Cannabis-Adjacent Businesses Ineligible for Federal Coronavirus Loans

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Cannabis-adjacent businesses will be ineligible for loan assistance under the $2 trillion stimulus plan approved by federal lawmakers and signed into law by President Trump last month, Marijuana Moment reports.

The plan, called The Coronavirus Aid, Relief, and Economic Security (CARES) Act, aims in part to assist American companies with 500 or fewer employees via a Paycheck Protection Program. The federal Small Business Administration (SBA) already confirmed, however, that cannabis businesses will not receive federal financial assistance because the industry remains federally prohibited. Additionally, under SBA rules, ancillary firms that work directly with or help to benefit federally illegal operations cannot receive loans from the administration, meaning these businesses will also be omitted from the coronavirus relief stimulus plan.

The type of businesses that fall under SBA’s category of “indirect marijuana businesses” include: “businesses that provide testing services, or sell or install grow lights, hydroponic or other specialized equipment, to one or more Direct Marijuana Businesses; and businesses that advise or counsel Direct Marijuana Businesses on the specific legal, financial/accounting, policy, regulatory or other issues associated with establishing, promoting, or operating a Direct Marijuana Business.”

The rule essentially sections off the entire cannabis space, including ancillary companies who have cropped up to support the budding industry, from receiving any of the federal government’s coronavirus loan assistance.

Josh Kappel, a founding partner at Colorado’s Vicente Sederberg, a cannabis industry law firm, called the restrictions “egregious” and “incredibly unfair.”

“These companies pay Social Security and Medicare taxes, unemployment taxes, and, of course, federal corporate taxes. In every way, they deserve to be treated like any other business when it comes to these emergency loans.” — Kappel, in a statement to Marijuana Moment

Hemp industry operators will have access to the federal assistance because the industry has been federally legalized.

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Oregon Sets Cannabis Sales Record In March

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March cannabis sales in Oregon set a new monthly record with $84.5 million – a 37 percent increase from the same time last year, Willamette Week reports. The previous record, set in July 2019, was just about $80 million.

The record-breaking month comes amid the state’s coronavirus response, which includes a stay-at-home order issued on March 23. On average, sales per cannabis retailer were about $135,000 – a 30 percent increase from March 2019.

According to the report, flower comprised more than half of total sales, while concentrates and extracts accounted for the second-highest market share.

Matt VanSickle, an Oregon Liquor Control Commission spokesperson said the sales appeared to be “stocking up type of activity” adding that “the next two weeks returned to slightly below their early March sales levels.”

VanSickle told KOIN that February’s sales were also 20 percent higher from February 2019 and that there was a 21 percent increase in March’s sales over February’s.

Despite the record-breaking month, Bridge City Collective owner Dave Alport told the Bend Bulletin that while the “average purchase is higher, the impact on sales is negligible.” He also said his payroll and cleaning costs have gone up after hiring delivery drivers and implemented enhanced sanitation practices.

“From what I can gather, there’s no increase in consumption tied to the pandemic or people staying home. But people’s shopping and spending habits have changed.” – Alport to the Bulletin

Tyson Haworth, owner of Oregon’s Finest, told the Bulletin that his sales have dipped since the stay-at-home order but he has hopes that the 4/20 “season” will help the company see pre-pandemic levels.

Oregon Gov. Kate Brown’s stay-at-home order does not have an end date.

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Organigram Temporarily Lays Off 45% of Workforce

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Canadian licensed cannabis company Organigram Holdings Inc. is temporarily laying off about 45 percent of its workforce as part of its coronavirus response. The company said the move is an attempt to “help boost COVID-19 containment efforts representing approximately 400 employees.”

CEO Greg Engel said in a statement that the company’s “priority right now is to make sound strategic decisions that are in the best interests” of the company’s employees “which will contribute to the long-term sustainability of the company.”

“This is a new and evolving situation demanding strong leadership and smart decision-making across all industries and sectors. We continue to monitor this rapidly changing situation and will make the decisions necessary to ensure the safest environment for our employees as well as insulating our business as best we can under the circumstances.” – Engel in a statement

The company had alluded to the cuts last month and said “the majority” of the layoffs were voluntary. They indicated that affected employees would receive lump-sum payments “to help bridge the gap to available government programs.” Additionally, the company said it will absorb the paid health, dental, and short-term disability premiums for all of its employees.

Organigram said they expect to reduce their cultivation, harvest, production, and packaging operations but plan to “supplement with inventories on hand to meet anticipated demand.”

“Specifically, the company will be focused on leveraging automated and the most efficient lines of production and will deprioritize lower value products requiring higher manual labor,” Organigram said in a press release.

The firm said it had already taken coronavirus mitigation actions at its facilities and offices as recommended by Health Canada, including work-from-home policies, the establishment of an Emergency Response Team, restrictions on work-related travel, social distancing, and enhanced sanitation practices.

Last week Canopy Growth announced temporary layoffs of 200 employees amid the outbreak, but also said they were re-opening some of the stores they shuttered last month. Canopy CEO Jordan Sinclair told Bloomberg that the temporary layoffs were retail employees and that the stores would operate under a “click and collect model” and reduced hours.

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DEA Deschedules Cannabis-Based CBD Medication

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The Drug Enforcement Administration has given up its influence over Epidiolex, the cannabis-based CBD epilepsy medication from UK-based GW Pharmaceuticals.

Epidiolex is currently the only FDA-approved CBD medication; it was approved in 2018 to treat cases of severe epilepsy and DEA had originally scheduled the drug as a Schedule V substance, the lowest restriction possible under the Controlled Substances Act (CSA).

“This notification from DEA fully establishes that EPIDIOLEX, the only CBD medicine approved by FDA, is no longer a controlled substance under the federal Controlled Substances Act. We would like to thank DEA for confirming the non-controlled status of this medicine.” — Justin Gover, CEO of GW Pharmaceuticals, in a press release

The scheduling shift removes many of the barriers to access Epidiolex. Patients, for example, will still require a doctor’s prescription to access the drug but the prescription will now last up to a year and patients will be allowed to change pharmacies and still have access to their medication.

Early reports on the drug suggested that a year’s worth of the CBD-based medication would cost about $32,500.

While Epidiolex has been removed entirely from the CSA, the cannabis plant itself hypocritically remains a Schedule I substance, which designates an extremely dangerous substance with no accepted medical value.

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Cannabis Industry Feeling Effects of Coronavirus Financial Fallout

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The financial effects of the coronavirus pandemic on cannabis companies are beginning to manifest as two licensed Canadian firms filed for bankruptcy protection amid the pandemic and the industry saw just two capital raises in the week that ended March 27, Bloomberg News reports.

According to Viridian Capital Advisors data outlined by Bloomberg, the two capital raises were worth just $5.6 million – the lowest level of activity this year. Over the same period last year, there were 17 capital raises in the cannabis space totaling $169 million.

Last week, Canadian firms CannTrust Holdings Inc. and James E. Wagner Cultivation Corp. both filed for bankruptcy protection. CannTrust’s filing can’t necessarily be linked directly to the global pandemic, though, as the company has been beleaguered by violations since last summer, which ultimately culminated in their license suspension in September. The New York Stock Exchange subsequently said it would de-list the firm.

“The effects of the COVID-19 pandemic have exacerbated what were already difficult circumstances making it even more challenging for CannTrust to attract new financing or a strategic partner.” — CannTrust in a statement

James E. Wagner Cultivation announced a deal last Wednesday that will see it undergo a “consensual restructuring” and pursue creditor protection with cannabis industry lender Trichome Financial Corp. Under the terms of the deal, Trichome will provide JWC with a debtor-in-possession loan of up to $2.8 million during the restructuring and Trichome will submit a “stalking-horse” bid.

Moreover, well-capitalized Cronos Group Inc. delayed its fourth-quarter results and restated three previous quarters due to the way it reported bulk resin purchases, according to Bloomberg. Those resin purchases also led to an investigation by the U.S. Securities and Exchange Commission.

Hexo Corp., which is also considered well-capitalized, missed its quarterly filing deadline, announced $266 million of writedowns and impairment charges when it did report, and its revived debt covenants require the firm to raise $40 million in equity by the end of the month, the Bloomberg report says.

In Canada, cannabis companies are eligible for government-backed loans made available as part of the pandemic response. In the U.S., hemp companies can apply for government assistance but not medical or recreational businesses since the cannabis plant remains federally prohibited.

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High Times Suspends Publication of DOPE and Culture Magazine

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Hightimes Holding Corp. announced on Monday that the company will suspend the publication of DOPE and Culture magazines due to the COVID-19 outbreak. The novel coronavirus has caused a mass shut down of in-store dispensary shopping as many states move to curbside pickup and online ordering only. DOPE and Culture are primarily print publications that are distributed to dispensaries monthly and, without waiting rooms full of patients and adult-use customers to read or pick up their latest issues, High Times has chosen to shut down both magazines for the time being.

In a statement to Marijuana Moment, Hightimes Holding Corp. Executive Chairman Adam Levin said the publications were on pause amid the pandemic.

“We furloughed the print publishing staff of Dope and Culture till the virus passes. Since both mags are distributed through walk up distribution methods (retailers, pharmacies, etc), we made the decision to suspend publishing till then.” — Levin, via Marijuana Moment

With stay-at-home orders in place and the possibility that the virus could persist for some time, High Times also laid off six workers from the canonical cannabis magazines. Among those furloughed was 18-year employee and long-time editor for High Times Danny Danko, confirmed by his own announcement on Twitter.

This follows a less graceful downsizing at the Seattle DOPE offices when the majority of the magazine’s employees were abruptly fired. This time, however, the company says their plan is to return all furloughed employees once the outbreak has been contained and the world returns to the new normal.

In the last year, High Times announced it would shift to becoming a plant-touching business with plans to open flagship retail dispensaries in Los Angeles and Las Vegas. Despite having disclosed financial hardships with the release of each quarterly statement, the corporation persists and recently acquired the cultivation firm Humboldt Heritage.

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California Officials Urge Santa Clara to Allow In-Person Cannabis Sales

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San Jose, California and state lawmakers are urging Santa Clara County public health officials to allow in-person recreational cannabis sales after they were shut down last week in favor of delivery-only options, the Mercury News reports.

In a letter to county Public Health Officer Sara Cody, San Jose council members Pam Foley, Magdalena Carrasco, and Maya Esparza requested that the agency “reconsider only allowing medicinal cannabis to be purchased within a store, curbside, or by delivery.”

“Today, a resident can walk out of a grocery store with a bottle of Tylenol, but that same person is unable to pull up curbside for pain relief from CBD oil. These individuals in need of relief should not be denied safe access to cannabis during this critical time.” – Foley, Carrasco, and Esparza in the letter, via the News

State lawmakers Assemblyman Ash Kalra and Senator Jim Beall also wrote a letter to county officials, pointing out that the order “has unintentionally led to confusion and places additional requirements on already thinly deployed law enforcement and licensing enforcement personnel.”

Santa Clara County Counsel James Williams told the News that the order aligns with the county’s overall goal of reducing the gathering of groups.

“Of note, many letters note the large numbers of people who may be seeking in-person access to dispensaries,” Williams said in an email to the News. “Even for essential services, everyone is strongly urged to stay at home as much as possible and to reduce and consolidate trips in order to minimize contacts to the greatest degree possible.”

Kalra and Beall echoed the sentiments of San Jose Police Department Cannabis Division Manager Wendy Sollazzi that shutting down in-person recreational cannabis sales would just move consumers into the illicit market.

Williams argues that the order doesn’t require medical cannabis customers to, necessarily, have a medical cannabis card but that some law enforcement agencies are choosing to use the card “as a proxy” for whether the person is seeking cannabis for medical purposes.

Santa Clara County’s stay-at-home order is in effect until May 3.

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Delaware Approves Emergency Dispensary Delivery Rules

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Delaware medical cannabis dispensaries will soon be able to deliver to patients amid the coronavirus outbreak as regulators are crafting emergency rules to allow the service.

The Delaware chapter of NORML broke the news last week and licensed provider Columbia Care said they would be the first in the state to offer the service to patients and designated caregivers who are registered with the company and live within a 30-mile radius from the dispensary.

Columbia Care said the company is following U.S. Centers for Disease Control guidelines to protect patients and staff to limit the spread of the virus, including sanitation of the stores and equipment, a heightened focus on staff hygiene and the use of protective gear, and a requirement that staff displaying or reporting symptoms must stay home.

NORML said the changes were needed as some patients may not drive and many don’t have an authorized caregiver to pick up their medicine for them.

“Ordering online with pick up options isn’t enough when a vast majority of patients are now homebound with little resources to facilitate those services. Medical patients are the most at risk and we should be doing everything we can to ensure their safety.” – Delaware NORML blog post, April 3, 2020

The state Department of Health and Social Services is also accepting patient and caregiver applications by mail during the pandemic.

According to Delaware Emergency Management Agency data, the state has reported 783 confirmed coronavirus cases and 15 deaths.

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Profile: Ram Dass, Medicinal Psychedelics Pioneer

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On December 22, 2019, Baba Ram Dass passed away peacefully at his garden home in Maui. Today — April 6, 2020 — marks the 89th anniversary of his birth, and as a father of the American psychedelic revolution, we want to honor him to celebrate.

The spiritual teacher first became Baba Ram Dass in the late ‘60s after a search for more led him to India. Then Richard Alpert Ram Dass embarked on a journey with Bhagawan Das through the temples of India. It was in the last temple where they traveled that he met Neem Karoli Baba, or Maharajji, the enlightened man who gave him his name.

Ram Dass means “servant of Lord Rama.” In the Hindu religion, Lord Rama is the seventh incarnation of Vishnu, a god of purity and marital devotion. However impactful this particular meeting was for him going forward, his whole life played a part in the lessons he taught. In his life, Ram Dass says he had three parts. He was an overachiever, he played a huge role in the psychedelic revolution of the 1960s, and finally, he became an Ashtangi; each part was essential in creating the Ram Dass cherished by the world.

Early Days

The psychologist was born Richard Alpert in Newton, Massachusetts. In his spare time, young Alpert was an amateur cellist and didn’t think much of the Jewish religion he was born into. His self-described achiever addiction inspired him to attend medical school at Tufts University. Soon he shifted his studies to focus on psychology, eventually earning his PhD. from Stanford University on the topic.

While studying at Stanford, Alpert developed severe anxiety, which would manifest physically as stomach cramps, diarrhea, and a severe rash between his fingers. During this time he committed himself to five years of psychoanalysis focused on the causes of his homosexuality. At Stanford Alpert learned from mentor David McClelland, and eventually accepted a tenure-track position working underneath him across the country at Harvard University. Before leaving, his psychiatrist informed him that because of his homosexuality he was too sick to function in modern society. But still, he persisted.

At Harvard, McClelland was the head of the Center for Research and Personality with Dr. Alpert serving as his deputy. It was in this research position that Alpert first met Dr. Timothy Leary. On a whirlwind trip to South America, Leary was fated to have his first experience with psilocybin and would bring it with him back to the States. A few months later, back in Massachusetts, Alpert walked from his childhood home over to Leary’s house to ‘turn on’ for the very first time.

The Age of Expanded Consciousness

This first experience with any psychedelic was pivotal for the young doctor: he described seeing the various social ‘masks’ he wore, like scholar and playboy, separate from him. He claimed he learned more in those few hours than he had in a lifetime of scholarly endeavors. This fact alone changed his world forever.

By this point, both Harvard Doctors were focused only on researching the therapeutic potential of psychedelic drugs. They were granted permission to research using graduate students, but rumors flew and the dean caught wind that their studies weren’t blind nor were they conducted only with graduate students. By 1963, both Leary and Alpert had been let go from Harvard.

Alpert, Leary, and their followers began living in houses rented out by Leary until their owners returned from academic leave. They conducted group LSD studies with the goal of cultivating divinity in every person. Their findings were published in the Psychedelic Review. This work culminated in the publishing of a 1964 book written by both Alpert and Leary alongside Ralph Metzger entitled The Psychedelic Experience. In 1966 Alpert co-authored LSD with Sidney Cohen and Lawrence Schiller.

The Psychedelic Experience, published 1966.

But the age of free hallucinogenics was destined to end sooner or later, and things became much more complicated in 1966 with the passing of the Staggers-Dodd Bill which made LSD illegal nationwide. By the end of 1967, Leary was on his own trip, and Alpert wanted to search for how this innate knowledge could be accessed without psychotropic medicines.

Pursuit of Enlightenment

According to a 1976 ‘Gonzo-style’ Rolling Stone article, Alpert’s final test was to take 400 micrograms of LSD every four hours for three weeks, and after finally coming down he remained unchanged. The Harvard-professor-turned-black-market-psychedelic-dealer knew that there had to be more. He set out to India on an opulent vacation, spending three weeks parading around the Southeastern Asian country in a Land Rover. This luxury halted when he met Maharajji, who gave Alpert his first task: present the guru with the Land Rover as a gift.

In Be Here Now Ram Dass describes how he felt after this meeting, “I cried and I cried and I cried… I felt like I was home. Like the journey was over. Like I had finished.”

After his initial meeting with Maharajji, Ram Dass spent another seven months at the temple. He rose at 4 am daily to work on meditating and deep breathing exercises, practicing raja yoga, reading Hindu texts, eating strictly vegetarian, and abstaining from all sex. He arrived home to Massachusetts barefoot and blissed out in his yoga whites. From that moment forward, Ram Dass could not function within society as it existed, and people noticed. His energy somehow was both enigmatic and transparent which prescribed him a magnetic quality. People were drawn to him, to his understanding, to his main mission: presence and love.

The Legacy of Ram Dass

From this point, his day to day is history, recorded in his many lectures, published books, and television appearances. Baba Ram Dass became a beacon of love for people all over the world, and though he was a fallible human like the rest of us, he was beloved.

Ram Dass left behind a reminder to be loving. His mantra may have continued to evolve from the original psychedelic publishing of Be Here Now, but it always centered around being present and living truthfully in love. That legacy will continue to permeate society as we continue to walk through our own challenges.

For anyone interested in learning more about the teachings of Ram Dass a body of his work — including text, videos, and more — can be found on his website, The Love Serve Remember Foundation

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First Prisoner Killed By Coronavirus Was Nonviolent Drug Offender

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The first federal prisoner in the U.S. to die from coronavirus was locked up on nonviolent drug charges, NBC News reports.

Patrick Jones, a 49-year-old inmate in a low-security penitentiary in Oakdale, Louisiana, was serving his 13th year of a 27-year prison sentence when he contracted the coronavirus and died. Jones was sentenced in 2009 on drug charges after police found 9 grams of crack and 21 grams of cocaine in his Temple, Texas home.

In the months before his death, Jones penned a letter to U.S. District Judge Alan Albright requesting a sentence reduction. “I feel that my conviction and sentence was also a punishment that my child has had to endure also and there are no words for how remorseful I am,” Jones wrote. “Years of ‘I am sorry’ don’t seem to justify the absence of a father or the chance of having purpose in life by raising my child.”

His request was denied on February 22 and he died from coronavirus twenty-two days later.

“He spent the last 12 years contesting a sentence that ultimately killed him. Ironically, it seems it is his death that might finally bring his case some attention.” — Alison Looman, a New York lawyer who had represented Jones

Jones was the first prisoner coronavirus casualty in the U.S. but there have been — and will be — others. The Oakdale prison where he was located has been the hardest hit in the country: at least five inmates there have perished from the disease, and there are so many prisoners suffering symptoms of the virus that officials have stopped testing presumed cases.

On Friday, U.S. Attorney General William Barr ordered the expansion of early release practices for federal prisoners in response to the virus’ rapid spread through the U.S. prison system.

Want to help? Cannabis activists at the Last Prisoner Project have been advocating for the early release of elderly and low-risk prisoners amid the COVID-19 pandemic. Visit the LPP resource page now to sign a petition for the emergency release of prisoners, donate to the emergency COVID-19 relief fund, and find resources for contacting your local and state officials.

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Cannabis Industry Spent $11M on Federal Lobbying in 2019

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Cannabis companies spent almost $11 million in federal lobbying efforts last year, according to a Cannabis Wire report. The spending is nearly three times what the industry spent in 2018.

Greenwich Biosciences, Curaleaf, Parallel, and the Cannabis Trade Federation each spent more than $1 million on lobbying the federal government in 2019. Greenwich — the U.S. subsidiary of U.K.-based GW Pharmaceuticals, makers of the cannabis-based pharmaceutical Epidiolex — spent $1.9 million lobbying Congress, the White House, the Food and Drug Administration, and the Department of Health and Human Services.

The Cannabis Trade Federation spent $1.7 million on more than 20 cannabis-related bills – including the SAFE Banking Act, which was approved by the House last September. Other measures the organization lobbied for did not receive votes in either legislative chamber.

Massachusetts-based Curaleaf’s lobbying spending totaled $1.4 million and Parallel spent $1.04 million, the report says. Other companies and organizations that spent money on lobbying include the National Cannabis Industry Association, the National Cannabis Roundtable, Canopy Growth, Acreage Holdings, and Trulieve. Collectively, cannabis companies also gave more than $200,000 to federal candidates; Oregon Rep. Earl Blumenauer (D) raised nearly $30,000 from the industry.

Former TILT Holdings CEO Alex Coleman donated $64,400 to the Republican National Committee. Native Roots Chief Strategies Officer Jonathan Boord, and Lightshade dispensaries owner Steve Brooks, each donated $2,800 to Senate Majority Leader Mitch McConnell’s committee.

Former Democratic presidential candidate Sen. Corey Booker raised about $12,000 from industry executives – mostly from iAnthus – for his presidential campaign.

In 2014, the cannabis industry spent just $80,000 on lobbying efforts, which increased to $300,000 in 2015, to $430,000 in 2016, and to $1.62 million in 2017.

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Canadian Cannabis Firms Can Access Federal Coronavirus Response Loans

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Canada’s cannabis companies will have access to $40 billion in new credit from the Business Development Bank of Canada that’s being made available amid the financial fallout from the coronavirus pandemic, the Canadian Press reports. Previously, cannabis firms were told that the bank does not “do business” with the industry.

Michael Denham, BDC president and CEO, told the Press that “any legal business is eligible to be part of the program” and that the bank would formally announce the clarifications today. The bar industry will also be eligible for the credit lines.

Applicants must go through their own banks to access the BDC program. The BDC is a federal corporation with a loan portfolio of about $35 billion; the new credit will be in addition to that. Denham told the Press that institutions seeking the loans would have to show that they would have been able to handle the loan they are seeking before the coronavirus impacted their business. The bank has lowered its interest rates, waived fees, and increased the amount of risk it is willing to take with its loans amid the catastrophe.

“My advice to all entrepreneurs: Understand the programs, talk to your bank, see what’s right for you, and take advantage.”- Denham to the Press

There are more than 300 cannabis businesses licensed throughout Canada and the industry has contributed about $8 billion for the nation’s gross domestic product, according to George Smitherman, president and CEO of the Cannabis Council of Canada.

Last month, after it was reported that cannabis companies would be shut out of BDC assistance, bank spokesperson Jean Philippe Nadeau said the firm was “evaluating the situation as it evolves.” According to Denham, the BDC received as many applications that normally come in in a full year via its online financing platform since the start of the crisis in mid-March.

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Massachusetts Allows Telehealth Medical Cannabis Recommendations

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Prospective medical cannabis patients in Massachusetts can use telehealth services to receive a program recommendation, according to a Mondaq report. The new, emergency rules come after the state imposed a stay-at-home order and closed non-essential businesses amid the coronavirus pandemic.

In order to provide telehealth services, medical providers must submit a waiver request form to the Cannabis Control Commission and receive the agency’s approval. Initially, the agency was only allowing telehealth options for medical cannabis recertification.

Additionally, the CCC is urging medical cannabis dispensaries to promote their delivery services and “remind patients of the ability to acquire up to a 60-day supply” of medical cannabis.

“The Commission urges licensees to consider, evaluate, and appropriately publicize protocols relative to agent interactions with patients and customers. Relevant procedures include how establishments manage lines and queues, the utilization of mobile or order-ahead features that may reduce the risk of exposure, considering appointment-only operations, and the increased frequency of cleaning and sterilization efforts.” – Massachusetts Cannabis Control Commission, bulletin, March 13, 2020

Massachusetts is the only state with cannabis legalization that has ordered the closure of adult-use cannabis shops amid a statewide stay-at-home order. Republican Gov. Charlie Baker has refused to reopen the shops, saying he is concerned about the possibility of people from outside of the state coming into the state to buy cannabis products. Medical cannabis sales are still permitted and the state has imposed safety measures on those “essential” businesses, including increased social distancing and enhanced sanitation practices.

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Senate Democrats Call for Federal Loan Assistance for Cannabis Industry

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Eleven Democratic U.S. senators are calling on the Small Business Administration to open up loans and other financial assistance to state-legal cannabis companies. The letter asks the agency to make cannabusinesses eligible for relief being offered to businesses throughout the county that are impacted by the coronavirus fallout.

“States collected an estimated $1.3 billion in tax revenue from legal cannabis sales in 2018. However, SBA’s current policy excludes small businesses with ‘direct’ or ‘indirect’ products or services that aid the use, growth, enhancement, or other development of cannabis from SBA-backed financing. Consequently, small businesses in states with some form of legal cannabis must choose between remaining eligible for SBA loan programs, or doing business with a rapidly-growing and legal industry.” — U.S. Senators in the letter

The letter says that the SBA loans would be “especially helpful to cannabis small businesses because they would fill gaps” left by financial institutions who the senators describe as “reluctant” to serve the industry due to federal cannabis prohibition.

“Access to these SBA loan programs could ensure that small businesses – especially those led by our minority, women, and veteran entrepreneurs – can raise money for their ventures and support job creation,” the letter says.

The signatories include Senators Michael Bennet (D-CO), Cory Booker (D-NJ), Tammy Duckworth (D-IL), Kirsten Gillibrand (D-NY), Kamala Harris (D-CA), Edward Markey (D-MA), Robert Menendez (D-NJ), Jeffrey Merkley (D-OR), Jacky Rosen (D-NV), Bernie Sanders (I/D-VT), and Ron Wyden (D-OR).

The letter is addressed to Senate Appropriations Committee Chairman Richard Shelby (R-AL) and Vice Chair Patrick Leahy (D-VT), and Financial Services and General Government Financial Services Chairman John Kennedy (R-LA) and Vice-Chair Chris Coons (D-DE).

Under the CARES Act passed earlier this week, state-compliant hemp businesses can access funds available under the stimulus package but cannabis companies are not eligible.

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USDA Approves Georgia & South Carolina Hemp Plans

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The U.S. Department of Agriculture approved hemp programs for South Carolina and Georgia this week, bringing the total of approved plans by the agency to 14.

Georgia‘s program had been placed on hold by the USDA last year but the federal agency signed off on the plan after state lawmakers approved $200,000 to regulate the program for the coming season and approved additional funding for the next fiscal year, the Atlanta Journal-Constitution reports. Following the approval, the Georgia Department of Agriculture immediately received 57 cultivation license and five processing license requests.

Georgia will allow in-state CBD production; currently, CBD products are legally available but all products come from out-of-state.

Hemp farmers in the state will pay $50 per acre – up to $5,000 – annually, while processors will pay an initial $25,000 fee and another $10,000 annually. Julie McPeake, a state Agriculture Department spokeswoman, told the AJC that the department is about 20 days behind in issuing licenses because the agency is stretched thin helping farmers respond to the fallout from the coronavirus.

In South Carolina, the hemp farming application period for the upcoming season has already closed but the state Agriculture Department is accepting applications for next year throughout the rest of 2020, the agency said in a press release, noting that 350 people applied to farm hemp this season.

“The State Plan, authorized by the South Carolina General Assembly and the 2018 federal Farm Bill, will end an era of regulatory flux for South Carolina’s hemp industry, bringing the state’s three-year-old Hemp Farming Program into line with other states and establishing more permanent regulations.” – South Carolina Department of Agriculture, in a press release

Under the federally-approved rules, the state program now includes new laboratory testing methods and “stricter adherence to the 0.3 percent THC threshold” that delineates hemp from THC-rich cannabis. The rules also mandate that the state Agriculture Department must sample every hemp field prior to harvest.

In all, 17 states are still operating under their 2014 pilot hemp programs, and six state programs are still pending USDA review. Connecticut and Tennessee are listed as having submitted a plan to the agency that required resubmission. Other states not pending review are currently drafting plans, according to agency data. Regulators have also approved 14 tribal hemp production plans and list another 16 as under review.

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Last Prisoner Project Launches “Roll It Up” Donation Program for Dispensaries

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The Last Prisoner Project (LPP), a cannabis advocacy group fighting to free all prisoners who are incarcerated on cannabis charges, has launched its new “Roll It Up for Freedom” program for dispensaries. The fundraising push encourages cannabis buyers at participating dispensaries to round up their purchases to the nearest dollar as a donation to LPP, who will use the money in their push to set cannabis prisoners free and help them rebuild their lives after incarceration.

There are currently more than 40,000 prisoners locked up in the U.S. on cannabis charges. LPP has been scrambling to pressure lawmakers and government officials in anticipation of the immediate and potentially lethal danger for prisoners posed by the novel coronavirus.

LPP founder Steve DeAngelo described the program in a video statement posted to LinkedIn:

“Delivery, brick-and-mortar, it doesn’t matter — if you retail cannabis, this message is for you. … It’s really a matter of life and death now. We need to do everything we can to take care of [cannabis prisoners] and get them home.” — Steve DeAngelo, in a statement

“Last Prisoner Project has been working around the clock to provide assistance to cannabis prisoners during the COVID-19 crisis,” said LPP’s Managing Director Mary Bailey. “The Roll It Up program will bring in much-needed donations so that we can continue to assist prisoners with their release and help them to rebuild their lives.”

Want to help? Dispensaries and other cannabis retailers who want to participate in the Roll It Up for Freedom program should contact LPP’s Managing Director Mary Bailey at mary@lastprisonerproject.org. You can also go to the Last Prisoner Project resource page now to sign a petition for the emergency release of prisoners or find resources for contacting your local and state officials.

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Is It Safe to Use Cannabis During Pregnancy? Here’s What We Know

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Cannabis use has been historically beneficial for women’s health. I can vouch firsthand that suppositories are fantastic for obliterating menstrual cramps (and my sciatic pain). Inhalation or ingesting cannabis can be an instant mitigator for hormone surges that often leads to a poor mood. These facts, paired with sweeping legalization, have many pregnant women asking their doctors about the effects of using cannabis rather than prescription drugs for symptoms like nausea and mood swings.

Physicians most frequently ask that women don’t use cannabis during pregnancy. This could be based on the fact that it is still a Schedule I drug. Schedule I drugs are deemed to have no potential for medical use and are considered highly addictive. For this reason, it takes quite a bit of financial backing and regulatory oversight to research cannabis medicine.

Due to these barriers, there are not many in-depth studies on the effects of cannabis use during pregnancy but we do have access to some relevant data

Are Pregnant Women Smoking Weed?

In the Summer of 2019, Kaiser Permanente released a study based on data gathered at their facility over 9 years, documenting 367,403 pregnancies in Northern California. The data comes from an interview taken at the 8-week gestation mark during women’s initial prenatal visit. Of those people, 276,991 admitted to cannabis use during their pregnancy thus far. Another stat from 2009 to 2017 showed that the number of women who have used cannabis in the year before their pregnancy doubled from 6.8% to 12.5%, while self-reported cannabis use during pregnancy increased from 1.9% to 3.4%. 

Another study released in February 2020 showed that women who were younger with lower annual household incomes were more likely to use cannabis while pregnant. Also, women with anxiety disorder, depressive disorder, depression symptoms, a trauma diagnosis, or self-reported intimate partner violence were more likely to use cannabis during pregnancy. These results show that despite warnings women are using cannabis during pregnancy to mitigate mood imbalances and stress as well as nausea, an indicator that research on efficacy and safety is needed. 

Does Cannabis Use During Pregnancy Hurt Babies?

A 2014 study out of Arizona reviewed 24 studies of maternal, fetal, and neonatal outcomes up to six weeks postpartum. In comparison with those who hadn’t used cannabis, mothers who did partake were more likely to be anemic. Babies born to the mothers who used cannabis did have a lower birth rate and were more likely to end up in the NICU after birth. 

Research analysts did note, however, that most cannabis users in this study were also tobacco users so it is hard to know which substance was responsible for the outcomes. These outcomes also combat data from a 1991 study on babies born to cannabis-using mothers. A researcher followed 59 Jamaican children from birth to age 5, all of which had mothers who used cannabis during pregnancy. There were no differences in women as compared to non-using mothers. 

Though there are studies on cannabis use during pregnancy, it’s very hard to come to a conclusive result without a controlled study. For now, we can conclusively state that mothers who are dealing with depression will be more likely to use cannabis while pregnant. It’s also been shown that mothers who used cannabis while pregnant have experienced complications with low birth rates and issues that landed babies in the NICU.

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40% of Iowa Dispensaries Abruptly Close, Reducing Patient Access

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Two of Iowa’s five medical cannabis dispensaries have closed and neither their operator nor state health officials have indicated the reason, according to the Associated Press. The dispensaries in Council Bluffs and Davenport were both owned by Have A Heart Compassionate Care.

In a statement, public health officials indicated they would work to license two new dispensaries “as soon as possible.”

“Providing patient access to medical cannabidiol products is important to the department, and we understand the difficulties that these closures may cause for patients and caregivers in the Council Bluffs and Davenport areas.” – Iowa Department of Public Health in a press release via the AP

According to agency data, there are 4,327 registered medical cannabis patients in the state as of February 20, along with 691 caregivers and 945 physicians allowed to certify patients for the program. The state program currently only allows patients to access cannabis products that contain no more than 3 percent THC; however, last month the state House Public Safety Committee passed a measure to remove those limitations. That proposal – which came directly from the state’s medical cannabis board last year – would also limit patients to 4.5 grams of cannabis above 3 percent THC over 90 days.

Iowa‘s strict medical cannabis law only allows two companies to grow and process the products. The state has approved 15 qualifying conditions for the program, and the average patient age is about 57-years-old. A poll last month found 81 percent of Iowans supported expanding the conditions that qualify for the program.

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Pharma Startup Investigating LSD as Anxiety Treatment

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Mind Medicine, a New York-based pharmaceutical startup that focuses on the potential medical application of psychedelics, announced it had partnered with the world-leading psychedelics pharmacology and clinical research laboratory headed by Professor Dr. Matthias Liechti at University Hospital Basel in Switzerland.

According to a company press release, MindMed — a publicly-traded company on the NEO exchange — is contemplating a new drug development program using hallucinogenic doses of LSD in the treatment of anxiety disorders.

The exclusive partnership will grant MindMed exclusive access to Dr. Liechti’s laboratory’s research. The company, however, said it is specifically interested in an ongoing placebo-controlled Phase 2 trial of high dose LSD as a potential treatment for anxiety.

“It’s a wonderful moment for our company to be recognized by Professor Dr. Liechti, the leading expert of LSD research in the world, as the right team to partner with in continuing our development of psychedelic inspired medicines,” MindMed Co-Founder & Co-CEO JR Rahn said in a press release.

“Over the past decade we have amassed the largest collection of clinical trials around LSD. We have been studying the pharmacology and potential medical uses of LSD and other psychedelics for many years in the laboratory, in patients, and in healthy volunteers.” — Dr. Matthias Liecthi of University Hospital Basel, in a statement

Dr. Liechti said MindMed is “the leading company with a similar mission to ours,” and that the collaboration will allow the lab to “greatly accelerate our groundbreaking research.”

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Andrew Cuomo Says New York Cannabis Legalization Has Stalled

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As expected, adult-use cannabis legalization will not be included in New York’s budget as the state reels from the coronavirus pandemic. When asked during a press briefing on Tuesday whether the reforms would make the final budget, Gov. Andrew Cuomo (D) responded it was “not likely.”

“Too much, too little time,” he said.

Legislative leaders last week said legalization was likely no longer on the table after the governor said the state would only be able to pass a “bare-bones” budget. New York is staring down an estimated $10 million revenue loss after the state issued a stay-at-home order last month to stem the spread of the coronavirus that, effectively, shut down the state’s economy.

State Sen. Liz Krueger (D), the champion of the legalization bill in the Senate, said last week that Cuomo’s staff “essentially took marijuana off the table weeks ago.” Krueger, however, agreed that if legalization “cannot be achieved in the midst of a public health crisis” then policymakers, stakeholders, and citizens are all “better off waiting.”

As of this morning, New York reported 83,889 total coronavirus cases and 1,941 deaths.

The plan to legalize cannabis using the state budget as a vehicle was not a slam dunk for Cuomo anyway prior to the pandemic. The governor and lawmakers reportedly had disagreements over how the revenues would be disbursed and whether or not to even include it in the budget – a sticking point that ultimately doomed legalization during budget negotiations in 2019 when Cuomo had also included the reforms in his executive budget proposal. Last year, the reforms were pulled after legislative leaders protested they should be debated as stand-alone legislation.

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Oklahoma Lawmaker Eyeing Cannabis Legalization to Fill Budget Hole

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At least one Oklahoma lawmaker is floating the idea of legalizing cannabis for adults as the state faces a $220 million budget hole this year, and a $250 million deficit next year, News9 reports. The massive deficits are due to low oil prices and coronavirus pandemic related job losses.

State Rep. Scott Fetgatter (R) said the state could “legitimately” see $100 million annually added to state budget coffers from broad cannabis legalization.

“It’s very early in the conversation. What’s important to me is to make sure we have a program that functions. A lot of people didn’t like medical marijuana, and they may not like marijuana, period. I understand that. But it is here and is not going anywhere.” – Fetgatter to the Tulsa World

Activists had been circulating a petition to get cannabis legalization on November general election ballots; however, the secretary of state shut down all ballot initiative efforts after the governor declared a state of emergency on March 15.

Ryan Kiesel, a proponent of SQ 807, told the Oklahoman earlier this week that even after the order is withdrawn it would be “really difficult, if not impossible” for an initiative petition campaign to “responsibly and feasibly” collect the necessary signatures to make the 2020 ballot unless the campaign already has the signatures on hand.

Tulsa attorney Ron Durbin, who worked with Fetgatter on implementing the voter-approved medical cannabis law, said the question remains whether there is enough support in the state Senate to legalize cannabis.

Senator Ron Sharp (R) told News9 that legalization is “not a very feasible idea.”

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Santa Clara County Shuts Down In-Person Adult-Use Sales

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Santa Clara County, California officials are shutting down in-person adult-use cannabis purchases amid a new stay-at-home order issued on Tuesday, the San Jose Spotlight reports. Registered medical cannabis patients may still make purchases either in-store or curbside but adult-use products can only be bought and sold via delivery services.

Sean Kali-rai, founder of the Silicon Valley Cannabis Alliance, accused officials of “imposing their moral will” on citizens while “disguising it as a public health concern.” Kali-rai told the Spotlight that just 3 to 5 percent of South Bay cannabis consumers have a physician’s recommendation.

“The county is playing politics with cannabis and using the public health order as cover to do it. There’s no logic behind this at all, it is going to endanger public health, not protect it,” Kali-rai said.

“Medical dispensaries can dispense under healthcare industry exemptions. Suppliers to medical dispensaries and licensed medical growers can operate as well. Non-medical cultivation, supply, and dispensing of cannabis are prohibited, with the exception of deliveries directly to residences. Dispensaries with a mixed clientele of both medical and non-medical customers can do in-person business only with medical customers.” – Santa Clara County Public Health Order, April 1, 2020

San Jose Police Department Cannabis Division Manager Wendy Sollazzi said city officials are concerned that consumers are just going to turn to the unregulated market, “where they sell products and don’t verify age” but noted there “are still avenues for dispensaries to continue making sales for both medical and recreational cannabis.”

Just last week, county officials had deemed both medical and recreational cannabis dispensaries as “essential” and set social distancing rules to allow sales to continue. In all, six California counties, including Santa Clara, have extended their stay-at-home orders to May 3.

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Chris Treville: Maximizing Efficiency for Indoor Cannabis Cultivation

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Chris joined our podcast host TG Branfalt recently for a conversation about GrowEx and the company’s high-tech cultivation capabilities. In this interview, Chris shares the story that brought him into the cannabis space, discusses the industry’s need for more advanced indoor growing systems, explains what exactly the GrowEx system is capable of and how the company’s innovations could revolutionize indoor cultivation practices, and more.

Scroll down and listen to the interview via the media player below, or keep scrolling to find a full transcript of this week’s Ganjapreneur.com podcast episode!


Listen to the podcast:


Read the transcript:

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TG Branfalt: Hey, there. I’m your host, TG Branfalt, and thank you for listening to the Ganjapreneur.com podcast, where we try to bring you actionable information and normalize cannabis through the stories of ganjapreneurs, activists, and industry stakeholders. Today I am joined by Chris Treville. He’s the co-founder of indoor cultivation tech company, GrowEx, a patent-pending technology that controls pests and mildew without using pesticides or chemicals. How are you doing this afternoon, Chris?

Chris Treville: Great. Thank you.

TG Branfalt: So tell me about yourself, man. Tell me about your background. How’d you end up in the cannabis space?

Chris Treville: Well, in 2014, my brother and I decided to look at it closer. It was starting up at ground-zero level, which is what we’re calling it in terms of large-scale, commercialized, legal cannabis commercialization, let’s say, in Colorado. So we started visiting some sites to see how that was taking place, who was doing what, how are they growing, really just interested in taking some notes and visited a few sites in the Denver area. That was in 2014, and then, of course, we went to the very first Las Vegas MJBiz show, which at the time was at the Rio Hotel in Las Vegas.

TG Branfalt: Sounds like a good time.

Chris Treville: Yeah. And since then, it just kind of kept escalating from one year to the next, just more shows, more visits, broader geography, not just Colorado, but also in Canada as Canadian law came into place federally, of course. Uruguay came on board, and then now we’re seeing a whole slew of United States that are coming on board, whether it’s medical or recreational, European countries, African countries, Australia. So it’s a worldwide movement, and we’ve been right on the ground floor of it since… I would say actually… I said 2014, but really it was 2012 that we started doing these visits, because 2014 was when we started to actually spend money towards it, which was an R&D, research and development effort on a small scale to start proving our first concept, which is what you introduced, the pest control system.

TG Branfalt: Tell me about when you first sort of started this R&D process, going to these sites. What were some of the things that stood out to you during those initial visits?

Chris Treville: Well, that’s a good question because our existing company at that time, my brother and I were involved and we are still involved in what we call controlled atmosphere technology. What that means is that we build storage facilities for fruit and vegetable farmers all across North America. So basically, it’s a facility kind of like a warehouse, but it’s got gas-tight rooms. I call them bubble rooms, so there’s no penetrations at all in those rooms, kind of like an operating room, if you will, but on a large scale, where millions of pounds of biomass are stored. And this biomass, in particular, is fresh fruit, just for an example, that gets harvested by the farmer, and then it gets held at low temperature in a fresh state, so kind of fridge-like conditions.

We control humidity as well, and we also control all the gases. The pertinent gases are CO2, oxygen, nitrogen, ethylene, ethanol. Those are all gases that exist inside these bubble rooms, and we have machinery, industrial-caliber machinery, that needs to control these gases to very precise decimal points, two decimal points actually in percentages. And that is what will dictate the quality holds that we’ll keep inside those storage facilities. So each variety, each cultivar of fruit or vegetable has its own protocol of temperature, humidity, and pertinent gases.

So that’s our expertise. We’ve been doing this for many years. It’s actually a Dutch background, the technology in question, Holland being world-renowned for agritech. And my brother was a senior engineer at Storex, which is probably the largest company in the world that specializes in that field. So when we did the visits with the cannabis facilities, our eyes and ears were mostly focused on the technology part of things, like how the building was built. Were there air leaks? Was there contamination involved? How energy efficient was the equipment? Because, in essence, the biomass for cannabis also needs to be controlled in the same way as the fruits. And since they’re plants, massive amounts of… millions of pounds of plants that are growing and that they require also specific protocols of temperature, humidity, and all the pertinent gases as well that affect yield, that affect quality, and affect consistency harvest after harvest.

TG Branfalt: So for that two years before you actually started putting money into the cannabis tech, what were some of the considerations that you and your partners and your brother were sort of taking on when trying to answer this question of whether or not you were going to start investing?

Chris Treville: Well, I mean, the first consideration logically for us was the building itself, like the actual structure, the shell, if you will, because that was also our main focus with our other farmer clients. And by the way, these are the biggest fruits producers in the world, so they’re large facilities that we build. So the structure was the first thing to look at, and we saw that the industry, the cannabis industry, was going towards a greenhouse model or a standard building, kind of like a warehouse with rooms built inside there. But they weren’t really paying attention to the detail that are necessary for such an industry, so for controlling such amounts of biomass on such a large scale.

So that was the first point of engineering on paper that we worked on, and there were a lot of parallels that were easy to bring over from our fruit clients to the cannabis clients. But then that wasn’t enough because we needed to be able to explain to a grower why that had an impact on the yield and on the quality. So we had to get involved… As a next step, we had to get involved also in terms of the actual way the plants grow, what kind of configuration of the canopy, what kind of lighting, what kind of irrigation, what kind of growing mechanism, if you will, throughout the entire facility. Not only growing, but from seed all the way to trimming, drying/curing, and packaging. So it started off in 2014, like I said, but it kept on going all the way to 2019 really.

TG Branfalt: Yeah. And you had mentioned earlier you had noticed some of the energy efficiency, what was going on at these centers. And a couple of years go, there was a report, and there hasn’t been too many that have looked at how much energy the cannabis space uses. And this report, in particular, found that it used as much as some larger data centers, server rooms. So what did you notice in terms of energy efficiency? What stood out to you? Was it very inefficient? What were you noticing?

Chris Treville: Yeah. I mean, that is a very big concern. The Dutch agritech has taught us over the last 20 years that energy efficiency is a big concern for farmers. I mean, they’re always looking for the more efficient tractor, the more efficient storage facility, industrial-caliber equipment to control temperature, humidity. There’s a real push towards finding ways to cut costs and to be more efficient with an industrial-caliber farming operation, whereas the cannabis industry has not looked at that at all. Even today, it’s still more focused… The industry, in general, is still more concerned about just the mere fact of being in business, the whole idea of getting a license to produce a legal substance that used to be prohibited, right? So that whole topic of legalization, getting the license, that still takes more precedence in the business plan.

And then the rush to market is the other big points that companies are looking at mostly, so how much volume of production they can make in the quickest time possible in as many places as possible. And the concern of energy efficiency is definitely not in their agenda. So we’re seeing an industry that’s growing very quickly without any concern whatsoever for energy efficiency. So that is, for me, a major issue that the industry is going in the wrong direction for that reason. So that has pushed us even more so to fine-tune that design so that we can get a model that’ll produce a very high yield per square footprint, and it’ll be able to do that using half the amount of energy that the current big players are using.

TG Branfalt: Describe this tech, the GrowEx tech, and how it is more energy-efficient. I said this at the top when we were sort of introducing ourselves. I don’t grow anything, and I’m killing a fern upstairs. So make it sort of simple enough so that a guy who is currently killing a fern can understand.

Chris Treville: Okay. Well, I mean, first of all, we recruited very important team members inside GrowEx. The GrowEx team is comprised of three growers who have a lot of experience. So we are, if you will, a team of expert growers, expert engineers of various kinds: mechanical, electrical, structural engineers, and some smart marketing people. So those people have been working on small-scale tests for the last five years, and we’re almost… I would say we’re about 80% completed our first large commercial site, which is near Montreal. And we had one site… We had data from another site, which was smaller. I still call that a small site, but it was really a commercial site also. It ran for about three years in Colorado on about 2,000 plants. So we had data from about three years on 2,000 plants.

TG Branfalt: And were those plants going into the market?

Chris Treville: Yeah. Yeah, those plants were going into the market in Colorado. So I call that Version 1.0, I would say, of the GrowEx system. And then the Montreal site that we’re 80 to 90% finished is what I’m calling Version 2.0, which is a larger scale. It’s on about 10,000 plants, as opposed to 2,000 plants.

TG Branfalt: Wow.

Chris Treville: So it’s a bigger step, right? Basically, the formula is you’ve got a bubble room, which means that if you can imagine a plastic bag, the plant is inside that plastic bag. Okay.

TG Branfalt: Okay.

Chris Treville: But of course, it’s not just one plant. It’s a whole room full of plants that’s inside a large plastic bag. So what does the plastic bag do? And by the way, it’s not made out of plastic. It’s a figure of speech I’m using. But what does it do? Well, it basically gives us complete control of everything that’s got to do with temperature, humidity, CO2, oxygen, nitrogen, and ethylene, all those gases that are pertinent to the plant’s development. And we can literally dial in down to a granular science exactly what we need in terms of protocol to get that perfect growth environment and stability also, which is a big key in terms of avoiding powdery mildew, for example, which mildew will proliferate if there are inconsistencies in those temperatures and humidities. So since we don’t have any inconsistencies at all, we don’t have any issues with powdery mildew at all. Therefore, no need for any treatments of any kind.

And then, of course, being in a bubble also avoids any incoming contaminants, whether it’s pollution or insects or whatnot. These bubbles have doors, so we still have humans walking into those rooms, but we’re working on a human-free environment. That’s our next development. But for now, we do still have people walking in. So there’s still a risk of insects, and these are microscopic insects that live outside. They’re all over the place normally in nature. But just like humans, they love those plants. So they’re literally lining up at the door trying to get in. So if there is an issue with too many of these insects coming in at once and a section of the room starts getting contaminated with some insects, then we have an algorithm we came up with to essentially suffocate these insects within 24 hours without affecting the plants.

So that’s our first patent pending. It’s called the PCS system. It’s a pest-control system, which doesn’t use any chemicals. It doesn’t use any outside, any external treatments. It’s purely the same exact temperature, the same exact humidity, the same exact gases, but just in different concentrations. Hence, the algorithm, right? And then the sixth factor is time, which is somewhere around 18 hours or something like that. So it’s a good insurance policy in case something goes out of control on these large, massive rooms full of valuable plants.

So that precision control, I’d say, is already the first step to using less energy because we have little waste of machine run-times. Because we have a very constant machine run-time and we don’t have to compensate for leaks coming into the room and having to compensate so that the system can hold the right amounts of CO2 or the right amounts of temperature or humidity, the machines don’t work as much. So that also helps with energy efficiency. The machines themselves are industrial caliber, so they’re meant to… The design of the machines are very energy efficient as well. Low maintenance as well. So I would say that’s the first topic. And then, of course, the structure is insulated and gas-tight, so that also has a huge impact.

And then the other point of energy efficiency is on the selection of the lights. We use laser LED lights. The short form of that is called LLED. So that’s very advanced because most of the market right now, I would say maybe 85% of the grows worldwide are still using HPS lights, which are good performance lights, but they’re very inefficient in terms of energy. They create a lot of heat. Hence, the fact that the plants have to be four to six feet away from those lights, or otherwise they burn. So you don’t have a good optimization of the canopy. You have to be very far away from the plants. The distance between the plant and the light is big, so that’s why you need these giant rooms with tall ceilings. Very inefficient.

So the LLED lights allow us to come six inches from the plant, and therefore, we can pack more plants in the room. And those lights use a lot less energy. They emit a lot less heat. So that would be a huge consideration there in terms of energy efficiency per gram produced. Since there’s a lot more plants, also a lot more density in terms of the canopy.

TG Branfalt: Are you able to control… Is time a factor, I guess is my question? With this system, do plants take any more or any less time to grow? Because as you said, people are trying to get product to market. And I don’t really grow anything, so does this also impact the growing time?

Chris Treville: Huge, huge. I mean, first of all, time to market is a huge point you just made, and I understand these companies. They get the license. They’re happy. They want to move forward. They’ve raised funds. They want to get to market as soon as possible. So not only are we energy efficient, but also our time to build such a facility is very fast because everything is pre-engineered, pre-fabricated. It’s just a question of assembly, kind of like a Lego, if you will. So it’s a really efficient build-out. And then to your question, the actual timeframe to grow, I mean, all these grow-masters out there who’ve been growing in their garage in the gray markets or black markets, whatever you want to call it, whatever shade of dark you want to call that, that are now operating in the legal market, they’re excellent growers, but their issue is that they’ve been growing in what I call craft growing, like a very small quantity. We’re not talking about millions of square feet of canopy. So it’s a different ballgame completely.

So we’re hitting some numbers right now. This is still early because we’re not fully optimized yet, but we’re talking about somewhere around 90 grams per square foot of canopy. And from the whole process, from the beginning of the plant to dry/cure, including dry/cure, we’re talking about 38 days.

TG Branfalt: Seriously?

Chris Treville: So it’s considerably… It’s about 40%… No, sorry. It’s almost two times faster than what normal people are seeing.

TG Branfalt: That’s incredible. And I don’t really grow anything, but I do know that it takes a hell of a lot longer than 40 days.

Chris Treville: Yes. Usually it’s longer. Like I said, it’s probably close to twice as longer, and the yield is also not as high. And it’s really math. I’m not a grower either, but the guys, the scientists, because really they’re scientists. They’re all masters; some of them are PhD that are on our team. It’s about science. So what it is in layman’s terms, the plant is like a device, if you will, that has X number of let’s call them receptors, which are these areas where light will go through in the process of photosynthesis. And of course, it’s not just light that they absorb. They also absorb CO2. They absorb nutrients. So let’s say that there’s X number of entry points for all this material to go inside the plant to create the energy to allow the plant to grow, right?

TG Branfalt: Yeah.

Chris Treville: Humans have similar points of receptors, i.e., the skin. The skin breathes. We eat obviously. We drink. We breathe through our nose and our mouth. So the plant has all these receptors. So there’s a certain number of these receptors per plant. It’s not an infinite number. There’s a finite number of these. And the formula is basically time, how much time do we feed through those receptors? How many are being fed at the same time, and at what concentration? And we try to basically optimize that.

TG Branfalt: One of the things too that stuck out to me when I started looking at interviews you’ve done and your website, you guys grow vertically as well, right?

Chris Treville: Yeah.

TG Branfalt: Explain why that’s important for efficiency, why you do that, and how you sort of came up with this idea to grow cannabis literally on the walls.

Chris Treville: Well, basically, it all boils… The industry of lighting has been pretty stuck, I would say, for the most part… Again, I’m going to use that number of 85%, let’s say, because there are a few exceptions out there. But let’s just say that for the most part, we’re talking about a horizontal layout. So it’s a plant that’s on a table, or sometimes you can even see them on the floor, or it could be a couple layers of tables, like horizontally stacked. And then you’ve got a light that’s above it that hangs from a ceiling or from the next level above it. And there’s a lot of space there, a lot of air space, cubic space basically that needs to be managed.

So right there was something that we didn’t like that. And as we were working with lights that allowed us to bring the light a lot closer, we thought, “Why not set up the plants along a vertical wall and then kind of like sandwich a row of lights and have another row of plants behind it?” where that way, instead of having just one light shining on one group of plants, we would have one light shining on two groups of plants on each side, right?

TG Branfalt: Yeah.

Chris Treville: That would reduce the capital expense of buying more lights. We would use less lights just in mere numbers of lights for basically double the amount of plants. And then the other consideration is also the whole topic of the human working there and how that person can reach the plants and work on them. And when you have these flat tables that you have to reach far to look at a plant that’s in the middle of the table, and even stacked horizontally, it’s even worse, because you have to climb up and then reach, so the topic of labor was also a concern.

So having the plants all laid in a vertical system along a wall, it’s much easier. There’s no leaning. The plants are right there at your fingertips, and you can just work along this wall, if you will, on a Skyjack basically that goes up and down. So it reduces the labor costs. It’s much more efficient for labor. And we started off, the growers that we work with developed this system in Colorado with a 14-foot height, and now we’re at 26 feet in height.

TG Branfalt: Wow!

Chris Treville: And we intend to go higher. We intend to go to 50 feet, but the way to go to 50 feet is you’re going to need some form of automation, because people won’t want to go that high in height. For myself even, 26 feet is too high. I don’t feel comfortable at that height. But there’s a lot of people who are totally fine working in the Skyjack. So the idea there is to replace that Skyjack with some sort of small robot that’ll just go and pick up a cartridge, which will bring it down to a human lower on the ground. So it’ll be kind of more automated. And this exists already in terms of in other industries, there’s automated palletization that exists already.

TG Branfalt: Yeah. I mean, just sitting here talking to you, it sounds like you guys are sort of like mad scientists of efficiency.

Chris Treville: Yeah, yeah, that’s what we are. We call it… And the thing is that it’s kind of evolved into a bunch of guys… I don’t call them mad scientists. I call them my Big Bang Theory team, and they’re all very excited about just making a better mousetrap. And then me, as a manager of all this, I’m kind of looking at it and saying, “Okay, this is interesting. Is it really worth it?” And so far, they keep showing me that it is. And now it’s going further than that. It’s actually creating a position that we’re in, which is a very sustainable and environmentally friendly position because all this is translating towards using 10 times less land, 20 times less water, half the amount of electricity. So it’s a very environmentally friendly position, which I still think…

I just came back from Vegas two weeks ago, Vegas still being the biggest trade show right now in this industry. And really, there’s no one having this position yet. So I think that we… And in fact, if we just look at it on the standpoint of the world and how every other industry is trying to be more environmentally friendly, cannabis, in my mind, kind of has the responsibility to lead the way of being environmentally friendly because all this technology that we’re learning from cannabis, and we’re very grateful that there’s value there and that the money can be used for R&D, it’s a spearhead really for other crops. And as soon as we have Version 2.0 up and running and 3.0, which we plan on launching in 2020, our goal is to draw out parallels from these GrowEx centers that are doing cannabis and seeing how we can do that on other crops and find that sweet spot of profitability and quality and an environmentally friendly position for lettuce, leafy green, and all that.

And there’s been an effort… There are companies right now in the world that are trying to figure out that sweet spot, to make that efficient and to make it viable so that we can stop relying on outdoor farming for a very consumed crop like lettuce or leafy green, for example. Those make no sense to grow outside, where there’s massive amounts of land being used and water and then trucking. And now we’re seeing the signs, that the costs are getting higher; the quality is not necessarily there in the supermarkets, and we’re seeing signs of contamination even because they’re trucked for a week to wherever, and it’s just not holding in terms of quality.

So I think we’re really at the brink of really needing another solution for many things that are in our salads and in our burgers. And like I said, there’s been companies that are trying it, but they’re not profitable. That’s the problem. And the ones that are still operating right now, it’s because they’re heavily relying on R&D money from people who are concerned and who want to spend money on R&D, and that’s great. But I think they’re still missing the point in terms of things that we’re doing right now with GrowEx.

TG Branfalt: So let me ask you. It sounds like you had to… There was a significant learning curve for you to begin with, and then you’re having to sort of expand at the pace of the industry somewhat, which is at breakneck speeds right now. What’s been your most challenging experience as it relates to launching in the cannabis space?

Chris Treville: Well, I mean, money is the gas we need, right? At the beginning, we were funded on our own. So basically our own company, which wasn’t that big, but it basically loaned money to the startup, if you will, to GrowEx. And that was tough. It was five years of really bootstrapping it basically out of Montreal and Colorado. And then we were hoping to get a… The investors were mostly after the shiny, bright toys, which were groups of people putting together business plans and hitting the market hard with massive-sized greenhouses, like I said, like I explained earlier. That was not our interest. We were not catering to that type of investor.

So we had to stay in our corner and just kind of keep focused on our message and on our design, if you will, and to look for that exceptional group that would understand our positioning and not try to influence us, because the other thing too is that the industry is also controlled… Not only is it controlled by the shareholder expectations and the stock market and the shiny, bright, new toy. But it’s also controlled, like I was saying earlier, by the grow-master and the know-how of those growers who have been propelled from their back yard or their garage on a small scale to these gigantic, multi-million square-feet facilities. And they must be losing sleep because overnight they have to manage a hundred times more plants. So they’re trying their best to do it, but again it’s, in my mind, the wrong model.

So having those meetings with those people was counter-productive. It was just not… I was trying to teach old dogs new tricks. And here I am, and I never grew a plant before, trying to explain to them how to do it. So that was a challenge, to find the right group of people, and we got lucky. We were persistent and wanted to meet the right group. We finally did, a group of investors in Quebec, who said, “Oh, yeah, okay. Yeah, you totally get this. We understand your positioning.” Those guys were totally not in the industry before, which was nice, and they didn’t have a grow-master on their team, so we became that entity. Not only did we become the consultant/contractor to build the facility based on our design, which I call the 2.0 design, but on top of that, we had the team of growers that were already in the right mindset, and so it was a perfect formula.

So now we have the money to execute, and it’s just been snowballing from there. My confidence level also has raised, and so when I go do a presentation to another group, I have a better approach. I can tell them per square foot how much yield we’re going to do. I can give them an estimate of how much their operating cost is going to be and how fast their production is going to be profitable.

TG Branfalt: So with this sort of… With the tech and the rate at which you’re growing, that your company is growing, and the growth that’s obviously happening in Canada and in Colorado, in the United States sort of in general, what advice do you have, would you have for entrepreneurs looking to enter maybe not the cultivation tech space, but the tech space in the cannabis industry?

Chris Treville: Well, I mean, what advice do I have? I mean, obviously, my advice is going to be a little biased, but I guess, you’ve got to look at it on the standpoint of what would a company today in our modern day and age need to look like in terms of environmental impact and what also would a company look for in terms of quality products, because I would say that most of the product that’s out there is not high quality. It’s very low quality, and it’s inconsistent quality.

Yeah. I mean, you’ve got to stay away from that shiny-new-toy syndrome, you know what I mean, which is, yeah, I get it. You’re getting a license. Finally, prohibition is gone. Okay, we get it. You’re in a hurry. We get that too. You want to rush to market, but really maybe look at your business plan more so on a standpoint of profitability, environmental position, social position, and what I mean by that is who you’re hiring, how the industry is… You should be modern in the sense that you should look at minorities. You should look at women. You have the potential to do that, so just right away, you should implement those more modern business behaviors, let’s say, training. And then, of course, quality of product is huge. Customer satisfaction, a big point also. Right now, we’re seeing companies just walking in and saying, “Here, I’ll supply this,” and then a month later, they don’t have it anymore. You know what I mean?

TG Branfalt: Yeah.

Chris Treville: So it’s so fragmented right now. So do a business plan that’s more modern. That would be my advice.

TG Branfalt: Cool, man. This has been a really interesting conversation. I don’t really have the opportunity that often to talk to cultivators or people involved in cultivation technology, so I really appreciate your time and breaking it down in a way that somebody who’s killing a fern can understand. Where can people find out more about GrowEx? Where can people find out more about you, man?

Chris Treville: Well, we’ve been trying to stay under the radar as much as possible, but people can reach out to me directly. Do you want me to give out my email address?

TG Branfalt: Sure can.

Chris Treville: Okay. It’s chris.treville@growxcorp.com, which is G-R-O-W-X Corp, C-O-R-P.com. We haven’t… Our website is not tailored for cannabis just because of that whole stigma and us crossing the border and all that. But if you look at the GrowEx website, which is GrowEx.StoreExCa.com, you can also see me there.

TG Branfalt: Awesome, man. That was Chris Treville. He’s the co-founder of the indoor cultivation tech company GrowEx. We’re delighted to have you on the show, man, and I really can’t wait to see what you guys do next, because you’re already growing cannabis literally on the walls. So what comes next is probably going to be pretty cool too.

Chris Treville: Well, what’s next is extraction. We’ve adapted for the last 12 months with the same type of scope because, at the end of the day, the flower is one thing, but it’s also mostly going to be consumed in a concentrated format, and that also requires efficiency and quality and all those things. So we’re getting involved in that. We’ve recruited some bright minds in extraction. And we’re looking to make our first deal in the US. It looks like we’re going to be doing that in the next 30 or 60 days with a similarly thinking group on the East Coast.

TG Branfalt: Awesome.

Chris Treville: And then Europe is next.

TG Branfalt: Awesome, man. Definitely keep me updated on what you’ve got going on in the US, man.

Chris Treville: All right.

TG Branfalt: It’s needed down here.

Chris Treville: I’ll be at the CWCB Expo in New York in May, which is-

TG Branfalt: That’s my neck of the woods, New York. I mean, it’s the wrong part of it, but…

Chris Treville: It’s a big trade show. It’s another organization. They’re really growing in leaps and bounds. They’re very cool people, and I’ve been supporting their trade show for the last couple of years. So yeah, it’s May… I think it’s May 27th or something like that in New York City, CWCB Expo.

TG Branfalt: Maybe we’ll do this again live at CWCB.

Chris Treville: Okay. Sounds good, man.

TG Branfalt: Thanks, man.

Chris Treville: All right, take care.

TG Branfalt: You can find more episodes of the Ganjapreneur.com Podcast in the podcast section of Ganjapreneur.com and in the Apple iTunes store. On the Ganjapreneur.com website, you’ll find the latest cannabis news and cannabis jobs updated daily along with transcripts of this podcast. You can also download the Ganjapreneur.com app in iTunes and Google Play. This episode was engineered by Trim Media House. I’ve been your host, TG Branfalt.

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Poll: 53% of Adults Say Medical Cannabis is ‘Essential’ Service

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According to a YouGov poll, 53 percent of U.S. adults believe medical cannabis dispensaries should be considered an essential service as states shutdown businesses amid the coronavirus pandemic. The poll found just 26 percent didn’t think medical cannabis should be considered essential and 21 percent said they didn’t know.

The majority of all adults under 55-years-old polled said medical cannabis should be essential, while just 47 percent of those 55-plus agreed. Democrats and those who described themselves as “other” politically overwhelmingly believed that medical cannabis should be considered essential, 62 percent and 64 percent, respectively. The majority – 52 percent – of independents also said cannabis should be considered essential, but just 43 percent of Republicans agreed.

Support for medical cannabis as an essential service was highest in the Northeast (57 percent), followed by the West (56 percent), the Midwest (53 percent), and the South (50 percent).

As of Tuesday, 32 states, Washington D.C. and Puerto Rico have issued stay-at-home orders, while three other states and one territory have closed non-essential businesses in order to stem the spread of the coronavirus. Every state that has issued a stay-at-home order has allowed medical cannabis dispensaries to remain open and operational as “essential” businesses; although, many have implemented rules such as social distancing, curbside pickup, or delivery.

Among states with recreational legalization, only Massachusetts has shut down adult-use sales.

The YouGov poll was conducted on March 25 and surveyed 5,369 adults.

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