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Heartland Cannabis Business Update – October 4, 2019

Erika Gee
Erika Gee

Partner

Little Rock

Hemp in Arkansas: Grow Your Know 3-6 p.m., January 23
Wright Lindsey Jennings, Little Rock

Tickets
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The latest cannabis industry news has been dominated by stories from Congress on the SAFE Banking Act, and vaping-related illness. We've worked hard to find the signal amongst the noise, the most useful articles we on those subjects as well as the the rest of the news on medical marijuana in the nation and throughout the Heartland. Here's our roundup of the week's stories impacting Missouri, Oklahoma and Arkansas that we think are worth your time.

Medical Marijuana and Recreational Cannabis Business Roundup

Business News

New Cannabis Report Predicts Legal Sales To Reach Nearly $30 Billion By 2025 - Forbes

Total legal sales of cannabis in current legal states are projected to grow at a compound annual growth rate (CAGR) of 14% over the next six years, reaching nearly $30 billion by 2025.

How You Can Start Making Money From Hemp - Entrepreneur

The four things to know before you grow.

Report: CBD tops turmeric as top-selling dietary supplement, charting up 333% in natural channels - Hemp Industry Journal

Sales of CBD products jumped 333% in 2018 in natural- and health-foods sales channels, notching $52.7 million in U.S. sales, the Texas-based industry group reported this week in its 2018 Herb Market Report.

Colorado marijuana companies are subject to federal labor laws despite being illegal, court rules - The Denver Post

"The district court correctly reasoned and case law has repeatedly confirmed that employers are not excused from complying with federal laws just because their business practices are federally prohibited," Senior Judge Stephanie Seymour wrote.

NCIA Releases Guidelines for Federal Cannabis Regulation After Legalization - Ganjapreneur

Report urges Congress to remove cannabis from the Controlled Substances Act; suggests classifications for different cannabis products, most appropriate federal agencies and methods to regulate them.

Defying early expectations, wholesale cannabis flower market remains unaffected as vaping health crisis continues - Marijuana Business Daily

"People are still very hungry for bulk distillate," meaning that demand for the mid- and low-grade flower that typically fuels extraction-related products is still strong.

Square Opens Up Payment Processing To More CBD Businesses - Forbes

"We believe everyone should be able to participate and thrive in the economy," Square said in a blog post. "Today, we’re thrilled to launch our CBD early-access program, which allows businesses in the U.S. to sell CBD products on Square quickly, easily, and securely."

Canopy Growth invests in sports nutrition company, lays groundwork for new CBD products - Hemp Industry Daily

"This acquisition allows us to enter the sports nutrition space with a strong and growing brand as we continue towards a regulated market of food and beverage products that contain cannabis."

Leafly Introduces New Visual Language For Cannabis - Marijuana Retail Report

The Leafly Cannabis Guide simplifies exploration of cannabis strains for consumers through flower-like visualizations that provide a straightforward way to explore the complexity of cannabis. It uses easily recognizable shapes to illustrate each strain’s dominant cannabinoid profile — circles for CBD and diamonds for THC — and uses vibrant colors to illustrate flavors and aromas that come from terpenes.

'Groundbreaking': 48North's purchase of US cannabis company signals major shift by TSX Venture Exchange - Marijuana Business Daily

It could serve as a blueprint for other Canadian cannabis companies seeking to enter the huge U.S. market without running afoul of the TSXV's rules.

Health News

Vaping-Related Illnesses Climb to 805, C.D.C. Says - The New York Times

The latest weekly tally includes 275 more reports of patients sickened, in 46 states. There are now 12 deaths linked to vaping-related lung injuries.

Massachusetts Bans All Vaping Products - Green Market Report

Many feel that banning all vape products is like throwing out the baby with the bathwater. Most of the illnesses have resulted from consumers using non-regulated and black market products.

What Top Cannabis Brands are Saying About Counterfeit Products - Weedmaps

To gain a better understanding of how the industry is tackling the counterfeit crisis, Weedmaps News reached out to some of the most popular — and, subsequently, most counterfeited — cannabis brands.

Study shows how CBD inhibits THC for first time - Greencamp

"For years we have known that strains of cannabis high in THC and low in CBD were more likely to cause psychiatric side-effects," study co-author Steven Laviolette said in a statement. "Our findings identify for the first time the molecular mechanisms by which CBD may actually block these THC-related side-effects."

National News

House Takes Historic Step to Validate Marijuana Industry Under Federal Law - Rolling Stone

In a landmark first step toward normalization of the cannabis industry, the House of Representatives voted overwhelmingly Wednesday to pass the SAFE Banking Act, a bill that would provide state-legal marijuana businesses with full access to banks and other financial services, as well as allow consumers to use credit- and debit cards when buying legal weed.

USDA Official Says There Are ‘Challenges' Giving Hemp Farmers Insurance Coverage - Marijuana Moment

Rep. Mike Conaway (R-TX), ranking member on the committee, said hemp legalization has "opened a Pandora's box" and added that the crop's THC levels can increase when it's stressed under conditions such as drought. If the THC content goes above the legal definition of 0.3 percent, that'd mean the federal government would essentially be "insuring an illegal product."

Pennsylvania Gov. Calls for Adult-Use Cannabis Legalization - Ganjapreneur

"People see economic potential, saying the state would save money on prosecution and incarceration of cannabis-related offenses. Residents who commented said regulated sales could create jobs. They specified that income generated should be used for infrastructure, education, and property tax relief." – Lieutenant Governor Fetterman Statewide Cannabis Listening Tour Report, July 2019.

Colorado's top federal prosecutor says banks working with marijuana industry have "no carve out" from prosecutions - Colorado Sun

"As federal prosecutors, we will never tell them that what they are doing is lawful under federal law. There's always a risk, just like a retail marijuana business in Colorado, that they face federal prosecution. There is no carve out from federal prosecutions."

Hundreds Of Companies Sign Letter Calling For Marijuana Descheduling To Prevent Vaping Injuries - Marijuana Moment

"Make no mistake, the legal state-regulated cannabis industry knows that any death is one death too many," the letter states. "Fortunately, we have policy tools that can be employed to help limit the illicit market, implement uniform good manufacturing practices and prevent future harms."

Hemp & Farming Advocates Call for EPA to Approve Hemp Pesticides - Ganjapreneur

"The NIHC therefore encourages EPA to approve all ten applications to add hemp uses to the label promptly," the groups said in their remarks. "It is essential to the industry that key crop protection tools for hemp production are in place for the 2020 growing season and beyond."

Major hurdle for hemp farmers — testing THC - Politico

Growers with hemp programs have learned through trial and error which types of cannabis are riskier to grow, such as ones that contain "cherry" in the name, like "Cherry Wine" and "Maui's Cherry." But there's a Catch-22: Varieties that are high in THC also produce more CBD, the treasured, high-value compound farmers covet.

State News - Oklahoma

Edmond, Oklahoma, smokes Denver in medical marijuana outlets - The Oklahoman

Using a marijuana-to-munchies ratio for comparison, Edmond, population around 92,000, has eight times the number of medical marijuana dispensaries as Denver, which has nearly eight times as many people.

Oklahoma's first case of vaping-associated lung injury found in Tulsa County teen, health department reports - Tulsa World

State health officials launched an investigation in September, requesting health care providers in the state report any cases of severe pulmonary disease of unknown origin and a history of recent e-cigarette use, according to the news release. Since, OSDH officials have reviewed medical records, gathered data and conducted patient interviews, and the agency continues to do so.

Upcoming marijuana growing operation draws concerns - Enid News & Eagle

"They're following the rules, they're investing money in the community. That's kind of what we want from anybody, isn't it?" - Ben Ezzell, Ward 3 Commissioner

Vaping concerns forcing marijuana businesses to adjust - The Oklahoman

Marijuana sales are still increasing throughout Oklahoma, despite the concern over vaping. The state collected nearly $6.8 million in September on taxes from the industry — a new record-high. For some dispensaries, including Okie Kush Club, a majority of revenues come from non-vaping revenues.

Tulsa World editorial: Let legal marijuana businesses into the U.S. banking system - Tulsa World

Even if you oppose legalizing marijuana, the SAFE Banking Act makes sense. There’s no reason for the federal government to make legal businesses into crime targets by forcing them to deal exclusively in cash. That potentially endangers not only cannabis companies and their employees, but also people completely unconnected to marijuana who happen to live, work or simply be walking past those companies.

Keeping it up to code: Dispensary, grow house inspections now cities’ job - KFOR

Starting August 30, 2019 all business applicants will be required to submit a Certificate of Compliance from the political subdivision that has jurisdiction where the business is located (usually a city or county). Businesses located within Oklahoma City may submit the Certificate of Compliance provided by Oklahoma City. Businesses are encouraged to contact their city or county for more information on this process before submitting their application.

Theoretical activist - Oklahoma Gazette

"I was blown away because people say there's no research. That's not true," he said. "There's around 40,000 publications, and so I just went from one to another to another to another. I started to send emails to cannabis researchers, and I began to get a much more complete picture of the medical benefits."

State News - Missouri

'Immaculate Conception' needed to kickstart medical marijuana industry in Missouri - KSHB

It's illegal to transport marijuana seeds into the state and within the state under current law, but growers have to get the seeds for a potentially massive new industry from somewhere.

Few people applying to be caregivers to medical marijuana patients - Booneville Daily News

Because caregivers are also allowed to grow, buy and have marijuana, it makes sense to designate a friend or family member so they can be protected, as well, Viets said. Anybody over 21 who has some responsibility over a patient's well-being can be their designated caregiver, he said.

Missouri Highway Patrol investigating 'Cannabus' traveling marijuana clinic - Springfield News-Leader

From the inception of medical marijuana in the United States 23 years ago, cannabis clinics have emerged to fill a perceived void in the marketplace because established health systems (think Mercy and CoxHealth) generally won't let their doctors touch anything related to marijuana.

Missouri won't cut off aid to poor people over medical marijuana use - St. Louis Post-Dispatch

The administration’s decision answers one of a wide array of questions about how to implement a medical marijuana initiative approved by more than 65% of voters last November.

Woman moves from Kansas to Missouri for cannabis help - KCTV

With recreational pot legal in Colorado and medical marijuana legal in Oklahoma and soon to be in Missouri, Kansas is nearly surrounded by states with access to pot.

On 'cannabus' tour of state, local doctor certifies thousands for medical marijuana - KMOV

After witnessing how the certification process works, News 4 asked Thomas if she would favor eliminating the physician certification for obtaining marijuana in Missouri. She said, "No, I provide guidance, education…this is my job. I'm a doctor."

State News - Arkansas

Steep Hill Says Licensed Cannabis Vape Kits Sold Safe - Arkansas Business

Arkansas' top cannabis tester, Steep Hill Arkansas CEO Brandon Thornton, warns Arkansans to buy cannabis vaping products only from licensed dispensaries.

Sen. Hendren says could be months before consensus formed on vaping changes - Talk Business and Politics

"If you're going to get the support, you're going to know within a few months. This may take a little bit longer because there's a lot of new evidence coming out, and we do want to make sure that we gather all the data, that we make wise decisions about how we implement this," he said.

Officers receive Marijuana 101 training in Benton - KATV

"All of these challenges that we are starting to face now in Arkansas, other states have dealt with them, and that's why I thought it was important to bring in experts from Colorado who have been dealing with these challenges for years," Rutledge said. "They can help our officers better understand and to make sure we don't infringe on anyone's rights, but at the same time, we're always protecting Arkansans."

Officials express concern for youth - Pea Ridge Times

"We have just adopted medical marijuana. We're just now getting that out to the community that needs that type of medicine. It would be wrong to shift gears and saw we're going to blow that out of the water and go straight to recreational use. It's too much too soon and the wrong direction."

CannaBeat: New West Memphis Dispensaries, Marketing CBD - Memphis Flyer

Moves are afoot to open one of three approved medical marijuana dispensaries in West Memphis as plans have been submitted for a Body and Mind dispensary on OK Street.

Bonus Section

How Many Grams in an Ounce of Weed? G to Oz - The Weed Blog

And technically, it's not 28.

We blind-tasted cannabis strains and guessed: indica or sativa? - Leafly

Sativa and indica. When you see these words, your brain is trained to see “upper weed” and “downer weed.” That’s because if you walked into a dispensary and asked the budtender for a product that will make you feel energized, sleepy, or chill, they will use these classifications as a guiding principle.

Inside Montego Bay's 4th Annual B2B Expo, CanEx Jamaica 2019 - Civilized

Cannabis industry experts from around the world gathered in Montego Bay, Jamaica, last week for the fourth installment of CanEx, a business conference and expo initially founded in 2016. More than 60 speakers from over 30 countries gathered to provide the hundreds of attendees with insights into the fast-growing, global cannabis industry and its current course.

Thanks for reading the Heartland Cannabis Business Update. See you next week!

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