Large New York marijuana operators are asking a state judge to compel state regulators to crack down on illicit activity.
Big marijuana operators sue New York state to halt inversion, launch track and trace is a post from: MJBizDaily: Financial, Legal & Cannabusiness news for cannabis entrepreneurs
New York marijuana regulators on Monday moved to severely punish a distributor accused of masterminding an inversion scheme.
New York moves to punish marijuana distributor at heart of inversion scheme is a post from: MJBizDaily: Financial, Legal & Cannabusiness news for cannabis entrepreneurs
Lexachrom Labs shut down on June 1 amid a state investigation that led to one of the largest recalls in state history.
New York cannabis regulators move to punish testing lab as sales continue to grow is a post from: MJBizDaily: Financial, Legal & Cannabusiness news for cannabis entrepreneurs
New York marijuana regulators delayed the launch of a long-awaited track-and-trace system until 2026.
Following surprise deal, New York delays cannabis track and trace until 2026 is a post from: MJBizDaily: Financial, Legal & Cannabusiness news for cannabis entrepreneurs
The Daily Hit is a recap of the top financial news stories for February 9, 2023.
Canopy Slashes 800 From Payroll After Revenues Slide
Canopy Growth Corp. (TSX: WEED) (Nasdaq: CGC) reported slumping revenues on Thursday and signaled a new cost-savings era that includes cutbacks on cultivation and 800 layoffs. The stock fell more than 8% in early trading on the news to lately sell at $2.52, a big drop from its year high of $9.61. Read more here.
Aurora Cannabis Revenue Boosted by Strong Euro
Aurora Cannabis Inc. (Nasdaq: ACB) (TSX: ACB) achieved positive adjusted EBITDA and reduced its debt even though it still recorded a net loss in its latest quarterly earnings. Aurora attributed the rising revenue to “growth across all cannabis business segments” as well as a full-quarter contribution of C$6.6 million from Bevo Farms. Read more here.
How Much Adult-Use Cannabis Has New York Sold? Who Knows?
While many other states quickly release sales figures for new cannabis markets, New York has been conspicuously silent. Inquiries to the New York Office of Cannabis Management and the existing stores regarding sales figures have been met with silence. Read more here.
Ayr Wellness to Exit Arizona, Expand to Ohio
Ayr Wellness Inc. (CSE: AYR.A) (OTCQX: AYRWF) is exiting Arizona and turning its attention to Ohio. The multistate cannabis operator signed a definitive agreement to sell its Arizona assets, Blue Camo LLC, to AZ Goat LLC. Read more here.
Cannabis Dispensary Deals Show How Prices Are Falling
The value of a cannabis dispensary just isn’t what it used to be. Six months ago, Planet 13 (OTC: PLNHF), a Las Vegas-based marijuana company, announced it would pull the trigger on its option to buy out its social-equity partner in an Illinois cannabis dispensary in a $2.9 million transaction. By the time the deal closed yesterday, the value had dropped by $1 million because of the steep downdraft in the stocks of cannabis companies. Read more here.
Pineapple Express Cannabis Co.
Minaro Corp. (OTC Pink: MNAO) (the “Company”), a publicly traded company, announced the execution of a share exchange, the change of its name to Pineapple Express Cannabis Company, and an application to change the company’s current ticker symbol. Read more here.
Halo Collective
Halo Collective Inc. (NEO: HALO) (OTCQB: HCANF) expanded the company’s cannabis genetics and strain portfolio within its Oregon operations. With the expansion, Halo Collective now offers a wide range of unique and rare strains, sourced from some of the top growers and breeders in the state. Read more here.
BioHarvest Sciences
BioHarvest Sciences Inc. (CSE: BHSC) (OTCQB: CNVCF) reported sales orders of $6.1 million in 2022 , representing a 160% increase over 2021. Fourth-quarter sales orders of $2.7 million were more than triple the sales orders from the same quarter in 2021. Read more here.
The post Daily Hit: February 9, 2023 appeared first on Green Market Report.
New York’s 280 conditionally licensed recreational cannabis farmers received a notice right after Christmas from state regulators, informing them they would be required to choose one of four cultivation plans for the coming year – and that they only had a few weeks to make that decision.
The initial notice gave farmers until Jan. 13 to make a selection between growing entirely outdoors for the 2023 season, growing entirely indoors in a greenhouse, or two possible combination options of both outdoor and indoor, a major policy shift from what growers had previously understood they’d be allowed to do this year, several growers said.
After the Cannabis Association of New York (CANY) and several members who are licensed cultivators complained to the state’s Office of Cannabis Management (OCM) about the deadline, the timeline was extended, but only to Feb. 1.
The situation has many growers feeling boxed into a choice they don’t want to make and without full knowledge of the possible ramifications for their own fledgling businesses. The state still only has two retailers open and operating, and most of the legal farmers have yet to even sell any of their crops from this past fall.
“It appears to be locking us in to uninformed decisions, possibly for the next couple of years, and that’s really what has the growers concerned,” said Tim Moshier, the owner of B30 Farm in Fulton. “We haven’t been able to get our stuff to market yet and find out what sells and what doesn’t.”
Moshier pointed out that early last year, state regulators told industry stakeholders that the plan was to have multiple dispensaries open by the end of 2022, but only one – Housing Works in Manhattan – actually launched. That has nearly all of the licensed farmers still waiting to sell the vast majority of their harvests.
The new letter, Moshier said, is “one more straw on the camel’s back” for a lot of growers.
“A lot of growers thought we’d have product in dispensaries a month or two ago, according to the OCM’s original plan. That didn’t happen. People are getting cash-strapped now,” he said.
It’s also unclear whether farmers will be permanently locked into whatever choice they make, or if regulators will allow them the flexibility to, say, add a greenhouse to an outdoor-only grow down the line at some point or transition into a vertically integrated microbusiness.
Those are both changes that several farmers have been seriously contemplating.
“We all had the idea we’d be in the place where we’re at until 2024, and then we’d be able to at least make an educated decision based on the market conditions and based on a good perspective of what our place can really be here to be successful,” said Brittany Carbone, the CEO of Tricolla Farms in Berkshire and a board member of CANY, which represents about 80 of the state-licensed farmers.
“To make that decision now is just very hasty,” Carbone said. “For a vast majority, it’s a very difficult decision to make at such an uncertain time.”
The four choices growers were given are:
“This form is required to be submitted by all (adult use conditional cultivators) that wish to cultivate in the 2023 season,” the letter from the OCM to growers reads.
The letter also includes a provision that any grower who signs and submits the form recognizes that the “selected and approved cultivation tier on this form will transition with conditional licensees as their approved tier for full licensure,” which suggests that whatever choice the growers all make will become their long-term place in the New York cannabis supply chain.
“The more indoor you’re allowed to have, then the less outdoor. It’s strange, and there’s no guidance for it,” said Tess Interlicchia, CEO and owner of Grateful Valley Farm in Corning.
Interlicchia said it feels as though the OCM is putting more restrictions on small distressed farms like hers, instead of giving them ways to be competitive, even though the New York market has been specifically designed to bolster small businesses. The 280 conditional cultivation licenses, for instance, were all given to licensed hemp farmers, with larger multistate operators being forced to largely sit on the sidelines until late 2025.
But once bigger companies can enter the market, Interlicchia said, the choice she and other farmers are being forced to make this coming week could come back to haunt them.
“It feels like we’re being set up to fail, to be honest, because none of us have tens of millions of dollars to throw up a greenhouse right away to be able to compete with the MSO’s,” said Interlicchia, who added she’s still struggling with which of the four options to choose. “It’s nerve wracking. It’s kind of scary.”
OCM spokespeople did not respond to multiple requests for comment on the policy shift, and the reason for the notice remains unclear.
“I would love to know” why the OCM sent out the notice, Interlicchia said. “They have sent out plenty of surveys. They could have just done that, instead of being like, ‘This is firm and you must do this by that date.'”
Carbone said she believes the policy shift is an attempt by the OCM to both get a better handle on overseeing the statewide supply chain and to address a prior CANY complaint that 20 lights for a greenhouse is too few lamps for indoor growers to be truly effective.
“They did provide a pathway for people to utilize more lights, to extend that season and greenhouse production,” Carbone noted. “It’s something that’s needed. But once again, it’s a lack of clarity, and communication not being as dynamic as we’d like it to be. It’s causing a lot of frustration for growers.”
“There are definitely people who are like, ‘F*** yeah, like, I have the greenhouse, I’m filling it out with lights.’ They’re ready to go. And that’s awesome, we need that,” Carbone said, but characterized that as a minority of farmers.
Moshier said he’s still hopeful that regulators will want to work with the farmers instead of being hard-nosed about the situation, but he added that the fundamental issue is a lack of communication.
“I think there’s a 50/50 chance they may extend the (Feb. 1) deadline again, and maybe come back with some more clarification,” Moshier said. “Hopefully they’ll allow us a little more latitude. I don’t know what’s driving the OCM, to need this information this early in the season.”
The post New York Forcing Cannabis Farmers to Choose Business Model appeared first on Green Market Report.
The New York state cannabis market is projected to be one of the biggest in the world, with some industry estimates forecasting sales to surpass $2 billion within just a few years. But the state’s recreational industry is just starting to get off the ground, with multiple players eyeing how to break in and make money.
The city’s first state-sanctioned adult-use dispensary opened in December, and its second – but first social-equity licensed store – just opened this week. Meanwhile, smoke shops are popping up on seemingly every corner, and medical marijuana dispensaries are holding on to prime real estate as both await what they hope will be their turn in the licensing process.
This month, Green Market Report joined forces with our sister publication Crain’s New York to take a closer look at the rollout:
We also asked some of the various stakeholders to share their thoughts on where the rollout is – and where they think it should go. Contributors include:
This package really is just a snapshot of an evolving market and industry – one that we’ll be keeping a close eye on in the weeks and months to come.
Thanks to Telisha Bryan, managing editor of Crain’s New York, and her team for helping us create this package for you, and to Buck Ennis for capturing the industry in pictures.
The post The Road to New York’s Potentially Massive Cannabis Market appeared first on Green Market Report.
This story was written in partnership with Crain’s New York, the trusted voice of the New York business community.
When New York gave the sale and use of medical marijuana the green light, officially permitting it in 2014, the firms that vied for a spot as one of the state’s 10 vertically licensed operators envisioned the true golden ticket to be early entry into the eventual recreational cannabis retail market.
That expectation was amplified when the state passed the Marijuana Regulation and Taxation Act in 2021. Investment dollars poured in, and medical licenses traded at high valuations on the secondary market, bolstered by the idea that those who bought in early would be able to capitalize on both adult-use and medical retail sales, cultivation and manufacturing.
However, under draft regulations released in November, those companies will have to wait at least three years from the official launch date of adult-use sales just to apply for a recreational retail permit. Final rules have yet to be published.
“They were hit with a bait and switch by the state regulators,” said Tom Adams, principal analyst and CEO of Global Go. “You know, ‘Come to our state and help apply your expertise and your capital to building out this incredibly limited medical-only market that you’re clearly not going to make any money at anywhere in New York.’”
So the multistate operators came.
The proposed rules, however, also established a two-tier system that prohibits growers and manufacturers from participating on the retail side—and vice versa. That means those same players who helped establish the medical cannabis industry “got sort of the back of the hand from regulators” and now must accept that they cannot implement the business models they’ve used in other states, Adams said.
Those who invested in medical operations in New York early on expected, if not “the first bite at the apple … at least a first bite at the same time as the other licensees for some of these retail adult-use licenses,” said Brandon Kurtzman, a partner at cannabis law firm Vicente Sederberg.
Both Adams and Kurtzman said the pivot now is to develop product brands through the cultivation and manufacturing side to sell to retailers and social consumption lounges.
Boxed in
The $138.9 million write-down Toronto-based RIV Capital took after its acquisition of New York’s Etain, one of the 10 local medical cannabis license holders, illustrates the conundrum. RIV Capital agreed to pay $212 million in cash and $35 million in stock for the small, women-led medical cannabis company.
But instead of being able to capitalize on its existing business structure, Etain has been forced into a single channel. With heavy investment already sunk into cultivation, the company appears to be boxed into being a grower—the less lucrative side of the cannabis business.
The price paid for Etain was so troubling to RIV Capital’s largest shareholder, JW Asset Management, that the firm asked for a special meeting of shareholders to replace five of the seven directors on RIV’s board.
In New York, Adams said, having a brand on store shelves “is probably more valuable than anything else” an operator can do, as there is not much real brand dominance yet among the plethora of cannabis companies out there.
Despite the firms seemingly being last in line, nothing is completely set in stone.
“It’ll be very interesting to see what happens with these draft regulations, see what the comments look like and if there’s going to be any compromise between what they put out [and] what [medical operators] are looking for in this market,” Kurtzman noted.
“The goal here is to provide access to consumers,” he added. “I think you do that by allowing new licensees but also allowing the existing licensees to participate, because that’s more or less what you told them they were going to be able to do in the law.”
The post As Rec Sales Start, Medical Marijuana Firms Left Warming the Bench appeared first on Green Market Report.
This story was written in partnership with Crain’s New York, the trusted voice of the New York business community.
The New York state cannabis market is projected to be one of the biggest in the world, with some industry estimates forecasting sales to surpass $2 billion within just a few years. But the slow rollout and uncertain regulations—after all, the rules are still in draft form—leave many wondering if a large chunk of sales will continue going to unlicensed dealers.
On top of that, the state’s unclear timeline for when licenses will be issued and storefronts will be fully operational as well as concerns about how much consumers will be willing to spend once potency and excise taxes are baked in, among other hurdles, have given some stakeholders pause about how successful smaller players will be in the market.
“This is a very optimistic time, but the business owner in me is very stressed out every single day on how I’m actually going to make this work,” said Brittany Carbone, a board member of the Cannabis Association of New York and the CEO of Tricolla Farms, near Ithaca. “There could be thousands of millionaires rather than a few billionaires created through the New York market, and the first step is getting more people licensed.”
Cultivation licenses were the first to be issued, but they were restricted to existing hemp farmers who could convert to growing marijuana to supply product rich in THC, the chemical that provides users with the sensation of being high, when the adult-use market launched.
There’s a long way to go, however. As of early January, the New York Office of Cannabis Management had awarded 354 conditional licenses, made up of 279 growers, 39 processors and 36 retailers, on top of the 10 registered organizations, or ROs, that are allowed to sell medical cannabis.
That includes 26 new adult-use retail licenses for four of New York City’s boroughs and Long Island. (Brooklyn was one of five regions where licensing has been delayed by litigation.) Each of those licensees can open three stores.
In addition, Manhattan, Queens, the Bronx, Brooklyn and Staten Island are already home to eight medical dispensaries, including three in Brooklyn.
It’s not clear when authorities will grant more permits; 903 applications were filed for the first round of retail licenses alone last year, so timing is a major question mark.
Not only that, but the sheer price difference between the first legal retailer in New York thus far Manhattan’s — Housing Works — and the enormous number of unlicensed dealers have some fearing that many companies won’t survive.
“It is an uphill battle, but again, it’s always an uphill battle when you don’t have massive capital, no matter what industry you’re in. But when you throw in the illicit market side, it makes it even harder,” attorney Jason Klimek, a member of the New York Bar Association’s cannabis law section, said when asked how he thinks the market—which is centered on small mom-and-pop businesses—will perform.
The most immediate obstacle for many New York cannabis hopefuls is getting licensed and operational, but the timeline on that front is painfully unclear.
The state has no limit on the number of business permits it will award—in theory—but regulators have been painstakingly slow on that front, particularly for retailers. The first round, which is so far only partially completed, will award 175 retail permits, including 150 for “justice-involved” individuals and an additional 25 for nonprofits.
The longer those retailers have to wait, the closer they’ll get to the three-year deadline, at the end of 2025, when the 10 multistate operator ROs will be allowed to fully enter the recreational cannabis side of the market. For now those behemoths are relegated to wholesaling cannabis products to licensed adult-use firms.
Most industry observers agree that the 10 will likely start dominating quickly because they’ve got an edge that no other retailer will have: vertical integration, their own in-house supply chains and branded product lines.
All the other retailers are prohibited from building such infrastructure or even having their own brands—another complaint of some license hopefuls.
“That is not good, because the only way we can level the playing field is for the smaller players like myself … to be able to support each other and be able to have each others’ products. The way the regulations are set up, I don’t think we could do that,” said Vladimir Bautista, CEO of New York City–based cannabis lifestyle brand Happy Munkey, one of the contenders for a retail license.
There’s even more uncertainty about the licensing rollout because of ongoing litigation that has held up at least 18 retail licenses thus far and has the potential to delay the permitting even more.
The post New York’s Cannabis Market Faces Uphill Climb as Adult-Use Sales Begin appeared first on Green Market Report.
This story was written in partnership with Crain’s New York, the trusted voice of the New York business community.
by Dasheeda Dawson, Cannabis NYC
It took nearly a century to suppress the legacy of cannabis in American agriculture and medicine. Just a decade ago, as a Brooklyn native who grew up during the height of cannabis criminalization, I could not have imagined buying an eighth of weed legally in New York City.
Despite the history, on March 31, 2021, the Marijuana Regulation and Taxation Act, championed by Assembly Majority Leader Crystal Peoples-Stokes, state Sen. Liz Krueger and the StartSMART Coalition, became the country’s landmark equity-centered law to intentionally hold government accountable for restoring and repairing communities disproportionately impacted by the overpolicing and disinvestment of the prohibition era.
I never expected the damage from decades of harsh laws and entrenched negative stigmas to disappear overnight. However, some have criticized the state’s timing, peddling the narrative that it is moving too slowly.
Analyzing the adult-use markets legalized prior to New York’s, every state had a lag period between legalization and launch, more often giving first access to already licensed medical operators, which further exacerbated inequities in the industry. In 2016 California and Massachusetts legalized adult use, and both opened the market for sales in 2018. In 2020 New Jersey legalized cannabis, and the state opened the market for first sales in 2022.
Providing 300-plus licenses to justice-involved individuals, small-business owners and farmers, the New York state Office of Cannabis Management should be commended for rapidly building a seed-to-shelf supply chain in less than two years, culminating with the first dispensary opening in December 2022.
New York is also taking an unprecedented approach to support previously existing, unlicensed cannabis entrepreneurs, often referred to as “legacy operators,” transition into the legal industry. Though others demonized the legacy market, New York has embraced the underground culture and its credibility.
The state’s conditional adult-use retail dispensary license and Cannabis Compliance Training and Mentorship Program mark the start of intentional inclusion in New York’s market. The nonprofit CAURD licensing opportunity also demonstrates an extraordinary model that supports sustainable funding to organizations that have served marginalized communities, provides opportunities to those same communities for retail workforce development and contributes to state cannabis tax revenue, 40% of which goes back to the communities disproportionately impacted by criminalization.
Amid these groundbreaking advancements for the state, New York City is contending with the proliferation of visible, unlicensed smoke shops, a common trend experienced during the lag period in other markets. From my experience in legalization efforts across the country, an industry grounded in restorative justice requires a three-pronged approach to enforcement:
Mayor Eric Adams launched Cannabis NYC to support New Yorkers starting or growing a legal cannabis-related business. As an emerging multibillion-dollar industry, cannabis will contribute significantly to the city’s economic recovery and can address the past wrongs that disproportionately affected Black and brown communities.
Cannabis NYC is on a mission to make our city the global leader in cannabis industry excellence in education and equity across business, science and culture. To accomplish this, MRTA’s intent must be protected, and efforts to repair social, economic, environmental and human injuries caused by prohibition must not be derailed by stigma and misinformation.
Cannabis NYC is actively creating an interagency hub of free resources and services for all New Yorkers, kicking off with a five-borough informational tour, in collaboration with the New York City Housing Authority and the Mayor’s Office of Equity. We are partnering with industry pioneers and institutions to support citywide public education initiatives, workforce training and curriculum development. The NYC Cannabis Policy Advisory Commission will include a diverse group of local and global experts, including racial justice, economic development and health equity leaders tasked with publishing an annual policy report. This is just the beginning.
Cannabis is a plant with agricultural, industrial, nutritional, medical and spiritual utilities that will have global impact, from health to hospitality to housing. Armed with the right alignment of community advocacy, business innovation and government leadership, at the state and local level, New York is poised to become a model of cannabis excellence for the world.
Dasheeda Dawson is founding director of Cannabis NYC.
The post Your Take: NY’s Cannabis Market Isn’t Moving Too Slowly — It’s on a Mission appeared first on Green Market Report.
This story was written in partnership with Crain’s New York, the trusted voice of the New York business community.
To read this post in Spanish, click here.
by Kristina Lopez Adduci, House of Puff, and Vladimir Bautista, Happy Munkey
As dispensaries begin to open and New York makes meaningful progress to launch its adult-use cannabis industry, one demographic that cannot be overlooked is the Latino community. We must address language barriers, cultural incompetence and the damage done by prohibition.
This is not an easy feat, but if we overcome this, Hispanic New Yorkers stand to be a key population to help our state’s legal industry achieve its true potential and fulfill the vision set out by the Marijuana Regulation and Taxation Act. Here’s why New York must do more to make legal cannabis accessible to its Latino population.
Prohibition was harmful to Latinos.
The racist undertones of anti-cannabis movements, such as the War on Drugs, adversely affected Latinos, and reversing those impacts must be a priority in the legal industry. It is commonly known that the now derogatory term “marijuana,” along with the first wave of prohibition in Texas, was created because of anti-Mexican sentiments and the plant’s association with migrants crossing the border.
For the Latino community, the War on Drugs not only perpetuated racist stereotypes, but it was also a driver of mass deportations and increased hostilities toward Hispanic migrant populations. Latino women were more likely to be arrested or have their children taken away in connection to cannabis use and possession. Prohibition also sparked the creation of the Drug Enforcement Administration, an agency responsible for the criminalization and incarceration of Latinos in the United States and in South America. This deepened the negative and discriminatory stereotypes about Spanish-speaking Americans and cannabis, especially in major cities with large Hispanic populations like New York City.
Latinos have an influential presence in New York.
New York state has the fourth-largest Latino population in the U.S., tallying almost 4 million of us. In New York City, we make up more than a quarter of the population, being outnumbered only by Caucasians. Due to our growing presence, Latinos will play an increasingly large role in the state’s culture, innovation, politics and key industries. This influence will undoubtedly continue in New York’s emerging cannabis industry. We have been leaders in legalization efforts in the state and trailblazers in the wider industry. We also represent a large portion of the legacy community and a significant consumer profile.
Latino culture and cannabis culture are closely related. We must ensure that this connective tissue remains as we transition into a legal market.
Latinos are becoming fierce cannabis advocates and consumers.
The Latino population is the youngest ethnic group in the U.S. Additionally, Hispanic culture has historically recognized the medicinal benefits of the plant. Attitudes are still shifting within our community. Though it is common for elder-generation Latinos to perpetuate negative stigmas around cannabis consumption, overall, our community not only consumes cannabis but fiercely advocates for it. According to a 2019 report by Ad Age, Hispanics are 30% more likely than the average cannabis consumer to belong to a group that actively promotes legalizing cannabis. The study also found that Latinos are 42% more likely than the average American to be cannabis campaigners. Cannabis campaigners are characterized as people who don’t necessarily consume cannabis, but who are informed about cannabis issues and actively support legalization.
New York must tap this enthusiasm to effectively incorporate our community into the cannabis industry. This means more cannabis education and restorative justice efforts in Latino neighborhoods, more programming and advertising in Spanish, and culturally competent “budtenders” and staff at dispensaries.
To most effectively address these barriers, an increase in Latino operators and dispensary owners is also key. That would grant us the social and economic equity benefits of the new legal industry and repair the lingering damage done to our communities by the War on Drugs.
Latinos will be a decisive demographic in the long-term success of the state’s legal industry. From Latino trailblazers paving the way within the community to Latino consumers and stakeholders posing an influence from the outside, we will uplift the cannabis sector for the long term. For the sake of social equity and the health of the industry, New York must activate our community in the rollout of its adult-use program.
Kristina Lopez Adduci is the founder and CEO of House of Puff, a cannabis accessories brand with a focus on education and destigmatization. Vladimir Bautista is CEO and co-founder of cannabis lifestyle brand Happy Munkey and a conditional adult-use retail dispensary license applicant.
The post Your Take: New York’s Legal Cannabis Industry Must be Accessible to the Latino Community appeared first on Green Market Report.
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