Cannabis Industry Daily News

Illinois probes marijuana retailers for sourcing violations

Illinois regulators are investigating apparent violations of a regulation intended to prevent marijuana stores from sourcing marijuana from a single cultivator.

The Illinois Department of Financial and Professional Regulation also reminded retailers that they are required by law to keep enough product on hand for medical marijuana customers.

Just over a week after the state’s Jan. 1 launch of adult-use sales, the agency sent letters to some marijuana retail stores saying they were being probed for potentially illegally sourcing more than 40% of their product from one grower.

The law is aimed at preventing marijuana growers from entering into exclusive agreements with specific retailers so that all sellers have a diversity of products from various sources.

Store owners are concerned that some companies that own both marijuana retail shops and cultivation sites could be attempting to control the market by limiting product available to competitors.

While the letter was intended to merely put the shops on notice that they need to correct any infractions, retailers could face fines and penalties of up to $20,000 if the situation persists.

The warning comes as some retailers are struggling with a shortage of product as demand has been outstripping supply.

– Associated Press

Maine lawmaker calls for cannabis banking, insurance reform

Maine legislator John Andrews plans to introduce a resolution in the state Legislature calling for the U.S. Congress to make banking and insurance services accessible to legalized marijuana businesses.

Many licensed cannabis businesses operate on a cash basis and have no insurance because of federal regulations, said Andrews, a Republican.

A lack of access to banking and insurance could hold back marijuana businesses in the state, he said.

Adult-use marijuana sales are expected to begin this spring in Maine.

In September, the U.S. House of Representatives passed the SAFE Banking Act with strong bipartisan support.

Andrews said a copy of the resolution will also go to President Donald Trump, Speaker of the House Nancy Pelosi and each member of Maine’s congressional delegation.

He added that the federal government should respect state laws.

– Associated Press

Demand fierce for Missouri medical marijuana manufacturing licenses

(This story has been updated to reflect that Missouri will issue 192 dispensary licenses on Jan. 24.)

The Missouri Department of Health and Seniors Services received 415 manufacturing license applications but granted only 86 permits to manufacturers of infused products such as edibles and vape cartridges, the Springfield News-Leader reported.

In December, Missouri regulators announced license winners for medical marijuana cultivation companies and for transportation firms.

The state expects to award 192 dispensary licenses on Jan. 24 and to announce seed-to-sale traceability system winners on Jan. 31, according to the News-Leader.

San Diego restricts billboard cannabis advertising

The San Diego City Council unanimously approved a ban on marijuana billboard ads within 1,000 feet of schools, playgrounds, day care centers, youth centers and parks with playgrounds, a move supported by local marijuana businesses.

Despite the law, initially proposed in October, 54% (352 of 644) of the city’s existing billboard sites will be available to marijuana advertisers, The San Diego Union-Tribune reported.

The law will help even the playing field between legal and illegal marijuana businesses in the San Diego area, as it will drive more customers to licensed businesses, said Phil Rath, leader of the city’s Medical Marijuana Coalition.

The new law won’t hurt San Diego marijuana businesses as long as it is uniformly applied, according to Breton Peace, an attorney for local cannabis retailer March and Ash.

– Associated Press

US House panel to hear marijuana reform issues

Cannabis reform is getting its first hearing in front of members of the U.S. House Energy and Commerce committee on Wednesday, but no one from the industry has been called to testify.

The Subcommittee on Health of the Committee on Energy and Commerce will hold a hearing titled “Cannabis Policies for the New Decade,” which is focused on public health issues related to marijuana.

The hearing references six bills that the committee has some jurisdiction over.

Those bills include:

  • Legislation on marijuana research.
  • Veterans access.
  • The Marijuana Opportunity Reinvestment and Expungement (MORE) Act of 2019, a comprehensive descheduling bill.

The U.S. House Judiciary Committee advanced the MORE Act in November in a historic vote.

The National Organization for the Reform of Marijuana Laws (NORML) said in a statement that while it is encouraged that lawmakers have prioritized the hearing, it’s unfortunate the committee “is not calling upon any witnesses to testify explicitly in support of ending our failed policy of marijuana prohibition.”

Beginning at about 10 a.m. ET Wednesday, a live-stream of the hearing will be available here.

GW Pharma beats projections with $108M in Q4 sales thanks to CBD drug

A popular cannabis-derived epilepsy treatment is increasing sales for a London company making pharmaceutical treatments from marijuana.

London-based GW Pharmaceuticals told investors Monday that it rang up $108 million in sales last quarter and $309 million for calendar 2019.

The company’s fourth-quarter sales beat consensus analyst expectations of $102.4 million.

GW attributed the sales figures to physicians being amenable to prescribing the company’s cannabis-derived epilepsy drug, Epidiolex.

The announcement about increased sales comes three months after the European Commission granted marketing authorization to Epidyolex, the trade name in Europe for Epidiolex and two months after British authorities said two cannabis-derived drugs from GW Pharmaceuticals are eligible for coverage through the United Kingdom’s National Health Service.

GW Pharmaceuticals said that the vast majority of fourth-quarter sales, $104 million, came from Epidiolex. But the company did not clarify how much of those sales were made in Europe.

The sales figures were released in advance of the company’s quarterly earnings report because executives are meeting with potential investors this week.

Epidiolex, the only plant-derived cannabis drug approved by the U.S. Food and Drug Administration, contains CBD extracted from marijuana plants grown in the United Kingdom.

The company owns another cannabis-derived drug, Sativex, which treats spasms caused by multiple sclerosis.

Sativex is approved for use in several European countries but not in the United States.

GW’s shares are traded on the Nasdaq as GWPH.

An earnings table that includes some hemp companies is available here.

Legalizing recreational marijuana won’t be on Florida ballot in 2020

Florida voters will not decide whether to legalize adult-use cannabis in the state this year.

Make it Legal Florida on Monday ended its effort to get recreational marijuana on the 2020 ballot.

The decision, first reported by the Tampa Bay Times, wasn’t a surprise.

Proponents of legalizing MJ were running out of time to collect the 766,200 signatures needed to place the adult-use measure on the ballot this year.

Make it Legal Florida collected more than 700,000 signatures, a spokeswoman for the group told Marijuana Business Daily, but only 294,488 of them had been verified by the Florida Division of Elections.

“We will continue to process signatures for our efforts,” Kat Bustamante wrote in an email to MJBizDaily, “but for the 2022 ballot.”

The collected signatures are good for two years, she confirmed in the email.

The legalization group recently filed a lawsuit challenging the constitutionality of the state’s ballot initiative process.

– Jeff Smith

Proposed Michigan cannabis union rule under fire

Marijuana regulators in Michigan are being criticized by some business groups for proposing an administrative rule that marijuana businesses must enter into labor peace agreements with unions as a condition for licensing to grow, sell or distribute cannabis.

Adult-use marijuana sales began Dec. 1 in Michigan, which also has a legal medical cannabis market.

Labor unions frequently seek peace agreements so cannabis business owners remain neutral when a union seeks to organize workers.

Republican lawmakers aligned with business groups are questioning why Michigan’s Marijuana Regulatory Agency (MRA) would propose such a requirement and whether it was ordered by Democratic Gov. Gretchen Whitmer, according to Crain’s Detroit Business.

Sen. Aric Nesbitt, a Republican and chair of the Senate Regulatory Reform Committee, pressed the Michigan Department of Licensing and Regulatory Affairs, which includes the MRA, to quash the proposed rule, describing it as a “mob style protection racket” for labor unions.

MJBizDaily donates $425,000 through Industry Giveback Program

Marijuana Business Daily donated more than $425,000 in cash and in-kind donations through its Industry Giveback Program in 2019.

The program, established in 2015, supports nonprofit organizations and professional associations focused on industry building in areas of professional development and inclusion, sustainability and community development as well as continued support for legalization advocacy work across the cannabis industry.

Marijuana Business Daily expanded the reach of the program this year by:

  • Providing $5,000 grants to the inaugural inductees into the MJBizDaily Awards Hall of Fame, Steve DeAngelo and Wanda James, to donate to the cannabis charities of their choice.
  • Increasing support for hemp-specific and international organizations.

The advocacy groups that received funding from the 2019 Industry Giveback Program include:

  • Drug Policy Alliance.
  • Marijuana Policy Project Foundation.
  • Students for Sensible Drug Policy.
  • Americans for Safe Access Foundation.
  • NORML Foundation.

MJBizDaily‘s Industry Giveback Program continues to foster growth through inclusion and professional development, supporting organizations that provide opportunities for equity through partnerships, collaboration and continuing education not just in the United States but around the world.

“Regardless of which geographic region you are in around the world, the idea of building a strong and responsible cannabis industry is a constant theme,” said Chris Day, MJBizDaily‘s vice president of external relations.

Interested in submitting your nonprofit organization for consideration for the Industry Giveback Program? Information is available here.

California gov moves to simplify cannabis regulatory, tax systems

California Gov. Gavin Newsom’s administration on Friday announced plans to simplify the state’s cannabis regulatory and tax systems, which have been blamed for enabling an illicit market to continue to thrive.

The proposed changes, which will be in Newsom’s state budget proposal, come in the wake of recommendations by an independent agency that the state overhaul its cannabis tax regime.

Newsom’s plan include consolidating the current three licensing entities – the Bureau of Cannabis Control, the Department of Food and Agriculture, and the Department of Public Health – into a single Department of Cannabis Control by July 2021.

His administration also proposed changes designed to reduce the tax-collection burden on the cannabis industry and simplify the tax-collection process.

Those changes would include moving the responsibility for the cultivation excise tax from the final distributor to the first and the retail excise tax from the distributor to the retailer.

Newsom’s administration said that, in consultation with the industry and stakeholders, it also will consider changes to the existing cannabis tax rates and the number of taxes.

The United Cannabis Business Association (UCBA) praised the move.

“Since legalization, the California cannabis industry and its consumers have struggled to navigate an increasingly complex regulatory landscape – a situation that contributed to the growth of the illicit market and the current accessibility of untested products, as well as an increased cost of compliance to license holders,” the UCBA said.

“Today’s announcement from the governor marks a turning of the tide, and we are encouraged by the efforts outlined to streamline the industry’s regulatory framework and simplify licensing and taxation.”

– Jeff Smith

Tennessee state senator offers bill to legalize medical marijuana

A Tennessee state senator has reintroduced legislation to legalize the use, cultivation and sale of medical cannabis in the state.

The bill would lay the legal groundwork to regulate the licensing of cultivators to grow, produce, distribute, transport, sell and acquire marijuana for medical use and scientific research, Nashville TV station WKRN reported.

It wasn’t immediately clear whether the legislation, offered by Republican state Sen. Janice Bowling, would rely on vertically integrated medical marijuana businesses to operate in Tennessee.

A measure died in the state Legislature in 2019 that would have legalized medical marijuana in the form of vapes and edibles but not joints.

According to polling, Tennesseans are becoming increasingly receptive to medical marijuana. A poll conducted in 2018 by Middle Tennessee State University found that 81% of Tennessee residents supported the idea.

More details are available here.

Alaska recalls contaminated cannabis products from two businesses

Alaska regulators ordered a marijuana product recall after tests showed that a cultivator and retailer in the town of Houston possessed contaminated cannabis.

“This is the first time contaminated products from pesticide and/or fungicides has been confirmed in Alaska marijuana products,” Glen Klinkhart, the interim director of the Alcohol and Marijuana Control Office (AMCO), wrote in an email to Anchorage TV station KTUU.

The agency urged consumers to return any of the product to licensed retailers for “proper destruction,” KTUU added. Houston is located about 30 miles north of Anchorage.

According to AMCO, products from the cultivator, Calm N Collective, and the retailer, Houston Grass Station, were contaminated with high levels of the fungicide myclobutanil and the insecticide cyfluthrin.

“They have a right to due process, and we are working with them and the Marijuana Control Board to establish what happened and who may be responsible, and what, if any penalties they may be facing,” Klinkhart wrote.