Tag Archives: canada

July 13, 2020

Gen Z Marketing Dos and Don’ts in the Cannabis Industry

By Alexis Krisay

Gen Z is currently at about 40% of consumers, and this segment will be rapidly growing in the coming years. Most researchers and media define this generation as those who were born between the mid to late 1990s and early 2010s. In the United States alone, Gen Z consumers have an estimated $143 billion in buying power. Businesses that aren’t putting enough marketing strategies toward Gen Z need to reevaluate and switch gears, stat! Start laying the groundwork for your company’s success in the coming years. Kickstart your targeted Gen Z marketing strategies now. Every industry is different, but there are a few key do’s and don’ts to follow when communicating with Gen Z buyers. In the cannabis field, it is especially important to only market to those who can legally indulge.

Do Make Genuine Connections Online

Gen Z is our first truly digital generation. They’ve grown up using social media and the internet. As digital natives, they’re quick to recognize inauthentic communication methods. Whether it’s unnatural comments or trying to cover up negative testimonials, the younger crowd can always spot brands trying to be something they are not. Instead, practice total transparency with followers and friends to ensure that there is never a lack of brand accountability and authenticity. Within the cannabis industry, businesses can use their social media platforms to educate, build relationships and easily refute longstanding cannabis stereotypes that are so common in older generations.

Don’t Try Too Hard to Be Relatable

One way to make genuine connections is to engage with, create and share memes and other trends on social media. Although this is an excellent method for increased interactions, there is also plenty of room for error, so caution is the guiding principle. If not executed correctly, a post about a meme could easily make brands look unprofessional, or behind the times as they’ve missed the actual joke. These techniques can make business accounts seem like they are trying too hard to fit in, and will ultimately cause Gen Z to hit the “unfollow” button. Instead, focus on topics that closely align with the brand’s image and find creative ways to make content relate to exciting and funny trending ideas about cannabis.

Do Care About Social Issues and Responsibility

Focus on creating high quality, exciting videos and vibrant pictures that highlight cannabisResearch has shown that Gen Z sincerely cares about social issues and responsibilities. These beliefs don’t only apply just to their personal lives, but also to their buying habits and which businesses they want to support. These beliefs provide an excellent opportunity for brands to stake out common ground with Gen Z and support a variety of causes at the same time. Many of these consumers seem to care about topics like the environment, equality, hunger and homelessness. Do note that it’s essential to review and analyze these issues before making statements or posting about them on social media. For the cannabis industry, many businesses tend to raise awareness about medical matters, social equity and community-oriented programs.

Don’t Post the Same Content Repeatedly

After getting into the social media game, it can be tough to figure out how often to post. As much as those aspects do play an essential role in overall engagements, it’s also crucial to pay attention to the type of content that makes it into followers’ feeds. All photos and videos should be related, yet unique. Posting the same marketing content over and over is going to bore Gen Z, and make business accounts look less aesthetically pleasing. Instead, focus on creating high quality, exciting videos and vibrant pictures that highlight cannabis, and then vary your post types.

Navigating Gen Z communication and marketing tactics are going to be pivotal in just a few years, making it critical for businesses to rework their marketing strategies as soon as possible. If cannabis brands can capture the essence of authenticity and social responsibility in their communication methods, while avoiding posting repetitive content, they should be able to reach legal Gen Z-ers seamlessly.

July 13, 2020

Moneybowl: How Data Analytics Can Improve Extraction Processes

By Dr. Markus Roggen, Sajni Shah, Stella Zhu

No Comments

When data analytics was first introduced in the sports industry, it was met with a lot of criticism. But then it began to show results; a popular example being the story of Oakland Athletics Manager Billy Beane, depicted in the movie Moneyball starring Brad Pitt. In the cannabis industry today, we face familiar hurdles. Everyone is focused on extracting as much CBD oil as they can, but not many are optimizing the process. We even hear that data analytics is too difficult, that it does not help and no one has time for it. In contrast, the sports industry nowadays widely uses statistics and analytics, because it has proved to be effective. They use data analytics to choose their players for a team so that they have the best chance to win the championship. NBA teams have entire departments focused on data analytics, so why doesn’t the cannabis industry? Focusing on basketball, what if the approach taken to pick players for an all-star team was employed in the cannabis industry? Imagine your instruments as players and their parameters as their skills. Now, all you need is data analytics to help you decide how best to optimize your team. Paying attention to the numbers, could help you win in the cannabis industry.

When thinking about players in basketball, one factor of interest is the “Players Offensive Rating”, which is the amount of points produced by a player per 100 possessions. In this scenario, you want the player to have a higher offensive rating as it means that they have a better chance of scoring points when they have the ball. Similarly, in cannabis production, you would want your instrument to yield as much product (points) per hour (possession) as possible as well. So, the cannabis extraction analogy for offensive rating is “Yield Per Hour”. By increasing the yield per hour, the instrument can extract more product in the same time frame, increasing overall output and reducing product cost per gram. In this scenario, the biggest extractor is not necessarily the fastest, and any supercritical CO₂extractor will be slower than, for example, ethanol extractors.

Another important factor that’s considered in basketball is “Shooting Efficiency,” which looks at the number of successful baskets made by a player in comparison to the number of shots taken and where the shot was taken from. Having a player with a high shooting efficiency would result in a good chance for that team scoring points over their competitors. This principle is similar in cannabis, while a high yield (number of shots) is great, you also want a high purity (baskets made) of your target compounds or “Percent Purity”. This means you will get a higher percentage of the compounds you want, such as cannabinoids, for every gram of oil extracted. Here, the supercritical CO₂ extractor shows its superiority over ethanol, as density modulation of the supercritical CO₂ allows for the separation of terpenes or cannabinoids from the rest.You can see that a team that has a better synergy has a higher winning rate. For the same reason, the cannabis extraction process can be optimized by adjusting the parameters of the instrument.

For one last example, let’s look at “Number of Steals” as well. This is the number of times a defensive player successfully tackles the ball from an opposing player before they manage to shoot a basket. If this is high, opponents have fewer opportunities to shoot and score points. Similarly, “Percent Recovery” in the cannabis industry is important to ensure that the target compounds in your flower are being extracted. The solvent should have the chance to extract the compounds (steal from the opposition), before the run ends (the opposition shoots). A high recovery gives a higher overall output for the materials that were input, generating more product overall. In theory, if you wait long enough every solvent can reach full recovery, but for supercritical CO₂ in particular there is a practical ceiling around 80% recovery.

While thinking about these variables in isolation is the first step, it is just as important to see how the variables interplay with each other. A concept is introduced here called “synergy”. A team member must establish a good cooperation with the entire team according to their own characteristics. For example, taller and stronger players whose “Offensive Rating” is higher are more suitable for guards, while those with a high “Shooting Efficiency” are more suitable for forwards. You can see that a team that has a better synergy has a higher winning rate. For the same reason, the cannabis extraction process can be optimized by adjusting the parameters of the instrument. For example, if you increase the extraction speed, which is “Yield per Hour”, you may need to compromise on “Percent Purity” as the increased speed may not allow for the optimal extraction of target compounds. Similarly, you may also need to compromise on “Percent Recovery” as a slower extraction rate will do a better job at having a higher recovery. Thus, in order to improve the overall process of extracting oil, there needs to be a focus on analyzing the synergies between different factors to guarantee optimal parameters for your benefit.

These examples highlight some of the basic data analytics that can be conducted on your instruments. However, there’s still one challenge to consider, most professional NBA teams have entire departments just for data analytics. How can you possibly accomplish conducting these analytics for your entire cannabis LP in addition to your regular job roles? That’s where we come in. Other than the “Yield per Hour”, “Percent Purity” and “Percent Recovery” listed above, CBDV can perform customized data analysis based on your company’s data. Let our team help you integrate the “boring” and “half-baked” data, and present you with a visual and clear data analysis report. Let us help you lead your team to win that championship in cannabis!

Acknowledgements

David “Davey” Jones
Dr. Tara Zepel

July 2, 2020

A Snapshot of The German Cannabis Market: Year 3

By Marguerite Arnold

No Comments

Despite the limitations and privations caused by the COVID-19 pandemic, Germany’s market is “up” in terms of sales and overall insurance approvals. For all the victories however, there are still many kinks along the way. That is of course, not just on the medical front (where flower is yet again in short supply this summer), but also in the CBD space.

There is also clearly a drumbeat for more reform afoot in a country which has bested the COVID-19 pandemic like few others in the world. And like France as well as other countries in Europe, the conversation across the region has turned to including cannabis in recovery efforts, and in multiple ways. That includes not only relying on a new crop and industry for economic revitalization, but also of course, on the topic of further reform.

A Brief Overview Of The “Modern” German Cannabis Market
Germany kicked off the entire cannabis discussion in a big way in Europe in the first quarter of 2017. The government got sued by patients and changed the law mandating that public insurers had to reimburse the drug. They also kicked off a cultivation tender bid which promptly became mired in several rounds of lawsuits and squabbles. The first German grown cannabis will hit pharmacies this fall, but it is not clear when, and the unofficial rumour is that the pandemic will delay distribution. The German distribution tender has been delayed three times so far this year.

In the meantime, the German market has developed into the world’s most lucrative target for global exporters, particularly (but not limited) to GMP and other certifiable high-grade cannabis (and in all its forms).

Other Issues, Problems and Wrinkles

Nothing about cannabis legalization is ever going to be easy, and Germany has been no exception.

The first problem on the ground is that the supply chain here has had several major hits, from the beginning. This is even though the supply has come from ostensibly otherwise reliable sources. Companies in Canada and in Holland have all had different kinds of problems with delivery (for different reasons) throughout this period.

Right now, there is a major reorganization afoot in Holland which may also be affecting the recent decision on the Dutch side to reorganize how the government picks (private) German narcotics distributors. Aurora also had product pulled last fall because of labelling and processing issues. But these, no matter how momentous momentarily, are also just waves in a cannabis ocean that is still choppy. Domestic sales continue to expand and foreign producers can still find a foothold in a still fairly open market.

As a result, even with a new dronabinol competitor, Israel, Australia and South Africa as well as multiple European countries now in advanced export schemes, the supply problem is still a thorny one, but not quite as thorny as it used to be.

However, On The CBD Front…

Things have gotten even more complicated since the repeated decisions on Novel Food at the EU level. Namely, last year’s decision that the only CBD extract that is not “Novel” is extracted from seeds, has thrown the entire industry into a major fluff. Especially when such decisions begin to filter down via a federal and regional approach. This has begun to happen. Indeed, the city of Cologne, in Germany’s most populous state just banned all CBD that is not labelled per an EU (although admittedly) non-binding resolution on the issue.

This in turn is leading to a renewed push for the obvious: recreational cannabis.

Where Is the Recreational Discussion Auf Deutschland?
The recreational movement, generally, has been handed several black eyes for the last three years. Namely, that greater reform was not preserved in the first cannabis legalization that passed, albeit unanimously, in the German Parliament in 2017. However, as many recognized, the first, most important hurdle had just been broached. And indeed, that cautious strategy has created a steadily increasing, high quality (at least for the most part) medical market that is unmatched anywhere in the world except perhaps Israel.

Now, however, there are other issues in the room. The CBD discussion is mired in endless hypocrisy and meddling at both the state country level and the EU. There are many Germans who are keen to try cannabis beyond any idea of cannabis as therapy. Remember that Germany has largely managed to contain the outbreak, despite the emergence of several recent but isolated hotspots of late. In Frankfurt, for example, with the exception of more people on kurzarbeit (which is not visible), most street traffic proceeds apace these days with masks on, but with that exception or two, feels pretty much back to “normal.” And of course, economic development in the form of exports is one of Germany’s favorite pastimes.

Beyond that, the needle has absolutely moved across Europe. Several countries, including Greece and Portugal as well as the UK’s Channel Islands, have already jumped on the cannabis economic development bandwagon, and this is only going to encourage the Germans as well as other similar conversations across the region. It has even showed up in France.

And of course, it is not like the implications of Luxembourg and Switzerland as well as recent efforts in Holland to better regulate the recreational industry there, have not been blatantly obvious to those in Europe’s largest medical market.

Look for new shoots and leaves, in other words of the next stage of cannabis reform to take hold auf Deutschland. And soon. It is inevitable.

June 29, 2020

South Africa Reschedules CBD and THC

By Marguerite Arnold

No Comments

The South African government has taken a leap into the future (ahead also of the expected World Health Organization (WHO) decision on cannabis this December). Namely, it has begun to regulate hemp (more in line with Europe intriguingly, than the U.S.) and attempted to remove the THC part of the equation from a domestic list of plants and drugs with no medical use.

The notice was signed by South African Minister of Health Zweli Mkhize and published a week after a domestic moratorium on CBD expired. The moratorium permitted the sale of some kinds of CBD products.

This is an intriguing new development, although it will also undoubtedly cause headaches for the burgeoning industry in the region.

On The CBD Front…

South Africa’s new hemp guidelines – namely for the amount of THC allowed in legit hemp crops that are also regulated – are that plants contain no more than 0.2% THC. This makes the guidelines absolutely in line with what is generally developing across the EU. And even more intriguingly, below federal guidelines for most U.S. domestic hemp crops (which are 0.3% at a federal level and only differ in a few state cases where the amount is lower by state law).

However, there is also a unique twist to all of this: The South African government has now created a two-pronged regulatory schemata just for CBD. The default approach to the cannabinoid is that it is in fact medication, scheduled under South African internal and global drug guidelines as a “Schedule 4” drug.

The structure of cannabidiol (CBD), one of 400 active compounds found in cannabis.

The other designation is reserved for CBD packaged in sizes of 600mg or less (and limited by instructions to no more than 20mg a day). This kind of CBD (despite the dubious understanding of cannabinoid science) will henceforth be labelled a “supplement” and on “Schedule 0”.

However, do not be fooled: This is not “descheduling.” This actually means that all CBD has been classified as a medical substance except in packets that are under a certain size, with portion suggestions on the outside of the wrapper or package.

That is hardly scientific. However, what is more burdensome is that any CBD cultivator in South Africa must also be GMP- (or internationally medically) certified (even if bound for the supplement market). By definition, in other words, it will make the cost of production for the supplement (commercial, food and cosmetic) part of the equation as expensive as pharmaceutical production. While from a purist’s point of view, having ultra clean cannabis in any product (at the level of pharmaceutical standards) is a wonderful idea, but this gets ridiculous when it comes to reality, and will ultimately never stand.

This development is also undeniably inconvenient (at minimum) for any who had envisioned outdoor hempires, which most of the cannabis grown in South Africa is. The only people who have the money to build indoor grows, starting with GMP certified greenhouses, are, for the most part, white people, foreigners or those who own property and have access to external, international equity.

The sins of Apartheid, in other words, are being writ large on the entire cannabis industry at present in South Africa. And CBD is contained right in the middle of the mix.

On The THC Front…

There are several interesting aspects to this.

The first is that THC has been removed from the South African “Schedule 7” which is roughly equivalent to the international “Schedule I” that cannabis also resides in until the WHO re- or deschedules the same.

However, this also means that all CBD as well as THC must be produced by those with pharmaceutical-grade facilities – and this of course includes more than just indoor, temperature-controlled greenhouses. It also includes a complex supply chain that is European and Western centric, starting with the requirement to access a rather large amount of capital to construct the same.

Global Re-Alignment Or Stopgap Measure?

This new regulation, in other words, specifically leaves the vast majority of what has already been seeded, or what is most likely to be, in the hands of a few Canadian and other companies who have been moving in this direction for the last several years.

It also implies, intriguingly, that the intra-African cannabis market is low priority at present for those writing the (health) rules. And that also means that eyes are being set more on creating an export market than for treating South African citizens.

It is not an unusual move, rather tragically so far. And almost certainly one that will be challenged, and in several directions, both by events, but also by firms caught up in the mix.

Why? For starters, the South African cannabis market also effectively controls the Lesotho cannabis regulatory scheme (namely all exports from Lesotho, which has seen quite a lot of cannabis investment over the last several years). All such crops must be labelled per South African guidelines if they, literally, can hit a port to be exported.

The vast majority of those grows, even with relatively decent foreign backing, are also outside – and of course as a result ineligible for GMP certification.

Of course given the fact that the UN is likely to clarify both the status of THC and CBD by the end of the year, this current situation in South Africa is also fairly clearly intended to be a stop-gap regulatory measure to last up until at least this time.

Where it may go after that is anyone’s guess. This measure, however, is also clearly being made to protect those who have invested in GMP-grade facilities as opposed to those who have been clearly angling for reform on the CBD front, starting with the beer market. Stay tuned. Interesting developments clearly ahead.

June 17, 2020

Will Australia’s Cannabis Program Follow Canada’s Lead?

By Marguerite Arnold

No Comments

The news is intriguing in a world overwhelmed with pandemic news. THC Global, a Canadian-Aussie company now raising money and signing global deals, has just bought a “clinic network” of 30 prescribing physicians that will be able to supply up to 6,000 Australian patients this year.

In doing so, this entity is clearly beginning to establish a pattern of expansion in a new medical market not seen so far outside of Canada. Namely being able to obtain the all-important prescription for one’s brand at the doctor or prescriber’s office which is affiliated with a certain producer. Pharmacies and dispensaries downstream have no discretion for any other product to sell if the brand is written right on the prescription itself.

And this marks a new step in an industry frustrated with the high prices and high levels of red tape in other international environments where more widespread medical cannabis reform has come.

The Situation in Germany
Germany represents, so far at least, the destination market of choice for Canadian cannabis firms (for the last several years at least). This is for several very sound business reasons (at least in theory).

The German medical market is the largest in Europe. Health reforms which swept the country at the time of reunification also created a system that is in its own way a hybrid of the more European (and British) NHS and American healthcare. Namely, 90% of the German population is on the system, but it is tied to employment and income. Freelancers, even of the German kind, must use private healthcare as must all non-passport foreigners. If you make over a certain amount of money (about $65,000), you must also pay for private healthcare. As the cannabis revolution rolls forward, many cannabis patients are caught in changing rules and a great reluctance by public health insurers to allow fast entry of any new drug, including this one. This is based on “science” but also cost.

Bottom line? Yes, the market is lucrative and growing, and yes, cannabis is covered under public health insurance, but the ability of any producers to be able to maintain a reliable, steady market of “prescribers” is highly limited. Furthermore, unlike anywhere else in the world, pharmacists play an outsized role in the process – namely because there are no chains (more than four brick and mortar outlets are verboten). Prices and availability vary widely across the country.

There are also no “online” drug stores where patients can send prescriptions in the sense that this vertical has developed in other countries.

Hospital dispensation is, for all the obvious reasons, highly expensive and generally prohibitive for the long term, if not serving much larger numbers of patients.

The Problem in the UK
Like Germany, the UK decided to launch medical “cannabis” – or at least cannabinoid-related drugs under the purview of the NHS, but there are several issues with this.

The problems start with the fact that the system remains a monopoly for one British company, GW Pharmaceuticals. The medication produced by them, including Sativex and Epidiolex is expensive and does not work for many patients that it is produced “on label” for (such as MS or childhood epilepsy).

And then of course, the largest group of cannabis patients anywhere (chronic pain) have been explicitly excluded from the list of conditions cannabis can be prescribed for under public health guidelines in the UK. This, like Germany, has created a highly expensive system where those patients who obtain the drug on a regular (and legal basis) have to have both private healthcare and obtain help through private clinics. While there are several chain clinics now forming in the UK, this is not the same thing as “buying” patients in the thousands – the model seen in Canada from the beginning of 2014.

The market has a lot of potential, in other words, but like Germany, via very different paths to market than seen in Canada, in particular.

Why Is Canada Different?
The development of the medical market came through federal change in the law around the turn of the century. Namely, after patients won the right to grow for themselves, via Supreme Court legal challenge, patient collectives gradually formed to grow and sell cannabis that was more “professionally” cultivated. This, in turn, became the right of private companies and indeed household names in the Canadian market saw buying patient pools as their path to financing on the equity markets as of 2014.

This is not widely popular within the industry. Indeed, the last legal challenge mounted by the industry to ban non-profit patient collectives fell apart in 2016 – the year that the larger Canadian companies began to look abroad to Europe.

It is also undoubtedly why, beyond the red tape they face in Germany and the UK if not across Europe, Canadian firms are looking to hybridize a model which worked well for them at least in the early days of capitalization of the private industry. And maybe Australia will be “it.” Stay tuned.

June 17, 2020

Why Europe May Serve as an Important Bellwether for Hempcrete Use in the United States

By Stephanie McGraw

No Comments

Hemp-based construction materials are an attractive option for achieving environmentally friendly goals in construction, including reduced emissions and conservation of natural resources. Hemp construction materials dating back to the 6^th Century have been discovered in France and it has long been eyed with interest by hemp growers and manufacturers, as well as environmentalists in the United States and abroad. As the European Union moves forward with its 2019 European Green Deal, United States hemp, construction and limestone industries, as well as regulatory agencies, will be provided with an important preview of the benefits, risks and issues arising out of the use of hemp in construction.

The European Green Deal and Circular Economy Action Plan

Hemp applications in construction are gaining increased interest as the EU seeks to neutralize its greenhouse gas emissions by 2050. Much of the specifics for this transition to zero emissions are outlined in the EU’s “A New Circular Economy Action Plan,” announced on March 11, 2020. According to the EU, “This Circular Economy Action Plan provides a future-oriented agenda for achieving a cleaner and more competitive Europe in co-creation with economic actors, consumers, citizens and civil society organisations.” The plan aims at accelerating the transformational change required by the European Green Deal and tackles emissions and sustainability issues across a number of industries and products, including construction.

Construction in the EU accounts for approximately 50% of all extracted natural resources and more than 35% of the EU’s total waste generation. According to the plan, greenhouse gas emissions from material extraction, manufacturing of construction products and construction and renovation of buildings are estimated at 5-12% of total national greenhouse gas emissions. It is estimated that greater material efficiency could save 80% of those emissions. To achieve those savings, the plan announces various efforts to address sustainability, improve durability and increase energy efficiency of construction materials.

How Hemp Could Help Europe Achieve Neutral Emissions

Hemp, and specifically hempcrete, is being eyed with heightened interest as the EU enacts its plan. Indeed, recent mergers and acquisitions in the European hemp industry signal just how attractive this hemp-based product may be as international, national and local green initiatives gain momentum. But how would hemp be utilized in construction and what types of legal issues will this industry face as it expands?

The primary hemp-based construction material is “hempcrete.” Hempcrete is typically composed of hemp hurds (the center of the hemp plant’s stalk), water and lime (powdered limestone). These materials are mixed into a slurry. The slurry petrifies the hemp and the mixture turns into stone once it cures. Some applications mix other, traditional construction materials with the hempcrete. The material can be applied like stucco or turned into bricks. According to the National Hemp Association, hempcrete is non-toxic, does not release gaseous materials into the atmosphere, is mold-resistant, is fire– and pest-resistant, is energy-efficient and sustainable. To that last point, hemp, which is ready for harvest after approximately four months, provides clear advantages over modern construction materials, which are either mined or harvested from old forests. Furthermore, the use of lime instead of cement reduces the CO2 emissions of construction by about 80%.

Watching Europe with an Eye on Regulation and Liability Risks

Hempcrete indeed sounds like a wünder-product for the construction industry (and the hemp industry). Unfortunately, while it may alleviate some of the negative environmental impacts of the construction sector, it will not alleviate the threat of litigation in this industry, particularly in the litigious United States. The European Union’s experience with it will provide important insights for U.S. industries.

Hempcrete blocks being used in construction

Because hemp was only recently legalized in the United States with the passage of the 2018 Farm Bill, it is not included in mainstream building codes in the United States, the International Residential Code, nor the International Building Code. Fortunately, there are pathways for the consideration and use of non-traditional materials, like hempcrete, in building codes. However, construction applications of any form of hemp, including hempcrete, at this point would likely require extensive discussions with local building authorities and an application showing that the performance criteria for the building are satisfied by the material. Such criteria would include standards and testing relating to structural performance, thermal performance, and fire resistance. Importantly, the ASTM does have a subcommittee working on various performance standards for hemp in construction applications. European progress on this front would pave an important regulatory pathway for the United States, as well as provide base-line standards for evaluating hempcrete materials.

Insights into regulation and performance standards are not the only reason to watch the EU construction industry in the coming decades. Introduction of hempcrete and hemp-based building materials in the United States will likely stoke litigation surrounding these materials. Although there is no novel way to avoid the most common causes of construction litigation, including breach of contract, quality of construction, delays, non-payment and personal injury, the lessons learned in Europe could provide risk management and best-practice guidance for the U.S. industry. Of particular concern for the hemp industry should be the potential for product liability, warranty, and consumer protection litigation in the United States. The European experience with hempcrete’s structural performance, energy efficiency, mold-, pest- and fire-resistant properties will be informative, not just for the industry, but also for plaintiff attorneys. Ensuring that hempcrete has been tested appropriately and meets industry gold-standards will be paramount for the defense of such litigation and EU practices will be instructive.

The United States construction industry, and particularly hempcrete product manufacturers, should pay close attention as the EU expands green construction practices, including the use of hempcrete. The trials and errors of European industry counterparts will inform U.S. regulations, litigation and risk management best practices.

June 9, 2020

International Cooperation: The Next Generation of Cannabis Development?

By Marguerite Arnold

1 Comment

The Canadian-German market connection has been a “thing” ever since the middle of the last decade. But this is not the only international cannabis connection. Indeed, firms in multiple countries have been developing international partnerships for quite some time – and not just deals involving the plant or its extracts, but on the cannabis technology front.

This year and going forward expect these to bear fruit, and in interesting ways.

What are the trends? And who is doing what?

Europe
The entire European cannabis market has slowly been developing momentum since 2017 when Germany kicked off its first attempt at a domestic cultivation bid. The first German-grown cannabis is expected to hit pharmacies this fall, and further at a price that will keep everyone else hopping (€3.20 a gram from BfArM to distributors). However, because domestic cultivation was never expected to keep up with patient demand, Germany has become one of the hottest destination markets on the planet.

While there is clearly product still coming in from Canada, the big importer into Germany is actually from Holland (Bedrocan), right across a common border.

But Holland is not the only game in town anymore. Europe has long had promise as one of the most international cannabis markets in the world, simply because of relatively open, cross-border trade. Cannabis from Denmark, Portugal and Spain as well as Australia and South Africa have already made it into the German market. Greece, Italy and Poland are all moving into position as major sources of at minimum, floss if not extracts, along with growing interest in Eastern European entries (and not only the Czech Republic).

The intra-European market for cannabis is well underway, in other words, and this is likely to be an increasing trend, particularly as cannabis continues to make waves on the medical front as well as continually mounting evidence that the drug treats difficult to treat conditions including neurological disorders, cancer and the ever-present chronic pain.

Then of course, there is Israel, which is expected to be a big contender now that the country is finally in the export game.

Beyond the direct imports, however, there are also multiple country hops in play (such as Uruguay to Portugal to Germany). Malta is also increasingly shaping up to be an intriguing pass through port, if nothing else.

But of course, Europe is not the only international game in town.

The UK
Despite all of the problems that British patients face in obtaining high quality medical cannabis at a price that is affordable, the UK has actually led the world in cannabis exports (benefitting so far only GW Pharmaceuticals). However many firms have also been cooperating to bring cannabis into the country (from Canada and Holland in particular so far). The biotech partnerships set up by firms like Canopy Growth are also expected to bear fruit as cannabinoid research begins to truly come into its own in the coming decade.

The Americas
Despite the fact that exporting from the U.S. is still difficult (although some firms have managed to export hemp to Europe), there is a lot of cross border cooperation going on throughout the hemisphere (including investment and all kinds of creative partnerships). Canada of course, got its export game going early. Yet one of the more intriguing cross border stories of the last 18-24 months is the amount of South American cultivated cannabis ending up “north of the border.” Changing laws in the region make Latin America a major export location as well as a source for product bound elsewhere including Europe (see Columbia, Uruguay and Jamaica in particular). Mexico is expected to be a power player globally going forward too.

There are also many American firms who have developed strategic partnerships globally beyond the actual plant (including in Israel).

Israel
The country is absolutely in the export market, but that is not the whole story. Earlier in the year, the country received its first import from Uganda. There are also multiple U.S. companies in partnership with Israeli firms, and this will increasingly play out in terms of both product and cannabis technology as the market continues to open internationally. American firms, in other words, are still largely prohibited from shipping from the U.S., but they can now do so from Israel, and further, anywhere in the world.

South Africa
Another newcomer, South African firms are partnering internationally (including with American firms) to develop not only product but extraction technology. Cannabis firms here have also already shipped product to Canada and Europe.

Australia
Agricultural exports generally are a major part of the Aussie economy, and cannabis is shaping up to be no exception. Domestic firms are increasingly exporting to Europe (in particular), but partnerships here will be intriguing to watch, particularly as the Chinese market comes into its own. And there are already plenty of firms with partnerships now established or in the last phases of inking out deals with Israeli firms. Canada has been the largest source of imports into the country since 2017.

June 3, 2020

Cannabis Quality Conference & Expo Goes Virtual

By Cannabis Industry Journal Staff

No Comments

The prospect of large events with 50 or more people in Illinois taking place in 2020 seems highly unlikely. Illinois released a plan called Restore Illinois that consists of five phases for reopening the economy. Illinois entered into Phase 2 in early May; it is not until Phase 5 that gatherings of 50 or more people are allowed, and only if there is a vaccine, or a highly effective treatment that is widely is available, or the elimination of new cases over a sustained period of time.

Regardless of federal and state guidance, we feel it would be irresponsible and premature to host a large gathering of people in a confined meeting space this year. That is why, instead of a three-day, in-person event, we will host a series of webcasts over the course of eight weeks in the Fall.

Every Tuesday, starting on September 8 and through Election Day, we will host two presentations and two Tech Talks, followed by a panel discussion. The Cannabis Quality Virtual Conference Series will culminate with a post-election analysis to take place November 10.

This will still be an interactive virtual conference, where attendees can ask questions and get in touch with speakers. We look forward to seeing everyone virtually there.

We are now accepting abstract submissions for the Cannabis Quality Virtual Conference Series. Below you’ll find a list of topic areas we are looking for abstract submissions on:

Government Policy, Reform & Legalization Efforts
This will still be an interactive virtual conference, where attendees can ask questions and get in touch with speakers.
State Regulations, Licensing & Requirements
USDA Hemp Programs
Laboratory Testing
Quality & Safety in Manufacturing
Cultivation Best Practices
Marketing, Branding & Communications
Legal, Insurance & Data Analysis
Extraction & Infused Products Best Practices
Standards, Certifications & Accreditations
International Market Analysis

If you’d like to submit an abstract, click here. If you’re interested in sponsorship opportunities, please contact RJ Palermo at Rj@innovativepublishing.net. If you’re planning on attending, stay tuned for announcements to come when registration opens.

We will continue to monitor the situation, but in 2021 we are planning on bringing this event back to Illinois for a face-to-face conference. Until then, we look forward to joining everyone virtually.

May 29, 2020

Israel Begins Granting Export Permits

By Marguerite Arnold

No Comments

On May 13, months after the Israeli government originally signed off on cannabis exports, a free export order was finally approved by outgoing Minister of the Economy Eli Cohen. This is also sixteen months after the government approved exports of locally grown cannabis (at least in theory) and after the country began importing earlier this year as domestic patients were given priority for existing medical supplies.

However, all the internal barriers have now been officially removed. Exporters who wish to sell medical cannabis abroad are now able to obtain a license, as the order enters into full force by mid-June. The new regulation specifically requires that such products have obtained GMP certification (the pharmaceutical-grade cert required for all medical cannabis in Europe’s medical markets).

Licensing Already Underway

At least two Israeli companies have already obtained such licensing approvals. Cannabics, a company located in both Israel and Bethesda, Maryland, has obtained final approval of its drugs for export to both Canada and Europe, as well as Australia. The company is licensed by the Israeli Ministry of Health to conduct research and development on cannabinoid-based medications and cancer and operates a facility in Rehovot.

Cannabics describes itself as an American pharmaceutical company with R&D operations in Israel.

However, there is another interesting twist to all of this. Cantourage, a German company founded by entrepreneurs behind Pedianos, one of the two earliest importers of medical cannabis into the country (created in 2015 and subsequently purchased by Aurora), announced its import of the synthetic dronabinol to Germany from BOL Pharma, based in Israel, in late April. In doing so, they also became the first company to challenge Canopy Growth in its domination of the synthetic cannabinoid market which remains about one third of reimbursed prescriptions by volume (at least ffor publically insured patients) of cannabinoid medications.

Why Is This Development So Significant?
The European and Canadian markets are clearly leading the world in at least the consumption of cannabinoid-based medications – which by definition are based on extractions of the plant, beyond floß (or flower). Israeli producers have been banned from entering these markets for the last several years due to internal political struggles domestically, and an apparent deal between Israel and American presidents Benjamin Netanyahu and Donald Trump to delay market entry.

This delay also impacted Israeli firms hoping to enter the first German cultivation bid, which was finally decided last spring. It is expected that the first domestically cultivated product will be distributed to local apothekes as of this fall, although this may be slightly delayed as a result of fallout from the COVID-19 pandemic.

This delay is not expected to impact the import market in the country, which is the source of all flower-based medicine here, and will continue to be a strong market segment. The bid itself only called for a limited production of cannabis in Germany, and was already too little to meet the needs of domestic patients.

However, what the potential lag in German product also does is open a door for Israeli products to now enter the market before German-produced cannabis becomes available.

A Steep Uphill Climb
What the COVID-19 pandemic has clearly affected, more than drug entry, however, is something almost as important – namely doctor education. For a producer or distributor to get sales via German pharmacies, they also have to ensure that doctors are prescribing the drug. This is a lot easier if the product is a generic, like dronabinol, because doctors can write prescriptions for a drug which can now be sourced from several sources. It becomes a little harder to do that with any formulated substance, and further one with a “brand” name. Especially because German doctors are right now are on the forefront of an uneasy “flattening the curve” scenario as the economy continues to cautiously resume somewhat normal operations.

The challenge that remains, indeed not just for Israeli entrants, but everyone with new product formulations, is educating doctors about prescribing such medications, and further, obtaining insurance approvals for those who have been prescribed such drugs.

Cost, which is beginning to be addressed by the regulated pricing established here for domestically produced cannabis, is still in the room too.

The Market Continues To Open
Regardless of the struggle, and the costs involved, it is clear that the German market is obviously now finally opening to Israeli firms and on the processed medical front (as opposed to “just” flower).

Further it is also a sign that the market here is maturing, and even specializing.

No matter the obstacles, in other words, and despite the pandemic, the global market for cannabinoid drugs continues to expand.

May 15, 2020

The British Isles Sees Cannabis as an Economic Development Pathway

By Marguerite Arnold

No Comments

Cannabis as a tool of local or even regional economic development has rapidly gained traction in many jurisdictions within the United States and Canada. It has also caught on particularly in the poorer states of the EU (see Greece) and those countries hoping to enter the Union (North Macedonia).

These days, the concept is also spreading even to the UK, where reform has lagged significantly behind other countries both in North America and Europe. Indeed, two island communities are now investing heavily in the idea that cannabis is not only here to stay, but may invigorate communities and the economic health of islands looking for a new path, post-Brexit.

Cannabis so far, certainly in the United States and Canada, has proved to be a job creator just about everywhere for the past five years. Indeed, despite a few large corporate restructurings (see Aurora and Canopy Growth) of late, the industry itself has not slowed down, even with bumps in the road in terms of full and final legalization and the new challenges of a global pandemic.

House Of Green, Guernsey
This project is moving along, with its first harvest set for later in the year. The ₤2 million facility plans to be able to process up to 800 pounds every eight-hour day. Raw product is being grown at vineyards on the island itself by independent farmers and partners from other islands. Indeed, it is a unique facility on the European side of the Atlantic.

The company plans to process cannabis into tinctures, balms and salves as well as alkaline waters.

The idea is to create the base ingredients from which other products – bound both for the medical and recreational market – can be made.

Vecticanna, Isle of Wight
Just off the southern coast of the UK, Vecticanna is also embarking on an ambitious project – a fully solar-powered facility which plans to eventually employ 60 people. Their mission? To “unlock the therapeutic potential of cannabis” for the treatment of Fibromyalgia and related conditions.

Vecticanna has partnered with several large institutions, including the University of Southampton, and CAR Laboratories in Cambridge, and plans to produce its products in an R&D and research setting with the ambitious hope of furthering the potential of cannabinoid-based healthcare.

Where Goes UK and European Reform?

Reform across Europe has indeed been frustratingly slow. This includes the many hiccups in the German cultivation bid, which was first launched in 2017, and will only see the first nationally produced cannabis in the country sometime this fall. That amount is far too little for the patients who have already obtained prescriptions, and certainly will not be enough to serve the expected million plus patients in market here in just a few short years. Indeed, medical cannabis distributors in Germany are scouring the planet right now for properly certified product that comes from other European countries as well as South Africa, Australia, and even Latin America.

In the meantime, a new generic producer of dronabinol (synthetic THC) has just gained access to the German market.

In the UK, reform so far has also been torturously tortoise-like, with the National Health Service (NHS) favouring local producer GW Pharmaceuticals and forcing all other patients and their families to import pricey product from the Netherlands or Canada. While, it should also be added, excluding chronic pain patients.

Why Are The UK’s Island Cannabis Projects So Intriguing?

With a few exceptions (see Greece and Malta), European cannabis development remains mired in complications that include everything from a lack of reform and high prices to fights over basic regulations, including whether cannabis is a “novel” substance or not. This has slowed down the ability of growers to obtain the right certifications, find financing and actually go into business.

With two new producers on islands close to Europe and the UK however, there appear to be projects on the horizon which have jumped the regulatory queue, and are lining up for an intriguing future, supported from the ground up, by local policies that are looking at two simple things: the efficacy of the plant itself, and the economic well-being of their neighbors.