This report provides a detailed overview of the current regulatory framework in place for CBD, hemp and cannabis in Taiwan, covering all policy areas from cultivation and processing to extracts, finished products and import/export.
The growing of hemp for any purpose, including the extraction of CBD, is prohibited in Taiwan by the Narcotics Hazard Prevention Act.
No change appears to be imminent in the regulatory environment for hemp in Taiwan. Although the public has called on the authorities to legalise medical cannabis, it is unlikely to happen in the near future.
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This week, the Colorado Task Force formed to study and provide recommendations for regulating intoxicating hemp products submitted its final report to the General Assembly. As previously reported, the establishment of the task force was a compromise made following negotiations between hemp and marijuana industry stakeholders to improve upon SB 22-205.
While we have yet to dive into the details of the report, we would like to applaud the task force for its diligent efforts to better understand intoxicating hemp products and provide Colorado legislators with thorough feedback and direction regarding regulation. We commend the careful consideration and comprehensive approach led by Governor Jared Polis’ administration, and congratulate all task force members for their hard work over the last several months. We would also like to recognize and thank U.S. Hemp Roundtable Board Member and General Counsel for Balanced Health Botanicals, John Harloe, for his dedicated service to the task force.
Of course, the devil is in the details, and our experts will be reviewing the report in the coming days. In the meantime, we want to hear from Colorado Hemp Supporters and industry stakeholders! Please share with us your thoughts regarding the task force findings and recommendations for regulating intoxicating hemp products.
Ohio’s secretary of state has formally resubmitted an activist-led marijuana legalization petition to the legislature, giving lawmakers four months to consider the reform. If they don’t act, advocates could then collect additional signatures to place the issue on the November ballot for voters to decide on.
Secretary of State Frank LaRose (R) sent a letter to legislative leaders on Wednesday, explaining that he is fulfilling his obligation to present the reform initiative to the legislature on the first day of the new session and kicking off the four-month window for lawmakers to take up the measure.
The campaign Coalition to Regulate Marijuana Like Alcohol (CTRMLA) worked strenuously to put the legalization initiative on the November 2022 ballot, but procedural complications prevented that from happening. Activists turned in enough signatures to initiate the legislative review, but the timing of their initial submission was challenged.
CTRMLA’s lawsuit to force ballot placement was unsuccessful with respect to the 2022 election, butthe state agreed to a settlementthat meant they will not have to collect another round of initial signatures and that the initiative would be immediately retransmitted to the legislature at the start of the 2023 session.
“As stipulated in the Settlement Order, today shall be considered the date on which the German Assembly’s four-month period to consider the proposed law begins, as provided for in Article II, Section 1b of the Ohio Constitution, and no parties shall take any direct or indirect action in contravention of this re-transmission,” the secretary of state wrote to lawmakers.
The company reports approximately 1,000 kilograms of commercial cannabis dry flower and derivative exports to Europe and the United States in Q4 of 2022.
Flora Growth has also received an updated cannabis export and production quota from the Colombian government, including the addition of four additional proprietary genetics and increased production for domestic medical markets.
FORT LAUDERDALE, Fla. & TORONTO–(BUSINESS WIRE)–Flora Growth Corp. (NASDAQ: FLGC) (“Flora” or the “Company”), a leading all-outdoor cultivator, manufacturer and distributor of global cannabis products and brands, is pleased today to provide an update on commercial cannabis operations out of Colombia. Following the April 2022 passage of Resolution 539 permitting licensed cannabis cultivators with export quotas to export dry cannabis flower, Flora successfully exported nearly 1,000kgs of dried cannabis and derivatives to Europe and the United States in the fourth quarter of 2022. These activities are a part of the full commercialization of the Cosechemos farm and Flora Lab One facility in Bucaramanga, Colombia.
The Company also updated its previously announced 43,000kg export quota to include multiple strains of THC flower, including four additional high-THC genetics, and increased limit to the production of psychoactive derivatives for domestic use in the Colombian medical market.
“As the largest cultivator of commercial cannabis in Colombia, our ability to activate our farm and distribute products is nearly unmatched,” said Luis Merchan, Chairman and CEO of Flora Growth. “With the acquisition of Franchise Global Health completed just last week, we now have direct lines of distribution to Germany and the rest of Europe.”
Since the passage of Resolution 539 last year, Flora has been focused on ramping up the commercialization and export of dry flower to Europe. The recently announced acquisition of Franchise Global Health and the integration of the German and European teams accelerates Flora’s immediate opportunity for medical products in Germany and positions the Company well for the potential incoming recreational market.
About Flora Growth Corp.
Flora is building a connected, design-led collective of plant-based wellness and lifestyle brands designed to deliver the most compelling customer experiences in the world, one community at a time. As the operator of one of the largest outdoor cannabis cultivation facilities, Flora leverages natural, cost-effective cultivation practices to supply cannabis derivatives to its commercial, house of brands, and life sciences divisions. Visit www.floragrowth.com or follow @floragrowthcorp on social media for more information.
This press release contains ‘‘forward-looking statements,’’ as defined by federal securities laws. Forward-looking statements reflect Flora’s current expectations and projections about future events at the time, and thus involve uncertainty and risk. The words “believe,” “expect,” “anticipate,” “will,” “could,” “would,” “should,” “may,” “plan,” “estimate,” “intend,” “predict,” “potential,” “continue,” and the negatives of these words and other similar expressions generally identify forward looking statements. Such forward-looking statements are subject to various risks and uncertainties, including those described under the section entitled “Risk Factors” in Flora’s Annual Report on Form 20-F filed with the SEC on May 9, 2022, as such factors may be updated from time to time in Flora’s periodic filings with the SEC, which are accessible on the SEC’s website at www.sec.gov. Accordingly, there are or will be important factors that could cause actual outcomes or results to differ materially from those indicated in these statements. These factors should not be construed as exhaustive and should be read in conjunction with the other cautionary statements that are included in this release and in Flora’s filings with the SEC. While forward-looking statements reflect Flora’s good faith beliefs, they are not guarantees of future performance. Flora disclaims any obligation to publicly update or revise any forward-looking statement to reflect changes in underlying assumptions or factors, new information, data or methods, future events or other changes after the date of this press release, except as required by applicable law. You should not place undue reliance on any forward-looking statements, which are based only on information currently available to Flora (or to third parties making the forward-looking statements).
For our first post on our much-publicized series on New York’s adult-use cannabis rules and regulations, we are going to cover the specifics on the license application process itself. The application requirements tracks the Marijuana Regulation and Taxation Act (MRTA), in that it reiterates the two-tier system separating production and retail licenses and includes evaluation criteria specifically enumerated in the MRTA. Let’s dive right in!
The actual application
The application itself will likely look very similar to New York’s Conditional Adult-Use Retail Dispensary (CAURD) application. Although the actual application has not been released, we anticipate that it will also be an online application that allows for uploading required documents in an organized and systematic fashion.
A significant deviation from the CAURD application is that adult-use applications will be reviewed on a rolling basis. This will make it incredibly important for applicants to submit applications as soon as the application portal opens, given the location proximity limitations for retail dispensaries and on-site consumption locations, as well as the possibility of license caps (see more below!).
Applications will be heavy on disclosure and details. All True Parties in Interest must be disclosed, whether as an owner of the applicant or under the OCM’s definition of a “True Party of Interest” (TPI). Broadly speaking (but by no means comprehensively), any individual or entity qualifies as a TPI if they:
Have an ownership interest in the applicant;
Have a financial interest in the applicant, including but not limited to assuming the applicant’s debt;
Have control over the applicant;
Is the spouse of an owner; or
Are contractually entitled to receive the greater of:
10% of gross revenue;
50% of net profit; or
$100,000 from the licensee in a calendar year.
License caps
Since the day the MRTA was passed, one of the big questions was whether New York would cap the number of licenses. The answer is, well, kind of. The rules and regulations do not provide an actual cap on the number of licenses issued across any license type. However, the rules and regulations do provide a proximity limitation for retails dispensaries. For towns with a population of 20,000 or more, no retail dispensary or on-site consumption licensee can be within 1,000 feet of another retail dispensary or on-site consumption licensee. The distance limitation is 2,000 feet for towns with a population of 20,000 or less.
The rules and regulations also allow for the possibility future caps, as limits may be imposed on the acceptance of applications based on:
Total number of licenses;
Location or authorized region of operations;
Size of operation or output; and
Operating conditions.
As we noted when first analyzing the MRTA, the requirement that retail dispensaries and on-site consumption applicant provide written notice to their municipality may also act as a de facto cap. It is imminently foreseeable that municipalities may begin submitting negative opinions regarding an applicant to the OCM once the municipality deems itself saturated.
License fees
The rules and regulations contemplate two separate fees: (i) an application fee of $1,000 for adult-use licenses; and (ii) license fees upon licensure based on the specific license type. We will cover the different license fees in our posts on the specific license types.
Real estate
New York has made clear from the moment the MRTA was passed that a license applicant’s real estate “situation” is a critical component to the licensing process. Upon provision license approval, applicants will have to disclose:
Information about who receives payment of rent (if the premises is leased);
Information about the premises, including:
The address;
Photos of the premises;
GPS coordinates for the premises;
Architectural drawings and information regarding the appearance of the exterior and interior of the premises; and
A floor plan
A statement that the location does not violate the MRTA’s requirements;
A statement regarding compliance with any required notice to the applicant’s municipality;
The premises’ certificate of occupancy; and
Proof of a plan to obtain insurance.
We will comprehensively cover application real estate requirements, but this is a good primer on the minimum applicants should start preparing as part of their New York cannabis license applications.
Evaluation criteria
As an important caveat before diving into the enumerated evaluation criteria, the rules and regulations note that the Cannabis Control Board (CCB) may prioritize licensure based on region, license type, and social and economic equity status. Beyond evaluating compliance with the rules and regulations and the MRTA’s evaluation criteria, the OCM identified the following additional criteria for evaluation:
The applicant’s community impact plan, highlighting the applicant’s proposed strategy for community engagement;
The applicant’s energy and environmental plan;
Completion of workforce or training programs offered by the OCM;
The applicant’s history in creating and maintaining an equitable workplace environment;
The applicant’s history in creating and delivering culturally and linguistically competent services to diverse and underserved populations; and
The applicant’s history in serving in community leadership roles.
Prohibitions
The rules and regulations contain a lot of prohibitions that applicants will have to navigate. The big one is this: no TPI can have an ownership interest or directly profit from both suppliers and a retailer. While the MRTA has always had a clear ban on vertical integration, the rules and regulations (and subsequent commentary) indicates that this limitation applies to ownership interests outside of New York. Ergo, an individual who has an ownership interest in vertically integrated cannabis business in Oregon have an ownership interest in a retail side license in New York. This limitation raises all sorts of questions, from the constitutionality of the limitation to the availability of financing for applicants (both questions we’ll address in a later post).
All in all, the New York cannabis license application process is comprehensive, with a focus on transparency and pushing forward the MRTA’s original goals. Stay tuned for the next post in our series on New York’s adult-use rules and regulations, and our upcoming webinar series!
In increasingly competitive markets, it is vital to do everything possible to maximize profitability and ensure survival in the face of significant headwinds. High selling prices plus high demand and low production costs result in ideal cannabis business profitability. The difference between the two can mean the difference between the life and death of your company.
As a result, establishing high-quality cultivation facilities is critical to running a profitable cannabis enterprise. Cultivators seek new support as they transition from traditional soil or media strategies to more effective growing methods.
One effective technique is aeroponics, which is excellent at growing any plant (cannabis inclusive) in the air in a controlled setting while using less labor, nutrients, and water. Let’s dive deeper into how to set up a successful aeroponics operation!
Photo by Jordan Siemens/Getty Images
Climate: Environmental Control
We kick off with the environment. Photosynthesis involves a lot more than light, plant, and moisture. You should aim to accomplish more than just cultivate plants. You should want to cultivate highly profitable plants. That implies you need to speed up photosynthesis so your plants can grow faster, bigger, and stronger than your competitors.
As a result, it is critical to understand how much moisture your environment can take from your plants as they break down carbon dioxide and release oxygen and water into the air surrounding them. Hence, the need to be familiar with Vapor Pressure Deficit (VPD).
VPD is the amount of “drying power” available in the airflow around your plants. It also measures how much mineral can be absorbed by the plant roots and converted into potency and size. We advise that you have facilities in your grow rooms to keep your environment within 5% of your temperature and humidity specifications for the best outcomes.
Humidification/Dehumidification
Cultivators often need to pay more attention to the importance of humidification/dehumidification. With cultivation starting at a very humid stage to encourage root initiation, humidity should be gradually reduced from a near 90% to a drier 50% in your end-of-flush flower rooms. You should understand that the critical variables for speeding growth throughout the phases are relative humidity (RH) and the associated VPD. Hence the need for proper humidification/dehumidification.
Cooling
Temperature control may appear simple, but the heat released by HPS lights, LED lights, or the sun varies across spaces, over time, and with the plant’s proximity to the light source. Temperature sensors should be placed throughout rooms to detect and activate temperature resources.
Airflow
It would be best if you used fans with your cooling, heating, humidity, and dehumidification systems to mix the air in the room. This will help break down the boundary layer on the leaf surface and allow for better transpiration. As previously said, VPD is essential to growth success. We recommend 0.5-1.5 meter/second flow rates to match your genetics and the phase of the flowering period.
Rich, beautiful scents and aromas are produced from good airflow and budding. Every facility must consider aroma management. If you live in a populated region, you will have to deal with ordinances and neighbors. The best way to accomplish this is to reduce the air that leaves a facility. It’sIt’s also the least expensive option.
Photo by Olena Ruban/Getty Images
Cultivation Media
Because hydroponic and aeroponic systems require no soil, water serves as the media and transport system for nutrition. Start with fresh, clean water that has “nothing” in it. Nothing in this situation indicates no pesticides, heavy metals, microbes, or diseases.
The first step is to test your water supply, whether well, surface, or municipal. This will get you a rough estimate of how “empty” your water is. Water supplies change over time. Thus, it is also an important input to assess water quality with annual or biannual testing. Clean water is essential for aeroponics success and an excellent method to reduce production costs. You can reuse and recycle 95%+ of the water you pump into your facility with the right design and management.
Organic particles and bacteria can be removed from water using UV light. The primary application of UV is to purify the water supply. Still, it is also critical for salvaged water that you’ve saved from humidity in your cultivation rooms. A note of warning, though; UV light must be handled with caution. Exposure will result in sunburn and eye damage, so use this resource with extreme caution.
RO is currently the standard technique for cleaning your inbound water. The method employs pressure filtration, which involves pushing the water through several meshes or filters that block or extract big particles, organics, and metals. Normally, this is 98% efficient. But these systems require special attention and management because they include filters that must be changed regularly depending on the purity of your water supply and the sort of material screened.
Capturing the moisture absorbed into the environment as the plants grow is the most effective way to preserve water in a rapid-growth aeroponic cultivation room. While DEHU water is efficiently distilled (or free of particles), it may contain healthy bacteria or pathogens transferred through the air or in the equipment filters. Generally, clearing them with UV light makes this water instantly recyclable in any fertigation system.
Oxygen Reduction Potential (ORP)
An oxidizing agent can be measured by ORP. Oxidizing treatments are a typical and low-cost way to disinfect water during and before usage in hydroponic systems. While in operation, oxidizers can be used to assess and deal with the “”cleanliness”” of a nutrient water solution. There are several oxidizing agents, the most common being hydrogen peroxide, chlorine, ozone, and chlorine dioxide.
Used Fertigation Water, or “Flush”
At the onset of the flowering cycle, take the clean water and mix it in the precise nutrient salt flower mixture before feeding it to your plants. Your plants will use some nutrients over the growth cycle from blossom to harvest. Since the salts and metals in the mixture may be removed by the same process of reverse osmosis that your source water goes through, nutrient-rich “”flush”” water can also be cycled in the source water feed.
Conclusion
When all these topics are adequately addressed, you can grow cannabis with the best bud quality and quantity. This guarantees maximum returns for a cannabis farmer looking to make a considerable profit margin.
TORONTO–(BUSINESS WIRE)–Organigram Holdings Inc. (NASDAQ: OGI) (TSX: OGI), the parent company of Organigram Inc. (together, the “Company” or “Organigram”), a leading licensed producer of cannabis, announced today it will report earnings results for its first quarter fiscal 2023 ended November 30, 2022, on Thursday, January 12, 2023, before market open.
The Company will host a conference call to discuss its results with details as follows:
Date: Thursday, January 12, 2023
Time: 8:00 am Eastern Time
To register for the conference call, please use this link:
To ensure you are connected for the full call, we suggest registering a day in advance or at minimum 10 minutes before the start of the call. After registering, a confirmation will be sent through email, including dial in details and unique conference call codes for entry. Registration is open through the live call.
A replay of the webcast will be available within 24 hours after the conclusion of the call at https://www.organigram.ca/investors and will be archived for a period of 90 days following the call.
About Organigram Holdings Inc.
Organigram Holdings Inc. is a NASDAQ Global Select Market and TSX listed company whose wholly-owned subsidiaries include: Organigram Inc. and Laurentian Organic Inc., licensed producers of cannabis and cannabis-derived products in Canada, and The Edibles and Infusions Corporation, a licensed manufacturer of cannabis-infused soft chews in Canada.
Organigram is focused on producing high-quality, cannabis for patients and adult recreational consumers, as well as developing international business partnerships to extend the Company’s global footprint. Organigram has also developed and acquired a portfolio of legal adult-use recreational cannabis brands, including Edison, Big Bag O’ Buds, SHRED, SHRED’ems, Monjour, Laurentian, Tremblant Cannabis and Trailblazer. Organigram operates facilities in Moncton, New Brunswick and Lac-Supérieur, Quebec, with a dedicated edibles manufacturing facility in Winnipeg, Manitoba. The Company is regulated by the Cannabis Act and the Cannabis Regulations (Canada).
This news release contains forward-looking information. Often, but not always, forward-looking information can be identified by the use of words such as “plans”, “expects”, “estimates”, “intends”, “anticipates”, “believes” or variations of such words and phrases or state that certain actions, events, or results “may”, “could”, “would”, “might” or “will” be taken, occur or be achieved. Forward-looking information involves known and unknown risks, uncertainties and other factors that may cause actual results, events, performance or achievements of Organigram to differ materially from current expectations or future results, performance or achievements expressed or implied by the forward-looking information contained in this news release. Risks, uncertainties and other factors involved with forward-looking information could cause actual events, results, performance, prospects and opportunities to differ materially from those expressed or implied by such forward-looking information include factors and risks as disclosed in the Company’s most recent annual information form, management’s discussion and analysis and other Company documents filed from time to time on SEDAR (see www.sedar.com) and filed or furnished to the Securities and Exchange Commission on EDGAR (see www.sec.gov). Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this press release. Although the Company believes that the assumptions and factors used in preparing the forward-looking information in this news release are reasonable, undue reliance should not be placed on such information and no assurance can be given that such events will occur in the disclosed time frames or at all. The forward-looking information included in this news release are made as of the date of this news release and the Company disclaims any intention or obligation, except to the extent required by law, to update or revise any forward-looking information, whether as a result of new information, future events or otherwise.
Whether it’s for orchids, berries, or bananas, plant tissue culture has been widely used in agriculture for nearly 40 years to produce uniform and disease-free stock. But when it comes to cannabis, this technology has only emerged within the last few years as scientists working with weed cracked the code of what the plant wants to reproduce successfully at a small scale. Joining in the fight against one of pot’s primary foes, hop latent viroid disease, cannabis tissue culture is a new path forward towards preserving the genetics of one of the most diverse botanicals on the planet. And, while cultivators have been able to get their hands on tissue culture-grown cuts for about eight years, tissue culture clones were made available to the public for the first time through Node Labs at the Emerald Cup Harvest Ball held in December 2022.
“Cannabis is a very tissue culture resistant plant. There are certain plants that are that way,” says Lauren Avenuis, CEO of Node Labs, explaining why it took so long for the technology to become viable for cannabis. “So, like avocados, grape vines, they just don’t like to go into micropropagation. They don’t like that kind of replication. And since cannabis is an annual plant, it likes to grow from a seed, flower, and die.”
The scientists working with Node, a small lab located within an unassuming red barn in rural Petaluma, California, spent years studying tissue culture before discovering the methodology that made stem cell technology for cannabis work. Now that they have, their facility houses an impressive bank of cannabis genetics. It causes a few snickers when I say it aloud, but being inside a room filled with shelves devoted to tissue culture clones, each in their own container, reminds me of being in a pet store aquarium. All the plants are growing within a clear jelly-like substance derived from seaweed called agar, allowing their whole root structure to be seen. They are tiny terrariums that hold the story of pot’s past, present, and future.
Courtesy Node Labs
Chief Science Officer Chris Leavitt walks me through the procedures at Node by explaining that plants, unlike humans, do not have an awareness of their entire body.
“[Plants] are a colony of cells that are attached to each other,” Leavitt says. “So if a stem is receiving all the like sap that it would be getting normally in the agar, it doesn’t even know that it’s not still attached to the plant. You can grow plant parts in tissue culture in a way you cannot grow outside. You can grow a dissection of just a leaf or just a stem… you can really break the rules of typical plant growing by having it in that setting.”
My tour at Node starts in the pre-fab clean room where the media, the agar, is mixed within an autoclave, a device designed for sterilization. This room is also where the other tools used for the tissue culture process, such as scissors and jars, are sterilized. I put on a second set of surgical booties before heading into the growth chamber and transfer room, where I watch the hot agar being dispensed into the same clear plastic containers I see in the bulk food section of my local grocery store. Within this room, the air quality is at ISO 8, a measure that contains a thousand specks of dust within a cubic yard that is also used in electronic and medical manufacturing. All the sterilization and air cleanliness ensure no contamination enters the lab.
“One of the things that we do here is we clean plants,” says Luis Mautner, Node’s director of propagation. “Cleaning plants is a process by which you take a plant from the outside world and you run it through a process that we developed here. We select the plants that do not have any issues associated with them like pathogenic bacteria, fungi, fusarium being one of the ones that affects the cannabis industry very much. Also, we index for HLVd, which is hop latent viroid.”
Mautner started working with cannabis after a career in tissue culture that included work with the berry company Driscoll’s and tropical ornamental plants such as peace lilies. He says the clear media is used because it’s diagnostic and shows when things should not be growing on the plant.
Next, we enter another room where shelves store cannabis plants in various stages of growth. There are also shelves containing some other plants Node is testing for research, including wine grapes and the cutest tiny Tempranillo.
To start work with Node, clients provide 10 clone stems from a cannabis plant to form what Mautner calls a bouquet. The clones are broken down to the cellular level because cannabis has a strong affinity for endogenous contaminants within its stem, Leavitt explains. The scientists at Node cut the clones down to one part, the meristem, a type of tissue in plants that houses stem cells, or cells from which all other types of cells develop.
“What we’ve found is when you have the meristem dissection, you can avoid that,” Leavitt says.
“What you’re basically doing is taking [the cannabis clones] down to essentially the stem cells of the plant,” Avenius adds. “So you’re eliminating all of the epigenetic, all of the genetic toggles related to stress or environment. You’re getting [the plant] down to its pure expression, its genetics, and then also removing essentially all the vascular tissue. So you’re just getting a brand new pure example and sample of that cannabis plant that we can now grow into tissue culture free of any other influences and then see its pure genetic expression.”
When cut down to the meristem, the clones are only about half a millimeter to a millimeter in size. Once the plants grow bigger and start looking like cannabis plants instead of little blobs, they are tested for HLVd. HLVd is a widespread pathogen in cannabis clones that causes growth stunting and reduces the plant’s ability to produce trichomes. Leavitt explains that HLVd is like skin cancer in that it can affect one part of the plant, but not another. This is another reason tissue culture has been such a valuable tool in combating the virus because it reduces a plant to its most basic elements.
After the plants have passed the extensive screening process, they are grown to about 3 to 4 inches and are used to fill the bank, the system in which Node keeps cannabis genetics within a genetic library.
“These two refrigerators play a huge role in the large genetics cannabis market,” Avenius says as I eye Node’s genetic bank, containing work from cannabis breeders like Sherbinski and Masonic as well as companies like Cannarado, Connected, and smaller growers like Sonoma Hills Farm, which banked its Pink Jesus.
The seed bank aspect of the company ties into the beginnings of Node Labs. Node was founded in 2018 after Felipe Recalde, CEO of Compound Genetics and Node co-founder, lost his genetic library of cannabis cultivars and his home in the Tubbs Fire, the most destructive wildfire in California’s history that tore through Santa Rosa in 2017. Recognizing everyone around him had also lost their mom stock, Recalde saw tissue culture as the future for genetic preservation. He’d been experimenting with faulty kits for tissue culture since 2010. Still, it wasn’t until he partnered with Leavitt, who had been working on using tissue culture to preserve endangered species, that he saw that tissue culture could be viable for cannabis. Nowadays, genetics are stored within the lab and at a place offsite to serve as an additional backup against a disaster like a fire.
Some of the work Node does is private client services of storing the genetics, but some companies like Connected Cannabis Co. also have certified genetics available for licensing. The consistency of the tissue culture clones one receives from Node Labs ensures that brands that operate in many states, like one of the lab’s partners Khalifa Kush backed by rapper Wiz Khalifa, can provide standardized, consistent flowers across the country. Node’s primary partnership with Compound Genetics allows the lab to grow clones to flower for clients to test. The minds at Compound Genetics grow plants from seed in their San Francisco facility and phenohunt to provide the best clone selections for their clients. The process at Node gives the genetics an authentication that does not occur if someone obtains a clone cut from a friend.
The future of the tissue culture industry is not in creating a million plants to order, but instead holding genetics and delivering mother plants that growers can multiply through traditional propagation, Leavitt says.
“The main functionary of [tissue culture] here is not in micropropagation. It’s not to get you 50,000 plants in one go,” Leavitt explains of the difference in tissue culture techniques in cannabis versus traditional agriculture. “It’s germplasm storage, which is the fancy term in the agriculture issue of holding genetics, genetic banking.”
Another indication of the future of cannabis propagation occurring at Node Labs is the process of in vitro phenohunts or growing seeds within the agar jelly within test tubes. Node takes a tissue culture from small plantlets the seeds produce and grows those plants out, saving time for cultivators because if they like the results, the tissue culture already exists.
Plantlets / Courtesy Node Labs
“It allows us to save a lot of time, but it also means that when we pop that seed and then we take that clone and put it out, we already have some of the advantages of tissue culture the first time we grow,” Avenuis says. “As an immature plant, it hasn’t been exposed to any viruses or pathogens. And then it has some of the unique morphology that you get from tissue culture plants. They tend to have higher vigor, higher yields, better stem strength. So you’re already seeing a better-performing plant from the very beginning.”
Leavitt points out an example within the lab, Gastro Pop #5, a cross of Apples & Bananas and Grape Gas which was developed in-house via an in vitro phenohunt.
“That Gastro Pop #5 over there, the plants in this lab have never seen microbial fungus and bacteria in their entire life,” Leavitt says.
If someone finds an outstanding cultivar they are in love with, a six-month process to get a tissue culture clone could stunt the excitement, he explains.
“With that process, in vitro, we could have the excitement of smoking the joint and going ‘This is the one’ and going, ‘Cool, it’s here at the lab’ at the same time,” he says.
An in vitro phenohunt is how Sherbinski and Compound created Tribute, a cross of Gelato #41 and Apples & Bananas. Look out for future collaborations between Compound Genetics and Tiki Madman and Compound Genetics and Green House Seed Company.
At the Emerald Cup Harvest Ball held in December 2022, Compound was able to offer “bare pulse” tissue culture clones of their newest offerings. These came without the agar jelly because the clones are more transportable that way. The bare pulse part comes from the fact that they are bare root or stored without soil around the roots. The bare pulse clones can be planted in a chosen medium and become a mother plant to power a grow with consistent genetics.
“We love this as the next gen of clones,” Avenuis says.
Bare pulse / Courtesy Node Labs
The whole process of tissue culture clones is an exciting new frontier for cannabis, one which I was able to experience firsthand when Recalde gifted me a tissue culture clone at a social gathering. I took the test tube, filled with a clone held in suspense within what I’ve since learned is agar, home and grew it out into a plant. At the time, I didn’t know that tiny plant contained within a test tube had the mighty makings to power a brand.
Read more about Node Labs in the upcoming Science & Technology issue of High Times Magazine.
Without much meaningful development concerning legalization efforts in 2022, many sobering themes likely will carry over into 2023.
Layoffs will persist, and continued price compression and competition from the illicit channels will drive brand share consolidation in mature markets. West Coast legacy operators will continue to be bogged down by legislative limbo, a lack of access to banking services, and an incredibly competitive gray market unbound by onerous tax regulations — which, in turn, will lead to more operators fleeing the troubled market.
Photo by megaflopp/Getty Images
Additionally, companies will shift toward tighter capital management and budgeting as cash becomes more expensive and harder to grab.
“Painfully, we will see more cannabis businesses fail,” said Poseidon Asset Management managing director Patrick Rea. “This culling will thin the competitive herd and hand more power to the established incumbents — increasingly MSOs — with their lower cost of capital and growing footprint of assets and operations.”
There are reasons for hope, though.
New and emerging adult-use markets in the Northeast region, as well as the Florida medical market, should show considerable growth next year.
That’s bolstered by increasing market access. Half of the U.S. population over the age of 21 now have access or live in a state that has adult-use legal, with more than half recorded as past six-month consumers, according to BDSA analyst Brendan Mitchel-Chesebro.
“Even though there’s still these problems with price compression, even though there’re still regulatory issues — people waiting for SAFE Act to pass, people waiting for 280E reform – there’s still a lot of reasons why we think that there’s going to be huge growth in a lot of these markets,” he said.
Likely Winners
Many in the industry remain bullish on Florida, especially as it gears up for a well-funded adult-use ballot initiative push for 2024. BDSA believes Florida will be the biggest contributor to sales growth nationally through 2026, with $2.7 billion in projected medical sales next year.
“In our opinion, that’s the thing that would effectively cut into the illicit market the most, and that’s why some markets that have been up and running for a few years are still having problems with (the gray market),” Mitchel-Chesebro said.
In the Midwest, Missouri shows promise for MSOs and big vertical out-of-state operators. Friendly state taxes, good product split backed by a maturing retail footprint, and a smooth compliance process could make the difference in the Show-Me State.
Photo by Nikolay Ponomarenko/Getty Images
Additionally, cross-border traffic from Arkansas and Kansas, which have fallen short on their own legalization efforts, should beef up sales in the new market, which is expected to launch in February.
Cy Scott, CEO of cannabis data firm Headset, expects Missouri’s adult-use rollout to put additional pressure on the Illinois market to accelerate license grants, given the number of already-licensed medical dispensaries converting to adult-use locations.
If the rollout is successful, BDSA predicts around $270 million-$280 million in adult-use sales in 2023. Factoring in the maturing medical market, Missouri could very well reach $730 million in total legal sales.
More Normalization
The New Year also could see additional normalization from consumption lounges and bigger retail shifts to raise foot traffic and basket size, Mitchel-Chesebro said.
Dispensaries could begin to move away from the “deli layout” in favor of a more open retail floorplan similar to Apple stores. The BDSA analyst pointed to places like Planet 13, where employees are on the floor to assist shoppers, yet customers can move and browse around and check out display cases on their own.
“I think that that’s going to be a big shift when we’re talking about storefront retail,” Mitchel-Chesebro said. “I think that a lot of people recognize that it is more approachable, especially for newer consumers.”
Still, convenience is king in the industry, which should see a stronger push toward direct consumer sales utilizing delivery and curbside pickup services.
‘The Missing Component is Capital’
Morgan Paxhia, co-founder and managing partner of Poseidon Asset Management, said this year is poised to be “the most bifurcated trajectories we have seen in the legal cannabis industry.”
Paxhia predicts a year full of the most defaults, wind downs, and state-level bankruptcies the legal cannabis industry has ever seen — especially with the sobering lull in meaningful federal banking legislation.
“We see this cycle finally coming to a head as the tight capital markets have persisted for so long combined with onerous cannabis taxes, deflationary cannabis prices and inflationary costs,” he said. “This cycle was well on its way and COVID interrupted it, like many other industries. We think most of this stress is within smaller companies.”
Photo by OlegMalyshev/Getty Images
However, Paxhia also sees a healthy return of M&A for many areas of cannabis, too, such as operators, ancillary technologies, and hydroponics. “We see this driven by companies continuing to seek operating efficiencies, scale, and stronger competitive footprints.
“We see that inward, digestion period running its course and companies getting back on offense,” he said. “We also wouldn’t rule out activity, not likely M&A activity per se, with mainstream strategies, like alcohol, tobacco, CPG.”
A meaningful return of equity capital flows after a long protracted bear market is also possible, likely benefiting the largest companies first due to lower perceived risk.
“Big picture, we know more now than ever about how to run a successful legal cannabis company. There are more experienced operators than ever. There are more legal states than ever,” Rea noted.
EDMONTON, AB,Jan. 4, 2023/PRNewswire/ – Aurora Cannabis Inc. (the “Company” or “Aurora”) (NASDAQ:ACB) (TSX: ACB), the Canadian company defining the future of cannabinoids worldwide, announced today that the Company has closed the sale of its Aurora Polaris facility for gross proceeds of approximately$15 million, previously announced to be closing under the Company’s ongoing transformation program.
Aurora’s balance sheet remains in a net cash position, with approximately$320 millionof cash and cash equivalents (including approximately$63 millionof restricted cash) inclusive of the transaction announced today, and the Company reiterates its expectation of achieving Adjusted EBITDA profitability for the quarter endingDecember 31, 2022.
About Aurora
Aurora is a global leader in the cannabis industry, serving both the medical and consumer markets. Headquartered inEdmonton, Alberta, Aurora is a pioneer in global cannabis, dedicated to helping people improve their lives. The Company’s adult-use brand portfolio includesAurora Drift,San Rafael ’71,Daily Special,Whistler,Being andGreybeard, as well as CBD brands,Reliva andKG7.Medical cannabis brands include MedReleaf, CanniMed, Aurora and Whistler Medical Marijuana Co. Aurora also has a controlling interest inBevo Farms,North America’sleading supplier of propagated agricultural plants. Driven by science and innovation, and with a focus on high-quality cannabis products, Aurora’s brands continue to break through as industry leaders in the medical, performance, wellness and adult recreational markets wherever they are launched. Learn more atwww.auroramj.com and follow us onTwitter andLinkedIn. Aurora’s common shares trade on the NASDAQ and TSX under the symbol “ACB”.
Forward Looking Statements This news release includes statements containing certain “forward-looking information” within the meaning of applicable securities law (“forward-looking statements”). Forward-looking statements are frequently characterized by words such as “plan”, “continue”, “expect”, “project”, “intend”, “believe”, “anticipate”, “estimate”, “may”, “will”, “potential”, “proposed” and other similar words, or statements that certain events or conditions “may” or “will” occur. Forward-looking statements made in this news release include, but are not limited to, statements regarding the Company’s path and timing to achieve Adjusted EBITDA profitability.
These forward-looking statements are only predictions. Forward looking information or statements contained in this news release have been developed based on assumptions management considers to be reasonable. Material factors or assumptions involved in developing forward-looking statements include, without limitation, publicly available information from governmental sources as well as from market research and industry analysis and on assumptions based on data and knowledge of this industry which the Company believes to be reasonable. Forward-looking statements are subject to a variety of risks, uncertainties and other factors that management believes to be relevant and reasonable in the circumstances could cause actual events, results, level of activity, performance, prospects, opportunities or achievements to differ materially from those projected in the forward-looking statements. These risks include, but are not limited to, the ability to retain key personnel, the ability to continue investing in infrastructure to support growth, the ability to obtain financing on acceptable terms, the continued quality of our products, customer experience and retention, the development of third party government and non-government consumer sales channels, management’s estimates of consumer demand inCanadaand in jurisdictions where the Company exports, expectations of future results and expenses, the risk of successful integration of acquired business and operations, management’s estimation that SG&A will grow only in proportion of revenue growth, the ability to expand and maintain distribution capabilities, the impact of competition, the general impact of financial market conditions, the yield from cannabis growing operations, product demand, changes in prices of required commodities, competition, and the possibility for changes in laws, rules, and regulations in the industry, epidemics, pandemics or other public health crises, including the current outbreak of COVID-19, and other risks, uncertainties and factors set out under the heading “Risk Factors” in the Company’s annual information form datedSeptember 30, 2022(the “AIF”) and filed with Canadian securities regulators available on the Company’s issuer profile on SEDAR atwww.sedar.comand filed with and available on the SEC’s website atwww.sec.gov. The Company cautions that the list of risks, uncertainties and other factors described in the AIF is not exhaustive and other factors could also adversely affect its results. Readers are urged to consider the risks, uncertainties and assumptions carefully in evaluating the forward-looking statements and are cautioned not to place undue reliance on such information. The Company is under no obligation, and expressly disclaims any intention or obligation, to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as expressly required by applicable securities law.
This blog series addresses common employment-related issues for cannabis industry professionals.
This first post addresses timekeeping considerations for manufacturers and retailers of cannabis products to ensure compliance with applicable state and federal law. Future posts will address other employment-related issues, including the administration of meal and rest periods, overtime and regular rate considerations, engaging independent contractors, exempt and nonexempt employment classifications in industry-specific roles, accommodating employee off-duty cannabis use, and similar topics.
Wage and Hour Compliance: Timekeeping
Large-scale class actions and other litigation alleging violations of legal obligations regarding payment of wages and related recordkeeping constitute a large percentage of active employment-related litigation and can expose businesses, including individual founders and owners, to exorbitant financial risk. Ensuring accurate timekeeping and compliance with related requirements is key to avoiding such liability.
The Fair Labor Standards Act (FLSA) governs pay practices for employees federally, though many states and localities have additional requirements.
As a baseline, employers must compensate all hourly (or “nonexempt”) employees for all time they are “suffered or permitted to work” and engaged in tasks directly related to their job duties. To comply with the FLSA’s recordkeeping rules, employers must accurately maintain employee payroll records for at least three years and the records upon which wage computations are based for two years, so that these records may be available for inspection by representatives of the U.S. Department of Labor (DOL) Wage and Hour Division (WHD).
An employer’s method for recording all time worked should consider the practical realities of each position. For example, retail and security staff may face different timekeeping obstacles than members of cultivation or manufacturing teams, such as:
Retail and security employees.Retail employees and security staff should be able to clock in and out promptly and effectively upon entering and leaving a retail facility. However, if these employees must use employer-owned devices to record their time, the employees may be entitled to be paid for time spent waiting for device access, booting up the device before logging in to the timekeeping system, and turning off the device after logging off.[1]Employers should also have coverage processes in place to allow employees to take appropriate paid and unpaid nonworking breaks, and to ensure any time spent on bag checks or other security measures is captured appropriately.
Cultivation and manufacturing employees.Cultivation and manufacturing employees who spend time putting on and removing protective equipment, or engaging in other necessary onsite pre-work activities, are generally entitled to compensation for time spent completing those tasks. Additionally, cultivation and manufacturing employees may be working in facilities, or areas within facilities, located a significant distance from where these employees arrive for work. Employers should carefully consider whether their timekeeping procedures accurately reflect the time spent by employees at the worksite, including time spent traveling to other areas of the worksite to commence work. A best practice is to instruct employees to clock in before performing any task related to their job.
In short, employers should take care to ensure employees are paid for all tasks that are integral and indispensable to the employees’ duties. Further, the FLSA requires employers to accurately maintain all payroll records for at least three years and the records upon which wage computations are based for two years, so that these records may be available for inspection by representatives of the U.S. Department of Labor Wage and Hour Division.[2]
This is one example of the wage and hour issues that employers should consider in the cannabis industry, and we will issue further guidance on these and related topics. Companies and organizations should work with experienced legal counsel to determine the best approach to ensure compliance with these requirements.
[1]The U.S. Court of Appeals for the Ninth Circuit held on October 24, 2022, inCadena v. Customer Connexx, LLC, 51 F.4th 831 (9th Cir. 2022), that the time a group of call center workers spent booting up their computers was compensable time under the federal Portal-to-Portal Act, which amended the FLSA. We discuss this decision and the Ninth Circuit’s reasoning in thisUpdate.
[2]Note that state or local requirements may mandate longer recordkeeping.
New York’sOffice of Cannabis Managementhas missed a deadlinemandatedby the state’s cannabis law to produce a social and economic equity plan, which is meant to guide the rollout of the state’s emergingmarijuanaindustry.
TheMarijuana Regulation and Taxation Actrequired OCM’s chief equity officer to provide a report to the Cannabis Control Board about the plan by Jan. 1, 2023, and the board was then supposed to provide a report to the legislature.
That hasn’t happened.
OCM spokesperson Freeman KlopotttoldNY Cannabis Insider the agency is in the process of reviewing “hundreds of pages of notes” from more than a dozen community round tables it held across the state with representatives from social and economic equity groups.
Staff is also analyzing data to determine the locations “of more than 1.2 million arrests to analyze communities disproportionately impacted” by the drug war, Klopott said, and the agency will be submitting a report about its “social equity-related activities” by the end of the week.
The full social and economic equity plan, he said, is expected to be released sometime in “the first quarter of 2023.”
‘This is another revolution’: could legalisation of cannabis transform Mexico’s economy?
In anticipation of the long-delayedlegalisation of cannabis– after a number of supreme court decisionsdecreed the right to cultivateand deemed unconstitutional the ban on recreational use – the war on weed in Mexico is winding down and the festival is just one of 20 marijuana-related events being heldacross the country.
Cannabis growers feel increasingly confident in going public and some farmers are switching crops tola Santa Rosa: a gram of which can be sold for more than several kilos of black beans.
“This is another revolution,” says Isidro Cisneros, a grower from the town of Cuautlixco in the state of Morelos where the Mexican revolutionary Emiliano Zapata was born. “It’s about land and freedom, and a plant that has been criminalised for years without good reason. Growing cannabis, peasants can live and eat well.”
Cisneros – who began growing cannabisin 2022– is part of the campaign group Plan Tetecala, which has gainedthe supportof the state human rights commission.
One of many growers selling their products late last year at Toquefest in Puebla, two hours south-east of Mexico City, Cisneros says: “Farmers must have the liberty to plant what they want, and not only when the government or corporations say they can,” he adds. “Since the revolution, no one has helped us: now is the moment for us to help ourselves.”
Mexico’s president, Andrés Manuel López Obrador, hasindicated his supportfor legalisation as part of a wider push to dismantle prohibitionist policies buthas been criticisedfor dragging his feet. Billshave been passedin both legislative chambers over the past two years but they have not agreed on the same version.
Campaigners allege that opposition from the armed forces could be holding up legislative success. In November, hacked documents from the defence ministryrevealed linksbetween elected officials and drug cartels, and influence of the military over civilian institutions. Activists also point to the removal of equity clauses in the drafts as evidence of corporate influence that, in the US, has contributed to high taxes and bureaucracy that effectively exclude small farmers.
Despite senior government figures indicating regulationis a top prioritythe domestic industry is developing apace in a mostly tolerated grey market free from an influx of foreign capital that could arrive if legalisation is passed without safeguards.
Communities in Michoacán, Chiapas, Oaxaca and Guerrero, among others, have said they want a share of the pie – with many landless farmers known ascampesinosstill earning near subsistence wages growing rice, corn and sugar.
The U.S. Department of Agriculture (USDA) recently granted $5 million to support the development of the hemp industry in Tennessee.
Tennessee State University (TSU), the Hemp Alliance of Tennessee (HAT), the University of Tennessee (UT) and the Tennessee Agriculture department are working together on research and expansion of the state’s hemp industry, reported the Rogersville Review. The project, “Climate-Smart Fiber Hemp: A Versatile Thread Connecting the Nation’s Underserved Farmers, Climate Change Mitigation and Novel Market Opportunities” and the nearly $5 million is from the USDA Partnerships for Climate-Smart Commodities.
The goal of the project is to support the market expansion of the American producers behind climate-smart commodities, treating hemp as one. It also aims to examine its greenhouse gas benefits and help small, medium and underserved producers across the state.
The Tarrytown Board of Trustees Tuesday approved zoning amendments regarding the regulation of cannabis retail dispensaries.
The changes to the Zoning Code place additional restrictions on potential locations and operations of dispensaries, which will otherwise be allowed in zones that currently permit retail uses.
“We’re amending the Village Code to put more oversight on to a cannabis business that applies to have this in Tarrytown,” explained Mayor Karen Brown, noting the village has received a few inquiries on its laws pertaining to such facilities. “We’re trying to make extra protection on our downtown.”
In December 2021, the Board of Trustees informally decided to join neighboring Sleepy Hollow in welcoming cannabis dispensaries by not opting out of the Marijuana Regulation and Taxation Act (MRTA), which was enacted in New York State on March 31, 2021.
That law legalized recreational marijuana and also opened the door for retail cannabis dispensaries and consumption sites to set up shop in all communities. Tarrytown gave a thumbs down to consumption sites, also known as lounges.
Any tax revenues on local sales of marijuana and other products would be distributed as a 9% excise tax to the state, 3% to the municipality and 1% to the county. Tax collections from the adult-use cannabis program are projected to reach $350 million annually.
Any businesses that want to open a cannabis business in the village will have to get approval from the Tarrytown Planning Board. Dispensaries are not allowed near schools or religious institutions.
Prior to the board’s vote on the amendments, several residents spoke out at a public hearing, urging the board not to permit dispensaries on Main St. and Broadway. “To each his own with pot smoking, but I don’t want to see it on Main St. in my charming village,” said Diane Tuohy of Storm St.. “We’re better than that. Don’t do it.”
Peter Bartolacci of Miller Ave. said he strongly opposed dispensaries in Tarrytown’s main downtown area. “It’s not something I want to smell when I walk down Main St.,” he said. “It’s awful. It’s unnecessary. It’s beyond me why we are even considering this.”
Bermuda needs to learn lessons from Canada about beating the black market in cannabis if it legalises the drug, according to a leading expert.
Professor William Bogart, who haswritten extensively on drug-related law issues, also urged that Bermuda pay special attention to protecting children if cannabis was made readily available, such as banning “edibles” – candy-styled variants of the substance.
Despite cannabis being legally available in Canada since 2018, roughly half of sales are still done on the illicit market, according to Mr Bogart.
The former professor of law at the University of Windsor emphasised that Bermuda would need to set tax levels on the sale of cannabis carefully to enable the over the counter market to out perform the illicit trade in the drug.
Bermuda’s move towards legalising the consumption and production of cannabis is stalled after Rena Lalgie, the Governor, announced last September that she had been “instructed”by the British foreign secretary to refuse to give Royal Assent to the Cannabis Licensing Bill, despite it having passed the House of Assembly.
This meant that reform of drug laws could not be enacted, leading the Governor to call fornegotiationsbetween Bermuda and London on the issue.
Mr Bogart, who is a regular visitor to Bermuda, said of the situation in Canada: “It was wishful thinking to believe that as soon as legal cannabis came in that the illicit market would evaporate.
“If you are making millions of dollars and you are not paying tax, then you are going to try and hang on to your revenue.
“People are migrating to the legal market in Canada but it’s a long way to go.
“The three driving factors are access, quality and price. The challenge for Bermuda is to ensure adequate access to the legal market.
“With legalised cannabis, the purchaser knows the strength. Tax is a crucial issue. The industry say they need to have a rate of return for it to be viable.
“While the public health attitude is that a level of tax needs to be in there, not just to cover regulatory costs, but to try to stop problematic use.
“The tax level is too high say the legal dealers – and that stops people from buying legally, they say.
“Tax would be a very important issue that Bermuda would need to sort through – price is a driver in terms of the legal or illegal markets.
“A big chunk of the market, about half, is still in the illicit market in Canada.”
Mr Bogart said that special attention was needed in relation to children and cannabis.
He said: “Campaigns like ‘Just Say No’ were not effective for most children.
“We need to look at what influences drug use – is the child doing well in school? Are they being influenced by their peer group, or parents who are using drugs?
“In Canada there has not been a big spike in cannabis use among children – legalisation didn’t become a driver.
“We need to focus on why children use drugs – alcohol, nicotine, cannabis.”
He added: “I would not favour edibles. Children are mistaking edibles for candy. What Bermuda could do is to delay edibles.
“Legalise cannabis if you want to, but delay edibles for one, two, three years, until you can assess the impact edibles have had on children in Canada.
“In this area I would come down on the side of protecting children.”
Mr Bogart said that any move to legalise cannabis would need constant monitoring.
“Bermuda would definitely need an evidence-based review, one that is not based on pressure groups who are on one side of the argument or another, but a review looking at evidence over time.”
Britain’s decision to block reform of cannabis laws in Bermuda has attractedinternationalattention.
Despite David Burt, the Premier, insisting in 2021 that refusing to give Royal Assent to the Cannabis Licensing Bill would “destroy” relations between Bermuda and Britain, he has been guarded in his public comments since London blocked the move to reform drug laws.
Kathy Lynn Simmons, the Attorney-General, said the Government stood by itspolicy commitment.
In the wake of the decision from Britain, she said: “The Government of Bermuda intends to continue to advance this initiative, within the full scope of its constitutional powers, in keeping with our 2020 General Election platform commitment.”
