By John Schroyer and Omar Sacirbey
Ohio lawmakers pass a medical marijuana bill in a bid to undercut a ballot measure, MassRoots’ Nasdaq listing is nixed again, and Congress moves to give military veterans easier access to medical cannabis.
Here’s a closer look at several notable developments in the marijuana industry over the past week.
Correction: An earlier version of this story reported that the Ohio Legislature’s bill to legalize medical marijuana would prohibit smokable MMJ. That is inaccurate; the bill would permit dispensaries to sell “plant material,” but smoking cannabis would remain illegal.
Head ‘Em Off at the Pass
The Ohio Legislature, in an attempt to head off a medical cannabis legalization ballot measure penned by Marijuana Policy Project, this week gave the final stamp of approval to a much more limited MMJ system of its own. Gov. John Kasich is expected to sign it into law.
“They absolutely are intending to take the wind out of our sails, but I still see a pathway forward for us. There’s still a number of flaws in their plan,” Aaron Marshall, spokesman for Ohioans for Medical Marijuana, said.
Some of the central differences:
- Smoking MMJ would remain illegal under the legislature’s bill even though “plant material” would be legal for dispensaries to sell, while MPP’s measure would not ban smoking.
- The patient base would be smaller under the bill, given that its list of qualifying conditions has fewer than MPP’s.
- No home cultivation would be allowed under the bill, while MPP’s measure would permit limited home grows.
- It’s unclear whether there would be a business license cap imposed by state agencies, whereas MPP’s measure would limit only the number of large-scale growers – and not other types of business, such as dispensaries.
“I don’t think voters are necessarily going to remember or know the distinction between what the statute says and what this ballot initiative says,” Sutton said, and noted that MMJ is overwhelmingly popular in Ohio, often polling with up to 90% support.
Nasdaq Nixes MassRoots
Nasdaq’s decision this week to reject the stock exchange listing application of MassRoots, a popular Denver-based social media network for cannabis enthusiasts, has for now slammed the door on cannabis companies hoping to list on a national stock exchange.
With the exception of a handful of pharmaceutical companies, like GW Pharmaceuticals, which trades on the Nasdaq, the overwhelming majority of publicly traded cannabis companies trade on the informal over-the-counter market.
That will likely continue to be the case after Nasdaq told MassRoots that it couldn’t list a company perceived to be aiding and abetting the distribution of a federally illegal substance.
“Clearly this sets a very dangerous precedent that Nasdaq could use as a broad brush to keep out almost any company that has any customer in the cannabis industry,” said Neil Kaufman, a corporate and securities attorney at Abrams Fensterman in New York state and head of the firm’s cannabis division. “Clearly this would preclude anyone that would touch the plant.”
The argument that a company such as MassRoots, which doesn’t touch the plant, could be guilty – in Nasdaq’s view – of enabling the distribution of a federally illegal substance is an “argument that every thoughtful person in the cannabis industry is concerned about,” Kaufman said.
“If, for example, (New Jersey Gov.) Chris Christie ends up as attorney general, all of us could be prosecuted for aiding and abetting the distribution of an illegal substance,” Kaufman said.
MassRoots first applied to trade on the Nasdaq last August, but failed to meet all of the exchanges’s listing requirements. Most notably, it needed to raise $5 million to meet a shareholder’s equity requirement, but it was only able to secure about $1 million.
MassRoots said it will appeal the latest decision to a Nasdaq hearing panel, and Kaufman believes they have a chance.
“Where we have been able to demonstrate that the issuer is in compliance with all Nasdaq requirements, and always has been, I’ve had success in having Nasdaq hearing panels overturn Nasdaq staff determinations,” he said.
MMJ for Vets?
U.S. military veterans are inching closer to having an ally when it comes to acquiring MMJ to treat various ailments: Both the U.S. House of Representatives and the Senate are moving toward allowing the federal Department of Veterans Affairs to recommend medical cannabis for vets, potentially creating thousands of new MMJ patients.
The House voted late last week to support the policy change, and the Senate is considered likely to pass a spending bill containing similar provisions.
That could lead to a major uptick in patient registrations in states with legal MMJ programs. Post traumatic stress disorder – a common ailment among vets – alone afflicts between 11-20 out of every 100 vets who served in either the Iraq or Afghanistan conflicts. According to some estimates, that could equate to roughly half a million MMJ patients.
And that’s not including other ailments that former combat troops often have to deal with, such as chronic pain.
But it could be some time before the change actually takes hold. For example, just this week the VA Hospital in Phoenix blocked MMJ researcher Dr. Sue Sisleyfrom giving a lecture on the potential benefits of MMJ for veterans suffering from PTSD, the Associated Press reported.
John Schroyer can be reached at [email protected]
Omar Sacirbey can be reached at [email protected]