Tag Archives: administration

5 Pivotal Trends Propelling Growth For the Medical Cannabis Market: 2021-2027

By Priya Deshmukh
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Growing awareness and public support for medical cannabis around the world has pushed regulatory authorities to consider the legalization of medical cannabis, which remains the major factor driving growth for the medical market. Cannabis-based medication has conventionally been used and studied to be an effective therapeutic solution for various disorders. Increasing R&D activities for the development of novel solutions and applications has led to various formulations being approved by The United States Food & Drug Administration (FDA). For instance, in 2020, the FDA had approved application of Epidiolex for treating seizures related to tuberous sclerosis complex in patients aged one year and above. On account of shifting interest towards the benefits of medical cannabis and significant technological advancements, application of medical cannabis is increasing rapidly, which is positively impacting the overall business space.

According to Global Market Insights, Inc., the medical cannabis market size was valued at USD 22.4 billion in 2020 and will record exceptional growth numbers in the coming years, considering the emergence of the following trends:

Development of new products by key market players

Prominent players operating in the medical cannabis industry such as Canopy Growth Corporation, Aurora Cannabis Inc., Aphria Inc., GW Pharmaceuticals, ABcann Medicinals Inc., The Supreme Cannabis Company, etc. are focusing on strategies pertaining to product development and acquisitions in order to gain a strong market presence. Citing an instance in 2018, GW pharmaceuticals, announced that it had received an FDA clearance for its first plant-based pharmaceutical cannabidiol for treating rare pediatric epilepsies. Apparently, the approval helped the company expand its portfolio while giving it the innovator’s advantage in cannabis-based treatments.FDAlogo

Rising demand for treating nausea conditions

Medical cannabis is finding extensive usage in the treatment of nausea conditions especially for the patients undergoing chemotherapy, as a part of cancer treatment. Numerous tetrahydrocannabinol- and cannabidiol-based medications have been approved for treating the symptoms of nausea. The rising incidences of cancer and nausea segments across medical cannabis markets is anticipated to register a substantial CAGR of 18.4% through 2027.

Increasing preference for topical route of administration

Topical administration of medical cannabis is gaining prominence as topical solutions such as lotions and creams can be directly applied to the skin for the treatment of an injury. They are also replacing opioids for injury-related pain management as these have shown several side effects. Topical products also allow for self-administration that’s minimally invasive, while exhibiting limited side effects. With increasing adoption of topical route of administration, the segment is estimated to register an appreciable valuation of $5 billion by 2027.

Higher sales through dispensaries

Dispensaries have become a prime distribution channel globally. Considering the stringent regulatory scenario around medical cannabis, its consumption and sales are highly monitored by authorities in order to avoid any abuse or instances that lead to addiction. It is relatively easy for both suppliers and consumers to engage in a conventional brick and mortar store model under a regional medical cannabis program. Given that, dispensaries are anticipated to retain dominance in the market over the coming years. In 2020, the segment had held a sizeable market share of 58.4%.

Rising consumption of medical cannabis in Latin America

South American countries like Argentina and Chile are the major consumers of medical cannabis in the region. While Argentina has legalized the domestic cultivation of cannabis, Chile is known to have a history of medical cannabis with various clinical trials being performed since 2014. The country is one of the leaders in the LATAM medical cannabis industry wherein the regulatory authorities keep on simplifying the laws time and again. With favorable regulatory scenarios, the regional market is projected to expand significantly by recording a CAGR of 20.9% through 2027.

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The Cannabis Industry, After the Election

By Serge Chistov
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While the 2020 Presidential election didn’t exactly end up in a clear landslide victory for the Democrats, there is one group that did well: the cannabis industry.

The results clearly show that the expansion of cannabis is a recognizable part of today’s society across the United States. States like New Jersey, for example, partly thanks to New York and Pennsylvania—which already allow the use of medical cannabis—traffic will start to force the state of New York’s hand and that’s a big chunk of the population of the Northeast.

If the question of legalization was on the ballot, it was an issue that overwhelmingly succeeded in delivering a clear mandate. Adult use of cannabis passed handily in Arizona, Montana, South Dakota and as mentioned above, New Jersey, and was approved for medical use in Mississippi and South Dakota. 

With only 15 states remaining in the union that still outlaw the use of cannabis in any form, the new reality for the industry is here. All of these outcomes show promise as the industry’s recognition is growing. 

Election outcomes and the position of the average American on cannabis

Americans are definitely understanding, appreciating and using cannabis more and more. It is becoming a part of everyday life and this election’s results could be the tipping point that normalizes the adult use of cannabis. It is becoming more widely understood as an effective and acceptable means to help manage stress and anxiety, aid in sleep and general overall wellbeing. 

Voters in New Jersey overwhelmingly passed their adult use measure

This image of cannabis is aided by the many different forms of consumption that exist now: edibles, transdermal, nano tech, etc. No longer does a consumer have to smoke—which isn’t accepted in many circles—to get the beneficial effects of cannabis. 

Knowledge expansion is going to move these products across state lines and eventually, the federal government will have to take notice.

Do Democrats and Republicans view cannabis through the same lens?

Cannabis is and will always be state specific. Republicans in general tend to be a little bit more cautious and there are a lot of pundits who believe that as long as the Republicans control the senate, there isn’t much of a chance for federal legalization.  

President-Elect Joe Biden & Vice President-Elect Kamala Harris

There is some hope, however, that the industry will get support from the Biden administration. While President-Elect Biden has been on record as being against legalization of cannabis at a federal level, even he will eventually see that the train has left the station and momentum continues to build. In fact, Biden’s tone has changed considerably while he running for president, adding cannabis decriminalization to the Biden-Harris campaign platform.

Ultimately, how cannabis is viewed from each side of the aisle matters less than how it is viewed at the state level. 

Cannabis reform under Biden

Biden had an opportunity to legalize cannabis federally in the U.S. during the Obama administration and it didn’t happen. It’s clear that the mandates of the Biden-Harris administration are going to be overwhelmed by current issues, at least in the beginning: COVID-19, the economy and climate change, to name but three.

What will be interesting is if the Biden-Harris administration goes to greater lengths to decriminalize cannabis. For example, cannabis is still a Schedule 1 drug on the books, which puts it in the same class as heroin. Biden couldn’t unilaterally remove cannabis from all scheduling, but his government could reschedule it to reduce the implications of its use.  

This could, however, create more problems than it solves: 

“It’s generally understood, then, that rescheduling weed would blow up the marijuana industry’s existing model, of state-licensed businesses that are not pharmacies selling cannabis products, that are not Food and Drug Administration-reviewed and approved, to customers who are not medical patients.

Biden rescheduling cannabis “would only continue the state-federal conflict, and force both state regulators and businesses to completely reconfigure themselves, putting many people out of business and costing states significant time and money,” as Morgan Fox, chief spokesperson for the National Cannabis Industry Association, said in an email on Monday.” (Source) 

In reality however, there is little chance that Biden will spend any political capital that he has, particularly if the Senate remains in Republican control, dealing with the legalization of adult use cannabis.

What needs to happen for legalization to become a reality

Outside of the law, if Trump suddenly decided to legalize adult use cannabis before leaving the White House, the states would still need to agree on issues such as possession, transportation, shipment and taxation.  

It’s clear that further normalization of cannabis use is required—which will likely take a good couple of years—in order for it to become as understood and as simple as wine, liquor or cigarettes.

Beyond that, it’s Congress that dictated that cannabis be illegal at the federal level and it will have to be Congress that makes the decision to change that. Even the Supreme Court has been reluctant to get involved in the question, believing this to be an issue that should be dealt within the House.

What does all of this mean for investment in the cannabis industry?

Cannabis should be part of most long-term investors’ portfolios. Like a group of stocks in a healthy market with the right balance sheets, cannabis is an expanding industry and growth is there.  

Whether or not this is specifically the right time to invest, it’s always important to evaluate each stock or each company individually, from the point of view of the merits of the investment and investment objectives, as well as risk tolerance perspectives.  

There isn’t any unique or special place to buy into the cannabis industry, unless it is connected to some new real estate or other opportunity that is COVID-19 related. This moment in time isn’t really any different from any other when it comes to the opportunity to own some cannabis stocks. It’s always a good time.

The short term returns of this market shouldn’t be speculated upon. There are just way more factors than the fundamentals of a company that will affect the short-term play. The country is in a transition of power, in addition to much international change taking place that can also contribute to returns in the short term, making speculation unhelpful.

The cannabis market in 2021

The cannabis industry is likely to continue to expand and grow with the select companies acquiring more and more and getting back to their cash flow. Some companies will slowly be going out of business and/or will be acquired by others going into a certain consolidation period of time. Whatever the outcomes in specific tourism dominated markets, the industry as a whole can really go in one direction. 

Cannabinoid Research & Pharmacology: A Q&A with Dr. Linda Klumpers

By Cannabis Industry Journal Staff
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Dr. Linda Klumpers has a Ph.D. in clinical pharmacology of cannabinoids. Originally from the Netherlands, she began much of her career in studying cannabis there. She now lives and works in the United States, where she has worked on a number of projects, started her own company and is continuing her research on cannabis as an effective medicine.

After studying neuroscience at the University of Amsterdam, she went on to train at the Centre for Human Drug Research and Leiden University Medical Center, where Dr. Klumpers obtained a clinical pharmacology degree and a Ph.D. in clinical pharmacology of cannabinoids. She has been researching cannabinoids in humans since 2006. Dr. Klumpers co-authored a number of peer-reviewed cannabinoid publications and she has received five honors and awards for her work, including the BJCP Prize from the British Journal of Clinical Pharmacology.

Dr. Linda Klumpers

In 2016, she moved to the United States and founded Cannify, an online tool that helps patients and clinicians with product matching and providing legitimate cannabis education based in sound science. In 2018, Dr. Klumpers joined forces with Dr. Michael Tagen, another clinical pharmacologist, to launch Verdient Science, a consulting partnership. Their work at Verdient Science includes helping clients set up human studies, advise on FDA submissions, creating course materials, adjusting product pipelines and product development strategies, among other areas of focus.

Right now, Dr. Klumpers is waiting to hear back from a grant application they submitted to study THC and CBD ratios for medical efficacy in chronic pain patients. We sat down with Dr. Klumpers to hear her story, what she is working on now and how she hopes to continue researching cannabis as an effective medicine.

Cannabis Industry Journal: Tell us about your background as a research scientist. How did you get involved in cannabis? 

Dr. Linda Klumpers: During my Ph.D. work, we studied the effects of so-called cannabinoid receptor antagonists that block the effects of THC – I prefer to say “we”, as research is always done by multiple people. The problem with studying these compounds in healthy volunteers is that you can’t observe acute effects, which means that you won’t measure any effect after a single dose. To circumvent this issue, we applied a trick and developed a ‘challenge test’: after you give the ‘invisible’ blocking compound, you stimulate the cannabinoid system by giving people THC. If the subjects don’t feel the effects of THC, you know that the blocker worked. One thing lead to another and we ended up studying various administration methods, such as intrapulmonal (via the lungs) with vaporization, oral and sublingual. We studied the behavior of cannabinoids in the body and how the body responded to them.

CIJ: Can you share some information on the projects you are working on? What is Cannify and what is Verdient Science?  

Dr. Klumpers: Cannify was founded in 2016 after I saw that too many people had opinions about cannabis that were more based on emotion than fact. Besides, I noticed that a majority of the scientific literature on cannabis pharmacology was left unnoticed and unapplied to the people getting exposed to cannabis, such as patients, the cannabis industry – that was in a very different stage at that time – healthcare providers and regulators. With my Ph.D. in cannabis pharmacology, I wanted to add a level of objectivity to cannabis education and research. Cannify’s goals are to understand the science of cannabis, and share this with others.

The way we do this is multi-fold:

  1. Cannify Quiz: Patients with an interest in cannabis often want to know the science about cannabis and their condition. Our quiz helps these people by asking in-depth questions and showing them relevant scientific literature in a personalized report. After that, an overview is given with products and product matching scores. Our account system allows users to track their progress over time. Product manufacturers, dispensaries and other companies can use the quiz for their websites and their stores to help out retail employees and save them time, and to receive insight with our analytics on customer desires and behavior. Needless to say, an educated customer is a better customer. It is important that customers come and leave stores well-informed.
  2. Education: Speaking of education, our website contains educational articles about everything cannabis: from plant to patient and from product to mechanism of action. We regularly publish educational quizzes for people to test their knowledge level. With a free Cannify account, you can find all of our educational quizzes and save your results. We also provide customized courses, and have educated a wide audience varying from industry professionals to CME-accredited courses for healthcare providers. On top of that, our educational videos in dispensaries (in collaboration with our partner, Enlighten) reach customers and retail employees.
  3. One of Cannify’s educational graphics, showing the difference between topical and transdermal product administration

    Research: To expand the knowledge on cannabis, performing and especially sharing research is essential. We have already performed and published some of Cannify’s results on descriptive statistics and effect prediction during conferences, as well as a review paper on cannabis therapeutics in a peer-reviewed journal and a book chapter. This year, we expect to co-publish the results of a survey in different sleep patient groups. We collaborated with the Centre of Excellence for Epilepsy and Sleep Medicine in the Netherlands on a peer-reviewed paper from which we expect new research to follow to benefit these patients. We have also co-submitted a grant to study THC and CBD ratios in chronic pain patients: fingers crossed! Another important next step is to test a healthcare provider-specific version of Cannify’s quiz in the clinic once COVID dies down. I want to add that after working in a clinical lab for many years, it is important to combine the results of clinical trials to what people do in real life, which is what we do with Cannify.

And here’s some information on Verdient Science:

Verdient Science is a consulting partnership I have with clinical pharmacologist Dr. Michael Tagen. We provide clinical and translational pharmacology expertise to improve the quality of product development & clinical testing. While both working as independent consultants, we decided from 2018 to start working together to offer better services. Since then, our work has been very variable and includes helping clients set up human studies, advise on FDA submissions, creating course materials, adjusting product pipelines and product development strategies to make them more efficient and cheaper, performed scientific due diligence and much more. When clients want additional services that are beyond our expertise, we are typically able to introduce them to various people per expertise area, or refer them to our partner companies, Complex Biotech Discovery Ventures (CBDV) with Dr. Markus Roggen, and Via Innovations with Dr. Monica Vialpando. A benefit of working with the same partners includes smooth handovers and the feeling of a one stop shop.

CIJ: How does Cannify match available products to consumer needs? Is there an algorithm you developed that matches moods or feelings to cannabinoids or chemical profiles?

Dr. Klumpers: That is a great question and the core of what we do! So back to the Cannify quiz: there are three steps:

  1. Users fill in questions;
  2. A personalized report is generated with the relevant science;
  3. The user gets a product overview with product matching scores.
Another Cannify educational graphic, showing THC distribution throughout the body over time

The report and the matching scores are generated using algorithms that are regularly updated. These algorithms are based on various data sources:

  1. Literature: There is a lot of available literature, and we make sure to select the most relevant and reliable studies;
  2. Raw data: There is only so much one can find in the literature, and lots is hidden in the raw data. Therefore, we piled up data from studies done at various research institutions, including the University of Kentucky and Johns Hopkins University, and used them in our algorithms;
  3. Internal studies: From the thousands of users filling in their results, there is a lot of information that we should learn from. This feedback loop helps us to better understand how the lab relates to real life situations.

CIJ: The world of cannabis research has been historically stymied by red tape, DEA interference and a host of federal regulations. How have you managed to work through all that? Do you have a DEA license? What did it take to get it? 

Dr. Klumpers: Luckily, a majority of our research was and is done outside of the US. You still need to obtain the appropriate licenses, but I was perhaps lucky to have filled in every form very thoroughly and we got the licenses within months. The process is quite meticulous, as you need separate licenses for almost every step from manufacturing to administration. An additional complication is that our cannabis is not stored in our own building, but in the hospital pharmacy across the street, involving transport via the public road. Despite the roadblocks, including a legal procedure about this matter that was going on in parallel, I had no major issues getting our work done. For our research in the US, we were lucky to have been working with partners that already have the required license.

Also with publishing, I have never had an issue with the cannabis stigma. Generally, in my field of science, good quality science is very much welcomed and appreciated, and this was even before the time that there were four different cannabis-related journals, as is the case nowadays.

CIJ: Looking to the future, where do you hope to focus your research efforts? Where do you think the cannabis community should be focusing their efforts in the next 5-10 years?

Dr. Klumpers: Besides continuing to analyze the data generated from Cannify, I keep my fingers crossed for the grant application I mentioned earlier on THC and CBD ratios in chronic pain patients. Although we know that CBD is able to influence THC-induced effects, it is not known at what dosages, which ratios and how the effects are related to each other. For example: is CBD able to decrease certain side-effects of THC without decreasing pain-relieving effects?

Whatever is done, wherever in the community: good quality data are keyNext to that, I am also interested in other neurological and psychiatric disorders, and, of course, my Ph.D. love: the cannabinoid antagonists. Sadly, all the research efforts on this compound group were halted more than a decade ago. However, there is a renewed interest. I would love to help turn these compounds into effective and safe medicines.

Regarding the cannabis community: 5-10 years sounds really far away for an industry that is relatively new to many, but a lot has already changed since I started cannabis research more than 14 years ago and time has flown by. Some changes have been positive and others less so. Whatever is done, wherever in the community: good quality data are key. Many companies gather data and even publish them in peer-reviewed journals, but that does not always mean that the data are useful or that the studies were done well. Only a few minor changes to how and which data are gathered, and so much more can be done. What can help with achieving this is to let the right people do the right thing: many call themselves a ‘cannabis scientist’ or ‘cannabis expert’, but that does not mean anything. What has someone truly achieved and what is their exact expertise? A Ph.D. in chemistry is not going to help you in setting up effect studies, neither will I be able to improve your product’s shelf life or extraction yield. Getting the right people in the right place is key. Lastly: the cannabis community should stay critical. The length of one article in Cannabis Industry Journal wouldn’t be enough to lay out all the misconceptions that people have about cannabis. Make sure that those misconceptions do not live on and do not be afraid to admit you don’t know something, irrespective of the branch you work in: only then, can the cannabis community progress to the benefit of all.

Some CBD Companies Are Getting Millions in Federal Aid

By Aaron G. Biros
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As we’ve covered previously, the coronavirus pandemic has impacted the cannabis industry in the United States in a number of ways. Many states with legal medical and recreational cannabis markets have deemed those cannabis businesses essential, allowing them to remain open during statewide stay-at-home orders. Congress passed the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) to help small businesses through the economic downturn, directing trillions of dollars to the Small Business Administration (SBA) to administer emergency loans, paycheck protection programs and other financial assistance to small businesses affected by the coronavirus pandemic.

CV Sciences received $2.9 million in federal aid from the SBA

However, pretty much all state-legal medical and recreational cannabis businesses are ineligible to receive money from the SBA because cannabis is designated as a Schedule 1 controlled substance. While Rep. Earl Blumenauer (D-OR) and Rep. Ed Perlmutter (D-CO) introduced legislation recently that would allow cannabis businesses to become eligible for federal assistance, it is unclear if that bill will become law. Furthermore, even if it does pass, cannabis businesses will likely receive little or no help at all, as a vast majority of the funds administered by the SBA have already been spoken for.

Enter the hemp and CBD products market. Thanks to the 2018 Farm Bill, which removed cannabis containing less than 0.3% THC from the list of controlled substances, hemp and CBD companies are not exempt from the SBA’s relief efforts.

According to VICE News, The Trump Administration has handed out millions of dollars to companies that sell CBD products. When VICE News looked into some SEC filings, they found more than $4 million in federal loans that have been granted to CBD products companies.

They found three CBD companies that scored big with federal assistance:

Despite state-legal medical and recreational cannabis businesses being left to fend for themselves, these large online CBD products retailers have received more than $4 million in federal aid money.

Emergency Cannabis Small Business Health and Safety Act – A Legislative Update

By Steve Levine, Megan Herr, Meghan Brennan
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On Thursday April 23, 2020, Representatives Earl Blumenauer (D-OR) and Ed Perlmutter (D-CO) introduced the “Emergency Cannabis Small Business Health and Safety Act” in the House. Blumenauer and Perlmutter have been influential in protecting state-legal cannabis businesses from federal interference, most recently under the 2020 federal appropriations rider.

If passed, the Act would allow state-legal medical and recreational cannabis businesses to take advantage of the multi-trillion dollar stimulus packages designed to help small businesses harmed by COVID-19.

As we previously discussed, cannabis businesses harmed by COVID-19 remain ineligible to receive federal financial assistance due to their engagement in “federally illegal” activities. Consequently, cannabis businesses cannot receive assistance from the Small Business Administration (SBA) thereby making them ineligible to receive Paycheck Protection Program (PPP) loans and other SBA financial assistance, including Economic Injury Disaster Loans (EIDLs), traditional 7(a) loans, 504 loans, and microloans.

To provide the industry with much needed economic relief, the legislation states that cannabis businesses would no longer be prohibited from (i) participating in the PPP, (ii) receiving EIDL loans, or (iii) receiving emergency EIDL grants purely on the basis that the business is a “cannabis-related legitimate business”1 or “service provider.”2

Additionally, the Act clarifies that the SBA and its officers, directors and employees would “not be held liable pursuant to any Federal law or regulation solely for providing a loan or a loan guarantee to a cannabis-related legitimate business or a service provider.”

Even though states have varied in their approach to continue medical and retail cannabis operations amid the coronavirus outbreak, a majority of states that allow some form of sale and consumption of cannabis have designated the cannabis industry as “essential” and open for operation.3 Some states have gone as far as allowing home delivery, curbside pick-up, and telemedicine consultations.

Nonetheless, despite the cannabis industry’s designation as “essential,” cannabis businesses (including those who service the cannabis industry) will continue to be precluded from receiving federal financial assistance until the Emergency Cannabis Small Business Health and Safety Act, or similar legislation, is passed. It is important to note that, even if passed, the Emergency Cannabis Small Business Health and Safety Act would likely provide little relief, as the majority of the funds to be administered by the SBA have already been accounted for.

What does this mean to you?

Although the COVID-19 pandemic has highlighted the need for the heavily-taxed and financially burdened cannabis industry to receive assistance under the stimulus packages, the Act, even if passed by Congress, faces an uphill battle in the Republican-held Senate.


References

  1.  The term “cannabis-related legitimate business” means a manufacturer, producer, or any person that – (A) engages in any activity described in subparagraph (B) pursuant to a law established by a State or a political subdivision of a State, as determined by such State or political subdivision; and (B) participates in any business or organized activity that involves handling cannabis or cannabis products, including cultivating, producing, manufacturing, selling, transporting, displaying, dispensing, distributing, or purchasing cannabis or cannabis products.”
  2. The term “service provider” (A) means a business, organization, or other person that – (i) sells goods or services to a cannabis-related legitimate business; or (ii) provides any business services, including the sale or lease of real or any other property, legal or other licensed services, or any other ancillary service, relating to cannabis; and (B) does not include a business, organization, or other person that participates in any business or organized activity that involves handling cannabis or cannabis products, including cultivating, producing, manufacturing, selling, transporting, displaying, dispensing, distributing, or purchasing cannabis or cannabis products.”
  3. State-by-State COVID-19 Announcements Impacting Marijuana Businesses.
FDA

FDA Warning Letter to CBD Company Provides Many Lessons for Burgeoning Market

By Seth Mailhot, Emily Lyons, Steve Levine
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FDA

The U.S. Food and Drug Administration (FDA) issued a warning letter to Curaleaf Inc., a multi-billion-dollar market cap company that is publicly traded on the Canadian Securities Exchange. The FDA determined, based upon a review of the company’s website and social media accounts (Facebook and Twitter), that several of Curaleaf’s cannabidiol (CBD) products are misbranded and unapproved new drugs sold are in violation of the Federal Food, Drug, and Cosmetic Act(FD&C Act). The FDA also determined that Curaleaf’s “Bido CBD for Pets” products are unapproved new animal drugs that are unsafe and adulterated under the FD&C Act2. This action by FDA holds many lessons and cautions for companies already in or looking to break into the CBD market.

Unapproved New Human Drug Claims and Misbranding
The FDA identified a variety of statements in its review of the Curaleaf website and social media accounts that it said established the CBD Lotion, CBD Pain-Relief Patch, CBD Tincture, and CBD Disposable Vape Pen products as drugs. It is important to highlight that these claims were not made on the products’ label and, in some instances, referred to CBD generally. The FDA characterized these claims as demonstrating an intent to market the products for use in the diagnosis, cure, mitigation, treatment or prevention of disease, as well as to affect the structure or any function of the body. For example, FDA asserted that Curaleaf made a variety of drug and disease-related claims that its products or CBD in general could be used:

  • To treat chronic pain;
  • To reduce the symptoms of ADHD, anxiety, depression, post-traumatic stress disorder, and schizophrenia;
  • As a natural alternative to pharmaceutical-grade treatments for depression and anxiety;
  • To address eating disorders;
  • To reduce the severity of opioid-related withdrawal;
  • To deter heart disease;
  • As an effective treatment for Parkinson’s disease and Alzheimer’s; and
  • To kill breast cancer cells and counteract the spread of cancer.

The FDA stated that the Curaleaf products are not generally recognized as safe and effective for the uses described on their website and social media accounts and, therefore, the products are new drugs under the FD&C Act3. The FDA stated that, because the products have not received approval from the FDA, they may not be legally introduced or delivered for introduction into interstate commerce.

FDAlogoThe FDA further declared that the Curaleaf products are misbranded within the meaning the FD&C Act, because their labeling fails to bear adequate directions under which a layperson can use a drug safely and for the purpose for which it is intended. The FDA will frequently add this charge when citing a product marketed as an unapproved new drug. In its warning letter, the FDA noted that Curaleaf’s products are offered for conditions that are not inclined to self-diagnosis and treatment by individuals who are not medical professionals (e.g. Parkinson’s, Alzheimer’s, etc.). Therefore, the products would need to bear adequate directions for use, as well as obtain appropriate new drug approvals from FDA prior to being marketed as human drugs.

Unapproved Dietary Supplement Labeling 
The FDA further concluded that Curaleaf intended to market their CBD products as dietary supplements. For example, under the disclaimer section of the Curaleaf products the FDA noted that it says that “Cannabidiol (CBD) . . . is a dietary supplement.” However, the warning letter reiterated the FDA’s longstanding position that CBD products do not meet the definition of a dietary supplement because they contain an active ingredient in a drug product that has been the subject of public research and drug approval by FDA. While the warning letter states that FDA is not aware of any evidence that counters the agency’s position that CBD products are excluded from the definition of dietary supplement, Curaleaf may present the FDA with any evidence that is relevant to the issue.

Further, the FDA noted that the Curaleaf products do not meet the definition of dietary supplement because those products are not “intended for digestion”. The CBD Lotion and the CBD Pain-Relief Patch products’ labeling states that they are intended to be applied directly to the skin and body, while the CBD Disposable Vape Pen is intended for inhalation. In addition, the CBD Tincture products contain a “Suggested Use” section on labeling that includes both edible and topical uses. According to the FDA, the addition of the topical use to labeling established that the tincture products are not intended for ingestion and therefore do not meet the definition of a dietary supplement.

Unapproved New Animal Drugs 
The FDA also concluded that Curaleaf’s “Bido CBD for Pets” products are unapproved new animal drugs as statements on Curaleaf’s website show that the products are intended for use in the mitigation, treatment or prevention of diseases in animals. For example, the company’s website states that its products will decrease dog separation anxiety, distressed feelings, anxiety and seizures, as well as reducing or stunting the growth of cancer, relieve muscle spasms and treat arthritis issues. The FDA stated that the products are “new animal drugs” because they are not generally recognized among experts qualified by scientific training and experience as safe and effective for use under the conditions prescribed, recommended or suggested in the labeling. In order to be legally marketed, a new animal drug must have an approved new animal drug application, conditionally approved new animal drug application, or index listing. As these products are not approved or index-listed by the FDA, these products are considered unsafe and adulterated.

What This Means to You 
The FDA is paying close attention to companies marketing CBD products with unapproved drug claims for both human use and animal use. It is important for companies that currently market or are considering marketing CBD products to ensure that their marketing materials and labeling generally comply with FDA requirements and avoid making unapproved human or animal drug claims.  Additionally, it underscores the fact that FDA will review more than just the label of the product, and will scrutinize statements made about the product on the company’s website and social media accounts to determine the product’s intended use. Even though the FDA is in the process of determining how to regulate CBD products, the agency will not withhold enforcement actions against companies that make unapproved drug claims, particularly those that FDA believes will steer patients from receiving approved treatments.

The receipt of an FDA warning letter may also potentially result in class action lawsuits based on state consumer protection laws or lawsuits by competitors under the Lanham Act or state competition laws. While the FD&C Act does not include a private right of action, publicly issued warning letters may form the basis of a claim that statements are false and misleading and actionable under state or other federal laws.


References to the Federal Food, Drug, and Cosmetic Act (FD&C Act).

  1. Sections 502(f)(1), 505(a) and 301(d)
  2. Sections 501(a)(5) and 512(a)
  3. Section 201(p)

Andrew Kline, Director of Public Policy at NCIA, to Speak at 2019 Cannabis Quality Conference & Expo

By Cannabis Industry Journal Staff
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EDGARTOWN, MA, Aug. 6, 2019 – Innovative Publishing Co., publisher of Cannabis Industry Journal, has announced that Andrew Kline, Director of Public Policy at the National Cannabis Industry Association (NCIA), will serve as the keynote speaker at the 2019 Cannabis Quality Conference & Expo on October 2. The Cannabis Quality Conference & Expo (CQC) takes place October 1-3 in Schaumburg, IL (just outside Chicago). The CQC is an educational and networking event for cannabis safety and quality solutions. Serving the Midwest market with a unique focus on science, technology and compliance, the CQC enables attendees to engage in conversations that are critical for advancing careers and organizations alike.

Andrew Kline, Director of Public Policy at NCIA

To see the agenda for the CQC and registration pricing, click here.Kline’s keynote talk is titled “The Business of Cannabis: Why Public Policy Matters.” It will feature two discussions: First, a general update on public policy and government relations with respect to the cannabis industry. Second, Kline will discuss how cannabis should be regulated at the federal level once legalization happens.

Kline joined NCIA’s leadership team in April of this year and began his work with the organization swiftly. He led a coalition of CBD and hemp businesses to prepare public comments and testimony for the purpose of educating and influencing FDA rule-making. Prior to working with NCIA, he served as President of the National Association of Cannabis Businesses (NACB), the first self-regulatory organization for the cannabis industry.

Before joining the NACB, Kline was Special Counsel for the Federal Communications Commission’s (FCC) Enforcement Bureau where he was responsible for high-profile investigations and public policy negotiations affecting the telecommunications, internet, cable and satellite industries. He also served as Chief of Staff and Senior Advisor for Intellectual Property Enforcement in the Obama Administration.

Andrew Kline will be delivering the keynote talk on October 2. To learn more about the Cannabis Quality Conference & Expo, click here. 

Richard Naiberg
Quality From Canada

Protecting Intellectual Property in Canada: A Practical Guide, Part 2

By Richard Naiberg
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Richard Naiberg

Editor’s Note: This is the second article in a series by Richard Naiberg where he discusses how cannabis businesses can protect their intellectual property in Canada. Part 1 introduced the topic and examined the use of trade secrets in business. Part 2 goes into how business owners can protect new technologies and inventions through applying for patents.


Patents: Protection For New And Inventive Technology

Patents, which are issued in accordance with Canada’s Patent Act, provide their owners with the right to have a Court prevent anyone else in Canada from making, using, selling, importing or exporting what is claimed as the patent’s invention. The owner of the patent enjoys this monopoly for a period of 20 years from the date the patent is applied for. A patent is infringed even if the infringer arrives at the invention independently, without actual copying. If a patent owner brings a lawsuit and the Court finds infringement, the Court will typically order the infringing activity to cease and require the infringer to pay the owner a suitable amount of compensation.

There are several drawbacks to applying for a patent from the point of view of the applicant.Patents are meant to protect only inventions, meaning novel, non-obvious and useful solutions to practical problems. In the cannabis field, such inventions could include engineered genetic sequences or new plant cells that lead to useful improvements in the whole plant, new cultivation processes, new methods of extraction, new methods of storage or means to enhance stability, new formulations for administration, and new uses for the plant. It would not be uncommon for a cannabis producer to hold a suite of different patents that cover a whole range of innovative technologies and innovative business methods.

Not all classes of technical innovations are protectable by patent. For example, patents are not available for a whole cannabis plant because no patents are allowed on higher, multicellular organisms. Patents are not issued for genetic sequences or cells that are the result of cross breeding. Patents are also unavailable to monopolize methods of using cannabis as a medical treatment. That said, patent agents are skilled at casting innovations in areas such as these in terms that do provide some patent rights.

To obtain a patent, the applicant hires a patent agent to prepare and submit an application to the Canadian Intellectual Property Office (CIPO). An examiner at CIPO reviews the application for compliance with the statutory requirements and enters into a correspondence with the applicant’s patent agent in a process known as a patent prosecution. Third parties also have the opportunity to oppose the grant of a patent on limited grounds. The prosecution may continue for a period of years before the application is either allowed to issue to patent, or is ultimately rejected. Separate patent applications must be filed in every country in which patent rights are sought, though there are international treaties that facilitate these separate filings and preserve early priority filing dates.there can be a significant cost in obtaining patents, particularly if patent rights are sought in multiple countries.

It is important to emphasize that if an invention had been disclosed to the public more than one year before the application for the patent is filed, a patent cannot issue. Cannabis producers must therefore ensure that disclosures of their innovative work be controlled, including when working with partners. This can typically be handled with the use of appropriate non-disclosure agreements.

The prospect of market exclusivity makes the filing of patent applications a must for cannabis businesses, including those just starting out. For a start-up, simply filing a patent application projects that the company has value and a clear vision of its business. Venture capital often seeks companies with patent applications on file because the applications can mature into assets which can be monetized either by protecting a market for the owner, or through assignment or license to others.

cannabis researchers and producers have already filed hundreds of patent applications in Canada. There are several drawbacks to applying for a patent from the point of view of the applicant. Unlike the case for a trade secret, an applicant for a patent must make full and correct disclosure of the invention and how to use it in the patent itself. This disclosure will allow competitors to understand the applicant’s technology. The public disclosure provides a blueprint for competitors to build upon the patent’s disclosure, and to design around it to avoid infringement. Also, and unlike trade secrets, patents have an expiry date after which the public is free to practice the invention. The Commissioner also has the power to issue compulsory licenses to third parties in several circumstances, including when the demand for the patented article is not being met on reasonable terms. Further, the patent right is not infringed when the patented invention is used for non-commercial or experimental purpose. Finally, there can be a significant cost in obtaining patents, particularly if patent rights are sought in multiple countries.

Disadvantages or not, cannabis researchers and producers have already filed hundreds of patent applications in Canada. These applications relate to a wide range of inventions in the cannabis field including new cannabis resins and oils, methods of producing cannabis having improved properties, specific new growing processes, new harvesting methods, new extraction techniques, new formulations for human and veterinary use as foods, medicines and supplements, new delivery devices, new purification methods, new analytical methods, and new stabilization methods. Interested companies can access these disclosures from the public record.

As cannabis companies rush to obtain patent monopolies for their technologies, minefields are created for operating companies. Cannabis producers should obtain reports on what patent applications exist and might be asserted against their operations if and when these applications mature to issuance. With that intelligence in hand, the cannabis producer can understand what threats can be safely ignored and what patents must be addressed by assignment or license, by ‘design around’ or by developing an argument as to why the patent is invalid and thus unenforceable.


Editor’s Note: In Part 3 of this series, which will be published next week, Naiberg will discuss plant breeders’ rights and protecting new plant varieties. Stay tuned for more!

Dr. Richard Kaufman
Soapbox

Replacing Opiates with Cannabis is Finally Becoming a Reality: Where do we go from Here?

By Dr. Richard Kaufman
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Dr. Richard Kaufman

Opiate abuse is a far-reaching international public health issue, impacting tens of thousands of people every year in the United States alone. As the epidemic continues to spread, the medical community is faced with the immense task of researching and developing safer, non-addictive treatment alternatives for patients of chronic pain and other ailments. The controversial and oft-debated notion of cannabis as an opiate alternative has become increasingly well-researched and gained considerable credibility in recent years. The new challenge lies in advancing the cannabis industry to the point of being a legitimate medicine that can be prescribed and administered by doctors.

Opioids are among the most commonly prescribed medical treatments for severe chronic pain, yet prescription opioid overdoses killed more than 165,000 Americans between 1999 and 2014 according to the Department of Health and Human Services. In fact, the health and social costs of opioids are estimated to be as much as $55 billion a year. As such, it has become more imperative than ever that mainstream medical practitioners take notice of the cannabis plant’s powerful healing properties and shift away from potentially harmful pharmaceutical medications.

Dr. Richard Kaufman
Dr. Richard Kaufman, co-founder and chief science officer of Nanosphere Health Sciences.

The evidence of cannabis’ safety and efficacy is well established. For instance, in a literature review of 38 studies evaluating medical cannabis’ efficacy for treating pain, 71 percent concluded that cannabinoids had empirically demonstrable and statistically significant pain-relieving effects. In addition, a 2015 meta-analysis of 79 studies found a 30 percent or greater reduction of pain with the use of cannabinoids compared to placebos. Further, an analysis of a decade of randomized, double-blind placebo-controlled clinical trials on cannabis for treating pain concluded that cannabis should be a first line treatment for patients with painful neuropathy and other serious and debilitating symptoms, who often do not respond to other available medications.

Not only is cannabis demonstrably safe and effective, but numerous studies also present compelling evidence that the prescription of opiates has dropped sharply in U.S. states and countries that have legalized medical cannabis. For example, a study in the Clinical Journal of Pain followed 176 chronic pain patients in Israel over seven months. Researchers found that 44 percent of participants stopped taking prescription opioids within seven months after starting medical cannabis. Patients cited the following reasons for using cannabis instead of pharmaceutical drugs: 65 percent reported less adverse side effects, 57 percent cited better symptom management and 34 percent found that cannabis had less withdrawal potential than their other medications.The evidence of cannabis’ safety and efficacy is well established.

The tide is quickly turning as many respected doctors are beginning to advocate for the tremendous medical potential of cannabis as a replacement for prescription pills. That said, if the cannabis industry is to help solve the crisis inflicted by modern pharmaceutical painkillers, we must develop next-generation scientifically formulated products and advocate to improve their accessibility.

Inhalation and oral methods of cannabis consumption have no reliable dosage as medicine, rendering them unfit for administration by health professionals. These mainstream consumption methods also have extremely low bioavailability and bioactivity. Bioavailability for ingested cannabis products is only 6 percent and for inhalation methods can be as low as 2 percent. Oral absorption of THC is slow and unpredictable, with peak blood concentration occurring 1–5 hours post dose. Similarly, inhalation methods can take up to two hours to have any effect. The next phase of the medical cannabis industry must focus on fixing problems that prevent cannabis from being a universally recognized health tool. Fortunately, scientists are making major advancements in cannabis delivery technologies, offering novel and innovative administration methods that have proven both effective and reliable.

With products like Evolve’s NanoSerum™ representing a promising solution to help reduce the morbidity and mortality associated with prescription opioid use and abuse, meaningful progress is already underway. It’s been a long and challenging road to arrive at this point, but our efforts are only just beginning. Achieving long-term change on a national and international scale will require professionals from all levels of the cannabis, science and medical communities to push for advanced product offerings that provide consistent, standardized dosing in healthier, smokeless modes of delivery.

Jeff Sessions and Eric Holder

Jeff Sessions Rescinds Cole Memo

By Aaron G. Biros
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Jeff Sessions and Eric Holder

According to The Associated Press, U.S. Attorney General Jeff Sessions rescinded the Cole Memo today, an Obama-era policy barring Department of Justice officials from going after state-legal cannabis businesses. This move comes just after California, the nation’s most populous state, legalized adult use sales of cannabis. Previously, the Cole Memo has served as a kind of stopgap for states to conduct legal cannabis markets, giving them peace of mind that the federal government wouldn’t interfere.

Sen. Jeff Sessions (R-AL)
Photo: Gage Skidmore, Flickr

Ushering in 2018 with a bang, California’s cannabis businesses finally celebrated their new market launch on New Year’s Day. Even CNN rang in the New Year with copious amounts of cannabis, sending journalist Randi Kaye to Denver where she was passed joints and even donned a gas mask bong.

One fifth of the entire United States population now live in states where adult use cannabis sales are legal. A majority of states in the country have some form of cannabis legalization law on the books.

According to The Associated Press, AG Sessions’ new policy will leave it up to federal prosecutors to determine how they wish to enforce federal law and the controlled substances act. Sessions has been historically conflicted with federal policy surrounding legal cannabis and has repeatedly expressed his disdain for the drug.

But his back and forth on policy directives has been largely symbolic until now. In January last year, Sessions said he would uphold federal law but expressed openness to ending the conflict between state and federal laws. In February of last year, he tied legal cannabis to violence in a press conference where he alluded to greater enforcement. But flip-flopping again in March of last year, he said the Cole Memo is valid and appropriate after a speech.

Sen. Cory Gardner (R-CO)
Image: Gage Skidmore, Flickr

The Trump Administration’s confusing and often-unclear stance on cannabis has only fueled more speculation, worries and fear that cannabis businesses are no longer safe from federal prosecution.

The cannabis industry and politicians around the country were quick to respond to the AG’s new policy shift. Sen. Cory Gardner (R-CO) said he would be holding up DoJ nominees, “until the Attorney General lives up to the commitment he made to me prior to his confirmation.” The Cannabis Control Commission of Massachusetts, the regulatory body tasked with overseeing the state’s legal cannabis industry, says “nothing has changed” and that it will continue their work to legalize and regulate the cannabis industry.

Steve Schain, Esq. practicing at the Hoban law Group

Steve Schain, Esq., an attorney with Hoban Law Group, a prominent cannabis law firm, says this only fuels the confusion. “With Jeff Sessions threatening to singlehandedly crush $7.2 billion legalized marijuana industry spanning 30 states, generating millions in taxes and providing tens of thousands of jobs, much confusion abounds,” says Schain. “While unclear if merely a ‘knee jerk reaction’ to California program’s launch breadth of coverage, unless and until the United States Department of Justice provides an official statement, publication, or other specific information, neither legalized marijuana’s current status – nor the Federal Government lack of Congressional mandate or funds to derail state programs – has changed.”

Omar Figueroa, a well-known California cannabis attorney, urges clients and friends to start getting informed. “Which district is your ‘commercial cannabis activity’ operation(s) located? Who is the US Attorney for that district? What is that US Attorney’s cannabis policy? The answers to these questions just became extremely important. Please contact us for legal advice and representation.”

Advocates and activists were also very quick to condemn Sessions’ move, including Matthew Schweich, interim executive director for the Marijuana Policy Project (MPP). “This extremely misguided action will enable a federal crackdown on states’ rights with regard to marijuana policy,” says Schweich. “Attorney General Sessions has decided to use the power of the federal government to attack the ability of states to decide their own laws. A majority of Americans support legalization, and Sessions has simply decided to ignore their views. In the states where marijuana is legal, voters approved those legalization policies at the ballot box. This is a direct attack on the will of the people.”

National Cannabis Industry Association (NCIA) Executive Director Aaron Smith gave the following statement in a press release:

“This news from the Department of Justice is disturbing, especially in light of the fact that 73% of voters oppose federal interference with state cannabis laws. But, the rescinding of this memo does not necessarily mean that any major change in enforcement policy is on the horizon. This has been, and still will be, a matter of prosecutorial discretion. We therefore hope that Department of Justice officials, including U.S. Attorneys, will continue to uphold President Trump’s campaign promise to not interfere with state cannabis programs, which have been overwhelmingly successful in undercutting the criminal market.

In addition to safely regulating the production and sale of cannabis, state-based cannabis programs have created tens of thousands of jobs and generated more than a billion dollars in state and local tax revenue to date. Any significant change in federal enforcement policy will result in higher unemployment and will take funds away from education and other beneficial programs. Those revenues will instead go back to drug cartels and other criminal actors.”

Could this move be a genuine policy shift that will cause a crackdown on the legal cannabis industry? One action that could prevent the DoJ’s ability to target cannabis businesses relies on a Senate vote passing the Leahy Amendment as part of the Omnibus Appropriations Bill. That amendment would prevent the DoJ from using resources to go after state-legal medical cannabis laws, but does not exactly protect companies operating under adult use and recreational laws.

Is it possible that this is just the Trump Administration moving public eyes away from the bombshell revelations in Michael Wolff’s book and Trump’s feud with Steve Bannon? The current administration has a history of creating headlines amidst unrelated controversy, deflecting a public relations crisis from the public eye.