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Taxes And Provincial Mark-Ups Are Hindering Ontario’s Cannabis Industry

Written by Johnny Green on . Posted in Business, Policy.

The main motivation behind legalizing cannabis for adult and/or medical use should always be based on it simply being the right thing to do. No one should ever be penalized for using/possessing a plant that is 114 times safer than alcohol.

With that being said, the reality of the situation is that creating a regulated industry for the purpose of generating public revenue is a driving force behind support for legalization around the globe for better or worse.

Taking the profit away from criminal enterprises and essentially re-routing it to a regulated system in which some profits benefit society is a winning political message, and if actually achieved, a great thing. However, it’s predicated on people actually making purchases from regulated sources rather than unregulated ones, and the transition is far from automatic.

Surveys and polls have consistently found that cost is a major factor for consumers and patients, which is not exactly shocking because that is basically true of any product. But unlike most products, there are a lot of unregulated options when it comes to cannabis, and in most cases, unregulated cannabis is significantly cheaper than regulated cannabis.

Various reports have been published regarding the average price for regulated and unregulated cannabis in Ontario and other parts of Canada, and while the price for regulated cannabis seems to be pretty consistent being that it can be easily tracked, the price for unregulated cannabis often seems to be inflated in my opinion.

I spend an ungodly amount of time online talking to consumers all over the world, and I have yet to find someone in Ontario that pays the prices for unregulated cannabis that are being reported for what that is worth.

It’s a safe assumption that for every extra dollar that gets added to the price of regulated cannabis a certain chunk of the consumer base then gets lost to the unregulated market. With that in mind, the fact that roughly half of the price of regulated cannabis products in Ontario is due to taxes and provincial mark-ups is obviously a problem and will always hinder the legal industry.

This is not to say that there should be no government profit at all. Regulatory oversight is not free, so there needs to be enough money to safely administer sensible industry regulations, and to some extent, put cannabis industry revenues to work helping society in various ways.

However, there needs to be a balance struck to help ensure that regulated cannabis is truly competitive with unregulated cannabis. Regulated cannabis will never be as cheap to produce as unregulated cannabis, but it needs to be close enough that consumers feel comfortable paying a little extra for a product that they know is tested and safe.

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Thailand To Release All Cannabis Prisoners

Written by Johnny Green on . Posted in Policy.

In just a matter of days, Thailand will implement a very unique and bold approach to cannabis policy. On June 9th a new law goes into effect that will, among other things, legalize home cultivation for every household in the nation.

Thailand will launch a registration program in which households can sign up to cultivate low-THC cannabis and make use of harvests in various ways, including eventually selling it to the government.

To assist in helping households participate, the government is offering extremely low-interest loans to aspiring cultivators and distributing over one million cannabis seeds to households across the country.

Additionally, as announced this week, Thailand will also be releasing thousands of people currently serving time for cannabis offenses. Per Bangkok Post:

Ongoing trials and detention in connection with cannabis-related offences will be cancelled once revised restrictions take effect on Thursday, according to the Office of the Judiciary.

The production, import, export, distribution, consumption and possession of cannabis — except for its psychoactive substances — will be formally legalised on June 9 when a Ministry of Public Health announcement published in the Royal Gazette on Feb 9 takes effect, said Sorawit Limparangsri, a spokesman for the Office.

Cannabis-related offences that resulted in court cases and detention prior to June 9 will be cancelled, with any bond payments to be returned. People incarcerated in related trials serving jail time due to an inability to pay fines will also be released, according to the agency.

In addition to people being freed from prison and current prosecutions being abandoned, people previously convicted of some cannabis offenses will have those prosecutions removed from their records.

People awaiting trial will still have to show up to court as a procedural requirement, however, it’s only so that a judicial review can be performed to ensure that the case is eligible for dismissal.

It’s worth noting that not every case involving cannabis will be eligible for release, dismissal, and/or expungement. Some cases that involve cannabis also involve other offenses, so obviously in those instances, the case will remain in the criminal justice system. The same is true for cannabis cases that are beyond the parameters permitted by the new cannabis law.

Still, it’s estimated that over 4,000 cannabis prisoners will be released next week in Thailand, and that doesn’t seem to include pending cases, expungements for people that already served their sentences, and the prevention of future cases. It’s a significant move by Thailand, and hopefully other countries will work to do the same.

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Researchers Find CBD To Be An Effective Form Of Oral Care Treatment

Written by Frank Schuler on . Posted in Science.

Having a wound in your mouth can be very uncomfortable, and in some cases, can lead to serious health issues. Developing a wound in your mouth can happen due to a number of factors, and regardless of the reason, it’s something that needs to be taken seriously.

Failing to properly care for a mouth wound can lead to infections in some cases, and at the very least, it will make the problem last longer if it goes untreated.

Researchers in Thailand recently examined the ability of cannabidiol (CBD) to treat oral inflammation, gingival wounds, and ulcers by using a scratch test assay and evaluating cytotoxicity.

“The hemp extract and CBD significantly decreased TNF-α release by up to 91.05 ± 2.91% and 50.78 ± 7.21% of LPS activity, respectively, in a dose-dependent manner, compared to 10 µg/mL hydrocortisone (61.67 ± 3.79%). The hemp extract and CBD also significantly decreased IL-1β release, also in dose-dependent response, up to 78.03 ± 3.34% and 85.87 ± 1.11% of LPS activity, respectively, compared to 5 µg/mL hydrocortisone (80.81 ± 3.55%).” the researchers stated.

“The mean percentage of closure of the wound area was 27.92 ± 1.21% when exposed to 5 µg/mL hemp extract and 33.49 ± 1.67% when exposed to 0.5 µg/mL CBD, compared to 24.34 ± 2.29% for non-treated control.” the researchers went on to say.

“Our study demonstrates that both hemp extract and CBD can inhibit TNF-α and IL-1β production in LPS-induced RAW 264.7 cells and promote wound healing in HGF-1 cells. This is the first to show that short-term exposure to hemp extract and CBD promoted gingival fibroblast wound healing, demonstrating that hemp extract and CBD have potential benefits in the treatment of oral inflammation and ulcers.” the researchers concluded.

If you are experiencing any of the conditions mentioned in this article make sure to contact a medical professional as soon as possible before trying any new treatments.

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South Africa Department Of Justice: Cannabis Industry Not Our Domain

Written by Frank Schuler on . Posted in Policy.

In the fall of 2018, South Africa’s Supreme Court determined that cannabis prohibition as it pertained to personal use by adults in private settings was unconstitutional. While the decision did not extend to many other parts of cannabis policy, lawmakers in South Africa used it as an opportunity to completely overhaul the nation’s approach to cannabis policy and industry.

Similar court decisions were rendered in Italy and Mexico to some degree, however, lawmakers in those countries have been very slow to move policy beyond the individual Court decisions.

South Africa, on the other hand, has really stepped up efforts to embrace the cannabis plant and the industry that surrounds it. As we previously reported, South Africa’s government is currently accepting proposals for cannabis businesses and recently approved the country’s first cannabis pharmacy.

In yet another example of the shifting cannabis landscape in South Africa, the nation’s Department of Justice recently announced that it should not oversee the emerging cannabis industry. Instead, its recommendation is that other agencies that oversee other large, legal industries perform that task. Per Business Day:

The department of justice was not empowered to introduce legislation dealing with the commercialisation of cannabis, as that fell within the domain of other departments such as health, agriculture, and trade, industry and competition.

On Tuesday, the department of justice’s legal adviser, Sarel Robbertse, gave the department’s response to public comments on the Cannabis for Private Purposes Bill, in a briefing to parliament’s justice and correctional services committee…

It will be very interesting to see where South Africa’s cannabis industry is at five years from now, and how much farther along it is compared to other countries within the global cannabis community.

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Government Agencies In Thailand Sign Agreement To Promote Cannabis

Written by Frank Schuler on . Posted in Policy.

In one week Thailand will implement robust changes to the country’s cannabis policies, not the least of which will be allowing every household in the country to sign up to cultivate low-THC cannabis.

To help encourage the nation’s industry, Thailand’s government previously announced that it will offer low-interest loans to aspiring cultivators, as well as distribute over 1 million free cannabis seeds to the public.

Earlier this week over half a dozen agencies in Thailand entered into an agreement to promote the nation’s emerging cannabis industry going forward. Below is more information via a social media post from the National News Bureau of Thailand:

An agreement has been signed by the Ministry of Public Health and seven other agencies to support and promote the appropriate use of cannabis and hemp.

Public Health Minister Anutin Charnvirakul presided over the signing of the agreement to prioritize using cannabis and hemp for health and economic purposes, and not for illegal or inappropriate use. In addition to the health ministry, the agreement was signed by representatives from other agencies, namely the Ministry of Tourism and Sports, the Thai Health Promotion Foundation, the Mass Communication Organization of Thailand, The Medical Council of Thailand, and Thai Traditional Medical Council.

The Royal Thai Police, the Office of the Narcotics Control Board and the Food and Drug Administration also signed as witnesses for the agreement.

According to Anutin, the agreement aims to ensure that use of the plants is prioritized for medicinal and economic purposes, encourage product diversity, and increase market value. He also emphasized the importance of publicizing the goal of removing these plants from the Type 5 Narcotics List in order to prevent public misuse.

Both plants will be removed from the Type 5 Narcotics List on June 9, 2022. However, any product containing more than 0.2% Tetrahydrocannabinol (THC) extract is still classified as a category 5 substance and is subject to narcotics control and suppression laws.

Anyone who wishes to grow cannabis and hemp must register through the Food and Drug Administration’s “Puk Kan” mobile application, while those who intend to cultivate them for commercial purposes must notify the authorities before starting their business.

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Japan’s Ministry Of Health Considers Legalization Of Medical Cannabis

Written by Marguerite Arnold on . Posted in Policy.

The country is considering medical reform and will create a new legal framework to recriminalize adult use

The Ministry of Health in Japan has decided to embark on a path that would seem to indicate that at least medical use of some kinds of cannabis is on track to be authorized soon.

The bad news? The government also apparently intends to become alone in the world to make medical use legal while also planning to specifically penalize recreational users.

As of last week, the Ministry began formal discussions on how to revise the country’s Narcotics Control Act, enacted just after WWII, in 1948. Last year, internal discussions began to lead ministers in the government in the direction of reform after a report discussed the medical efficacy of the drug on diseases like epilepsy. The Ministry of Health intends to draw up proposals before the end of this summer.

All G-7 countries, with the exception of Japan, have approved the use of CBD-based drugs to treat epilepsy.

Going Sideways?

That said, it is not clear how fast the country will move on cannabis reform more generally. The governmental inquiry is also discussing a new provision to the Control Act that specifically criminalizes recreational use while providing a medical exception to patients. There are also expected to be harsh penalties for the consumption of recreational cannabis.

This is a country with a long and tortured cannabis history. In 1980, former Beatles member, Paul McCartney visited the country with about 8 ounces in his possession. He was subsequently banned from the country for 11 years.

The government also made international headlines in 2018, clearly targeting Japanese nationals living in North America when it forbade its ex-pat citizens to use cannabis even if living in a country where its use was legal.

More recently, this February, a U.S. Marine received two years of hard labour for importing a half-gallon of cannabis-infused liquid and a quarter pound of cannabis flower. On May 17, a Japanese school nurse was also imprisoned for suspected possession of an unspecified amount of dried cannabis flower.

As of last year, there were 5,400 people charged with illegal possession – a new record for the country. Offenders below thirty accounted for 70% of those arrested. The number of people arrested for possession has doubled since 2017.

While it is unlikely that this strange compromise will hold, Japan, as a result, has certainly entered the global cannabis conversation with a unique “reform” proposal – even if it is, obviously, an unsustainable one long term.

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Argentina Legalizes Medical Cannabis And Hemp To Revive Economy

Written by Johnny Green on . Posted in Archives, Business, Policy.

The Latin American country has high hopes that the legalization of cannabis will bring much-needed cash and jobs to the country after Covid

At the beginning of May, the Argentine Congress passed a bill to establish a legal framework for the establishment of a domestic cannabis industry (cultivation and sale) as well as the export of both medical cannabis and industrial hemp.

The move was backed by the country’s president, Alberto Fernandez, who hopes to create new jobs, increase productivity, and create new kinds of exports for the country, which is now facing a deep economic crisis, post-Covid.

The government believes that the industry could create about 10,000 new jobs in the next two years and create $500 million worth of revenue for the country. They hope that of this amount, $50 million will also be exported.

The country has 8 different varieties of cannabis seeds so it will not have to import them, or seedlings.

Cannabis – A Latin American Export Commodity?

Argentina of course is not the only country now exploring the cultivation of cannabis for economic development purposes – not only in Latin America but globally.

At this point, with the exception of Venezuela, Bolivia, French Guiana, Suriname, and Guyana, the entire continent is engaged in medical cultivation of some kind. Even in these countries, the discussion is moving forward toward other things. Uruguay of course is the only country on the continent where recreational use has been legalized. Indeed, Uruguay was the first country in the world to legalize recreational use.

Beyond this, many countries in Africa are now looking to the crop to boost domestic income via exports and for job creation, starting with South Africa.

The question is, of course, will the demand for cannabis actually be this great, globally. Beyond that, there are many questions about the current sustainability of the industry in developing countries. Yes, the prices of cannabis need to drop, dramatically, but there is also likely to be a “race to the bottom” as countries compete with each other for more valuable markets, like Europe.

In many countries on the African continent, cannabis is increasingly being seen as a replacement for tobacco.

In Latin America, in particular, however, the sustainability of the industry, particularly when considering that rain forests could be further decimated to grow the crop, is still in question.

One thing is for sure, however. “South” economies are now in the middle of a green rush. The question is, however, will this return the gold they hope for?

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Why Uruguay’s President Is Wrong About Cannabis

Written by Johnny Green on . Posted in Archives, Policy.

Late last week the President of Uruguay, Luis Lacaille Pou, reportedly stated that it was a mistake for Uruguay to have passed an adult-use legalization measure back in 2013, and subsequently, launched legal adult-use sales four years later. Both moves by Uruguay were the first of their kind by any country on earth since the start of global cannabis prohibition. It’s worth noting that Uruguay’s current President was elected in 2020, well after the country legalized cannabis for adult use.

As expected, cannabis opponents are pointing to the President of Uruguay’s statements as loudly and as often as possible. They are touting it as some type of ‘proof’ that adult-use cannabis legalization does not work, and that the first country to ever legalize cannabis for adult use has buyer’s remorse. According to the President, the government should not be part of the process of growing or selling “drugs” because he considers legal cannabis to be “unprofitable.”

Why Did Uruguay Legalize Cannabis?

When Uruguay passed its national cannabis legalization measure, the public policy shift had three main objectives, two of which were specified in the law itself:

  • Reducing cartel-related violence by moving cannabis into a regulated market
  • Promoting public health through education and prevention
  • Eliminating the catch-22 of allowing possession but effectively blocking consumers from accessing cannabis

Contrary to the spin-doctoring that Uruguay’s President seems to be currently engaging in, the goal of Uruguay’s historic cannabis policy shift was never to maximize profits. Prohibition is a failed public policy, and a regulated model will always be a better approach to cannabis policy.

Drug cartels have caused an enormous amount of misery and suffering in Uruguay and throughout the region. Cannabis is obviously only one of the many facets of a drug cartel’s operations, however, giving consumers a regulated option to legally acquire cannabis hurts cartels’ bottom line to some extent, and from that perspective, legalization is clearly working.

Improve The Legalization Model

Legalizing cannabis purely for monetary gain is not a solid reason for such a public policy change. People should support cannabis legalization because it is the right thing to do being that cannabis prohibition literally ruins lives. No one should ever be subjected to the criminal justice system due to possessing, cultivating, and/or buying a personal amount of cannabis.

With that being said, if Uruguay’s President is truly concerned about the profitability of the nation’s emerging cannabis industry, then he should seek to improve it rather than destroy it. The first thing that the President should seek to do is open up the nation’s cannabis system to tourists. Unlike Canada, Uruguay only allows sales through pharmacies and private clubs, and those sales are only open to residents. That is obviously going to limit the size of Uruguay’s potential customer base and hinder industry profits.

One thing that the President seemed to disregard in his statements is the cost savings to Uruguay by the country no longer enforcing failed public policy. Enforcing cannabis prohibition is expensive. It costs money to pay law enforcement to identify and investigate unregulated cannabis activity. It costs money to then prosecute cases through Uruguay’s court system. Incarcerating people also costs money. When Uruguay stopped enforcing prohibition, it yielded obvious cost savings for the government. Legalization is working in Uruguay, whether the country’s President wants to admit it or not.

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The Top 20 Cannabis Firms In Germany In 2022

Written by Marguerite Arnold on . Posted in Business.

This list of firms currently operating in the regulated cannabis ecosystem and space in Germany are the top companies in the vertical

Make no mistake – the German cannabis industry is going to morph dramatically over the next 24 months. Recreational legalization changes everything!

However, there is likely to be a direct connection between early movers in the medical and recreational space – just because of certification infrastructure and the need to track and trace product.

Here is an alphabetical list of the top 20 cannabis firms aus Deutschland that you almost certainly have heard about before if you follow events and the industry in Europe. You will definitely be hearing more about them in the near future. They range from cultivation, distribution, and manufacturing companies to those that provide vital equipment for the certified industry. And all of them have weathered the dramatic transition in the market here since 2017.

Alephsana

Based in Berlin, this GDP-certified distributor was founded in 2019 by Boris Moshkovits. The company has had many successes so far, including helping to bring the first Australian cultivated cannabis into the German market. Moshkovits is a dedicated cannapreneur and aspires to help normalize the cannabis pipeline into Germany by sourcing high-quality, certified cannabis globally.

Aphria/Tilray

Aphria was one of the three firms that won authorization to grow cannabis during the German cultivation bid. They subsequently merged with Tilray, but not before also purchasing the sixth-largest mainstream medical distributor in the country (CC Pharma).

Aurora Cannabis

This Canadian public company also won one of the three cultivation slots in the German cultivation bid. The firm has a footprint across Europe at this point. It was one of the earliest public Canadian companies before establishing itself across the EU over the last five years.

Canify Clinics

This new addition to the medical cannabis clinic and telehealth space in Germany (but an established company in the Danish cannabis space) is entering the market at an interesting time – and going up against several more established competitors. With clinics opening this year in Berlin, Munich, Dusseldorf and just south of Frankfurt, the firm also just acquired a German GDP distributor.

Cannamedical

Based in Cologne, the company was one of the first independent, certified, GDP distributors in the country. Founded by David Henn, the company has consistently been at the forefront of industry trends.

Cannovum

Germany’s first publicly traded distributor, importer, and manufacturer, based in Berlin, also has the distinction of being helmed by one of the few women executives in the industry, Pia Marten. The company has also established a Portuguese subsidiary, which is a joint venture with local partners to initially distribute medical cannabis to Portuguese pharmacies.

Cansativa

Located in Frankfurt, Cansativa won the tender issued by BfArM to become the sole distributor for medical cannabis grown in Germany. The company has now successfully raised two rounds of financing, the last from American cannapreneur and rapper, Snoop Dogg.

Cantourage

The founders of the company have extensive experience in the German cannabis industry. They originally founded Pedianos (later acquired by Aurora) as Germany changed its medical law to include cannabis. Cantourage is their second cannabis company. They are also continually bringing in cannabis and cannabinoid medicines from various parts of the world.

Demecan

Demecan remains the only German-founded cannabis cultivation company. The three founders managed to acquire the license won by Canadian Wayland as the company merged with ICC: Currently they are growing cannabis for the German medical market.

Drapalin Pharmaceuticals

Founded in Munich in 2017 by four childhood friends, the wholesaler and GDP distributor is currently importing cannabis from Lesotho for distribution mainly in Bavaria. The firm also has a range of CBD extracts.

Harter GmbH

Harter does not cultivate or distribute cannabis products – but they do something almost as important. They build drying systems for certified cannabis, with an eye toward also creating a carbon-friendly footprint for the process. The firm has established a global customer base.

HERBLIZ Berlin/NGP Berlin

Berlin-based Herbliz operates in multiple sectors of the emerging cannabis industry, including CBD white and private label manufacturing. In addition to its brand Herbliz, the company also operates a THC-focused medical cannabis business.

Khiron

Khiron is an interesting hybrid. It is a Canadian public company with cultivation based in Columbia combined with a strong European presence (in Frankfurt). The company is a producer and distributor of medical-grade cannabis and commercial CBD products and are also opening specialty clinics in key markets, starting with Latin America and the UK.

LIO Pharmaceuticals GmbH

Based just outside of Düsseldorf in Solingen, Lio is currently a GDP distributor with plans to become Germany’s first GMP white label extraction factory. The company is currently building out its manufacturing facility and distributing medical-grade product.

Nimbus Health/Dr. Reddy’s

Nimbus, founded by two millennial friends in Frankfurt, established itself as a medical specialty distributor in the center of European banking and finance. The company was acquired at the beginning of 2022 by Dr. Reddy’s, a globally known Indian wellness and generic pharmaceutical company.

Sanity/Vayamed

Sanity Group, a Berlin based health and life-science company founded by Finn Age Hänsel and Fabian Friede in 2018, aims to improve people’s quality of life through the use of cannabinoids and the utilization of the endocannabinoid system. The focus is on pharmaceuticals and medical products (Sanity Medical with Vayamed, AVAAY Medical, Endosane, and others) on the one hand and cannabinoid-based consumer goods (Sanity Care with VAAY and This Place) on the other. Financially and strategically, Sanity Group is backed by investors such as Redalpine, Calyx and Casa Verde Capital (Snoop Dogg).

Storz and Bickel

This eponymous firm is well known globally for its vape products – starting with the ever-amazing “Volcano.” The firm also has the most widely used medically certified vape in the German market. Canopy Growth bought the firm in 2018.

Synbiotic

This holding company is comprised of a current portfolio of four firms it has acquired on an aggressive purchasing spree over the last several years including Hempamed, Solidmind Group GmbH, BioCBD and Cannexo GmbH. The company is establishing a broad footprint across the CBD and medical cannabis space with an eye to the opening recreational market.

WEECO

WEECO is a certified pharmaceutical distributor based in lower Saxony, with an international presence in Denmark, Switzerland, and Greece, selling cannabis-based products worldwide. The company’s mission is to “revive healing powers of Cannabis and help to establish a reliable supply structure for industry and patients.

Four20 Pharma

Four 20 Pharma is a GMP licensed German manufacturer, wholesaler and importer of medicinal cannabis. Since its establishment in 2018, the company has positioned itself as one of the biggest players in the German medicinal cannabis market, with its growth underpinned by the success of its “420 NATURAL” brand, one of the highest selling medicinal cannabis brands in Germany.