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Connecticut Makes Headway on Cannabis Legalization (Sort Of): Week in Review

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By now, many in the industry are aware of the recent craze surrounding delta-8 tetrahydrocannabinol (THC), a natural component of cannabis that has burst into popularity over the past several months.

And it seems as soon as the industry has gained a solid understanding of delta-8, another THC compound has come into the spotlight: delta-10 THC. 

Similar to delta-8, delta-10 is a minor cannabinoid that exists in trace amounts in hemp and cannabis, according to ACS Laboratory, a cannabis, hemp and cannabidiol (CBD) testing laboratory in Florida.

As previously reported by Hemp Grower, delta-8 is said to have a relaxing effect and produces some psychotropic effects that are believed to be less potent than delta-9.

Roger Brown, the president and founder of ACS Laboratory, describes the effects of delta-10 to be the opposite of delta-8, based on his personal experience.

“For myself, I don’t utilize or smoke marijuana, but I tried delta-8 and delta-10 products that we tested as an experiment, and for me, delta-10 had no psychoactive effects; it was more like a mood enhancer,” he says.

Erik Paulson, senior analyst at Infinite Chemical Analysis Labs, an analytical cannabis and CBD testing lab with locations in California and Michigan, says he’s heard consumers compare delta-10’s effects to sativa cannabis varieties, which are traditionally known for being energizing and uplifting, and delta-8 effects to indica varieties, which are associated with relaxation.

However, Paulson says he’s unsure if there’s any scientific evidence behind that, adding,  “It could just be that the higher psychoactivity of delta-8 is causing more of a pronounced sedative effect compared to delta-10.”

At this point, Paulson and Brown both say there is some published research on delta-10, though it is minimal.

A pigeon study conducted in the 1980s by Raphael Mechoulam, a cannabis research pioneer, studied the effects of delta-10 compared to delta-9 on pigeons. The study found that delta-10 may have some psychoactive effects, but the effects are much less potent than delta-9.

However, “there’s not as much known about delta-10 in terms of the psychoactivity and its effects on the human body,” Paulson says.

Where it Comes From

Like delta-8, delta-10 can be converted in a laboratory from delta-9 or CBD, Paulson says.

Delta-10 is typically produced more predominantly through extraction or converted from delta-9 through isomerization, he says. Transforming delta-9 to delta-10 (or delta-8) is possible because they have the same chemical compounds, just different structures.

According to Extraction Magazine, extractors would waste a significant amount of time and plant material trying to extract delta-10 from natural varieties, so it is more likely produced via isomerization. Delta-10 appears in such small amounts that laboratories often misidentify the compound for [cannabichromene] CBC or [cannabicyclol] CBL using standard high-performance liquid chromatography (HPLC) methods.

“You can create any delta you want—delta-8, delta-9, or delta-10—by chemically altering CBD isolate or CBD crude,” David Reckles, president of Private Label Hemp Lab, a hemp testing and manufacturing lab in Florida, told ACS Laboratory. “If you’re using crude CBD, you’ll generally create the reaction through carbon and vitamin C derivatives. If you’re using an isolate, you’ll incorporate solvents and acids.”

RELATED: Understanding Delta-8-THC: Where Does It Come From?

Delta-10 vs. Delta-8 and Delta-9: Chemical Differences

Delta-10 is an isomer of delta-9, Brown says.

Paulson says when one begins to isolate delta-9 or, more commonly, convert THC to CBD, they’ll start to discover the additional isomers (or different classifications of THC).

“Really, all THC isomers chemically have the same basic structure,” he says. “It’s just the placement of one bond that differs between the different isomers.”

For example, as previously reported by Hemp Grower, “delta-8 has a double bond on the 8th carbon chain, and delta-9 has a double bond on the 9th carbon chain.”

Delta-10 follows the same pattern and has a double bond on the 10th carbon chain. And while this seems like a “small distinction, it’s enough to produce slightly different cognitive and physical effects,” Hemp Grower previously reported.

Brown says that a significant difference is delta-8 can essentially only produce one compound, whereas delta-10 can produce up to six different isomers (variations of the same compound).

“What we call delta-10 is really a mixture of two different types of compounds, and then within that, they might have different configurations,” Paulson says. “So, there’s just a lot of different compounds, and that’s one of the reasons why it’s so challenging to quantify accurately. So, in terms of psychoactivity, instead of having to test one compound, you have to test six.” 

Legal Status

According to ACS Laboratory, “Delta-10 THC derived from cannabis is [federally] illegal because marijuana is a schedule 1 controlled substance. However, delta-10 derived from hemp extract exists in a legal gray zone.”

And Brown agrees, arguing that the Agriculture Improvement Act of 2018 (the 2018 Farm Bill) is very “specific to delta-9,” and if a delta-8 or delta-10 product derived from hemp contains less than 0.3% total THC (defined as delta-9 THC plus tetrahydrocannabinolic acid (THCA), its acidic version), then it’s considered “legal.”

The Drug Enforcement Administration’s (DEA) response to the 2018 Farm Bill is: “All synthetically derived tetrahydrocannabinols remain schedule 1 controlled substances.”

“So, in our mind, all tetrahydrocannabinols cannabinoids are considered federally illegal,” Paulson says. “We’re not placing a judgment on that, whether it’s right to do that or not. I just think there hasn’t been a lot of legal challenges to these laws and to that point, people keep on producing delta-8 and delta-10 products….”

More than 12 states have already begun to implement delta-8 bans, while very few states, including New York, Colorado and Alabama, have started to crack down on delta-10.

And Paulson says while delta-10 may currently be “flying under the radar,” he thinks it’s only a “matter of time” before there’s increased regulation.

Surna Cultivation Technologies Introduces High Efficiency EcoChill Heat Recovery Chiller

by

By now, many in the industry are aware of the recent craze surrounding delta-8 tetrahydrocannabinol (THC), a natural component of cannabis that has burst into popularity over the past several months.

And it seems as soon as the industry has gained a solid understanding of delta-8, another THC compound has come into the spotlight: delta-10 THC. 

Similar to delta-8, delta-10 is a minor cannabinoid that exists in trace amounts in hemp and cannabis, according to ACS Laboratory, a cannabis, hemp and cannabidiol (CBD) testing laboratory in Florida.

As previously reported by Hemp Grower, delta-8 is said to have a relaxing effect and produces some psychotropic effects that are believed to be less potent than delta-9.

Roger Brown, the president and founder of ACS Laboratory, describes the effects of delta-10 to be the opposite of delta-8, based on his personal experience.

“For myself, I don’t utilize or smoke marijuana, but I tried delta-8 and delta-10 products that we tested as an experiment, and for me, delta-10 had no psychoactive effects; it was more like a mood enhancer,” he says.

Erik Paulson, senior analyst at Infinite Chemical Analysis Labs, an analytical cannabis and CBD testing lab with locations in California and Michigan, says he’s heard consumers compare delta-10’s effects to sativa cannabis varieties, which are traditionally known for being energizing and uplifting, and delta-8 effects to indica varieties, which are associated with relaxation.

However, Paulson says he’s unsure if there’s any scientific evidence behind that, adding,  “It could just be that the higher psychoactivity of delta-8 is causing more of a pronounced sedative effect compared to delta-10.”

At this point, Paulson and Brown both say there is some published research on delta-10, though it is minimal.

A pigeon study conducted in the 1980s by Ralph Micheolam, a cannabis research pioneer, studied the effects of delta-10 compared to delta-9 on pigeons. The study found that delta-10 may have some psychoactive effects, but the effects are much less potent than delta-9.

However, “there’s not as much known about delta-10 in terms of the psychoactivity and its effects on the human body,” Paulson says.

Where it Comes From

Like delta-8, delta-10 can be converted in a laboratory from delta-9 or CBD, Paulson says.

Delta-10 is typically produced more predominantly through extraction or converted from delta-9 through isomerization, he says. Transforming delta-9 to delta-10 (or delta-8) is possible because they have the same chemical compounds, just different structures.

According to Extraction Magazine, extractors would waste a significant amount of time and plant material trying to extract delta-10 from natural strains, so it is more likely produced via isomerization. Delta-10 appears in such small amounts that laboratories often misidentify the compound for [cannabichromene] CBC or [cannabicyclol] CBL using standard high-performance liquid chromatography (HPLC) methods.

“You can create any delta you want—delta-8, delta-9, or delta-10—by chemically altering CBD isolate or CBD crude,” David Reckles, president of Private Label Hemp Lab, a hemp testing and manufacturing lab in Florida, told ACS Laboratory. “If you’re using crude CBD, you’ll generally create the reaction through carbon and vitamin C derivatives. If you’re using an isolate, you’ll incorporate solvents and acids.”

RELATED: Understanding Delta-8-THC: Where Does It Come From?

Delta-10 vs. Delta-8 and Delta-9: Chemical Differences

Delta-10 is an isomer of delta-9, Brown says.

Paulson says when one begins to isolate delta-9 or, more commonly, convert THC to CBD, they’ll start to discover the additional isomers (or different classifications of THC).

“Really, all THC isomers chemically have the same basic structure,” he says. “It’s just the placement of one bond that differs between the different isomers.”

For example, as previously reported by Hemp Grower, “delta-8 has a double bond on the 8th carbon chain, and delta-9 has a double bond on the 9th carbon chain.”

Delta-10 follows the same pattern and has a double bond on the 10th carbon chain. And while this seems like a “small distinction, it’s enough to produce slightly different cognitive and physical effects,” Hemp Grower previously reported.

Brown says that a significant difference is delta-8 can essentially only produce one compound, whereas delta-10 can produce up to six different isomers (variations of the same compound).

“What we call delta-10 is really a mixture of two different types of compounds, and then within that, they might have different configurations,” Paulson says. “So, there’s just a lot of different compounds, and that’s one of the reasons why it’s so challenging to quantify accurately. So, in terms of psychoactivity, instead of having to test one compound, you have to test six.” 

Legal Status

According to ACS Laboratory, “Delta-10 THC derived from cannabis is [federally] illegal because marijuana is a schedule 1 controlled substance. However, delta-10 derived from hemp extract exists in a legal gray zone.”

And Brown agrees, arguing that the Agriculture Improvement Act of 2018 (the 2018 Farm Bill) is very “specific to delta-9,” and if a delta-8 or delta-10 product derived from hemp contains less than 0.3% total THC (defined as delta-9 THC plus tetrahydrocannabinolic acid (THCA), its acidic version), then it’s considered “legal.”

The Drug Enforcement Administration’s (DEA) response to the 2018 Farm Bill is: “All synthetically derived tetrahydrocannabinols remain schedule 1 controlled substances.”

“So, in our mind, all tetrahydrocannabinols cannabinoids are considered federally illegal,” Paulson says. “We’re not placing a judgment on that, whether it’s right to do that or not. I just think there hasn’t been a lot of legal challenges to these laws and to that point, people keep on producing delta-8 and delta-10 products….”

More than 12 states have already begun to implement delta-8 bans, while very few states, including New York, Colorado and Alabama, have started to crack down on delta-10.

And Paulson says while delta-10 may currently be “flying under the radar,” he thinks it’s only a “matter of time” before there’s increased regulation.

Law Enforcement Action Partnership Joins Cannabis Freedom Alliance Steering Committee

by

By now, many in the industry are aware of the recent craze surrounding delta-8 tetrahydrocannabinol (THC), a natural component of cannabis that has burst into popularity over the past several months.

And it seems as soon as the industry has gained a solid understanding of delta-8, another THC compound has come into the spotlight: delta-10 THC. 

Similar to delta-8, delta-10 is a minor cannabinoid that exists in trace amounts in hemp and cannabis, according to ACS Laboratory, a cannabis, hemp and cannabidiol (CBD) testing laboratory in Florida.

As previously reported by Hemp Grower, delta-8 is said to have a relaxing effect and produces some psychotropic effects that are believed to be less potent than delta-9.

Roger Brown, the president and founder of ACS Laboratory, describes the effects of delta-10 to be the opposite of delta-8, based on his personal experience.

“For myself, I don’t utilize or smoke marijuana, but I tried delta-8 and delta-10 products that we tested as an experiment, and for me, delta-10 had no psychoactive effects; it was more like a mood enhancer,” he says.

Erik Paulson, senior analyst at Infinite Chemical Analysis Labs, an analytical cannabis and CBD testing lab with locations in California and Michigan, says he’s heard consumers compare delta-10’s effects to sativa cannabis varieties, which are traditionally known for being energizing and uplifting, and delta-8 effects to indica varieties, which are associated with relaxation.

However, Paulson says he’s unsure if there’s any scientific evidence behind that, adding,  “It could just be that the higher psychoactivity of delta-8 is causing more of a pronounced sedative effect compared to delta-10.”

At this point, Paulson and Brown both say there is some published research on delta-10, though it is minimal.

A pigeon study conducted in the 1980s by Ralph Micheolam, a cannabis research pioneer, studied the effects of delta-10 compared to delta-9 on pigeons. The study found that delta-10 may have some psychoactive effects, but the effects are much less potent than delta-9.

However, “there’s not as much known about delta-10 in terms of the psychoactivity and its effects on the human body,” Paulson says.

Where it Comes From

Like delta-8, delta-10 can be converted in a laboratory from delta-9 or CBD, Paulson says.

Delta-10 is typically produced more predominantly through extraction or converted from delta-9 through isomerization, he says. Transforming delta-9 to delta-10 (or delta-8) is possible because they have the same chemical compounds, just different structures.

According to Extraction Magazine, extractors would waste a significant amount of time and plant material trying to extract delta-10 from natural strains, so it is more likely produced via isomerization. Delta-10 appears in such small amounts that laboratories often misidentify the compound for [cannabichromene] CBC or [cannabicyclol] CBL using standard high-performance liquid chromatography (HPLC) methods.

“You can create any delta you want—delta-8, delta-9, or delta-10—by chemically altering CBD isolate or CBD crude,” David Reckles, president of Private Label Hemp Lab, a hemp testing and manufacturing lab in Florida, told ACS Laboratory. “If you’re using crude CBD, you’ll generally create the reaction through carbon and vitamin C derivatives. If you’re using an isolate, you’ll incorporate solvents and acids.”

RELATED: Understanding Delta-8-THC: Where Does It Come From?

Delta-10 vs. Delta-8 and Delta-9: Chemical Differences

Delta-10 is an isomer of delta-9, Brown says.

Paulson says when one begins to isolate delta-9 or, more commonly, convert THC to CBD, they’ll start to discover the additional isomers (or different classifications of THC).

“Really, all THC isomers chemically have the same basic structure,” he says. “It’s just the placement of one bond that differs between the different isomers.”

For example, as previously reported by Hemp Grower, “delta-8 has a double bond on the 8th carbon chain, and delta-9 has a double bond on the 9th carbon chain.”

Delta-10 follows the same pattern and has a double bond on the 10th carbon chain. And while this seems like a “small distinction, it’s enough to produce slightly different cognitive and physical effects,” Hemp Grower previously reported.

Brown says that a significant difference is delta-8 can essentially only produce one compound, whereas delta-10 can produce up to six different isomers (variations of the same compound).

“What we call delta-10 is really a mixture of two different types of compounds, and then within that, they might have different configurations,” Paulson says. “So, there’s just a lot of different compounds, and that’s one of the reasons why it’s so challenging to quantify accurately. So, in terms of psychoactivity, instead of having to test one compound, you have to test six.” 

Legal Status

According to ACS Laboratory, “Delta-10 THC derived from cannabis is [federally] illegal because marijuana is a schedule 1 controlled substance. However, delta-10 derived from hemp extract exists in a legal gray zone.”

And Brown agrees, arguing that the Agriculture Improvement Act of 2018 (the 2018 Farm Bill) is very “specific to delta-9,” and if a delta-8 or delta-10 product derived from hemp contains less than 0.3% total THC (defined as delta-9 THC plus tetrahydrocannabinolic acid (THCA), its acidic version), then it’s considered “legal.”

The Drug Enforcement Administration’s (DEA) response to the 2018 Farm Bill is: “All synthetically derived tetrahydrocannabinols remain schedule 1 controlled substances.”

“So, in our mind, all tetrahydrocannabinols cannabinoids are considered federally illegal,” Paulson says. “We’re not placing a judgment on that, whether it’s right to do that or not. I just think there hasn’t been a lot of legal challenges to these laws and to that point, people keep on producing delta-8 and delta-10 products….”

More than 12 states have already begun to implement delta-8 bans, while very few states, including New York, Colorado and Alabama, have started to crack down on delta-10.

And Paulson says while delta-10 may currently be “flying under the radar,” he thinks it’s only a “matter of time” before there’s increased regulation.

Latest Cannabinoid in the Spotlight: Delta-10 THC

by

By now, many in the industry are aware of the recent craze surrounding delta-8 tetrahydrocannabinol (THC), a natural component of cannabis that has burst into popularity over the past several months.

And it seems as soon as the industry has gained a solid understanding of delta-8, another THC compound has come into the spotlight: delta-10 THC. 

Similar to delta-8, delta-10 is a minor cannabinoid that exists in trace amounts in hemp and cannabis, according to ACS Laboratory, a cannabis, hemp and cannabidiol (CBD) testing laboratory in Florida.

As previously reported by Hemp Grower, delta-8 is said to have a relaxing effect and produces some psychotropic effects that are believed to be less potent than delta-9.

Roger Brown, the president and founder of ACS Laboratory, describes the effects of delta-10 to be the opposite of delta-8, based on his personal experience.

“For myself, I don’t utilize or smoke marijuana, but I tried delta-8 and delta-10 products that we tested as an experiment, and for me, delta-10 had no psychoactive effects; it was more like a mood enhancer,” he says.

Erik Paulson, senior analyst at Infinite Chemical Analysis Labs, an analytical cannabis and CBD testing lab with locations in California and Michigan, says he’s heard consumers compare delta-10’s effects to sativa cannabis varieties, which are traditionally known for being energizing and uplifting, and delta-8 effects to indica varieties, which are associated with relaxation.

However, Paulson says he’s unsure if there’s any scientific evidence behind that, adding,  “It could just be that the higher psychoactivity of delta-8 is causing more of a pronounced sedative effect compared to delta-10.”

At this point, Paulson and Brown both say there is some published research on delta-10, though it is minimal.

A pigeon study conducted in the 1980s by Ralph Micheolam, a cannabis research pioneer, studied the effects of delta-10 compared to delta-9 on pigeons. The study found that delta-10 may have some psychoactive effects, but the effects are much less potent than delta-9.

However, “there’s not as much known about delta-10 in terms of the psychoactivity and its effects on the human body,” Paulson says.

Where it Comes From

Like delta-8, delta-10 can be converted in a laboratory from delta-9 or CBD, Paulson says.

Delta-10 is typically produced more predominantly through extraction or converted from delta-9 through isomerization, he says. Transforming delta-9 to delta-10 (or delta-8) is possible because they have the same chemical compounds, just different structures.

According to Extraction Magazine, extractors would waste a significant amount of time and plant material trying to extract delta-10 from natural strains, so it is more likely produced via isomerization. Delta-10 appears in such small amounts that laboratories often misidentify the compound for [cannabichromene] CBC or [cannabicyclol] CBL using standard high-performance liquid chromatography (HPLC) methods.

“You can create any delta you want—delta-8, delta-9, or delta-10—by chemically altering CBD isolate or CBD crude,” David Reckles, president of Private Label Hemp Lab, a hemp testing and manufacturing lab in Florida, told ACS Laboratory. “If you’re using crude CBD, you’ll generally create the reaction through carbon and vitamin C derivatives. If you’re using an isolate, you’ll incorporate solvents and acids.”

RELATED: Understanding Delta-8-THC: Where Does It Come From?

Delta-10 vs. Delta-8 and Delta-9: Chemical Differences

Delta-10 is an isomer of delta-9, Brown says.

Paulson says when one begins to isolate delta-9 or, more commonly, convert THC to CBD, they’ll start to discover the additional isomers (or different classifications of THC).

“Really, all THC isomers chemically have the same basic structure,” he says. “It’s just the placement of one bond that differs between the different isomers.”

For example, as previously reported by Hemp Grower, “delta-8 has a double bond on the 8th carbon chain, and delta-9 has a double bond on the 9th carbon chain.”

Delta-10 follows the same pattern and has a double bond on the 10th carbon chain. And while this seems like a “small distinction, it’s enough to produce slightly different cognitive and physical effects,” Hemp Grower previously reported.

Brown says that a significant difference is delta-8 can essentially only produce one compound, whereas delta-10 can produce up to six different isomers (variations of the same compound).

“What we call delta-10 is really a mixture of two different types of compounds, and then within that, they might have different configurations,” Paulson says. “So, there’s just a lot of different compounds, and that’s one of the reasons why it’s so challenging to quantify accurately. So, in terms of psychoactivity, instead of having to test one compound, you have to test six.” 

Legal Status

According to ACS Laboratory, “Delta-10 THC derived from cannabis is [federally] illegal because marijuana is a schedule 1 controlled substance. However, delta-10 derived from hemp extract exists in a legal gray zone.”

And Brown agrees, arguing that the Agriculture Improvement Act of 2018 (the 2018 Farm Bill) is very “specific to delta-9,” and if a delta-8 or delta-10 product derived from hemp contains less than 0.3% total THC (defined as delta-9 THC plus tetrahydrocannabinolic acid (THCA), its acidic version), then it’s considered “legal.”

The Drug Enforcement Administration’s (DEA) response to the 2018 Farm Bill is: “All synthetically derived tetrahydrocannabinols remain schedule 1 controlled substances.”

“So, in our mind, all tetrahydrocannabinols cannabinoids are considered federally illegal,” Paulson says. “We’re not placing a judgment on that, whether it’s right to do that or not. I just think there hasn’t been a lot of legal challenges to these laws and to that point, people keep on producing delta-8 and delta-10 products….”

More than 12 states have already begun to implement delta-8 bans, while very few states, including New York, Colorado and Alabama, have started to crack down on delta-10.

And Paulson says while delta-10 may currently be “flying under the radar,” he thinks it’s only a “matter of time” before there’s increased regulation.

Clock is Ticking for Adult-Use Cannabis Bill in Connecticut 

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Less than a month after debuting on the Nasdaq Stock Market, Colombia-based cultivator Flora Growth is connecting its cannabis pipeline to Europe through a manufacturing and distribution partnership with Hoshi International.

Headquartered in Toronto, but with 95% of its operations in Colombia, globally motivated Flora Growth made a 2-million-euro ($2.4 million) strategic investment to become a preferred supplier to Hoshicap Portugal—a subsidy of Toronto-based Hoshi International—the company announced June 7.

Courtesy of Flora Growth | floragrowth.ca

Luis Merchan became the CEO of Flora Growth in December as the company worked toward a public listing. 

The investment will provide Flora access to extraction facilities in Malta and Portugal to process its cannabis derivatives from Colombia and distribute them through Hoshi’s channels throughout Europe. The transaction is the first of many steps intended by Flora to launch its seven brands and 300-plus products across the world, President and CEO Luis Merchan told Cannabis Business Times. Flora’s cultivation practices to supply cannabis derivatives also include business divisions in cosmetics, hemp textiles, and food and beverage.

The Portugal license will allow for the cultivation and import of cannabis produced through good agricultural and collection practices (GACP)—guidelines outlined by the World Health Organization for medicinal plants—and also enable the Good Manufacturing Practice (GMP)-certified processing facility to export indoor and outdoor medical cannabis throughout Europe.

In Malta, Hoshi is completing its GMP facility to produce, process and package cannabis products, including oil derivatives, to be distributed throughout the European Union (EU). Hoshi’s Maltese entity received a provisional medical cannabis license covering cultivation, processing and importation/exportation under Malta’s Production of Cannabis for Medicinal and Research Purposes Act. 

“Those assets, the cultivation in Portugal as well as the facility in Malta, opened the door to us for completing the supply chain into the European Union,” Merchan said. “That’s very important to us because the market in the European Union is significant. Obviously, the No. 1 economy (in Europe), Germany, is very attractive and clearly is open for the import of cannabis derivatives. And having a partner as Hoshi as a critical partner and preferred distributor for the European Union became a no-brainer.”

Merchan said Portugal and Malta offer favorable regulatory environments, and low labor and energy costs. In addition, Hoshi’s analytical testing labs in Malta will allow Flora to establish a consistent import and distribution hub, which opens the doors for sought-after markets such as Germany, he said.

With a population of roughly 750 million and a health care spend exceeding 2.1 trillion euros, Europe has the potential to become the largest global market for medical cannabis products, according to Hoshi. That’s including non-EU members such as the United Kingdom (U.K.), which rivals Germany and France among the largest economies on the continent.

But that potential high-growth market has yet to be fully tapped because of a lack of legal infrastructure to supply GMP and GACP-grade medical product, according to Hoshi, which is on course to have EU cultivation licenses under both practices by first quarter 2022. 

Included in the Flora-Hoshi partnership, Flora will provide access to its library of tested and proven outdoor genetics to Hoshi for eventual cultivation at its Portugal facility. Hoshi also has import distribution agreements in the Czech Republic, Germany, Poland and the U.K.

“With the partnership with Flora Growth, Hoshi can now fast track a number of established initiatives to sell high-quality GACP flower to the EU market,” Hoshi CEO John Aird said in a Flora press release announcing the partnership. “We look forward to working with the Flora team and accessing not only their high-end genetics and outdoor grown cannabis but also assisting Flora move more finished products to its customers across the EU and globally.”

Courtesy of Flora Growth | floragrowth.ca

Flora Growth cultivates 100 hectares of cannabis year-round near the equator in Bucaramanga, Columbia. 

Founded in 2019, Flora leverages natural, low-cost cultivation practices with an all-outdoor cultivation operation that includes roughly 100 hectares (247 acres) of cannabis in Bucaramanga, Colombia. Approximately 500 miles north of the equator, Flora’s farm produces year-round yields with 12-plus hours of natural sunlight per day and a constant breeze of 3 mph at 1,500 meters above sea level, Merchan said. In addition, the Flora farm has six natural spring-water deposits to further reduce operational costs. 

Those natural conditions allow Flora to cultivate dried cannabis flower at 6 cents per gram (roughly $25 to $30 per pound), he said.

“We are cultivating under one of the best geographies in the world in terms of flower cultivation,” said Merchan, a dual citizen who was born and raised in Colombia but has spent his entire executive career specializing in retail and consumer packaged goods in the U.S., including his role as Macy’s Inc.’s vice president of workforce strategy and operations.

“The problem with cultivating and growing cannabis in [the U.S. and Canada] is the severe weather, right?” he said. “If you are doing it outdoors, you can only cultivate for a portion of the year. If you want to do it year-round, you have to build massive infrastructures to cultivate indoors, and that immediately increases your cultivation costs over the long term.”

When Flora debuted on the Nasdaq on May 11, the company publicized the U.S.-based initial public offering (IPO) as the first known cannabis cultivator to list without using a special purpose acquisition company (SPAC), reverse merger or dual listing. Flora completed a $30 million pre-IPO equity raise in 2020, and then raised another $16.6 million once it completed the IPO.

Merchan said Flora already had enough funds to complete the transaction with Hoshi before the listing, but completing the IPO allowed the company to increase its cash position, which opened the door to freely finalize the Hoshi partnership as well as many other deals that are in the works and will be shared with investors and publicly as they become realities.

“[Expanding to Europe has] been part, all along, of our overall long-term strategy,” Merchan said. “We founded Flora Growth under the vision of becoming a global player in the cannabis industry. Europe, it’s a very attractive economy because of acquisition power, but also because of the favorable regulatory environment of some of the countries within the European Union. So, we knew all along that this was going to be an important step towards our expansion and distribution.”

How Effective is Your Internal Auditing Program?

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The word “audit” evokes various emotions depending on your role in an organization and the context of the audit. While most are familiar with and loathe the IRS’s potential for a tax audit, the audits we are going to discuss today are (or should be) welcomed – proactive internal quality audits. A softer term that is also acceptable is “self-assessment.” These are independent assessments conducted to determine how effective an organization’s risk management, processes and general governance is. 

“How do you know where you’re going if you don’t know where you’ve been” – Maya Angelou

Internal quality audits are critical to ensuring the safety of products, workers, consumers and the environment. When planned and performed periodically, these audits provide credible, consistent and objective evidence to inform the organization of its risks, weaknesses and opportunities for improvement. Ask yourself the question: do your clients/vendors rely on you to produce reliable, consistent and safe products? Assuming the answer is yes, what confidence do you have, and where is the documented evidence to support it?

Compliance units within cannabis businesses are typically responsible for ensuring a business stays legally compliant with state and federal regulations. This level of minimum compliance is critical to prevent fines and ensure licenses are not revoked. However, compliance audits rarely include fundamental components that leave cannabis operators exposed to many unnecessary risks.

Internal quality audits are critical to ensuring the safety of products, workers, consumers and the environment.

As a producer of medical and adult-use products that are ingested, inhaled or consumed in other forms by our friends, family and neighbors, how can you be sure that these products are produced safely and consistently? Are you confident that the legal requirements mandated by your state cannabis control board are sufficient? Judging by the number of recalls and frustrations voiced by the industry regarding the myriad of regulations, I would bet the answer is no.

What questions do internal audits address? Some examples include:

  • Are you operating as management intends?
  • How effective is your system in meeting specified objectives? These objectives could include quality metrics of your products, on-time delivery rates and other client/customer satisfaction metrics.
  • Are there opportunities to improve?
  • Are you doing what you say you do (in your SOPs), and do you have the recorded evidence (records) to prove it?
  • Are you meeting the requirements of all applicable government regulations?

There are potential drawbacks to internal audits. For one, as impartiality is essential in internal audits, it may be challenging to identify an impartial internal auditor in a small operation. If your team always feels like it is in firefighting mode, it may feel like a luxury to take the time to pull members out of their day-to-day duties and disrupt ongoing operations for an audit. Some fear that as internal assessments are meant to be more thorough than external assessments, a laundry list of to-do items may be uncovered due to the audit. But, these self-assessments often uncover issues that have resulted in operational efficiencies in the first place. This resulting “laundry list” then affords a proactive tool to implement corrective actions in an organized manner that can prevent the recurrence of major issues, as well as prevent new issues. The benefits of internal audits outweigh the drawbacks; not to mention, conducting internal audits is required by nearly every globally-recognized program, both voluntary (e.g. ISO 9001 or ASTM Internationals’s Cannabis Certification Program) and government required programs such as 21 CFR 211 for Pharmaceuticals.

Internal Auditing is a catalyst for improving an organization’s effectiveness and efficiency by providing insight and recommendations based on analyses and assessments of data and business processes. Additional benefits of internal audits include giving your organization the means to:

  • Ensure compliance to the requirements of internal, international and industry standards as well as regulations and customer requirements
  • Determine the effectiveness of the implemented system in meeting specified objectives (quality, environmental, financial)
  • Explore opportunities for improvement
  • Meet statutory and regulatory requirements
  • Provide feedback to Top Management
  • Lower the cost of poor quality

Findings from all audits must be addressed. This is typically done in accordance with a CAPA (Corrective Action Preventive Action) program. To many unfamiliar with Quality Management Systems, this may be a new term. As of Jan 1, 2021, this is now a requirement for all cannabis licensed operators in Colorado. Many other states require a CAPA program or similar. Continuing education units (CEUs) are available through ASTM International’s CAPA training program, which was developed specifically for the cannabis industry.

Examples of common audit findings that require CAPAs include:

  • Calibration – Production and test equipment must be calibrated to ensure they provide accurate and repeatable results.
  • Document and record control – Documents and records need to be readily accessible but protected from unintended use.
  • Supplier management – Most standards have various requirements for supplier management that may include auditing suppliers, monitoring supplier performance, only using suppliers certified to specific standards, etc.
  • Internal audits – Believe it or not, since internal audits are required by many programs, it’s not uncommon to have a finding related to internal audits! Findings from an internal audit can include not conducting audits on schedule, not addressing audit findings or not having a properly qualified internal auditor. Are you looking for more guidance? Last year, members of ASTM International’s D37 Committee on Cannabis approved a Standard Guide for Cannabis and Hemp Operation Compliance Audits, ASTM D8308-21.

If you are still on the fence about the value of an internal audit, given the option of an inspector uncovering a non-conformance or your own team discovering and then correcting it, which would you prefer? With fines easily exceeding $100,000 by many cannabis enforcement units, the answer should be clear. Internal audits are a valuable tool that should not be feared.

NFL, Players Association Provide $1 million for Cannabinoid Research on Pain Management

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Less than a month after debuting on the Nasdaq Stock Market, Colombia-based cultivator Flora Growth is connecting its cannabis pipeline to Europe through a manufacturing and distribution partnership with Hoshi International.

Headquartered in Toronto, but with 95% of its operations in Colombia, globally motivated Flora Growth made a 2-million-euro ($2.4 million) strategic investment to become a preferred supplier to Hoshicap Portugal—a subsidy of Toronto-based Hoshi International—the company announced June 7.

Courtesy of Flora Growth | floragrowth.ca

Luis Merchan became the CEO of Flora Growth in December as the company worked toward a public listing. 

The investment will provide Flora access to extraction facilities in Malta and Portugal to process its cannabis derivatives from Colombia and distribute them through Hoshi’s channels throughout Europe. The transaction is the first of many steps intended by Flora to launch its seven brands and 300-plus products across the world, President and CEO Luis Merchan told Cannabis Business Times. Flora’s cultivation practices to supply cannabis derivatives also include business divisions in cosmetics, hemp textiles, and food and beverage.

The Portugal license will allow for the cultivation and import of cannabis produced through good agricultural and collection practices (GACP)—guidelines outlined by the World Health Organization for medicinal plants—and also enable the Good Manufacturing Practice (GMP)-certified processing facility to export indoor and outdoor medical cannabis throughout Europe.

In Malta, Hoshi is completing its GMP facility to produce, process and package cannabis products, including oil derivatives, to be distributed throughout the European Union (EU). Hoshi’s Maltese entity received a provisional medical cannabis license covering cultivation, processing and importation/exportation under Malta’s Production of Cannabis for Medicinal and Research Purposes Act. 

“Those assets, the cultivation in Portugal as well as the facility in Malta, opened the door to us for completing the supply chain into the European Union,” Merchan said. “That’s very important to us because the market in the European Union is significant. Obviously, the No. 1 economy (in Europe), Germany, is very attractive and clearly is open for the import of cannabis derivatives. And having a partner as Hoshi as a critical partner and preferred distributor for the European Union became a no-brainer.”

Merchan said Portugal and Malta offer favorable regulatory environments, and low labor and energy costs. In addition, Hoshi’s analytical testing labs in Malta will allow Flora to establish a consistent import and distribution hub, which opens the doors for sought-after markets such as Germany, he said.

With a population of roughly 750 million and a health care spend exceeding 2.1 trillion euros, Europe has the potential to become the largest global market for medical cannabis products, according to Hoshi. That’s including non-EU members such as the United Kingdom (U.K.), which rivals Germany and France among the largest economies on the continent.

But that potential high-growth market has yet to be fully tapped because of a lack of legal infrastructure to supply GMP and GACP-grade medical product, according to Hoshi, which is on course to have EU cultivation licenses under both practices by first quarter 2022. 

Included in the Flora-Hoshi partnership, Flora will provide access to its library of tested and proven outdoor genetics to Hoshi for eventual cultivation at its Portugal facility. Hoshi also has import distribution agreements in the Czech Republic, Germany, Poland and the U.K.

“With the partnership with Flora Growth, Hoshi can now fast track a number of established initiatives to sell high-quality GACP flower to the EU market,” Hoshi CEO John Aird said in a Flora press release announcing the partnership. “We look forward to working with the Flora team and accessing not only their high-end genetics and outdoor grown cannabis but also assisting Flora move more finished products to its customers across the EU and globally.”

Courtesy of Flora Growth | floragrowth.ca

Flora Growth cultivates 100 hectares of cannabis year-round near the equator in Bucaramanga, Columbia. 

Founded in 2019, Flora leverages natural, low-cost cultivation practices with an all-outdoor cultivation operation that includes roughly 100 hectares (247 acres) of cannabis in Bucaramanga, Colombia. Approximately 500 miles north of the equator, Flora’s farm produces year-round yields with 12-plus hours of natural sunlight per day and a constant breeze of 3 mph at 1,500 meters above sea level, Merchan said. In addition, the Flora farm has six natural spring-water deposits to further reduce operational costs. 

Those natural conditions allow Flora to cultivate dried cannabis flower at 6 cents per gram (roughly $25 to $30 per pound), he said.

“We are cultivating under one of the best geographies in the world in terms of flower cultivation,” said Merchan, a dual citizen who was born and raised in Colombia but has spent his entire executive career specializing in retail and consumer packaged goods in the U.S., including his role as Macy’s Inc.’s vice president of workforce strategy and operations.

“The problem with cultivating and growing cannabis in [the U.S. and Canada] is the severe weather, right?” he said. “If you are doing it outdoors, you can only cultivate for a portion of the year. If you want to do it year-round, you have to build massive infrastructures to cultivate indoors, and that immediately increases your cultivation costs over the long term.”

When Flora debuted on the Nasdaq on May 11, the company publicized the U.S.-based initial public offering (IPO) as the first known cannabis cultivator to list without using a special purpose acquisition company (SPAC), reverse merger or dual listing. Flora completed a $30 million pre-IPO equity raise in 2020, and then raised another $16.6 million once it completed the IPO.

Merchan said Flora already had enough funds to complete the transaction with Hoshi before the listing, but completing the IPO allowed the company to increase its cash position, which opened the door to freely finalize the Hoshi partnership as well as many other deals that are in the works and will be shared with investors and publicly as they become realities.

“[Expanding to Europe has] been part, all along, of our overall long-term strategy,” Merchan said. “We founded Flora Growth under the vision of becoming a global player in the cannabis industry. Europe, it’s a very attractive economy because of acquisition power, but also because of the favorable regulatory environment of some of the countries within the European Union. So, we knew all along that this was going to be an important step towards our expansion and distribution.”

HEXO Commits to ESG Leadership, Starts by Offsetting 100% of Carbon Emissions and Plastic Packaging

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OTTAWA, Ontario, June 8, 2021 – PRESS RELEASE – HEXO Corp. is proud to announce a commitment to offsetting the company’s operational carbon emissions and the personal emissions of all 1,200 employees*, making HEXO 100% carbon neutral from September 2021 onward. The company is also committing to offset the plastic used in its pouch packaging through Plastic Bank in partnership with Dymapak, HEXO’s primary packaging supplier. These concrete actions highlight the company’s early steps toward a long-term commitment to leading the cannabis industry on Environmental, Social and Governance (ESG) action.

“We have always taken our responsibility for sustainability seriously. Now, as we are on the verge of becoming the top Canadian LP by recreational market share and continuing down the path towards top three globally, it’s more important than ever to take meaningful action to protect our planet—and this is just the start,” HEXO CEO and co-founder Sebastien St-Louis said. “We are challenging ourselves and the rest of the industry to do better, so in addition to becoming carbon neutral by offsetting our operational emissions, we feel it is our obligation to offset our employees’ emissions as well.”

Through a partnership with Canadian carbon management solutions company Offsetters, in support of the Great Bear Forest Project, HEXO will be measuring and offsetting the company’s corporate carbon emissions starting with its 2020 calendar year, making HEXO 100% carbon neutral by September 2021, as well as offsetting its employees’ personal emissions. The GreatBear Forest Carbon Project reduces carbon emissions by protecting forests previously designated, sanctioned or approved for commercial logging. Carbon finance supports the local First Nations communities by generating stewardship jobs protecting the Great Bear Rainforest—the largest intact coastal temperate rainforest remaining in the world—and offsets the equivalent of one million tonnes of carbon dioxide each year.

“On top of their own commitment to carbon neutrality, HEXO has raised the bar by committing to purchase offsets to mitigate their employees’ personal emissions,” said Dawn Hancock, director of client engagement at Offsetters. “This is the first time we’ve seen a company of this size make this kind of commitment and we hope that it helps to spur stronger commitments from other companies.”

In conjunction with HEXO’s primary packaging supplier Dymapak and its partnership with Plastic Bank, the company has offset 63,000 kilograms of plastic in 2021—the equivalent of over 3.15 million plastic bottles. HEXO will continue to counteract the use of all plastic in its packaging. Plastic Bank builds ethical recycling ecosystems in coastal communities and reprocesses the materials for reintroduction into the global manufacturing supply chain. Collectors receive a premium for the materials they collect to help them provide basic family necessities such as groceries, school tuition and health insurance.

“Ocean plastic is a critical issue with increasing challenges,” Dymapak CEO Ross Kirsh said. “Environmental consciousness has never been more important and we’re proud to partner with Plastic Bank and HEXO to mitigate the impact of child resistant bags and other plastic packaging. It’s our hope that other businesses will turn interest into action by committing to plastic neutrality.”

Offsetting HEXO’s carbon emissions, the emissions of its employees and counteracting the use of plastic packaging are among the latest steps in its company-wide mission to build a business that balances profit, people and planet. HEXO will monitor and publicly report on its greenhouse gas emissions, carbon neutrality and its continued efforts to improve sustainability. This includes minimizing waste at facilities, moving toward a more virtual workforce and reducing carbon emissions at production facilities, as well as exploring new sustainable packaging materials that are more easily recyclable or biodegradable. The recent acquisition of Zenabis and planned acquisitions of 48North and Redecan also offer unique opportunities to integrate sustainable practices and grow the company’s positive impact along with its business.

For more information on these efforts and how the HEXO continues to develop its ESG platform and stakeholder relations to make a positive impact on the communities in which it operates and globally, please visit https://www.hexocorp.com/environmental-social-governance.

*Estimated personal emissions based on the average Canadian’s emissions from heating and powering their homes, driving and food consumption

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Kelab Analitica Becomes First Accredited Cannabis Lab in Colombia

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Established in 2019, Kelab Analitica is the first laboratory in Colombia to specialize in cannabis and pharmaceutical testing. In March of 2020, the lab began operating and serving the cannabis market in the South American country.

Then in December of 2020, Kelab Analitica obtained ISO/IEC 17025:2017 through Perry Johnson Laboratory Accreditation, making it the very first cannabis testing lab in Colombia to attain accreditation. The lab was also certified shortly after in Good Laboratory Practices by Colombian health authorities for analysis of pharmaceutical products.

The lab has found that ISO 17025 accreditation has helped with their marketing strategy. “As the industry grows, more producers are beginning to understand the importance of working with an accredited laboratory for quality and consistency of results and to comply with international requirements,” says a team member at Kelab Analitica.

In the future, they plan to expand their reach locally in Colombia and look for opportunities to expand in Latin America. They are also engaged in research in chromatography and instrumentation to develop new cannabis testing methods.

Flower-Side Chats Part 6: A Q&A with Fabian Monaco, CEO of Gage Cannabis

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In this “Flower-Side Chats” series of articles, Green interviews integrated cannabis companies and flower brands that are bringing unique business models to the industry. Particular attention is focused on how these businesses integrate innovative practices in order to navigate a rapidly changing landscape of regulatory, supply chain and consumer demand.

The Michigan cannabis market is making pace with big time cannabis players like California (#1) and Colorado (#2). For the first quarter of 2021, combined cannabis sales in Michigan were nearly $360 million. At that pace, Michigan could see combined sales of $1.4 billion — well outpacing 2020 sales of $984 million.

Gage is the exclusive cultivator and retailer of world-leading cannabis brands including Cookies, Lemonnade, Runtz, Grandiflora, SLANG Worldwide, OG Raskal, and its own proprietary Gage brand portfolio in Michigan. The company recently secured a $50M investment in an oversubscribed round which included a $20M investment from JW Asset Management.

We spoke with Fabian Monaco, CEO of Gage Cannabis. Fabian started Gage in 2017 after meeting his operating partners in Michigan. Prior to Gage, Fabian worked as an investment banker racking up a number of firsts in cannabis industry financing and M&A transactions.

Aaron Green: Tell me how you got involved in the cannabis industry.

Fabian Monaco: My background is in investment banking – specifically 10 years of capital market experience. I was fortunate enough to be part of the initial team that brought Tweed, now Canopy Growth public. In fact, I worked on a lot of firsts in the industry: the first acquisition, the first $100 million financing, the first IPO in the space. Shortly after that, I went to XIB Financial, which co-founded Canopy Rivers with Canopy Growth. I was working on that when I encountered these two phenomenal operators. At the time, I had visited over 100 of these cultivation facilities and these were some of the best operators in the business. So that led me to start Gage in 2017.

Green: Where is Gage currently operating?

Fabian Monaco, CEO of Gage Cannabis

Monaco: In the U.S., we are purely operating in Michigan. We do have a licensing agreement with a small producer in Canada, so you will see the brand there.

Green: Tell me about your choice to settle the company in Michigan initially?

Monaco: If you look at Michigan as a historical cannabis market, it was the second largest cannabis market from a medical card holder standpoint for nearly a decade, only behind California. This was probably the case until 2019, where they went to adult use. So, for us, we knew this medical base was going to be a great platform to an outsized adult-use market. And already we see that April was $154 million in sales, adding up to over a $1.8 billion dollar run rate. That’s the third highest run rate in the country, only behind California and Colorado.

Green: What is it that makes Michigan different? You talked about medical cannabis already. Is there anything else about the demographics in Michigan or the consumer base that makes Michigan special in that sense?

Monaco: In Michigan, over 70% of the population is old enough to consume. So, when you take a look at how much of the population is 21-years-old plus, relative to other markets, the total addressable market in Michigan is just huge. Then when you take a look at their consumption habits, especially when it comes to flower, Michigan is consuming some of the highest amounts on a per capita basis. Those two stats set up a scenario where we foresaw the potential of the market. To be honest, the market has exceeded our expectations. We didn’t think it would be this strong this quickly. Right now, the state is looking to be a $3 billion market by 2024 – and it could easily surpass that.

Green: Any plans for expansion beyond Michigan?

Monaco: We’ve been to eight or so different states in the past 60 or 75 days really trying to educate ourselves on the licensing structure, the markets there and the key players in those respective markets. What are some of the costs, in terms of acquisitions? We really want to branch out the Gage brand into other states across the US. The thing is, we believe in the model that Trulieve deployed. They really focus on being the number one player in a very, very big market. For instance, Trulieve is obviously one of the top players in Florida. We’re trying to mimic that strategy.

Trulieve is a dominant market force in Florida

Once we have that deep market penetration, that market share, then we’ll start to get into other states. But for now, why would you want to go and rush out to another state when you’re already in the third largest market in the country?

Green: Are there any criteria you look for in a potential expansion state?

Monaco: We look at consumption habits. We want states with similar demographics to Michigan. Close proximity states also allows us to quickly go from one state to the other without having to take a multi-hour flight to get there. States we’re considering are Northeast and Midwest states, like Illinois, Pennsylvania, Ohio, New Jersey, Massachusetts and Maryland.

Green: What kind of consumer trends are you seeing in Michigan as it relates to products?

Monaco: Flower continues to dominate. In a market like Michigan, we have some of the top flower consumers in the country on a per capita basis. We specialize in flower and flower only, so this created a perfect scenario where we are able to ramp up our brand quite quickly, from a flower standpoint.

Now that we have that brand equity, that brand power, we are going to potentially delve into other categories, including extract-based products, such as carts, vapes and concentrates. You hear talk about these new beverages, but we’re not seeing that take off in this market as much as people think it would. Flower still remains at the top and that’s something we highly anticipate going after for quite some time.

Green: Can you tell me about your vertical integration strategy?

Monaco: We’re one of the larger retail portfolios in Michigan right now. We have 13 locations. Nine are operational. So, we’re really in a great spot overall in terms of how big of a platform we do have – one of the larger ones – and, frankly, in one of the larger markets in the country.

The Cookies flagship dispensary in Detroit, Michigan

We actually have a little bit of a unique scenario on the cultivation side of things. We have our own three cultivation assets that are going to be producing, on average, about 1,000 pounds of product over the next couple of months as they fully ramp up. We’ve actually contracted out a lot of our cultivation. Cultivation is time consuming, and it’s also very, very costly to build out. Luckily for us, we’re a really well-established and strong brand. We had the opportunity to contract out our growing. So, we have 10 different contract growth partners. These are phenomenal cultivators, again, some of the best in the state. They grow Gage and Cookies branded product for us. We have a great breakdown from a financial standpoint. We share the retail revenue with them on a 50/50 basis. They pay a little bit too, for packaging and testing. So, basically for $0 we’re getting product on the shelf where we’re achieving 50% plus gross margins. It’s a phenomenal setup for us on the cultivation side where we went from two cultivation assets in the latter half of last year to now eight different cultivation assets, moving to 13 by the end of the year.

On the processing side, we’re just actually finishing our processing lab. We should have extract-based products launched in Q3. We’re really excited to have our own line of extract-based products. We plan to focus on the carts to start – a very popular category in Michigan on the retail side of things.

Green: Are those cultivations all indoor?

Monaco: Yes, we’re big proponents of indoor flower. It allows us to control the quality of our flavors and consistency in our strains when we grow indoors. From our consumers, there is a very strong demand for indoor grown high-premium, high-quality products.

Green: What sets Gage apart from other competitors in Michigan?

Monaco: I think focus. We just focused on our flower. We focus on our post-production process. We hang dry everything, we hand trim everything, and we hand package everything. That’s a little bit more time consuming. It’s a little more costly. But all that effort shows in the end product which is key.

A lot of people think you can grow great quality product, you cut it down, you dry it and put it in the pack and it’s going to be great. You really need a strong attention to detail, especially in a big consuming market like Michigan, because again, they are a refined consumer. They’re looking for the best. They’ve already been consuming some of the best quality products in the country for many years now. So for us, we put a painstaking process in place for flower production, not only from the growing standpoint, but also through the end of that post production process.

Ancillary to our cultivation process is also consistently providing new varieties of flavors on the flower side of things to the consumers. When you look at the successful brands in California, what makes them special is that they’re consistently pheno hunting, coming out with new flavors. This is similar to the wine industry where the best wineries come out with a new kind of grape or mix and consumers get excited, they rush out and buy half a dozen bottles or a dozen bottles.

It’s a very similar scenario in the cannabis industry. I hate when people say that cannabis is a commoditized industry. It’s so far from the truth. You look at brands like us or Cookies, Jungle Boyz and you can see their constant innovation, their constant drive. They are always bringing something new for the consumers to try. That’s what really sets apart the best brands.

Green: What are the top three criteria you look for in a cultivation partner?

Monaco: Someone that follows a similar culture to us as a company. Obviously, quality of the actual cultivation assets is also important. We’ve vetted heavily each and every contract grower. It was actually a painstaking, multiple-month process. We started buying wholesale product from these partners first, then gave them a couple cuts of our clones and saw how they produced on a small batch basis. Once we saw that, we got to know them on a personal level, saw what they could produce with our own genetics, then said “Okay, do you want to be part of this program?”

We’ve had an overwhelming demand for the program. We’ve capped it off at 10 for now. We may expand as time progresses. We’re seeing some great, great quality product coming out of these producers.

Green: What’s got your attention in the cannabis industry? What are you interested in learning more about?

Monaco: I’m always intrigued with new ways of consuming. Across the U.S. and well-developed markets like California and Colorado, you see all these interesting new ways to consume the product. You’ve got patches, sublingual strips, etc. There are so many unique ways. I am currently seeing how they play out. Are they fads? Do people get excited about them initially, and then go back to their carts, or pens, and typically dried flower pre-rolls? I’m always trying to educate myself to see what’s on the market. What’s new? Who has a new drink? How does it hit? Are people excited about it?

Also, I am constantly learning about new brands that come out. There are so many new small brands that don’t necessarily have the scale or the capital to really expand, but are producing some of the best products in the country in a cool, unique form of packaging, etc..

Green: Alright, great. That concludes the interview!

Monaco: Thanks, Aaron.