CBD OIL

Rhode Island Capitol TV | ritv.devosvideo.com

More than a decade ago, Rhode Island state Sen. Joshua Miller chaired a commission that examined cannabis prohibition and the effects of what he called a failed policy.

That was in 2010. When Miller finally had the opportunity to introduce an adult-use cannabis bill Tuesday evening on the Senate floor, the upper chamber spent all of 15 minutes discussing the legislation before approving it in a 29-9 vote.

Sponsored by Miller and nine of his Democratic colleagues, Senate Bill 568 would allow adults 21 years and older to possess up to 1 ounce of cannabis or 5 grams of concentrate and grow up to six plants for personal use. The measure would also expedite the expungement process for those with misdemeanor cannabis records.

“It is a historic day, as it is the first time a bill to legalize and regulate cannabis has reached the floor of either legislative chamber in Rhode Island,” Miller said. “We have arrived at this point about 10 years later than I would have liked, and it is important that we act expeditiously to enact a regulatory framework.”

Miller pointed out that neighboring Connecticut Gov. Ned Lamont signed adult-use cannabis legislation earlier that day. And neighboring Massachusetts opened up shop for adult-use retail in 2018.

And with Vermont and New York’s legislatures legalizing cannabis in 2018 and 2021, respectively, Rhode Island and New Hampshire are the only two states remaining in New England where prohibition remains intact.

“The longer we wait, the more we put Rhode Island’s eventual cannabis retailers at a disadvantage,” Miller said. “The longer we wait, the more Rhode Island customers are getting into the habit of traveling to a nearby shop over the border, and the more they are building relationships with those companies. And with cannabis so readily available, whether on the black market or readily in neighboring states, Rhode Island must address all of the societal ills, but we will lack the regulatory framework and revenue stream. This legislation is therefore urgently needed.”

Under S.B. 568, cannabis use would be prohibited in public places and unsealed containers would be prohibited from the passenger areas of a motor vehicle.

The legislation aims to create a five-member Cannabis Control Commission to oversee a competitive and accessible licensing structure that Miller said would prevent monopolization of the new market by limiting business entities to one license. The licensing structure would generate tax revenue through a 7% sales tax, a 10% cannabis excise tax and a 3% local sales tax, which would return to municipalities where the point of sale occurred.

In addition, every community would be eligible for at least three retail licenses, but any municipality can opt out if it chooses. Communities can also pass local ordinances to regulate the time, place and manner of cannabis operators, however they cannot impose any additional fees or contingencies.

And on the social equity front, the legislation would create a fund to provide technical and grant assistance to qualified individuals who have been directly and indirectly impacted by prohibition. One-third of the licenses would be reserved for individuals from impacted communities.

“In the development of this bill, we wanted to ensure as many Rhode Islanders as possible have an opportunity to participate in this new economy,” Miller said. “That is why we set low barriers to entry with accessible tiered licensing fees.”

Licensing fees from the 11-tier system range from as low as $100 for up to 1,000 square feet of outdoor grows, to $5,000 for manufacturing and testing entities, and up to $20,000 for the largest cultivators and retailers.

While the bill passed by a 76% majority in the Senate, it competes with two other legalization measures: Gov. Dan McKee introduced a proposal in March that includes a three-year initiative to roll out retail licenses; and House Bill 6370 was introduced by Democratic Rep. Scott Slater on May 28.

Rhode Island Capitol TV | ritv.devosvideo.com

With the Senate-approved bill getting introduced in March, the upper chamber had the opportunity to make some really important improvements to it, Democratic Sen. Samuel Bell said Tuesday on the floor.

“That being said, I do think there are a couple things that the House bill does right that we might be able to modify,” he said. “I think we should make expungement automatic, and I think the tiering structure here is set up in such a way that it allows certain larger cultivators to potentially dominate the market. It’s something that I hope we can tweak. With that being said, I think it’s a really excellent piece of legislation.”

Republican state Sen. Gordon Rogers, who voted against the bill, said the legislation has two shortfalls. First, Rogers said the 3% local sales tax that will be returned to municipalities only takes dispensaries into account and not cultivators. In turn, cultivation-dominant communities absent of retail will be left out, he said.

Rhode Island Capitol TV | ritv.devosvideo.com

Second, Rogers said he’s in favor of a central distribution facility that would act as a middleman between cultivators and dispensaries.

“Let’s say something happens with a fungus or something; it’s growing, it’s a public health issue, you have a central place to find out where it’s coming,” he said. “If it’s coming from growers shooting off the dispensaries, it’s kind of erratic. But if you have a central distribution hub where this can be followed, [there is] control and testing.”

Miller said authors of the bill considered such a distribution center but decided not to go with that concept because of what they observed at operations of retailers in Massachusetts.

“Some of them actually only use maybe one or two cultivators,” Miller said. “And so, the central distribution would just be another security component that would be a burden both to the cultivator and the security, and the tagging and the tracking that you want to go through with the marijuana.”

S.B. 568 will now go to the House for consideration, although only a week remains before the Legislature adjourns June 30. Earlier this month, House Speaker Joe Shekarchi told WPRI-TV that the lower chamber would focus on passing a budget first and possibly push back adult-use cannabis legislation to a special session later this year.

But the Senate’s approval of S.B. 568 on Tuesday is just another example of the momentum behind the nationwide movement to end prohibition, National Organization for the Reform of Marijuana Laws (NORML) Executive Director Erik Altieri said in a statement.

“The American people are sick and tired of our failed prohibitionist policies and finally their elected officials are enacting the will of their constituents,” he said. “We call upon the Rhode Island General Assembly to follow the Senate’s lead and quickly approve this bill.”

Rhode Island Capitol TV | ritv.devosvideo.com

More than a decade ago, Rhode Island state Sen. Joshua Miller chaired a commission that examined cannabis prohibition and the effects of what he called a failed policy.

That was in 2010. When Miller finally had the opportunity to introduce an adult-use cannabis bill Tuesday evening on the Senate floor, the upper chamber spent all of 15 minutes discussing the legislation before approving it in a 29-9 vote.

Sponsored by Miller and nine of his Democratic colleagues, Senate Bill 568 would allow adults 21 years and older to possess up to 1 ounce of cannabis or 5 grams of concentrate and grow up to six plants for personal use. The measure would also expedite the expungement process for those with misdemeanor cannabis records.

“It is a historic day, as it is the first time a bill to legalize and regulate cannabis has reached the floor of either legislative chamber in Rhode Island,” Miller said. “We have arrived at this point about 10 years later than I would have liked, and it is important that we act expeditiously to enact a regulatory framework.”

Miller pointed out that neighboring Connecticut Gov. Ned Lamont signed adult-use cannabis legislation earlier that day. And neighboring Massachusetts opened up shop for adult-use retail in 2018.

And with Vermont and New York’s legislatures legalizing cannabis in 2018 and 2021, respectively, Rhode Island and New Hampshire are the only two states remaining in New England where prohibition remains intact.

“The longer we wait, the more we put Rhode Island’s eventual cannabis retailers at a disadvantage,” Miller said. “The longer we wait, the more Rhode Island customers are getting into the habit of traveling to a nearby shop over the border, and the more they are building relationships with those companies. And with cannabis so readily available, whether on the black market or readily in neighboring states, Rhode Island must address all of the societal ills, but we will lack the regulatory framework and revenue stream. This legislation is therefore urgently needed.”

Under S.B. 568, cannabis use would be prohibited in public places and unsealed containers would be prohibited from the passenger areas of a motor vehicle.

The legislation aims to create a five-member Cannabis Control Commission to oversee a competitive and accessible licensing structure that Miller said would prevent monopolization of the new market by limiting business entities to one license. The licensing structure would generate tax revenue through a 7% sales tax, a 10% cannabis excise tax and a 3% local sales tax, which would return to municipalities where the point of sale occurred.

In addition, every community would be eligible for at least three retail licenses, but any municipality can opt out if it chooses. Communities can also pass local ordinances to regulate the time, place and manner of cannabis operators, however they cannot impose any additional fees or contingencies.

And on the social equity front, the legislation would create a fund to provide technical and grant assistance to qualified individuals who have been directly and indirectly impacted by prohibition. One-third of the licenses would be reserved for individuals from impacted communities.

“In the development of this bill, we wanted to ensure as many Rhode Islanders as possible have an opportunity to participate in this new economy,” Miller said. “That is why we set low barriers to entry with accessible tiered licensing fees.”

Licensing fees from the 11-tier system range from as low as $100 for up to 1,000 square feet of outdoor grows, to $5,000 for manufacturing and testing entities, and up to $20,000 for the largest cultivators and retailers.

While the bill passed by a 76% majority in the Senate, it competes with two other legalization measures: Gov. Dan McKee introduced a proposal in March that includes a three-year initiative to roll out retail licenses; and House Bill 6370 was introduced by Democratic Rep. Scott Slater on May 28.

Rhode Island Capitol TV | ritv.devosvideo.com

With the Senate-approved bill getting introduced in March, the upper chamber had the opportunity to make some really important improvements to it, Democratic Sen. Samuel Bell said Tuesday on the floor.

“That being said, I do think there are a couple things that the House bill does right that we might be able to modify,” he said. “I think we should make expungement automatic, and I think the tiering structure here is set up in such a way that it allows certain larger cultivators to potentially dominate the market. It’s something that I hope we can tweak. With that being said, I think it’s a really excellent piece of legislation.”

Republican state Sen. Gordon Rogers, who voted against the bill, said the legislation has two shortfalls. First, Rogers said the 3% local sales tax that will be returned to municipalities only takes dispensaries into account and not cultivators. In turn, cultivation-dominant communities absent of retail will be left out, he said.

Rhode Island Capitol TV | ritv.devosvideo.com

Second, Rogers said he’s in favor of a central distribution facility that would act as a middleman between cultivators and dispensaries.

“Let’s say something happens with a fungus or something; it’s growing, it’s a public health issue, you have a central place to find out where it’s coming,” he said. “If it’s coming from growers shooting off the dispensaries, it’s kind of erratic. But if you have a central distribution hub where this can be followed, [there is] control and testing.”

Miller said authors of the bill considered such a distribution center but decided not to go with that concept because of what they observed at operations of retailers in Massachusetts.

“Some of them actually only use maybe one or two cultivators,” Miller said. “And so, the central distribution would just be another security component that would be a burden both to the cultivator and the security, and the tagging and the tracking that you want to go through with the marijuana.”

S.B. 568 will now go to the House for consideration, although only a week remains before the Legislature adjourns June 30. Earlier this month, House Speaker Joe Shekarchi told WPRI-TV that the lower chamber would focus on passing a budget first and possibly push back adult-use cannabis legislation to a special session later this year.

But the Senate’s approval of S.B. 568 on Tuesday is just another example of the momentum behind the nationwide movement to end prohibition, National Organization for the Reform of Marijuana Laws (NORML) Executive Director Erik Altieri said in a statement.

“The American people are sick and tired of our failed prohibitionist policies and finally their elected officials are enacting the will of their constituents,” he said. “We call upon the Rhode Island General Assembly to follow the Senate’s lead and quickly approve this bill.”

It’s been a busy year for federal cannabis legislation. Will all the activity lead to legalization – or even incremental progress on changing federal law? 

Federal cannabis reform hasn’t passed into law, but it’s not for lack of trying. In 2021 alone, several high-profile cannabis bills have been proposed in both chambers of Congress, while others have been promised later this year.

Moving into the second half of 2021, let’s examine the most prominent federal cannabis bills, assess their current status, and with the help of industry experts, make some predictions about the future.

The Marijuana Opportunity Reinvestment and Expungement (MORE) Act

Introduced in the House by Rep. Jerry Nadler (D-NY) & other Democratic representatives

May 2021

The current flagship legislation for comprehensive cannabis legalization, the MORE Act was first introduced in the summer of 2019. It passed a full floor vote in December 2020, making history as the first bill to explicitly legalize cannabis to pass in Congress.

Since the bill’s inception, however, momentum has been slowed by a lack of bipartisan support – particularly related to the bill’s strong social equity provisions, which would devote federal grants to help communities hurt most by the War on Drugs. 

“In order to pass the Senate, you’re going to need to get 10 Republicans on board with a descheduling bill without alienating Democrats, and I think that can be pretty tricky,” said Morgan Fox, Director of Media Relations for the National Cannabis Industry Association in a phone interview. “Particularly since in the GOP, the main sticking point tends to be social equity.”

Last month, Rep. Nadler reintroduced the MORE Act, highlighting advancements in state-level cannabis reform in an accompanying statement: “Since I introduced the MORE Act last Congress, numerous states across the nation, including my home state of New York, have moved to legalize marijuana. Our federal laws must keep up with this pace,” said Nadler, who chairs the House Judiciary Committee.

The Common Sense Cannabis Reform for Veterans, Small Businesses, and Medical Professionals Act

Introduced in the House by Reps. David Joyce (R-OH) and Don Young (R-AK)

May 2021

Perhaps recognizing the desire among their Republican party for simple legalization without any social justice provisions, two GOP representatives introduced a bill that would remove cannabis from the DEA’s Controlled Substances schedule, provide protection for cannabis-related financial services companies, and offer blanket protection for veterans to use medical cannabis in accordance with state laws. 

Reps. Joyce and Young, who are members of the bipartisan Congressional Cannabis Caucus, may have introduced the bill as an opening for House Republicans to support plain legalization without attaching their vote to the kind of progressive reform measures included in other legislation.

“One of the reasons the Joyce bill was introduced in the House was to see which Republicans are completely against legalization and which ones are okay with a simple, straightforward bill that only deschedules and doesn’t include any social justice or restorative issues,” said Fox.

Untitled Comprehensive Cannabis Reform

Upcoming in Senate by Senators Cory Booker (D-NY), Ron Wyden (D-OR) and Chuck Schumer (D-NY)

(Announced) February 2021

This piece of federal cannabis legislation is distinct from others in one important way: No one has seen it. From what the Senators have been saying about it for several months, the legislative package will focus on legalizing cannabis reform, while also striving to “right the wrongs of this failed war [on drugs] and end decades of harm inflicted on communities of color,” and “enact measures that will lift up people who were unfairly targeted in the War on Drugs.” Its promised social justice and equity measures have made it highly anticipated by the industry, but details are scant.

“Nobody to my knowledge outside of their offices has gotten a look at the actual language yet,” said Fox. “So far we’ve been hearing it’s going to be pretty heavy on restorative justice and social equity provisions…but again, we don’t know exactly what that looks like. So I think it’s going to be pretty important, once we see the details, to do a line-by-line with the MORE Act and see how they compare and contrast.”

Dasheeda Dawson, Cannabis Program Manager for the City of Portland and Chair of Cannabis Regulators of Color Coalition (CRCC), said it’s fair to expect the Senate legalization package to go even further than the MORE Act when it comes to restorative justice, given the history of the Senators involved.

“We expect MORE will be the baseline for the Schumer, Booker & Wyden efforts in the Senate,” said Dawson in an email to Cannabis Business Times and Cannabis Dispensary. “Much of the foundation of the MORE Act was built on Booker’s Marijuana Justice Act of 2017. If anything, because of the additional time and New York’s landmark legalization bill, I believe the Senate bill will be a slight step above the MORE Act as it pertains to restorative justice and equity.”  

The Secure and Fair Enforcement in (SAFE) Banking Act

Introduced in the House by Rep. Ed Perlmutter (D-CO)

March 2021 – passed April 2021 

The SAFE Banking Act is a more incremental reform step that would allow cannabis businesses access to the same kind of banking products available for other businesses, including credit and insurance. It also provides legal protection for ancillary businesses that provide service to the cannabis industry, such as contractors and packaging companies.

The bill has now passed a full floor vote in the House twice: once in September 2019, and once this past April, after its most recent introduction by Rep. Perlmutter. Now that even more Americans support full cannabis legalization, some in the industry hope the time is finally right to at least allow cannabis companies access to relatively basic business tools.

“SAFE Banking enjoys the support of the banking industry and many Republicans, so it could be seen as a fallback option should comprehensive legalization ultimately fail,” said Kris Krane, Founder of 4Front Ventures and President of Mission Dispensaries. 

But others believe that incremental progress could actually represent a step backwards for cannabis equity.

“On surface the SAFE Banking Act is a helpful band-aid for those already privileged to be participants in this developing industry,” said Dawson. “Passage of SAFE would be an incremental step that actually would further the gap in equity for this industry, even if it temporarily relieves small cannabis business[es] from the oppression of cash-only business management. There’s also risk that it will encourage much bigger industry players, like Amazon, to begin their money moves to position themselves for future domination.” 

In an early June blog post, Amazon announced it would no longer screen prospective hires for cannabis and its policy team would be “actively supporting” the MORE Act.

For now, the SAFE Banking Act awaits a hearing in the Senate after passing a floor vote in the House – just like the MORE Act.

The Hemp Access and Consumer Safety Act

Introduced in the Senate by Senators Rand Paul (R-KY), Ron Wyden (D-OR), and Jeff Merkley (D-OR)

May 2021

Like the SAFE Banking Act, the Hemp Access and Consumer Safety Act is a more incremental cannabis bill that would confirm the legal status of cannabidiol (CBD) and other hemp-derived supplements in foods and beverages. The bill is a companion to the Hemp and Hemp-Derived CBD Consumer Protection and Market Stabilization Act of 2021, which was introduced in the House in February.

The Hemp Access act is designed to help bring clarity to a lucrative yet confusing industry: hemp and CBD. Right now, these products are sold in a gray area, since they’re not technically approved under federal law. Under the Farm Bill of 2018, The Food and Drug Administration (FDA) was supposed to create guidelines to regulate this prominent sector of the cannabis industry. To date, however, not much progress has been made outside of a few statements and official updates.

“The Hemp Access and Consumer Safety Act is a bill that only exists because the FDA has not done its job of regulating hemp-derived cannabinoids as an ingredient,” said Dawson. “I suspect this bill will be supported because it essentially compels the FDA to treat hemp-derived CBD specifically like a dietary supplement.”

“Theoretically it could move pretty easily, since it’s pretty narrowly-focused and is mandating something the FDA promised to do anyway and just hasn’t gotten around to yet,” added Fox when asked about the prospects of the bill in the Senate.

Despite all this activity, industry insiders are still pessimistic about federal cannabis legislation – particularly on a comprehensive scale.

“I think there’s definitely a chance of something passing this year but I don’t necessarily think that it’s going to be a comprehensive descheduling bill,” predicted Fox. 

“At this point, we don’t expect federal legalization to happen this year,” said Dawson. “There is still too large of a gap in cannabis competency at the federal level, across legislators and would-be regulators.”

 

Rhode Island Capitol TV | ritv.devosvideo.com

More than a decade ago, Rhode Island state Sen. Joshua Miller chaired a commission that examined cannabis prohibition and the effects of what he called a failed policy.

That was in 2010. When Miller finally had the opportunity to introduce an adult-use cannabis bill Tuesday evening on the Senate floor, the upper chamber spent all of 15 minutes discussing the legislation before approving it in a 29-9 vote.

Sponsored by Miller and nine of his Democratic colleagues, Senate Bill 568 would allow adults 21 years and older to possess up to 1 ounce of cannabis or 5 grams of concentrate and grow up to six plants for personal use. The measure would also expedite the expungement process for those with misdemeanor cannabis records.

“It is a historic day, as it is the first time a bill to legalize and regulate cannabis has reached the floor of either legislative chamber in Rhode Island,” Miller said. “We have arrived at this point about 10 years later than I would have liked, and it is important that we act expeditiously to enact a regulatory framework.”

Miller pointed out that neighboring Connecticut Gov. Ned Lamont signed adult-use cannabis legislation earlier that day. And neighboring Massachusetts opened up shop for adult-use retail in 2018.

And with Vermont and New York’s legislatures legalizing cannabis in 2018 and 2021, respectively, Rhode Island and New Hampshire are the only two states remaining in New England where prohibition remains intact.

“The longer we wait, the more we put Rhode Island’s eventual cannabis retailers at a disadvantage,” Miller said. “The longer we wait, the more Rhode Island customers are getting into the habit of traveling to a nearby shop over the border, and the more they are building relationships with those companies. And with cannabis so readily available, whether on the black market or readily in neighboring states, Rhode Island must address all of the societal ills, but we will lack the regulatory framework and revenue stream. This legislation is therefore urgently needed.”

Under S.B. 568, cannabis use would be prohibited in public places and unsealed containers would be prohibited from the passenger areas of a motor vehicle.

The legislation aims to create a five-member Cannabis Control Commission to oversee a competitive and accessible licensing structure that Miller said would prevent monopolization of the new market by limiting business entities to one license. The licensing structure would generate tax revenue through a 7% sales tax, a 10% cannabis excise tax and a 3% local sales tax, which would return to municipalities where the point of sale occurred.

In addition, every community would be eligible for at least three retail licenses, but any municipality can opt out if it chooses. Communities can also pass local ordinances to regulate the time, place and manner of cannabis operators, however they cannot impose any additional fees or contingencies.

And on the social equity front, the legislation would create a fund to provide technical and grant assistance to qualified individuals who have been directly and indirectly impacted by prohibition. One-third of the licenses would be reserved for individuals from impacted communities.

“In the development of this bill, we wanted to ensure as many Rhode Islanders as possible have an opportunity to participate in this new economy,” Miller said. “That is why we set low barriers to entry with accessible tiered licensing fees.”

Licensing fees from the 11-tier system range from as low as $100 for up to 1,000 square feet of outdoor grows, to $5,000 for manufacturing and testing entities, and up to $20,000 for the largest cultivators and retailers.

While the bill passed by a 76% majority in the Senate, it competes with two other legalization measures: Gov. Dan McKee introduced a proposal in March that includes a three-year initiative to roll out retail licenses; and House Bill 6370 was introduced by Democratic Rep. Scott Slater on May 28.

Rhode Island Capitol TV | ritv.devosvideo.com

With the Senate-approved bill getting introduced in March, the upper chamber had the opportunity to make some really important improvements to it, Democratic Sen. Samuel Bell said Tuesday on the floor.

“That being said, I do think there are a couple things that the House bill does right that we might be able to modify,” he said. “I think we should make expungement automatic, and I think the tiering structure here is set up in such a way that it allows certain larger cultivators to potentially dominate the market. It’s something that I hope we can tweak. With that being said, I think it’s a really excellent piece of legislation.”

Republican state Sen. Gordon Rogers, who voted against the bill, said the legislation has two shortfalls. First, Rogers said the 3% local sales tax that will be returned to municipalities only takes dispensaries into account and not cultivators. In turn, cultivation-dominant communities absent of retail will be left out, he said.

Rhode Island Capitol TV | ritv.devosvideo.com

Second, Rogers said he’s in favor of a central distribution facility that would act as a middleman between cultivators and dispensaries.

“Let’s say something happens with a fungus or something; it’s growing, it’s a public health issue, you have a central place to find out where it’s coming,” he said. “If it’s coming from growers shooting off the dispensaries, it’s kind of erratic. But if you have a central distribution hub where this can be followed, [there is] control and testing.”

Miller said authors of the bill considered such a distribution center but decided not to go with that concept because of what they observed at operations of retailers in Massachusetts.

“Some of them actually only use maybe one or two cultivators,” Miller said. “And so, the central distribution would just be another security component that would be a burden both to the cultivator and the security, and the tagging and the tracking that you want to go through with the marijuana.”

S.B. 568 will now go to the House for consideration, although only a week remains before the Legislature adjourns June 30. Earlier this month, House Speaker Joe Shekarchi told WPRI-TV that the lower chamber would focus on passing a budget first and possibly push back adult-use cannabis legislation to a special session later this year.

But the Senate’s approval of S.B. 568 on Tuesday is just another example of the momentum behind the nationwide movement to end prohibition, National Organization for the Reform of Marijuana Laws (NORML) Executive Director Erik Altieri said in a statement.

“The American people are sick and tired of our failed prohibitionist policies and finally their elected officials are enacting the will of their constituents,” he said. “We call upon the Rhode Island General Assembly to follow the Senate’s lead and quickly approve this bill.”

The edible cannabis market in Canada is still green. Delayed by a year from the legalization of dried flower, the edibles and extracts market poses significant opportunities for manufacturers. Edibles and extracts typically have higher profit margins than dried flower (“value-added” products) and consumer demand appears to be high and rising. So, what is causing trouble for cannabis companies trying to break into edibles and extracts? Below are four observations on the market potential of edibles in Canada.

Canada’s Edibles Market: The Numbers

In 2020, Canada – the largest national market in the world for cannabis products – grew more than 60%, largely as a result of the introduction of new products introduced in late 2019, often called “Cannabis 2.0,” which allowed the sale of derivative products like edibles. Deloitte estimates that the Canadian market for edibles and alternative cannabis products is worth $2.7 billion, with about half of that amount taken up by edibles and the rest distributed amongst cannabis-infused beverages, topicals, concentrates, tinctures and capsules. More recently, BDSA forecasts the size of the Canadian edibles market to triple in size by 2025 to about 8% of the total cannabis dollar sales.

In December 2020, the Government of Canada reported that edibles made up 20% of total cannabis sales; Statistics Canada data shows that 41.4% of Canadians who reported using cannabis in 2020 consumed edibles. While sales have gone up and down over the course of the COVID-19 pandemic, there are clear indications that there is a substantial demand for edibles and extract products, which can be consumed more discreetly, with greater dosage precision and with fewer adverse effects (as opposed to smoking).

While sales of regulated edibles products continue to grow, edibles, extracts and topicals sales in Canada are facing a similar problem as dried flower sales: inventory growth is outpacing sales. Unsold stock sitting in inventory is growing at a dramatic pace, showing a clear lag in demand for these products on the legal market. How do we understand this contradiction?

1) Complex Regulatory Standards are a Major Barrier

Cannabis edibles compound the already existing problems around the conceptualization of cannabis products regulation. How should it work? Edibles can be considered in any of the following categories:

• Cannabis as a pharmaceutical with medical application. Requires strict dosage and packaging requirements;
• CBD as a nutraceutical with health benefits claimed. Requires specific nutraceutical regulations be followed;
• Food product to be consumed. Must comply with food safety regulations around biological, chemical, physical hazards through a risk-based preventive control program. A full supply chain and ready-to-recall based system of regulatory standards need to be followed.

Incorporating elements from each of these three regulatory regimes into a single regulatory standards body is a confusing logistical and compliance challenge for both the regulators, and the producers and retailers of the product.

In mid-2019, the Government of Canada released the Good Production Practices Guide for Cannabis. This merged cannabis-specific regulations with food safety-specific regulations. Rigorous food safety requirements were combined with equally rigorous cannabis production and processing requirements, resulting in extremely laborious, detailed and specific regulations. These span everything from building design and maintenance, to pest control, to employee sanitation, to traceability – at all levels of the process. Navigating these regulations is a challenge, especially for many smaller producers who lack the necessary resources, like automation technology, to devote to understanding and tracking compliance.

2) Low Dosage Regulations Give an Edge to the Illicit Market

When edibles were legalized, THC dosage was capped at 10mg per package. For more experienced consumers, especially those who are dealing with chronic pain and other medical needs, this limit is far too low – and the unregulated market is more than able to fill this gap. One analyst from Brightfield pointed out that the dosage restriction, in combination with other regulations, will make it harder for the edibles market to grow in Canada.

It also makes the unregulated market almost impossible to beat. Barely more than half of cannabis consumers in Canada buy exclusively from government-licensed retailers, while 20% say that they will only buy unregulated products. According to a Deloitte report, 32% of legacy cannabis consumers said that unregulated products were better quality, and 21% reported that they preferred unlicensed products because there were more options available. Almost half of respondents also reported that quality was the biggest factor that would cause them to switch to regulated sources, and 28% said that higher THC content would prompt them to switch.

3) There is a Big Price Disparity between Legal and Illicit Edibles

As a result of dosage requirements and other factors, price per gram of regulated edible product is much higher than that of flower, unregulated edibles and edibles available through regulated medical distributors.

If you take the BC Cannabis Store’s price for Peach Mango Chews as an example: a 2pc package is $5.99. Since the dosage limits at 10mg per package, that’s the equivalent of $0.60/mg or $600/gram. A quick Google search reveals that an easily available edible from a medical cannabis distributor contains 300mg of THC and sells for $19.00, a price of $63.00/gram.

That means that not only is 10mg too low a dose for many users to achieve the result they were looking for, but the dosage restriction also makes the products less attractive from both a nutrition and cost standpoint. Deloitte reportsthat higher prices is the reason that 76% of long-time cannabis consumers continued to purchase from unregulated sources. The regulated industry as a whole is missing its legal market opportunity, where consumers prefer a lower price product with a greater range of dosage availability.

4) The Range of Products Available is Too Limited for Consumers

For most of 2020, chocolate edibles were the dominant product in this category in the Canadian market, garnering 65% of all edibles sales. But is this reflective of consumer wants? Despite a demand for other kinds of edibles like the ever-popular gummies, there are still only a few edible brands that offer the range of products consumers are asking for. According to research from Headset, there are 12 manufacturers in Canada making edibles but only two of them produce gummies. In comparison, 187 brands make gummies in the United States.

While some of this delay is likely due to the long licensing process in Canada and the newness of the market, there are other factors that make it challenging to bring a variety of products to market. The province of Quebec, Canada’s second-largest province, has banned the sale of edibles that resemble candies, confections, or desserts that could be attractive to children – giving yet another edge to unregulated sellers who can also capitalize on illegal marketing that copies from existing candy brands like Maynard’s.

When companies do want to introduce new products or advertise improvements to existing product lines, they are restricted by stringent requirements for packaging and marketing, making it harder to raise brand awareness for their products in both the legal and unregulated markets. Industry players are also complaining about government restrictions on consumers taste-testing products, which further compounds challenges of getting the right products to market.

In the meantime, illicit producers have also shown themselves to be savvy in their strategies to capture consumers. It is not uncommon to find illicit products packaged in extremely convincing counterfeit packaging complete with fake excise stamps. New consumers may assume the product they are purchasing is legal. Availability of delivery options for higher dosage, lower price illicit products is also widespread. All of this adds up to significant competition, even if it were easier to meet regulatory requirements.

Conclusion: Significant Room for Growth Remains Limited by Government Regulations

These four challenges are significant, but there are a number of opportunities that present themselves alongside them. A year and a half into the legalization of edibles, cannabis companies are getting a better picture of what Canadian consumers want and low dosages are proving to be desirable for Canadian consumers in some areas.

In particular, sales of cannabinoid-infused beverages far outpaced other edibles categories last year, likely tied to the availability of these products in stores over the summer of 2020. BDSA’s research has shown that, in contrast with American consumers, the lower THC dosage for cannabis beverages is an advantage for Canadian consumers. Major alcohol brands like Molson Coors and Constellation Brands are investing heavily in this growing product area – though there the dosage limits also apply to how many products a consumer can buy at a time.

At the same time, the large quantity of unsold cannabis flower sitting in storage also poses an opportunity. While its quality as a smokeable product may have degraded, this biomass can be repurposed into extracts and edibles. Health Canada has also shown some responsiveness to industry needs when it shifted its stance to allow for Modified Atmosphere Packaging (MAP), which will help improve shelf life of products.

While strict regulatory obstacles remain, challenges will continue to outweigh opportunities and the illicit market will remain a strong player in the edibles market. As regulations become clearer and producers become more accustomed to navigating the legal space, barriers to entry into the regulated cannabis market and specifically the extracts and edibles market, will decrease. Meanwhile, those getting into the edibles market will do well to be wary of the challenges ahead.

A second citizen-led petition to legalize adult-use cannabis in Florida bit the dust June 17, when the state’s Supreme Court ruled the words “for limited use” were misleading.

The initiative, titled “Regulate Marijuana in a Manner Similar to Alcohol to Establish Age, Licensing and Other Restrictions,” was geared for the 2022 ballot and also included provisions for home grows—up to six mature cannabis plants per household member 21 years and older.

But in a 5-2 decision last week, Florida’s Supreme Court struck down the proposed constitutional amendment, concluding it was “clearly and conclusively defective” and did not meet certain clarity requirements outlined in Section 101.161 of Florida Statutes.

Florida Attorney General Ashley Moody first requested the court give an advisory opinion on the ballot proposal’s validity in September 2019. It took the court nearly two years to weigh in.

“Namely, the opponents take issue with the language in the ballot summary that states the proposed amendment would regulate marijuana ‘for limited use and growing by persons 21 years of age or older,’” justices Charles Canady and Ricky Polston said in the majority opinion. “They contend that the text of the proposed amendment itself does not limit the personal ‘use’ of marijuana and that the ballot summary therefore affirmatively misleads voters. We agree.”

Canady and Polston also said, “The ballot summary plainly tells voters that the proposed amendment ‘limit[s]’ the personal use—i.e., consumption—of recreational marijuana by age-eligible persons. But the proposed amendment itself does not do so.”

Sponsored by Sensible Florida Inc., the initiative petition had 28,983 signatures of the 891,589 signatures needed—or just 3.2%—to make the ballot, according to the Florida Division of Elections. Had it reached the ballot, the proposed amendment would have required at least 60% approval from voters to pass.

That was the second initiative to legalize adult-use cannabis that the Florida Supreme Court struck down in three months. In April, the court ruled in another 5-2 decision that a Make it Legal Florida-ballot hopeful would have misled voters by failing to disclose that cannabis would still be illegal under federal law.

In his dissenting opinion of the most recent decision, Justice Alan Lawson said the majority properly analyzed the ballot summary but did not properly analyze the ballot summary and ballot title together, which is required by a precedent court decision in determining whether the ballot information properly informs the voters.

“The amendment itself details the ways that marijuana use would be regulated similar to Florida’s current regulations affecting alcohol use,” Lawson said. “Therefore, reading the title and summary together, ‘limited use’ could also be understood as a reference to the regulations disclosed in the aptly descriptive title.”

With two adult-use cannabis initiatives struck down, one legalization effort still remains—a Floridians for Freedom-sponsored ballot proposal titled “Right of Adults to Cannabis.” Currently, that initiative only has 2,292 signatures (of 891,589 needed). In its summary, the proposal discloses that cannabis would remain federally illegal.

But Florida Republican Gov. Ron DeSantis recently signed legislation, Senate Bill 1890, that imposes a $3,000 cap per individual on contributions to any political group sponsoring or opposing a proposed constitutional amendment initiative while signatures are being gathered. Once enough signatures are gathered and a proposal is approved for the ballot, unlimited contributions are allowed. That new law is set to take effect July 1.

Sensible Florida had raised roughly $271,000 before the Supreme Court struck down its initiative last week, according to the Miami Herald. Most of that money would not have been allowed under the new law.

Meanwhile, as Floridians for Freedom push forward with its initiative, proponents believe they should be exempt from the financial restrictions the new law places on the signature-gathering process because their initiative was first approved in 2015, reported WJHG-TV, an CBS affiliate in Panama City, Fla.

The signature deadline is Feb. 1, 2022.

Courtesy of Cresco Labs

In January 2021, Michael Thompson was freed from a Michigan state prison after serving 22 years of a 60-year sentence for selling cannabis in the 1990s. In recent years, particularly as the state-legal cannabis space rapidly expanded, Thompson became emblematic of the deep wounds inflicted by prohibition—and the lasting impact of the War on Drugs’ nefarious legacy.

On June 19, the trailer for “The Sentence of Michael Thompson” was released. The documentary covers his story and the broader implications of cannabis reform vis-à-vis the criminal justice system. It was underwritten and supported by Cresco Labs, which is embarking now on its Summer of Social Justice initiative.  

Chima Enyia, Cresco’s executive vice president of SEED (the company’s Social Equity, Education, Development initiative), says that Thompson’s story helps illustrate the disconnect between the burgeoning industry and the men and women left behind by prohibition policies.

“From the Cresco brand, centering on Michael Thompson, his story unfortunately is not unique,” he says. “There is much more work that needs to be done. What we’re doing cannot be performative in nature. What we’re doing and what this industry is doing cannot be tokenized. We have an obligation to lead corporate America on these issues and to evolve our efforts.”

https://www.youtube.com/watch?v=AgN7SZ8ou8A 

The documentary is only the most visible part of this program, however. As the summer unfolds, Cresco will be partnering with on-the-ground community-based organizations around the U.S. to host expungement clinics and elevate workforce development efforts within and around the cannabis space. This, Enyia says, is where the real work of restorage justice takes place: on a local level within communities that are raising their voices against oppressive social policies.

He says that when he took the job at Cresco Labs earlier this year, a conversation with CEO Charlie Bachtell really struck him. The two discussed restorative justice as a pillar of the cannabis business—not a generic talking point, but rather a measure of how an individual business operates and engages with people.

“I saw an earnest commitment to continuous improvement, an earnest commitment to really understanding what social equity is and how we can evolve over the future and really amplify the work we’re doing in the community,” he says.

Two groups involved in Cresco’s work this summer are the National Diversity & Inclusion Cannabis Alliance (NDICA, say it out loud) and the Black and Brown Cannabis Guild. The guild, as an example, is running the 2021 Clean Slate program, which offers expungement guidance for those convicted of cannabis charges in Michigan. 

“These are things that we should be doing anyway,” he says. “This should be part of the culture of this industry. As we grow, it will remain the culture of Cresco. We’ll continue to evolve our efforts going forward. There’s still much to do. We are committed to growing and lifting as we climb. That’s the key—lifting as we climb.”

For Enyia, on a more personal note, it’s also a chance to expand his ambitions in a professional space more amenable to the cause. He came to Cresco Labs after working for the state as the executive director of the Illinois Liquor Control Commission. That, too, is an industry rife with oppressive history, but Enyia says the opportunities are a bit more inclusive in cannabis. In this industry, it’s a pillar.

“Coming from liquor, there’s a lot of work there yet to be done. I was ready to expand and leverage my expertise into the cannabis industry,” he says. “Cannabis is in a unique space with the technology that we have, with the bandwidth that we have, to lead corporate America.”

 

Debate on adult-use cannabis legalization finally got its day on the Connecticut House floor, where reform proponents prevailed during a special session Wednesday evening.

After House Republicans denied a vote in the regular order of the legislative session through the threat of a filibuster June 9—the final day before adjournment—lawmakers returned to the lower chamber and deliberated for more than seven hours June 16. In the end, legalization efforts prevailed in a 76-62 vote on an amended version of Senate Bill 1201.

The Senate, which passed the legislation in a 19-12 vote the previous day, took up the House’s amended version of the bill for final approval Thursday morning and concurred to push passage through the Legislature. Pending Democratic Gov. Ned Lamont’s signature, Connecticut will be the 19th state to legalize adult-use cannabis. And with some of the social equity language dialed back in this latest version of the bill, Lamont’s signature seems more likely than in previous days.

“Connecticut is just the latest domino to fall as states begin to repeal their failed prohibition of marijuana and replace it with a sensible system of legalization and regulation,” National Organization for the Reform of Marijuana Laws (NORML) Executive Director Erik Altieri said in a statement.

“Never before has the momentum for legalization looked as strong as it does in 2021, with four state legislatures already approving bills to ensure state law reflects the overwhelming will of their state residents in just a few short months,” he said. New York, Virginia and New Mexico have also passed adult-use bills this year. 

The Connecticut measure will allow adults to possess up to 1.5 ounces of cannabis flower or an equivalent amount of concentrate in public, and up to 5 ounces in their homes, beginning July 1, 2021. Commercial sales could begin as soon as May 2022.

The roughly 300-page bill has been many years in the making and includes several changes and modifications over that time, said Democratic Rep. Steve Stafstrom, who co-chairs the Joint Judiciary Committee and co-sponsored a previous version of the adult-use bill earlier in the regular legislative session.

Connecticut Network | ct-n.com

“Connecticut’s time has finally come,” Stafstrom said in his opening remarks Wednesday. “Today, we take the next step as this chamber in recognizing that the war on drugs has failed us, and the criminalization of cannabis was the wrong course of action for our state and for our nation.” 

Legalization in Connecticut will be heavily regulated, he said. The bill limits possession, purchase amounts and dosage; restricts packaging and advertising; bans smoking and vaping in most public locations; allows local municipalities to set appropriate zoning; increases the enforcement and intervention of impaired driving; provides protection to employers; and increases drug prevention funding, Stafstrom said.

The legislation also sets up a council to address social equity issues, although this became a point of contention within the Legislature. The Senate passed an amendment Tuesday, one that would have expanded social equity eligibility for prospective entrepreneurs—but this drew the ire of Lamont, who vowed to veto the bill if that language was not addressed in the House. The House acted accordingly, rejecting the Senate’s amendment by a 125-0 vote.

The rejected Senate amendment would have allowed those with previous drug arrests or convictions a better chance to enter the state-legal cannabis industry through winning social equity licenses made available through the bill.

Republican Rep. Craig Fishbein, a ranking member of the Judiciary Committee, said he was puzzled about the House proponents’ decision to nix that provision that was approved by the Senate in a 26-4 vote the previous day.

Connecticut Network | ct-n.com

“I’m a bit confused, because all through the committee hearings [in] the discussions about this we heard from individuals that had been previously convicted of drug crimes looking for their chance to engage in this market, and they were given assurances that they would be part of that,” he said. “What happened in the Senate was overwhelmingly approving of the amendment.”

Instead of jeopardizing the entire bill over social equity language Lamont didn’t agree with, House members passed their own amendment, which whittled down the Senate’s multi-subject provision to only include one item: banning elected officials from participating in the cannabis industry laid out in the bill for two years after leaving the General Assembly. That amendment passed, 128-0.

When discussion continued on the underlying bill, Fishbein was the main opponent who addressed concerns with the legislation. The first conflict he mentioned was the oath he said he took to uphold the U.S. Constitution, stating that the Supremacy Clause in Article VI establishes that federal law takes precedence over state laws.

Other Republicans, and some Democrats, voiced similar concerns as lawmakers in other states who recently voted against adult-use legalization measures in their legislatures. Public safety and protecting youth were the main two mentioned by Republican Rep. Tom O’Dea.

Connecticut Network | ct-n.com

“This is the most important vote that I will take in my nine years here, and I don’t say that lightly,” he said. “Mark my words: people will die when we pass this bill, because of this bill. Because of recreational marijuana being sold in Connecticut, more people will die.”

O’Dea offered an amendment to increase the legal age for adult-use cannabis from 21 to 25 years. He said he believed the commercialization of cannabis will harm the state’s youth. The amendment was rejected.

Having two young children himself, Stafstrom said he agreed that he does not want cannabis in the hands of youth.  

“But I think actually what we are doing in this bill is putting in place a regulated marketplace,” Stafstrom said. “We are putting in place protections with respect to container sizes and dosage limits, and additional dollars for prevention, and the like, all of which are necessary in many respects because cannabis is legal on our borders whether we like it or not.”

To the north, Massachusetts legalized cannabis through a 2016 ballot measure. And to the west, New York’s Legislature legalized cannabis earlier this year.

The war on drugs has failed Connecticut’s youth, failed its cities and has led to disparate impacts, Stafstrom said. That’s why the bill is titled “An act concerning responsible and equitable regulation of adult-use cannabis,” he said.

Connecticut Network | ct-n.com

Later in the debate, Democratic Rep. Juan Candelaria provided an example of how an unregulated cannabis market affected his family.

“I had a niece who passed away because she was smoking marijuana and it was laced with PCP (phencyclidine),” he said. “The reason that I came around in support of adult-use cannabis is for that same reason—to protect the children. I am a father. I do have children. And I don’t want to see my children go through this path.

“What we are trying to attempt with this bill is to ensure that these kids do not have access.”

Democratic Rep. Jason Rojas, who as House majority leader helped negotiations between the governor’s office and the Legislature to agree upon the final version of the bill, said that now is the time to move in a different direction after a long and complicated road.

“It began with a federal prohibition on marijuana in 1937,” he said. “It was complicated by a war on drugs launched in 1971 that took a tough-on-crime approach—an approach that has impacted the lives of millions of Americans whose involvement with the use of a substance should have been treated as a public health matter rather than a criminal justice matter.”