CBD OIL

When Deseret Wellness Market President Jeremy Sumerix returned to his home state of Utah to launch a business in the state’s nascent medical cannabis market, he crafted a retail operation focused first and foremost on patient experience.

“What we stand for is patient experience, completely,” Sumerix tells Cannabis Business Times and Cannabis Dispensary. “Everything that we do is geared towards limiting wait times, expediting the process and making patients feel comfortable.”

Sumerix grew up in Utah before leaving to pursue a career. Prior to his role with Deseret Wellness, Sumerix worked for a multistate cannabis operator with a presence in New York, Florida, Illinois, Nevada and Arizona. After Utah voters approved medical cannabis in November 2018, Sumerix left that particular role to pursue a cannabis business in his home state, and his team were one of only four licensees awarded two retail locations by the state. The company’s first pharmacy opened Aug. 31 in Provo, and Deseret Wellness will open its second location in Park City during the first week of February.

“I think the thing that I’m continually the most excited about, is the state is conservative by nature,” Sumerix says. “They’re very methodical and careful in what they do. I think they’ve put together a really solid program that allows us to truly take care of our patients the right way.”

Creating the best possible patient experience is at the forefront of Deseret Wellness’ operations, Sumerix says, and the state has been very receptive to the company’s feedback on which regulations could be tweaked to improve patient access.

“If something in the current regulations doesn’t necessarily make sense or it limits our ability to take care of the patients the right way, the state is very cooperative and collaborative, so that’s been very, very encouraging,” Sumerix says. “I’ve operated in states that are less that way, so it’s refreshing to work with partners like we have here in the state of Utah.”

Deseret Wellness has implemented a robust, two-week training program for its employees, Sumerix says, which provides education on everything from the company’s products to the state’s regulations. After completing the training program, new hires then shadow an existing employee for a week or so until they are able to answer the wide variety of questions that may come up from patients.

Utah law requires licensed pharmacists to be on-site at cannabis pharmacies during business hours, and Sumerix says the company sought the best pharmacists it could find to join its team. These pharmacists are involved in the training and onboarding of new staff members.

“We look to those pharmacists as experts in the industry and the product,” Sumerix says.

Another way Deseret Wellness strives to offer the very best patient experience is through patient education. The company provides educational materials on-site at the pharmacy, such as articles that explain the differences between cannabis varieties and the various product formulations.

Deseret Wellness also regularly invites the state’s cultivators into the pharmacy to discuss their specific cultivars and products, and how their offerings can help patients with their medical conditions.

“It’s been a great collaboration with the cultivators in the state,” Sumerix says. “We have a great relationship with them, [and] I think the patients get really excited to see them visit the pharmacy because they get to learn about the product firsthand.”

Utah’s medical cannabis law forbids open flame, so Deseret Wellness sells flower and vaporizers, as well as vape cartridges and topicals in the form of balms, lotions and patches. The pharmacy also carries gel capsules, tinctures and sprays.

In the future, Sumerix says Deseret Wellness will also carry cannabis concentrates for patients who might need higher-potency products.

Utah is currently developing a system that will allow the state’s licensed pharmacies to deliver medical cannabis products directly to patients, which Sumerix says will only continue to improve patient access and experience.

“That will allow us to get to patients who aren’t necessarily able to get to our pharmacy, so that’s very exciting,” he says. “[The state needs] to pin down some of the specifics of the delivery platform, the delivery service, but more than likely, it’ll allow us to get to patients who are in more rural parts of the state.”

As Deseret Wellness looks toward opening its second location in Park City, Sumerix says he hopes the company can replicate what has worked well in its Provo store, from the welcoming environment to SOPs that keep patient wait times down.

The company will also continue what Sumerix calls a “deliberate approach” to avoid the spread of COVID-19 as the pandemic rages on. Efforts include checking employees’ temperatures every morning, as well as requiring all employees and patients to wear masks while inside the pharmacy.

Deseret Wellness launched curbside pickup very quickly at the start of the pandemic, Sumerix adds, and once a patient has enrolled in Utah’s medical cannabis program and purchased product inside the pharmacy once, he or she can then leverage the company’s online ordering and curbside pickup services.

“Like everybody else, we’ve worked really hard and we’re incredibly nimble, … ready to react if and when things come up,” Sumerix says. “It’s all about being diligent and consistent, and so far, we’ve been able to do that.”

Deseret Wellness is in the final stages of construction and hiring for its Park City store, and plans to hold a ribbon cutting ceremony and open house Jan. 27 with select members of the community, including the director of Utah’s medical cannabis program. The Park City pharmacy will then open its doors to patients the following week.

Looking ahead, once its new location is up and running, Deseret Wellness aims to explore its delivery options, as well as continue its efforts to offer the best possible patient experience at both of its pharmacies.

“It’s just ensuring consistency and constantly making sure that we have the right products for the patients,” Sumerix says.

Cannabis genetics are the cornerstone of Green Dot Labs’ Boulder, Colo.-based concentrates operation, and according to co-founder Dave Malone, the craft beer industry provided the inspiration he needed to give the company’s unique cultivars their own identities.

Malone says the craft brewing industry started out as a select few companies with lines of beers that were almost indistinguishable among consumers, but as soon as brands began investing in marketing, consumers started gravitating toward specific brands.

The cannabis industry, he says, has a lot to learn from this approach.

“That’s what we’re aiming to do with our genetics, is give them their own identity,” Malone says. “People may prefer different brands for whatever reason, but they still look at our Cherry Fluff strain, for instance, which is [branded as] a beautiful cherry on a big pile of whipped cream, and [the marketing is] very captivating and seductive. People identify with that.”

Photo courtesy of Green Dot Labs

Dan Banks, director of cultivation strategy for Denver- based Lightshade, echoes this sentiment, adding that marketing is beginning to play a large role in the cannabis genetics space, with name-brand recognition starting to emerge among consumers.

“You have a couple different demographics,” Banks says. “You have people who are used to getting certain things from dispensaries, [and] they want to see those things maintained. Then you have people who are interested in anything new and checking that out, and if it’s new, then they’re like, ‘I want more of that’ or ‘I want more from that lineage.’”

Founded in 2011, Lightshade is one of the largest Colorado-owned, vertically integrated cannabis operators in the state. The company operates a greenhouse operation in Denver, as well as four indoor grow facilities.

When Banks joined Lightshade in late 2019, the company was cultivating roughly a dozen varieties across its five facilities, but it has since grown its genetics library to nearly 70 cultivars, with roughly 30 in regular production.

“Over the last year and some change, we’ve grown the library of genetics in the company and then implemented what we call a phenotyping program,” Banks says. “Basically, that’s a systematic way of introducing new varieties into production and gathering information about their performance, both on the horticultural side and also on the quality [and] potency side, as well.”

Lightshade acquired vertically integrated cannabis operator Sacred Seed last summer, which provided the company with a large bank of new genetics. Heading into 2021, Lightshade will establish an in-house breeding program to produce unique and proprietary varieties.

“[We’re] really trying to get some unique variety, … while also trying to cater to consumers that are looking for specific name-brand strains, as well,” Banks says, adding, “A lot of the things that people are excited about right now, there’s a lot of marketing behind that. Sometimes that marketing has a lot of substance backing it up, and other times it’s just a lot of hype.”

Photo courtesy of Lightshade

Along those same lines, Malone says that companies can invest in robust marketing for a mediocre product, but that product still won’t do as well as better-quality offerings—product quality and marketing must go hand in hand.

“You can put all of the branding in the world on a jar of undifferentiated product and it won’t do well, but if you have integrity from the core, which is your genetics, it really extrapolates the value downstream when you do add these marketing layers to the product,” he says.

Green Dot Labs is entering its seventh year and maintains an in-house breeding program to create genetics specifically for its extracts.

“A lot of cannabis companies are curating genetics through a vast network that are available worldwide, whereas we’ve taken that into our own hands and steered the ship toward the goals that we set out, [so we’re] not necessarily … at the mercy of the market to provide content for the brand,” Malone says.

As it breeds new strains, Green Dot Labs brands them, which Malone says has become especially important in recent years as consumers have started to expect more from cannabis extracts.

“The consumer wants to know more,” he says. “They want to know the heritage, the lineage, where the strain came from, [and] what kind of flavors and experience they can expect when they open the package.”

Green Dot Labs has roughly 20 branded strains in its genetics library, and Malone says the branded cultivars outsell the company’s non-branded offerings, 3-to-1.

“There is so much content out there for the average consumer,” he says. “It’s overwhelming to find what strains work best for you. Everything in the current market, specifically here in Colorado, is extremely generic. A lot of companies haven’t taken this extra measure to differentiate their genetic portfolios.”

It’s a cultivator’s responsibility to tell the consumer why his or her product is better than others through branding, Malone says. The main points of brand differentiation, he adds, will be proprietary genetics that offer unique flavors and experiences, as well as the quality and efficiency with which these cultivars are produced.

Creating a Differentiated Experience

When Green Dot Labs launched its breeding program, Malone says it took a qualitative approach. The company pursued genetics that mirrored nearly every type of fruit, from a banana to an apple, and also started breeding what he calls “gassy” varieties. Since not all genetics are created equal when it comes to performing well in the extraction process, data collected during extraction helped the Green Dot Labs team further refine its genetics offerings. Specifically, the company looked at extract yields, and pursued cultivars with differentiated flavors that offered as much resin as possible.

Green Dot Labs recently closed on a new facility in Colorado that will allow the company to expand and increase its R&D capacity as it heads into the new year.

“We’re going to be delivering new strains and new flavors that have never even been imagined by the most sophisticated cannabis connoisseur,” Malone says. “That’s the goal now.”

Another one of the company’s goals, he adds, is to find strains that perform well during solventless extraction.

Photo courtesy of Green Dot Labs

“You see a lot of connoisseurs wanting to enjoy the solventless extract, but the problem with this and why it’s so expensive is because your yields are highly unpredictable and heavily predicated on the quality of the plants you produce and the genetics,” Malone says, adding that Green Dot Labs currently has 10 cultivars in its genetics library that work well with solventless extraction.

As the company heads into 2021, it will expand its extracts line by improving the resin structure of its favorite plants while also creating new cultivars.

“We like to offer something for everyone,” Malone says. “Each consumer has a certain taste, and we don’t want to alienate anybody. We want to make it so anybody who likes cannabis can come to Green Dot Labs and this can be their one-stop shop.”

For Banks and the Lightshade team, 2021 will be focused on establishing the company’s breeding program, which will include sourcing more genetic material and identifying desirable plants to work with.

“What we’ll do is try to establish a bank of male plants that we can then use to start crossing with females, and the other thing that we’ll do is look at partnering with some of the companies that are offering genetic mapping in order to get a better understanding of the source genetics that we have,” Banks says. “You bring something in and it has a name, but is it what they’re saying it is? We don’t know, but we can look into that.”

The market continues to change rapidly as consumers gain a better understanding of terpene profiles and minor cannabinoids, adds Nick Drury, Lightshade’s director of cultivation operations, and Lightshade will lean into consumer education and marketing to address these topics.

“People are realizing that it’s not just about THC content,” Drury says. “It’s also about your overall terpene profile, and how those terpenes and cannabinoids are interacting to produce a high. As people start to increase their own education into certain things, I think what you’ll start to see in the market as a whole is a shift … in terms of what people are looking for, and a little bit more interest in specific profiles, [which will do] away with the indica/sativa/hybrid terminology. … That will open up the market to a lot of cultivars that may be low in overall THC, but they might be high in CBN and all these other cannabinoids and all the different terpene profiles. … I would say education and marketing are huge in the upcoming year.”

“I think branding is just going to become more important than ever,” Malone adds. “[With] the quality [and] the differentiation being so vast, how you present the product to the consumer is really where the rubber is going to hit the road once competition elevates to this level.”

As the COVID-19 pandemic rages on, cannabis businesses—many of which were deemed “essential” during coronavirus-related shutdowns—have become accustomed to implementing policies and procedures to keep their employees and customers safe, from mask-wearing and sanitation protocols to how they handle COVID testing at their facilities. Now, as the first vaccines are released across the country, primarily to frontline and health care workers to start, Bianchi & Brandt partner Laura Bianchi says cannabis businesses should develop internal policies regarding vaccination.

“It really is an evolving topic, as it has been all year long,” Bianchi tells Cannabis Business Times and Cannabis Dispensary. “It changes week to week, but I do think that cannabis companies are prepared [to handle the vaccine] because they had to deal with [the pandemic] in such a front-facing manner throughout the entirety of 2020. I think for a lot of businesses, they could say, ‘Everybody work remotely,’ and they haven’t had to come up with the thoughtful policies and procedures to keep everybody safe. Cannabis companies for the most part have, so I think that puts them ahead of the curve in going, ‘OK, now let’s figure out this next phase. How do we adopt and implement things that will make sense for our patients and our staff?’”

Businesses should be prepared to move quickly once the COVID-19 vaccine is available to the general public, Bianchi says, and when developing their policies regarding vaccination, business owners should consider that in many markets, cannabis companies operate medically. Dispensaries must be prepared to deal with ill patients who may be in higher-risk populations, and Bianchi says many of her cannabis clients are considering requiring their employees to be vaccinated for this reason.

“We always advise [that] there has to be exceptions for people who have some sort of medical issue or seriously held medical beliefs,” she says. “But this is a health care facility, so we can’t place other people and patients at risk. If we can require people to take the vaccination, it’s a benefit not only to the business owners and to all of their employees, but [also] to the patients who come in.”

Many states are “at will” employment states, Bianchi says, which means that employers have the right to establish company and workplace policies, requirements and conditions—such as those relating to mandatory vaccination—as long as they don’t violate any constitutionally protected class or right.

In addition, this past December, the Equal Employment Opportunity Commission (EEOC) determined that an employer’s act of requiring employee vaccinations alone would not violate the Americans with Disabilities Act (ADA), Bianchi says, which could further strengthen an employer’s position on required vaccinations.

Although it appears, then, that employers can legally require employees to receive the COVID-19 vaccine, Bianchi says the issue is likely going to be the subject of debate and litigation going forward.

“Employers really do need to weigh the risks and benefits of requiring vaccinations to ensure the health, safety and welfare of their employees, clients and business as a whole, versus any potential liability related to implementing such a requirement,” she says.

Many of Bianchi’s clients have asked how to approach mandatory vaccination from an operational standpoint, and she has advised them to be as detailed as possible in their policies and procedures. First and foremost, she says employers should issue a uniform vaccination policy in writing, and this policy must be carefully constructed.

For example, in many facilities, such as dispensaries and cultivation and manufacturing operations, employees cannot work remotely to slow the spread of the coronavirus, and they work in close proximity to one another. In these situations, Bianchi says it might make sense for employers to require mandatory vaccination.

“A lot of our clients also have corporate offices, and for corporate offices, there’s a little bit more flexibility in saying, ‘If we don’t want to implement a must-have vaccination policy, can some of these individuals work remotely?’” she says. “Even that can be a slippery slope because you want to make these rules and requirements cohesive across the board, but there is some flexibility where maybe you’re in a location where you don’t always have to be on-site to do work.”

“Employers really do need to weigh the risks and benefits of requiring vaccinations to ensure the health, safety and welfare of their employees, clients and business as a whole.”

– Bianchi & Brandt partner Laura Bianchi

In most cases, Bianchi advises companies to evenly apply vaccination policies across the board, and business owners should meet with their attorneys to go over exceptions to mandatory vaccine policies, including requirements for employees looking to prove that they are in a situation where they would be exempt from such a policy.

If an employee refuses to follow a mandatory vaccination policy for reasons outside of the allocated exemptions, Bianchi says an employer could legally take disciplinary action, including termination.

“Again, most states are ‘at will’ employment states, so if an employer implements a COVID-19 employee vaccination policy … and an employee simply refuses, that employee may be subject to discipline, up to and including termination,” she says. “This is also something employers may opt to contractually require through an employment agreement. In that case, an employee’s refusal would be deemed a breach of contract and in the same manner, be subject to discipline, up to and including termination.”

Employers should also consider whether they will pay for mandatory vaccines if they are not covered by health insurance, as well as the timeframe for employees to be vaccinated.

“A lot of our employers are saying, ‘We’ll do this as a group—either we’ll take our employees to a certain location, or we’ll have them come to us,’” Bianchi says. “[Many businesses] did this with COVID testing, as well, [to make] it easier for employees, so they’re not searching for a location, they’re not paying fees—the employers are taking that on when they can.”

Creating a vaccination policy for seasonal workers at cultivation facilities could also pose a challenge, she adds, and employers must decide whether to require these types of hires to receive the vaccine, as well.

“You’ve really got to think about how do we keep everybody safe?” Bianchi says. “They’re going to go home to their families, [and] we’ve seen how quickly [the virus] can spread. This is an industry where it can and certainly does spread fast, so we’re trying to think of those things ahead of time, and every business has to figure out how to function financially but also help employees who may be in vulnerable financial situations get through this.”

Throughout the coronavirus pandemic, Michigan saw a significant increase in adult-use cannabis sales, according to a new report from Headset.

Michigan legalized adult-use cannabis in 2018 and had its first sale on Dec. 1, 2019. Although the state legalized recreational cannabis nearly two years ago, sales have yet to launch in the state’s most populous city, Detroit. 

Despite the pandemic and Detroit sales not yet launched, the data report from Headset, a company that provides leading insights into cannabis consumer trends, disclosed that adult-use cannabis sales in Michigan increased by 482% between January and December 2020, topping $500 million in sales.

Within eight months of the state’s first adult-use sale, Michigan’s medical and adult-use markets brought in $595 million combined, surpassing the Nevada market last year, which legalized recreational sales in January 2017.

The report revealed that traditional flower accounted for the majority of recreational sales at 47.8%, followed by vape pens at 20.6% and edibles at 14.9%.

Medical cannabis also saw a consistent increase in sales throughout the year. That market led cannabis sales in the state between January and June 2020; however, recreational sales took over the market in the second half of the year, exceeding medical by $5 million in July.

Looking forward, the report states that adult-use sales may continue to gross more sales than medical. Furthermore, the anticipation of adult-use cannabis hitting the Detroit market this year may further boost the predicted increase in sales of recreational cannabis.

Boulder, Colorado, Jan. 14, 2021 (GLOBE NEWSWIRE) — PRESS RELEASE — Surna Inc. announced today that it recently signed a sales contract valued at $3.2 million.

The project in Arizona is for an approximately 53,000-square-foot facility. Surna is under contract to provide custom air handlers, heat recovery chillers and its StrataAir vertical racking air flow system for the cultivation, processing, drying and office spaces (the mechanical engineering design was done by Surna through a previous contract in October). Surna will also provide its SentryIQ environmental controls, and system start-up.

Tony McDonald, CEO, commented: “For the second time in six months, Surna is announcing its largest-ever single contract with this latest contract being nearly 15% larger than the previous record. Over the last several years Surna has invested heavily in technology R&D as well as in our engineering capabilities. The result has been an expanding portfolio of product and system offerings and enhanced engineering sophistication. With Surna’s expanded array of technology offerings, our engineering and sales teams were able to present several options to the client, giving them the opportunity to compare and contrast design approaches and choose the solution best tailored to their particular goals, budget and cultivation methods.”