CANADA: Aphria Inc. announced record adult-use cannabis gross revenue in first quarter fiscal year 2021 and sixth consecutive quarter of positive adjusted EBITDA.
Net Cannabis Revenue Increased 103% from Prior Year Quarter. Adjusted EBITDA from cannabis business of $10.4 million increased 11% from prior quarter. Cash cost per gram remained below $1.00 and decreased for the fourth consecutive quarter to $0.87
|
|
|
|
|
CALIFORNIA: The Bureau of Cannabis Control and California Department of Public Health (CDPH) announced today the filing of a complaint seeking civil penalties from Vertical Bliss, Inc. also known as Kushy Punch and related people for unlicensed commercial cannabis activity. The complaint was filed on September 23, 2020 by the California Office of the Attorney General in Los Angeles County Superior Court.
The complaint alleges that Vertical Bliss conducted unlicensed operations on an undisclosed premise in Canoga Park, California, and inverted illegally manufactured product back into the regulated market. On October 2, 2019, in response to tips about illegal manufacturing and distribution of cannabis goods, the Division of Investigation executed search warrants at the unlicensed Canoga Park location. The search revealed significant quantities of cannabis concentrates, edibles, vape cartridges and raw materials. Seized records document the production of more than 3.3 million Kushy Punch brand gummies during an 18-month period, with an estimated value of $64 million.
Vertical Bliss simultaneously held cannabis manufacturing and distribution licenses for a premises located in Chatsworth, California. These licenses were revoked, following the discovery of the unlicensed operations.
The Medicinal and Adult-Use Regulation and Safety Act (MAUCRSA) establishes strict requirements for the cannabis market and products, including requiring a state license and local approval for every premises where commercial cannabis activity is conducted. Manufacturing, distributing or selling cannabis goods without a state license or at a location that is not licensed is a violation of state law. A person engaging in commercial cannabis activity without a license is subject to civil penalties of up to three times the amount of the license fee for each day of operation.
To file a complaint regarding illegal cannabis activity, click here – Enforcement Online Services.
ILLINOIS: The Illinois Department of Financial and Professional Regulation (IDFPR) announced today that permanent rules have been adopted for adult use cannabis dispensary licensees to be selected when there are two or more applicants in the same Bureau of Labor Statistics Regions with tied high scores. The rules, which were filed in June, may be found here.
The approval of these rules allows IDFPR to move forward in awarding the 75 conditional adult use cannabis dispensary licenses that were authorized by the 2019 Cannabis Regulation and Tax Act. Consistent with the new rules, IDFPR will provide a public notice announcing the applicants with tied high scores who, if they meet the requirements in the rules, may participate in the selection process for a conditional license.
“We are pleased that these rules have been adopted, and we remain unwavering in our commitment to ensuring these licenses are issued in a fair and objective way that implements Illinois’ equity-centric law,” said Toi Hutchinson, Senior Advisor for Cannabis Control to Gov. Pritzker. “Additional licenses will be made available in the coming years and these rules will help ensure a strong foundation is established for the licensing process in the future.”
Once IDFPR awards a conditional license, the licensee will have 180 days to find a location within its BLS Region to operate. A license to operate cannot be issued if the location is within 1,500 feet of an existing licensed dispensing organization. More about the awarding of the conditional adult use dispensing organization licenses may be found under 410 ILCS 705/15-25 and 15-30 of the Cannabis Regulation and Tax Act.
In addition, application scoring for craft grower, infuser and transporter licenses is being finalized, and the Illinois Department of Agriculture will announce award dates in the near future.
Announces $2.8 million Sales Contract in July
COLORADO: Surna announced today that it recently signed a sales contract valued at $2.8 million.
The project in Illinois is for a multi-state operator with whom Surna has worked on previous facilities in other states. The facility is approximately 88,000 square feet, of which approximately 66,000 square feet is dedicated to cultivation, drying and processing areas. Surna is under contract to provide a full suite of climate control products and technologies for the cultivation and processing spaces (the mechanical engineering design was done by Surna through a previous contract), supply of major mechanical equipment, SentryIQ™ environmental controls, and system start-up. While Surna can and does provide MEP design and equipment for a wide range of climate control approaches, in this case the priorities of reducing electrical infrastructure requirements and reducing roof loading, along with the desire for precise control of the facility’s environment, resulted in the selection of a 4-pipe hydronic system. The design has integrated dehumidification, in which Surna is providing its proprietary line of multi-function fan coils, destratification fans, dehumidifiers and heat recovery chillers.
Tony McDonald, CEO commented: “The team at Surna has worked diligently to secure the largest single contract in the Company’s history. Now our operations and controls departments will be hard at work ensuring the delivery of a precisely controlled environment and on-time delivery of equipment to meet our customer’s requirements.”
OREGON: At its regular monthly meeting on June 18, 2020, the Oregon Liquor Control Commission moved to extend the ability of licensed marijuana retailers to continue curbside delivery, and took the first step towards adopting rules that would ban non-cannabis additives from inhalable cannabis products. Commissioners also approved six marijuana violation stipulated settlement agreements.
In the wake of the COVID-19 pandemic the OLCC, in order to promote social distancing required under the Governor’s Executive Orders, approved a temporary rule allowing licensed marijuana retailers to make “curbside delivery” within the immediate vicinity of their licensed (premises) retail store. That temporary rule expires in September 2020 and cannot be extended with another temporary rule.
Because the duration of the pandemic remains unknown, measures aimed at accommodating social distancing requirements and minimizing person-to-person contact remain critical to protecting public health. The proposed rule provides licensed marijuana retailers flexibility in how they can deliver to consumers at their licensed premises.
In the fall of 2019, a number of Oregonians suffered from the outbreak of vaping-associated lung injury (VALI) linked in part to inhalable cannabis products. As of March, 2020, Oregon had 23 reported cases of VALI, including two fatalities. VALI has been tentatively linked to additives combined with cannabis oil.
Commission staff are attempting to address consumer product safety concerns by prohibiting all processed non-cannabis additives from being added to inhalable cannabis products. Non-cannabis vaping additives are used in cannabis vaping products for a variety of purposes, including dilution, flavor, and effects. However, non-cannabis additives are not necessary to make a vape product work with vaping technology.
Although the additives may be generally recognized as safe (GRAS) for ingestion, the same cannot be said for their inhalation. There is no regulatory body that evaluates the safety of these ingredients when inhaled, and additive makers do not disclose all of their ingredients due to trade secret concerns.
The Commission also ratified the following violation fines and suspensions based on stipulated settlements (detailed information on specific cases can be found here on the OLCC website):
Licensee is: Mahalo, Inc.; Frankie Powell, President/Secretary/Director/Stockholder.
Licensees are: Plane Janes’ LLC; Patricia Wiegele, Member.
Marijuana Worker Permit #393L5E.
Licensees are: Green Box, LLC; Adrian Wayman, Member; Robert Wayman, Member.
Licensees are: JIMO Holdings, LLC; Joseph Cohen, Member; Idan Magal, Member; Arman Daytian, Member/Manager.
Licensees are: Winds of Change, LLC; James McQuade, Member.
WASHINGTON: The Washington State Liquor and Cannabis Board (WSLCB) is hosting two Listen and Learn forums about the current rules regarding marijuana producer licenses, specifically the consideration of revisions and new rule sections that would incrementally expand the plant canopy square footage allowed for licensed Tier 1 producers. This is the second of two planned sessions. Session #1 will cover WAC 314-55-075 Sections 1 through 5. Session #2 will focus on Sections 6 through 11.The full text of WAC 314-55-075 is provided here.
Please join us virtually on Tuesday, June 30, 2020, from 1:00 p.m. until 3:00 p.m. via WebEx in alignment with guidance and recommendations issued by the Governor’s office.
As you may recall, the Board began to consider revisions to existing producer license rules by initiating a formal rule inquiry on December 18, 2019. The Pre-proposal Statement of Inquiry filed by the Liquor and Cannabis Board may be found here.
The Board has received requests from medical marijuana patients and segments of the industry to increase the availability of Department of Health (DOH) compliant product in licensed retail stores. The Board has also learned that smaller producers are concerned about business sustainability based on canopy space restrictions. Recognizing this, the Board would like to explore the ways that it can support Tier 1 producer business viability. Revisions considered may also include clarifying and technical updates to existing rule within the scope of this topic.
An agenda is attached to help you prepare. Please come prepared to offer feedback and suggestions regarding this rule section.
If you wish to join us virtually, we’d like to offer the following reminders:
Please remember that we are still in the developmental phase of rulemaking, and there are not yet any proposed or final rules amendments. To help you prepare for this listen/learn/contribute forum, please review the guidance document prepared for this and future forums.
Questions? Contact Casey Schaufler at casey.schaufler@lcb.wa.gov
To join the WebEx meeting online:
https://watech.webex.com/watech/onstage/g.php?MTID=e704a0de07d3b41806e1f7f59ba96195e
To join the WebEx meeting via audio conference only:
Toll Free: 1-855-929-3239
Access Code: 133 418 7301
WASHINGTON: The Washington State Liquor and Cannabis Board (WSLCB) has rescheduled a Listen and Learn forum on draft conceptual rules regarding marijuana true party of interest regulations described in WAC 314-55-035 to accommodate concerns around the COVID-19 outbreak.
Please join us virtually on Wednesday, May 20, 2020, from 1:00 p.m. until 3:30 p.m. via WebEx in alignment with guidance and recommendations issued by the Governor’s office.
As you may recall, the Board began to consider revisions to existing marijuana true party of interest rules by initiating a formal rule inquiry under WSR 18-22-54 in October, 2018. Those efforts were extended by the passage of Engrossed Substitute House Bill (ESHB) 1794, concerning agreements between licensed marijuana businesses and other people and businesses, including royalty and licensing agreements relating to the use of intellectual property during the 2019 regular session of the Washington State legislature
During the summer, and into the fall and winter of 2019, WSLCB held multiple meetings with industry association representatives, licensees, and others to draft the conceptual rules we’ll be discussing during this Listen and Learn session. These conceptual draft rules reflect an engaged and inclusive developmental process that embodies not only WSLCB’s commitment to regulatory stability and consistency, but to listening to and learning from the input of licensees. They also represent a significant agency policy shift in the removal of the spousal vetting requirement.
An agenda is attached to help you prepare. Please come prepared to offer feedback and suggestions regarding this new rule section and the draft conceptual rules.
If you wish to join us virtually, we’d like to offer the following reminders:
Please remember that we are still in the developmental phase of rulemaking, and these are not proposed or final rules. To help you prepare for this listen/learn/contribute forum, please review the guidance document prepared for this and future forums.
Questions? Contact Kathy Hoffman at katherine.hoffman@lcb.wa.gov
To join the WebEx Event:
Event address for attendees: https://watech.webex.com/watech/onstage/g.php?MTID=e13ac4927e2202ebbb097b00732f4e5b0
To attend by phone: (TOLL) +1-415-655-0001 or (TOLL FREE)+1-855-929-3239
Access code: 285 815 516
The Company continues to expect to incur approximately $700-800MM pre-tax charge in Q4 Fiscal 2020.
CANADA: Canopy Growth Corporation (“Canopy Growth” or the “Company”) (TSX:WEED, NYSE:CGC) today announced a series of global operational changes designed to further optimize production, better align supply and demand, and improve efficiencies in its global operations. As part of its ongoing strategic review of the business, the Company announced today the following changes to its operations:
“When I arrived at Canopy Growth in January, I committed to conducting a strategic review in order to optimize our cost structure and reduce our cash burn,” said David Klein, CEO, Canopy Growth. “I believe the changes outlined today are an important step in our continuing efforts to focus the Company’s priorities, and will result in a healthier, stronger organization that will continue to be an innovator and leader in this industry. I want to sincerely thank the members of the teams affected by these decisions for their contributions in helping build Canopy Growth.”
The Company continues to expect, based upon information currently available to management, to record estimated pre-tax charges of approximately $700-800MM in the quarter ending March 31, 2020. This relates to this announcement and previous announcements, as well as any additional changes made during the organizational and strategic review. The organizational changes announced today include a headcount reduction of approximately 85 full-time positions.
All figures reported above with respect to the quarter ending March 31, 2020 are preliminary and are unaudited and subject to change and adjustment as the Company prepares its consolidated financial statements for the year ending March 31, 2020. Accordingly, investors are cautioned not to place undue reliance on the foregoing information. The Company does not intend to provide preliminary results in the future. The preliminary results provided in this news release constitute “forward-looking statements” within the meaning of the United States Private Securities Litigation Reform Act of 1995 and “forward-looking information” within the meaning of applicable Canadian securities legislation, are based on several assumptions and are subject to a number of risks and uncertainties. Actual results may differ materially. See “Notice Regarding Forward Looking Statements”.
OREGON: The Oregon Liquor Control Commission will allow alcohol and marijuana licensees to accept expired Oregon driver licenses or identification cards that expired, on or after March 8, 2020, as an acceptable form of identification.
This decision aligns with the Oregon Department of Motor Vehicles and law enforcement position, as DMV offices are closed because of the COVID-19 public health crisis preventing individuals from renewing their driver’s license or ID cards.
This temporary exception only applies to driver licenses and identification cards issued by the State of Oregon. This exception will remain in place while the Governor’s Executive Order 20-03remains in effect.
This addresses a concern, brought to the attention of the OLCC, faced by former Oregon Medical Marijuana Program cardholders, who have transitioned to the recreational marijuana system, but have driver’s licenses or identification cards that have expired.
On March 20, 2020, The Oregon DMV asked law enforcement to exercise discretion in enforcing violations due to expired credentials and the Oregon State Police, Oregon State Sheriff’s Association and the Oregon Association of Chiefs of Police have agreed to support this “grace period.”
Additional information can be found in the OLCC recreational marijuana program FAQ.
Information about COVID-19 related changes to OLCC rules, program and compliance/enforcement can be found on the OLCC COVID-19 Business Continuity page on the OLCC website.
CALIFORNIA: Viola, a nationwide leader in the production and sale of premium quality cannabis products founded by NBA veteran Al Harrington, today announced the official launch of its social equity initiative – Viola Cares. Through education, equitable offerings, expungement, and incubation programs, the initiative will result in more than 10,000 jobs, hundreds of new business owners and expanded industry diversity by increasing representation, facilitating community building and providing employment opportunities.
Viola’s first strategic alliance within its Viola Cares program kicks-off with Root & Rebound. Root & Rebound is home to lawyers and advocates committed to restoring power and resources to the communities most harmed by mass incarceration and the War on Drugs. Their work combines direct legal services with systems-changing policy advocacy and public education, in an effort to move society toward greater racial and economic equity, justice, collective liberation and intergenerational healing. Their educational resources like the California Roadmap to Reentry, the Reentry Planning Toolkit, the National Fair Chance Housing Toolkit, and others have supported thousands of people as they work to navigate the collateral consequences of an arrest or conviction history.
Viola, in conjunction with Root and Rebound, will produce a first-of-its-kind toolkit designed specifically for people with cannabis-related convictions, to be entitled: “A New Leaf: A ‘How-To Guide’ for Successful Reentry After A Cannabis Conviction.”
“At Viola, we live and breathe the belief that a cannabis conviction should never be considered a life sentence,” said Al Harrington, Founder, Viola. “In joining forces with Root and Rebound, we will look to help those communities of color who have historically been the victims of cannabis-related incarceration and who have fallen on hard times, and turn those struggles into opportunities for success within this rapidly growing industry.”
Opportunity within the cannabis industry only continues to grow as legalization progresses and passes into law across the country, and Viola is breaking the barrier of entry for minorities to contribute to that growth through cultivation and entrepreneurship.
“We’re honored to be working side-by-side with Viola on such an important initiative–one that positively impacts thousands who have been unfairly stigmatized by their prior cannabis-related incarceration,” Katherine Katcher, Founder and Executive Director of Root and Rebound. “Together we’re changing that conversation, leveling the playing field for minorities and creating opportunities for those deserving of a second chance.”
In celebration of the strategic alliance between Viola and Root and Rebound, Viola will host a welcome reception and panel discussion in support of the launch of “A New Leaf” toolkit at the Viola headquarters in Los Angeles on February 26, 2020. A moderated panel hosted by Viola CMO Ericka Pittman will include Katherine Katcher, Eliana Green, and Sandra Johnson from the Root & Rebound team, along with Al Harrington and Dan Pettigrew, Co-Founders of Viola moderated by Van Lathan.
