Canadian cannabis company The Green Organic Dutchman said on Friday that it had received approval to list on the Canadian Securities Exchange.

Policy moves

  • New York Senate Majority Leader Andrea Stewart-Cousins on Thursday named former senator Jen Metzger as her pick to sit on the Cannabis Control Board, the regulatory body responsible for shaping New York’s adult-use program. On Wednesday, Assembly Speaker Carl Heastie tapped attorney Adam Perry as his choice, according to the Times Herald-Record.
  • Rodney Hood, the former chairman of the National Credit Union Administration, said federal legalization is inevitable and criticized Congress’s lack of action on cannabis banking reform, reports Marijuana Moment.
  • Italy is set to decriminalize marijuana for personal use, with the rules allowing for the cultivation of up to four marijuana plants at home, reports The Independent.

Research and data

  • A study in the Journal of the American Medical Association found little evidence that the legalization of either recreational or medical marijuana encourages teen use.
  • However, a report from the National Institute on Drug Abuse found that marijuana use among college students hit record highs during the pandemic, the highest mark since 1983. The report found that binge drinking declined among college students as well.

What we’re reading (and watching)

The cannabis industry is booming, but for many Black Americans the price of entry is steep (The Guardian)

Minorities struggle for headway in the legal weed business (PBS News Hour)

In the weeds: How cannabis businesses get around a web of online advertising barriers (Morning Brew)

Growers in the Emerald Triangle are Facing a Potential Extinction Event (High Times)

Cannabis researchers seek to unlock the healing power of pot (Wall Street Journal)

Legal woes of CEO’s spouse bring marijuana MSO Trulieve unwanted attention (MJ Biz Daily)

Read the original article on Business Insider

TILT Holdings enters New York

marijuana, california
Marijuana plants for sale at the ShowGrow dispensary, a medical marijuana provider in downtown 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 everyone,

After a busy few weeks, cannabis earnings are winding down- this week we had Jushi, Planet 13, and a few other companies report results as we come to the tail end of a very eventful earnings season.

There were also a slew of deals this week, including an unexpected strategy announcement on the part of US cannabis company TILT Holdings to enter New York. On Tuesday the company said that it had made a deal with the Shinnecock Indian Nation of New York to develop a vertically integrated cannabis operation on their tribal territory.

We’ll be on the lookout for similar deals that give companies a way to enter the Empire state as vertically integrated enterprises.

Speaking of New York, Governor Kathy Hochul was officially sworn in. As we previously reported, this could be good for the cannabis industry, which has been waiting months for regulations to roll out.

Hochul’s Deputy Director of Communications Jason Gough told me in an email yesterday that the administration is “actively working” to ensure that the Cannabis Control Board and Office of Cannabis Management (the regulatory bodies tasked with creating the rules around the new market) can start implementing a cannabis program as soon as possible.

We’ll be watching closely as seats on New York’s Cannabis Control Board and Office of Cannabis Management start filling up.

My canna buddy Jeremy will be back next week, most likely with a killer tan and a stomach full of pasta.

– Yeji Jesse Lee (@jesse_yeji)

If you like what you read, share this newsletter with your colleagues, friends, boss, spouse, strangers on the internet, or whomever else would like a weekly dose of cannabis news.

Executive moves

  • US cannabis company Acreage Holdings said on Monday that it had appointed Pfizer’s former director of public affairs, Bryan Murray, as executive vice president of government relations.
  • Communications firm KCSA announced that former 4Front Ventures president Kris Krane is joining to head its Chicago office and expand its cannabis practice.
  • Canadian cannabis company HEXO said it appointed Guillaume Jouët as its new chief people & culture officer.

Deals, launches, and IPOs

  • HEXO said on Tuesday that it closed a previously announced $144.8 million underwritten public offering.
  • US cannabis company TILT Holdings said on Tuesday that it made a deal with the Shinnecock Indian Nation of New York to enter the state.
  • Cannabis e-commerce company I Heart Jane announced that it raised $100 million in a Series C round led by Honor Ventures.
  • Psychedelics biotech company FSD Pharma announced on Wednesday that it will acquire Lucid Psycheceuticals for $9 million.
  • The Green Organic Dutchman Holdings announced on Thursday that it had gained conditional approval to uplist from the Toronto Stock Exchange to the Canadian Securities Exchange.
  • Cannabis hydroponic company GrowGeneration announced two deals this week: one for Washington-based Hoagtech Hydroponics and another for Californian company Commercial Grow Supply. The company has made 14 such deals so far in 2021.

Policy moves

  • New Mexico released rules for its cannabis market this week, giving more guidance for those looking to get involved in the industry. The state began to accept cannabis producer applications on Wednesday, according to Marijuana Moment.

Earnings

  • Gage Growth released its Q2 results on Tuesday, reporting $26.4 million in revenue, and a net loss of $9.4 million.
  • TILT Holdings released its Q2 results on Tuesday, reporting $48.5 million in revenue, and a net loss of $4 million.
  • Jushi Holdings released its Q2 results on Wednesday, reporting $47.7 million in revenue, and a net profit of $4.8 million.
  • Planet 13 released its Q2 results on Thursday, reporting $32.8 million in revenue, and a net loss of $4.4 million.

Chart of the week

Flower is still the king of cannabis, according to recent data from cannabis data firm Headset. In Canada, flower makes up 51.5% of the overall market while in the US that figure drops slightly to 46%.

Chart of Canada and US market shares of different cannabis products with flower in the lead

What we’re reading

More than 70% of New Jersey towns ban adult-use marijuana retail (MJ Biz Daily)

A “Window” Into What’s Next for California’s Cannabis Appellations (Cannabis Wire)

New Mexico Is Officially Accepting Recreational Marijuana Producer Applications (Marijuana Moment)

Read the original article on Business Insider

Insider Cannabis: Earnings, earnings, earnings

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.

Hello everyone,

Breathe out. If you work for, invest in, or lead a cannabis company – this was probably one of the busiest weeks of the summer.

Most of the major US cannabis companies or MSOs reported earnings this week, giving us a clear snapshot into how the industry’s doing amid the pandemic.

For us, that means a whirlwind of calls, interviews, reading, writing, more calls, more interviews, more reading, and more writing. If you tried to reach Yeji or me this week and we haven’t gotten back you, now you know why. We’re doing our best.

Our quick takeaway on the quarter: MSOs like Trulieve, Green Thumb Industries, Verano Holdings and others posted strong quarters in terms of revenue growth and actually turning a profit, compared to their Canadian counterparts. How novel.

What else we’re watching:

Gov. Cuomo’s resigning, and industry experts told us that’ll speed up the rollout of legalization in New York.

Trulieve CEO Kim Rivers‘ husband JT Burnette is on trial over corruption charges associated with real estate purchases he made. The jury is deliberating as we speak.

But for the cannabis industry, there’s a damning piece: According to audio from a conversation between Burnette and an undercover FBI agent, Burnette claimed he worked with a Republican state representative to create barriers that would benefit his wife’s company and keep others out of Florida’s lucrative medical marijuana market, the Tallahassee Democrat reported.

In an industry like cannabis, in the context of decades of racially motivated policing and incarceration, reputation is everything for leaders of publicly traded cannabis companies that are now profiting from legalization.

We’re asking CEOs and other execs how they thread that needle in an industry where corporate reputation is of critical importance because of that history and the polarized political environment we all inhabit.

If you’ve got thoughts on that, get in touch with us.

– Jeremy Berke (@jfberke) & Yeji Jesse Lee (@jesse_yeji)

If you like what you read, share this newsletter with your colleagues, friends, boss, spouse, strangers on the internet, or whomever else would like a weekly dose of cannabis news.

Here’s what we wrote about this week:

A top Wall Street analyst says investors are overlooking a ‘transformative growth opportunity’ in cannabis stocks, and names 9 to buy now

Cannabis stocks have pulled back significantly since February and Viridian analyst Jonathan DeCourcey says this creates an opportunity for investors. DeCourcey names 9 stocks in particular that are poised to see “transformative growth.”

Robinhood just announced a $140 million deal for a startup focused on increasing proxy voting as meme stocks struggle to get participation from retail investors

Companies with large retail-investor bases face difficulties reaching a quorum in shareholder votes. “It’s hard to get those shareholders to show up and vote,” Tilray CEO Irwin Simon told Insider. To address this issue, Robinhood said on Tuesday that it had made a big deal that would help increase proxy voting.

The cannabis industry says Cuomo’s resignation could speed up marijuana sales in New York

New York Gov. Andrew Cuomo’s resignation amid a wave of sexual assault allegations may be beneficial for the state’s fledgling cannabis industry.

“I think a lot of people in this industry, including some of our clients, are breathing a sigh of relief knowing that the governor of New York is no longer using cannabis as a pawn in unrelated battles,” Jeffrey Schultz, partner at cannabis law firm Feuerstein Kulick, told Insider.

THE NEW GREEN RUSH: Risk-taking real-estate brokers who cater to cannabis companies are cashing in

Cannabis real estate is projected to be a $50 billion industry by 2027 and some risk-taking brokerages are cashing in, helping cannabis firms find grow houses and retail storefronts.

The man building a new cannabis company with cash from Scotts Miracle-Gro lays out his plan to dominate the US with a $320 million war chest

A Scotts Miracle-Gro unit is investing $150 million in RIV Capital and RIV Capital CEO Narbe Alexandrian told Insider he’s using the money to shop for US cannabis deals. He says he’s focused on populous states and said he’s looking for distressed deals and for companies with strong teams.

Executive moves

  • Tom Price, the former HHS secretary under President Donald Trump, is joining the board of Botanical Sciences, a cannabis company that recently won a coveted medical license in Georgia, Marijuana Moment reports.

Deals, launches, and IPOs

  • Leafly said on Monday that it plans to go public through a special purpose acquisition company sponsored by Merida Capital Holdings in a deal that values the company at around $532 million. The company plans to trade on the NASDAQ under the ticker “LFLY.”
  • RIV Capital announced on Tuesday that it has received a $150 million investment from The Hawthorne Collective, a subsidiary of The Scotts Miracle-Gro Company. RIV Capital CEO Narbe Alexandrian told Insider he’s using the money to shop for US cannabis deals.
  • Montréal Cannabis Médical Inc. is going public on the CSE through a reverse takeover with Canada House.
  • Canadian cannabis company Fire & Flower is entering the US through a licensing agreement with American Acres Managers, which will change its name to Fire & Flower U.S. Holdings and open a branded dispensary in Palm Springs.
  • Psychedelics giant Atai announced on Thursday that it had launched Revixia Life Sciences, a subsidiary focused on developing Salvinorin A, a compound derived from the psychedelics plant Salvia divinorum.
  • Origin Therapeutics said on Thursday that it closed a $6.5 million private placement to fund investments into private, early-stage psychedelics companies.
  • BuzzFeed is launching a line of cannabis products, Forbes reports.
Cannabis
An employee tends to a freshly-harvested medical cannabis plant at Pharmocann, an Israeli medical cannabis company in northern Israel January 24, 2019. Picture taken January 24, 2019

Policy moves

Earnings

  • Curaleaf released its 2021 Q2 results on Monday, reporting $312 million in revenue and a net loss of $7.2 million.
  • Verano Holdings released its 2021 Q2 results on Tuesday, reporting $198.7 million in revenue and a net profit of $6.8 million.
  • Acreage Holdings released its Q2 2021 results on Tuesday, reporting $44.2 million in revenue and a net loss of $2.6 million.
  • Harvest Health & Recreation released its Q2 2021 results on Tuesday, reporting $102.5 million in revenue and a net loss of $19.5 million.
  • Ascend Wellness Holdings released its Q2 2021 results on Tuesday, reporting $83.4 million in revenue and a net loss of $44.9 million.
  • Green Thumb Industries released its Q2 2021 results on Wednesday, reporting $221.9 million in revenue and a net profit of $22.1 million.
  • Columbia Care released its Q2 2021 results on Thursday, reporting $102.4 million in revenue and a net loss of $10.2 million.
  • Trulieve released its Q2 2021 results on Thursday, reporting $215.1 million in revenue and a net profit of $40.9 million.
  • Charlotte’s Web released its Q2 2021 results on Thursday, reporting $24.2 million in revenue and a net loss of $5.4 million.
  • Hydrofarm Holdings released its Q2 2021 results on Thursday, reporting $133.8 million in sales and a net income of $2.3 million.
  • Cresco Labs released its Q2 2021 results on Friday, reporting $210 million in revenue and a net income of $2.7 million.

What we’re reading

An inconvenient truth (about weed) (Politico)

Legal U.S. marijuana is pouring into Mexico. It’s pricey, popular and has names such as ‘Bubba Kush.’ (The Washington Post)

Beyoncé Is Building a Hemp and a Honey Farm (Vanity Fair)

What Do You Do with a Billion Grams of Surplus Weed? (The Walrus)

Opinion: Punishing drug use heightens the stigma of addiction (Stat News)

Read the original article on Business Insider

Tilray’s war chest

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.

Hello everyone,

Here on the home front, reports that Gov. Andrew Cuomo is slow-walking legalization – he has yet to make nominations for the Office of Cannabis Management – have raised eyebrows across the New York cannabis world.

The New York Post reported that the delay was because of Cuomo’s anger over the legislature’s lack of action on his proposed MTA legislation. Sen. Dianne Savino, who co-led the push for cannabis reform, said that she expects Cuomo to be able to “walk and roll a joint at the same time.”

Speaking from experience, that’s much harder than it looks.

What else happened?

Yeji has a pair of stories in her series on what’s in store for the burgeoning psychedelics market. You should read those if you want to get quickly up to speed.

I published a deep dive into the promises and pitfalls of synthetic cannabinoids and the surprising amount of money being poured into research by startups. It’s expected to become a $115 billion market.

Tilray CEO Irwin Simon – fresh off a profitable quarter – told us in an interview that he’s got ambitious M&A plans for the US.

– Jeremy Berke (@jfberke)

If you like what you read, share this newsletter with your colleagues, friends, boss, spouse, strangers on the internet, or whomever else would like a weekly dose of cannabis news.

Here’s what we wrote about this week:

Top psychedelics VCs predict a tech boom and a rise of clinics over the next year

Some of the top VCs in the psychedelics space told Insider that they predict a rise in psychedelic clinics and more companies focused on other areas that don’t involve drug development.

Biotechs are betting millions on unlocking the $115 billion synthetic-cannabis market

Growing quality cannabis isn’t easy. Biotech startups are chasing what Wall Street analysts say could become a $115 billion market for synthetic cannabis compounds. “It’s a biosynthesis revolution,” one cannabis biotech executive told Insider. “Biology is to the 21st century what physics was to the 20th.”

The CEO of cannabis giant Tilray is sitting on a $500 million war chest, and says he’s ready to make a deal for a US cannabis company

Tilray CEO Irwin Simon told Insider he’s not waiting on legalization to make a deal with a US company. Instead, the executive said he’s closely watching US cannabis companies with good assets and branding. “I’m making a big bet,” he said.

Top psychedelics VCs warn the industry’s boom could turn into a correction and some companies are a ‘flash in the pan’

In the third edition of Insider’s psychedelic VC predictions series, top investors said they expect big changes to the landscape. Some said that many companies will fail as the market corrects itself. Others predicted a new era for psychedelic compounds.

Cannabis
An employee tends to medical cannabis plants at Pharmocann, an Israeli medical cannabis company in northern Israel.

Executive moves

  • Psychedelics giant Compass Pathways said on Thursday that Guy Goodwin, an emeritus professor of psychiatry at the University of Oxford, would join the company as chief medical officer.
  • Philadelphia 76ers legend Allen Iverson is joining Al Harrington‘s California cannabis company, Viola Brands.

Deals, launches, and IPOs

  • London Stock Exchange-listed medical cannabis company Kanabo is acquiring Canada-based Materia Ventures, to create what the companies say is the largest European cannabis company. The financial terms of the transaction were not disclosed.
  • Cannabis company Verano announced on Monday that it would acquire Nevada-based cannabis company Sierra Well in a $29 million cash and stock deal.
  • Poseidon Garden Ventures, Poseidon Asset Management’s third fund in the cannabis space, said on Monday that it invested in its first three startups: cannabis operator JKL2, cultivation tech company Adaviv, and dispensary tech provider Dispense.
  • Psychedelics company Field Trip Health began trading on the Nasdaq on Thursday under the ticker ‘FTRP’, the latest of a slew of psychedelics companies to list on a US exchange.
  • Atai Life Sciences, the largest psychedelics company in the world by market cap, said on Wednesday that it had launched InnarisBio, a company focused on nose-to-brain delivery methods for various treatments, alongside the University of Queensland.

Policy moves

  • Pennsylvania‘s Supreme Court ruled that the public has a right to review applications for the state’s medical marijuana licenses, Law 360 reports.
  • The House approved a far-reaching spending bill that provides protections to banks that work with legal cannabis companies, allows cannabis sales in Washington D.C., among other cannabis elements, Marijuana Moment reports.
  • Colorado Gov. Jared Polis is creating a Cannabis Business Office for the state, to promote social equity in the industry, The Denver Post reports.

Research and data

  • Legalizing cannabis federally would reduce arrests but could put some minority entrepreneurs out of business, according to research led by Carnegie Mellon’s Jonathan Caulkins and published in the Boston University Law Review. The analysis shows that expunging records for cannabis possession could advance social equity goals more than other reforms.
  • CBD can reduce nicotine cravings in rats, according to a new study published in the journal Psychopharmacology. The data suggest that CBD may be a tool to help people alleviate cravings after quitting cigarettes.
  • Hemp goes ‘hot’ – as in, exceeds the legal threshold of 0.3% THC – because of genetics and not environmental stress, as was previously thought, according to new research from Cornell University published in the journal Global Change Biology-Bioenergy. Hemp that exceeds the THC threshold can cause farmers to lose their entire crop.
  • Legalizing cannabis does not lead to more problematic or chaotic use, according to a new study 0f 1,225 cannabis users published in the journal Contemporary Drug Problems.

Earnings

  • Tilray released its fiscal Q4 2021 results on Wednesday, reporting $142.2 million in net revenue and $33.6 million in net income.

Chart of the week

Canada’s regulated cannabis sales are expected to grow 54% in 2021, according to Headset, double the US growth rate. The cannabis data company said that the Canadian market is newer and smaller than that of the US, making growth more noticeable:

Chart showing cannabis estimated annual sales growth rate for Canada and US
Estimated annual sales growth rate.

What we’re reading

Billionaire Charles Koch on why cannabis should be legal (Forbes)

I gave up alcohol and turned to weed instead, and now I’m a more present and patient parent (Insider)

New York will be buzzing with union jobs thanks to upcoming pot industry (New York Post)

Marijuana helped former NHL champion Darren McCarty beat alcoholism, he says. ‘I would’ve been dead without it.’ (Insider)

Struggling MedMen Seeks Restructuring, Turnaround (LA Business Journal)

Is medical cannabis really a magic bullet? (The Guardian)

Read the original article on Business Insider

Amazon lobbying on legalization

marijuana, california
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:

What’s going on this week? Turning Points Brands, a NYSE-listed company, turned a few heads in the industry this week by announcing an $8 million investment into Old Pal, a California cannabis brand.

Companies that want to maintain their listings on marquee exchanges like the NYSE usually won’t touch US cannabis with a 10,000-foot pole. But Turning Points Brands got around that with some clever moves, as Marc Hauser, who co-leads Reed Smith‘s cannabis practice, noted in his Cannabis Musings newsletter (which you should read).

First, the investment is a convertible note – a form of debt that converts to equity at a later date – and that Old Pal, while nominally a “plant-touching” company, actually operates on a licensing model. So, as Hauser said, TPB is merely lending to a licensing business – not directly investing in a company that traffics in a Schedule I controlled substance.

It’ll be interesting to see if other companies follow this model.

What else is happening?

Cannabis was first domesticated in neolithic China, making it one of the oldest domesticated crops known to humanity. New York airports won’t seize cannabis found at TSA checkpoints anymore. New Jersey is dismissing 88,000 marijuana possession cases.

Sen. Cory Booker clarified his stance on the SAFE Banking Act, a bill that would let cannabis companies access the banking system in an interview with Yahoo. He called the bill – which has bipartisan support, unlike the broader, social justice-focused legalization bill he, Sen. Schumer, and Sen. Wyden proposed last week – a good “sweetener” to sway moderates to a more progressive vision of full-scale legalization.

He previously said he would try and stop SAFE Banking from advancing ahead of his broader legalization bill at all costs, as you may remember from last week’s newsletter.

– Jeremy Berke (@jfberke) & Yeji Jesse Lee (@jesse_yeji)

If you like what you read, share this newsletter with your colleagues, friends, boss, spouse, strangers on the internet, or whomever else would like a weekly dose of cannabis news.

Here’s what we wrote about this week:

Check out the pitch decks that hot cannabis startups used to raise millions from top investors

Cannabis startups have raised millions in the last few years, targeting everything from tech, to distribution, to branded products. We’ve published over a dozen pitch decks from startups like Cann, Dutchie, and Eaze, and gone deep with the founders about their best tips for raising money in an emerging sector like cannabis.

‘A generational wealth opportunity’: 4 top Wall Street analysts share the cannabis stocks to buy now

Four top Wall Street analysts named their top cannabis stock picks. Here’s a look at which companies analysts from Cowen, Jefferies, and others say you should place your bets.

Huge consumer companies from Nestle to Altria are vying for a slice of the exploding CBD market

CBD is already a $2 billion industry in the US, but the cannabis compound’s legal status is murky. Still, that hasn’t stopped large consumer companies from striking up deals and partnerships to jump into the industry.

See the pitch deck that Compass Pathways used to raise $80 million and fuel its rise into one of the world’s biggest psychedelics companies

Compass Pathways is the second-largest psychedelics company in the world by market cap. But in 2019, the company was just getting started. Insider got a hold of a leaked pitch deck the company used to raise $80 million from investors like Otsuka and Founders Fund.

Amazon, investment banks, and even big tobacco are spending millions of dollars to try to get favorable marijuana laws

A record 167 special interests lobbied on cannabis in the second quarter of 2021, an Insider analysis of new lobbying disclosures found. Amazon, Altria, and Morgan Stanley were among the companies lobbying on cannabis banking or legalization.

The CEO of the biggest psychedelics company lays out the 3 challenges he has to address before treatments hit the market

Florian Brand is now the CEO of the biggest psychedelics company in the world. In an interview after Atai’s IPO, Brand laid out the three challenges he has to address before treatments hit the market

Top VCs in psychedelics say Big Pharma is knocking at the door – and it could fuel a wave of deals

Insider talked to 11 top VCs in the psychedelics space and asked for their predictions. Three of them said that pharmaceutical companies are eyeing the space and looking for a way in. This article is the first of three that will detail VCs’ predictions for the psychedelics industry.

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

Executive moves

  • California-based cannabis company Harborside announced on Monday that chairman Matt Hawkins would be stepping in as interim CEO. Hawkins runs the cannabis investment firm Entourage Effect Partners. Former CEO of Sublime Ahmer Iqbal has been appointed to COO.
  • Psychedelics company Compass Pathways said on Wednesday that it had appointed Danielle Schlosser to senior vice president of clinical innovation.
  • Cannabis edibles startup Hervé has appointed a pair of marketing execs in California, including Cheyne Nadeau who joins from Canndescent, and Emily Ryan, from Plus Products. Read our story on Hervé’s Series A here.

Deals, launches, and IPOs

  • Multistate operator Ayr Wellness announced on Tuesday that it would acquire Illinois-based Herbal Remedies Dispensaries in a $30 million cash and stock deal.
  • Cannabis-focused hydroponics company GrowGeneration said on Tuesday that it had acquired Oregon-based Aqua Serene. The investment bank Stifel estimated the deal amounts to $7 million in a note.
  • Turning Points Brands, an NYSE-listed company that owns Zig-Zag rolling papers and other smokeless tobacco brands, is investing $8 million into cannabis brand Old Pal through a convertible note.
  • Silver Spike Investment Corp. said on Tuesday that it had plans to make an initial public offering on the Nasdaq until the symbol “SSIC.”
  • Psychedelics company Field Trip Health announced on Friday that it had obtained conditional approval to list on the Nasdaq under the symbol “FTRP.”

Research and data

  • A new study from the Cannabis Research Center at UC Berkeley found that cannabis grows in California often tap unregulated groundwater sources which may have negative effects on streamflow and wildlife.
  • A new study published in the Journal of the International Neuropsychological Society did not find a link between adolescent cannabis use and reduced motivation, but the authors said that greater cannabis use was associated with a devaluing of school.
  • A new study published in the journal Science Advances found that cannabis was first domesticated in Neolithic China.

Policy moves

  • New York State Senator Jeremy Cooney proposed a new bill that would let cannabis growers harvest and sell cannabis ahead of the final rules and appointments for the state’s Office of Cannabis Management. The bill would let growers start next year.

Chart of the week

Thirty-five to 44-year-olds in the US make up the largest portion of medical cannabis patients in the country, according to New Frontier Data. Twenty-five to 34-year-olds trail closely behind, making up 21% of all medical patients in the US.

cannabis weekly newsletter chart about the medical cannabis patients by age
medical cannabis patients by age

What we’re reading

What truck drivers really think about new federal regulations to crack down on drug use (Insider)

‘It’s going to be a bloodbath’: Why some Toronto pot store owners are giving up (BNN Bloomberg)

Your shopping mall’s latest tenant? A pot dispensary (NBC News)

Thieves are stealing California’s scarce water. Where’s it going? Illegal marijuana farms (CalMatters)

A man failed workplace drug test days after N.J. legalized weed and was fired. Now he’s suing. (NJ Advance Media)

Read the original article on Business Insider

Schumer’s legalization plan

GettyImages 1178310599
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.

Most of our time this week was spent covering a sweeping, long-shot bid to legalize cannabis from Sens. Chuck Schumer, Cory Booker and Ron Wyden.

The trio introduced a draft version of the bill, The Cannabis Administration and Opportunity Act (CAOA), on Wednesday. If you need the key takeaways, we’ve got you covered here.

In short, and I said this on NBC LX on Thursday, the bill goes after the ‘whole enchilada’ (yes, terrible metaphor) for marijuana legalization: It would fully remove cannabis from the list of federally controlled substances, expunge some criminal records, tax and regulate the industry, create funds that help minority entrepreneurs, and eventually allow for interstate commerce.

This is the first time the senate majority leader has outlined cannabis reform as a top priority, and he’s joined by Wyden, chair of the Senate Finance Committee – arguably the most powerful committee – as well as a former presidential candidate in Booker.

Though the bill will likely change significantly over the next few months, the chances it gets over the 60-vote filibuster threshold are almost nonexistent. It’s even unlikely they’ll get all 50 Democratic Senators onboard, as we’ve reported.

There’s a broader fight brewing within the industry as well as the popular activist movements that view legalization as the tip of the spear of broader police reform.

The industry’s investors and executives want access to banking. Senate Democrats and their progressive base want criminal justice reform first.

Booker drew a bright red line in a Wednesday press conference, indicating that we would stop bills like SAFE Banking, which would allow cannabis companies to access the financial system without broader legalization, from advancing ahead of criminal justice reform.

– Jeremy Berke (@jfberke)

If you like what you read, share this newsletter with your colleagues, friends, boss, spouse, strangers on the internet, or whomever else would like a weekly dose of cannabis news.


Insider.com update: Newsletters are now coming from our new domain, @insider.com. Also, a friendly reminder to add newsletter@insider.com to your address book.


Here’s what we wrote about this week:

Top Senate Democrats just released a 30-page draft that lays out their vision for legalizing cannabis. Here are the 8 things you need to know.

The discussion draft for the Cannabis Administration and Opportunity Act (CAOA) was released on Wednesday. The bill isn’t expected to garner enough votes to pass the Senate – and the White House has not signaled support for the legislation – but Insider looked through the 30-page document to highlight eight key points in the draft.

A top Wall Street analyst lays out why Schumer’s legalization bill isn’t a slam dunk for US cannabis companies

In a Thursday note, Cantor Fitzgerald analyst Pablo Zuanic said that while de-scheduling – a key aspect of the CAOA – would be a big win for the industry, a hefty federal tax would pose a “new burden” to consumers who already have to pay high state and local taxes. Zuanic broke down the draft into 7 points and noted how each one would affect current cannabis companies.

A top Wall Street analyst lays out 4 cannabis stock picks after Schumer’s sweeping marijuana legalization proposal

Analysts say that the recent pullback in US cannabis stocks the day Democrats released their bill draft has created a prime buying opportunity and laid out his top four picks. “Make use of yesterday’s weakness,” the analysts said in a Thursday note, adding that investors should avoid financially stretched companies that lack “state-level depth.”

Meet the top 11 VCs who’ve bet the most cash on turning MDMA and magic mushrooms into medical treatments

The psychedelics space has burgeoned over the past year and VCs are largely responsible for all the capital that’s flowing into the space. Insider put together a list of the top investors that have bet the most cash on psychedelics companies.

Executive moves

  • Curaleaf announced that Ranjan Kalia, former executive vice president and CFO of tech firm Virtusa Corp, would be joining the company as CFO.
  • MedMen announced that Tom Lynch, who had been serving as interim CEO, would be stepping into the role on a permanent basis.
  • President Joe Biden tapped Dr. Rahul Gupta as the new director of the Office of National Drug Control Policy (ONDCP). Gupta is the former chair of the West Virginia Medical Cannabis Advisory Board.
  • Cannabis retail company Zoned Properties named Berekk Blackwell as its new COO.
  • Psychedelics wellness retreat company Dimensions Health Centres said that Dr. Douglas Cook, head of neurosurgery at Queen’s University, will be joining the company as chief medical officer. Hospitality veteran Linda Griffin will be joining as managing director of hospitality.

Deals, launches, and IPOs

  • Michigan cannabis company C3 Industries closed a $25 million funding round led by Welcan Capital and Navy Capital, bringing the company’s total capital raised to $65 million.
  • Psychedelics company Wesana Health announced that it acquired therapeutic software company PsyTech in a C$21 million all-stock deal.

Policy moves

Research and data

Chart of the week

Florida dominates the US medical cannabis market, selling $1.2 billion worth of products in 2020, according to New Frontier Data. Trailing closely behind are Arizona and California, at $1.1 billion and $857 million in sales respectively:

A bar chart about the top 10 medical cannabis market by revenue in 2020
Top 10 medical cannabis market by revenue in 2020

What we’re reading (and listening too)

The trucking industry is doubling down on booting marijuana smokers, and it’s getting a little ridiculous (Insider)

Lab-grown weed designed to give you the munchies without feeling high could be a life-saving cancer treatment (Insider)

The lawyers making money behind the scenes of emerging fields like crypto, cannabis, and the influencer economy (Insider)

Can Marijuana Make You a Better Athlete? (New York Times)

Illegal pot invades California’s deserts, bringing violence, fear, ecological destruction (LA Times)

One of the biggest names in craft beer is hopping over to the cannabis business (CNN)

Opinion: How should we do drugs now? (New York Times)

Mr. Marijuana and the Drug Czar (Slate)

Read the original article on Business Insider

What GTI and Trulieve told Wall Street

Marijuana
An employee holds a display of dried marijuana at the Fire and Flower store as the first legal cannabis stores open in the province of Ontario, in Ottawa, Ontario, Canada, April 1, 2019.

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.

If you follow cannabis news closely, this week was a good reminder of the strange world we live in where marijuana use is completely legal and normalized in some states and a criminal act in others.

Late-night host Conan O’Brien lit up a joint with cannabis evangelist and comedian Seth Rogen on live TV, for O’Brien’s second-to-last ever TBS show. O’Brien said he’s not a regular marijuana user, but joked that he needed to do something with all his newfound free time.

Elsewhere in the late-night world, Jimmy Kimmel helped “Freddie the Stoner,” an Indiana man who was interviewed by the show while waiting in line at a dispensary opening in Michigan, land his dream job writing product reviews for Emjay, a Los Angeles-based cannabis delivery startup.

Lots of Americans of all political stripes watch Kimmel and O’Brien. You might think that late-night hosts being so brazen about using marijuana on live television is a clear sign that the era of marijuana prohibition is over. You’d be wrong.

LA Lakers guard Alex Caruso was arrested in Texas for having a grinder with a small amount of marijuana on him at the airport. He was released, but not before his mugshot was shared with the world. He’ll be fine, and I’m sure he has the money and resources to cover bail and fight whatever charges crop up, but he’s an example of what’s still happening to thousands of people across the country.

And on a semi-related note, two former consultants to Eaze were sentenced to prison for disguising credit card payments on the marijuana delivery service’s platform. At the hearing, US District Judge Jed Rakoff criticized the sentencing guidelines which called for life in prison for one, and 24 years for the other, Reuters reports.

The consultants broke the law. But life in prison for what amounts to fraud is quite a harsh sentence – the defendant ultimately got two-and-a-half years.

What else?

The Ontario Securities Commission gave out “quasi-criminal” charges to CannTrust‘s former CEO, Peter Aceto, as well as another executive and a board member for growing unlicensed cannabis.

And I got a fun scoop on what the CEOs of US cannabis companies Trulieve and Green Thumb Industries told an audience of some of the world’s most powerful investors at last week’s Robin Hood Investors Conference. You can read that here.

Cantor Fitzgerald analyst Pablo Zuanic said in a note this week the US cannabis sector has been suffering from a ‘Schumer overhang’ while the industry waits for the Senate Majority Leader’s legalization bill.

Let’s get to it.

– Jeremy Berke (@jfberke) & Yeji (@jesse_yeji)

If you like what you read, share this newsletter with your colleagues, friends, boss, spouse, strangers on the internet, or whomever else would like a weekly dose of cannabis news.

Here’s what we wrote about this week:

Psychedelics giant Atai is targeting a $2.3 billion valuation in its IPO. We pored over its 446-page filing to find 7 key takeaways.

The largest private psychedelics company in the world made its long-anticipated public debut last Friday. We dug through Atai’s public filings to narrow down the main takeaways investors should know about the company.

4 top cannabis-tech startups share how they’re gearing up to win a slice of New York’s $7 billion marijuana market

Tech companies that work in cannabis are preparing for New York’s adult-use marijuana market. Insider spoke to four cannabis-tech companies – Fyllo, Dutchie, LeafLink, and SpringBig – and all said they’re hiring aggressively to meet the demand of the New York market.

Capitol Hill staffers say they use marijuana freely even though it’s still illegal for federal workers

Using marijuana is a fireable offense in President Joe Biden’s White House, but many power players who work a couple of miles away on Capitol Hill can and do get away with it.

Most congressional staffers never get asked about their cannabis use, so they can light up or take edibles without too much concern about losing their jobs.

Meme stock shareholders are causing issues by not voting on things like exec pay and M&A deals. Here’s how startups are trying to improve the process.

Companies with large retail-investor bases face difficulties reaching a quorum in shareholder votes. “It’s hard to get those shareholders to show up and vote,” Tilray CEO Irwin Simon told Insider.

The CEOs of two of the biggest US cannabis companies break down the future of the industry to an exclusive audience of Wall Street’s most powerful investors

Green Thumb Industries and Trulieve CEOs spoke at the exclusive Robin Hood Investors Conference last week. The talk was closed to the press, but Insider learned the executives discussed the generational opportunity of investing in cannabis and made predictions about the industry.

Israel cannabis
An employee holds a leaf of a medical cannabis plant at Pharmocann, an Israeli medical cannabis company in northern Israel June 24, 2020.

Executive moves

  • Amy Larson is joining TILT as the VP of operations and communications next week. She was previously a VP at Simplifya.
  • Psychedelics company Awakn announced on Thursday that David Nutt, director of the neuropsychopharmacology unit at Imperial College London, has joined as chief research officer.
  • In more psychedelic people moves, Novamind has appointed Dr. Paul Thielking as chief science officer.

Deals, launches, and IPOs

  • Hydroponics company Hydrofarm Holdings will acquire Aurora Innovations, an Oregon hydroponics company, for $161 million in cash and $26 million in Hydrofarm stock.
  • Precision Extraction Solutions and Cascade Sciences are merging to form Sinclair Scientific. The merger will create what the company says is the largest cannabis and hemp extraction company, with combined annual revenue of over $100 million.
  • PharmaCann announced on Friday that it had completed a senior secured note offering. The net proceeds are worth around $79.9 million.
  • Awakn Life Sciences went public on the NEO Exchange on Wednesday under the symbol “AWKN” through a reverse takeover.

Policy moves

Marijuana Cannabis
In this March 25, 2018 file photo, a convention visitor examines a marijuana sample at the New England Cannabis Convention in Boston.

Research and data

  • Adolescent marijuana and alcohol use remained steady during the pandemic, despite decreases in both substance’s availability, according to a study from the National Institute on Drug Abuse’s Dr. Nora Volkow. The study also showed that past-month nicotine vaping among high schoolers decreased during the pandemic. The authors say the study shows that reducing teen use of substances cannot be achieved solely by limiting supply.
  • A new study published in the journal Sleep found that Zelira Therapeutics cannabinoid drug, Zenivol, is effective for treating insomnia and showed few adverse effects.
  • Alabama could add $600 million to its GDP in its first three years of medical cannabis sales, according to a report from cannabis software firm Akerna. Alabama legalized medical cannabis in May.
  • Cannabis information site Leafly published a report ranking states with legal cannabis on their social equity programs. California and Colorado topped the list, while Montana and South Dakota came in last. The report states that only 1 in 50 cannabis companies is black-owned, compared to the US average of 1 in 20 for other industries.
  • A new report from the Coalition for Cannabis Policy, Education, and Regulation (CPEAR) looked at the challenges of establishing a framework for small, minority-owned businesses in the cannabis industry.
  • Cannabis use may be associated with suicidal ideation in young adults, according to a National Institutes of Health analysis of survey data from 280,000 young adults between the ages of 18-35.

What we’re reading

Amazon ditched cannabis testing, and more employers will likely follow (CNN Business)

CannTrust’s former CEO and two directors charged with fraud over unlicensed pot growing scandal (Financial Post)

Opinion: Cannabis is the great social experiment that wasn’t (CTV News)

Maine’s mom and pop weed scene sweats corporate ‘gentrification’ (Politico)

The Future Of Psychedelic Medicine Might Skip The Trip (Forbes)

How Conn. Learned From Its Neighbors On Pot Legalization (Law 360)

Political ‘infighting’ could mean more delay for New York’s legal marijuana business (New York Upstate)

I ate a 4-course meal at a weed pizza parlor and got stoned to the bone (Insider)

Eric Adams on weed, Beyonce, and the housing-sleuth haters (Vanity Fair)

Cannabis firms Tilt, Ayr pay nearly $300,000 each in MA settlements (MJ Biz Daily)

Read the original article on Business Insider

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