Tag Archives: colorado

Leaders in Infused Products Manufacturing: Part 2

By Aaron Green
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Editor’s Note: Part 3 will be an interview with Liz Conway, Regional President of Florida at Parallel. In part 4 we’ll sit down with Stephanie Gorecki, vice president of product development at Cresco Labs. 


Cannabis infused products manufacturing is quickly becoming a massive new market. With companies producing everything from gummies to lotions, there is a lot of room for growth as consumer data is showing a larger shift away from smokable products to ingestible or infused products.

This is the second article in a series where we interview leaders in the national infused products market. You can find the first piece here. In this second piece, we talk with Mike Hennesy, vice president of innovation at Wana Brands. Mike started with Wana in 2014 after moving to Colorado and leveraged his science background to transition into product development and innovation where he has helped develop one of the best-known brands in Colorado.

Next week, we’ll sit down with Liz Conway, Regional President of Florida at Parallel. Stay tuned for more!

Aaron Green: Thank you for taking the time today. Just to start off, can you walk me through how you got involved at Wana Brands?

Mike Hennesy: Thanks Aaron. I got involved in the cannabis industry pretty intentionally. After graduating college in 2012, I was determined to get involved. I moved to Colorado from the east coast. I’m originally from Virginia. I moved out here in 2013 and started with Wana in 2014.

Mike Hennesy, Vice President of innovation at Wana Brands

I got involved in the sales side of the business originally – as the company was just starting to emerge into the legal recreational market – and oversaw growth here at Wana during significant changes in the industry. Over time, my role transitioned into innovation and R&D where I am leaning on my background in science.

I now lead new product development and education as Vice President of Innovation, and I’m also completing a master’s degree in cannabis science and therapeutics.

Aaron: So, what does innovation mean to you?

Mike: Innovation for the cannabis industry is pretty unique and interesting. We are just beginning to unpack the pharmacopeia of the cannabis plant as well as starting to understand our own bodies endocannabinoid system.

Innovation spans from genetics of plants and how they are grown to how you deliver cannabinoids to the body and what different ratios and blends of cannabinoids and terpenes you are actually putting in there. So, innovation is not a one size fits all category for cannabis.

Aaron: Sounds like an interesting role! At Wana Brands, and in your role in innovation, how do you think about differentiating in the market with your products?

Mike: I would describe the way we perceive differentiation as going beyond simple developments, such as product forms or new flavors. We see the future of product development trending towards what active ingredients and in what ratios we are putting into products. For example, what kinds of cannabinoids and terpenes are we using? What kinds of drug delivery systems might we be harnessing? How do we put all of these ingredients and technologies into a product to make it more effective?

A simple way to think about all of this is: how is our product going to work better for the consumer? Because that is really the key here. Tasting great is important, but we are delivering a product that provides an experience. We want to continue to make a better experience and a better way for customers to enhance their life.

Aaron: I think that leads nicely into our next question, which is, when you’re thinking about creating a new product for the consumer, what’s your process for creating a new product?

Mike: We have a very full pipeline of new products, and many of these ideas come from networking and speaking with innovators and following the research and science for inspiration and direction. We take this information and start brainstorming as a team. We have a decade of experience in the cannabis space that provides us with a unique lens on how we apply new research to our product development.

From there, we build a product development pipeline of potential ideas and start to prioritize, looking at the feasibility of each of these ideas and their market readiness. Sometimes we have a great idea for a product, but a lack of consumer knowledge may mean we don’t move forward with launching.

Aaron: Can you expand a bit on what you mean by education and how you guys think about education to the end consumer?

Mike: Since product innovation must move with consumer knowledge and cannabis is so new, education is critical. We have a very robust education platform with topics that range from cannabis 101 to the endocannabinoid system, to lessons on terpenes and CBD, as well as trainings on our products themselves. We have both bud tender-facing and consumer-facing trainings. The consumer trainings are on our website, and bud tender trainings are hosted through dispensaries.

Aaron: Is that training electronic training or written material?

Mike: Both, but the primary platform is online in the form of interactive training courses. We also have printed flip book training material in dispensaries and offer in-person presentations, but with the pandemic, we’ve been heavily leaning on the online training content.

Aaron: Alright. So, we’re going to take a different direction here on questions. From your perspective, at the innovation level, can you walk me through your experience with your most recent product launch?

Mike: Most recently, we launched the line of Wana Quick Fast-Acting Gummies. I am extremely excited and proud of this line. They have absolutely exploded in popularity!

The idea for these products started a few years ago as we were learning cannabinoids are not very bioavailable. This means most of the cannabinoids that you consume from an edible do not end up in the bloodstream. Edibles also have a delayed onset and undergo a conversion of THC in the liver, called first pass metabolism, that gives a heavier sedating high. This slow onset and difference in effects with edibles can be a turn off for some consumers, leading us to the idea of developing a fast acting gummie that works differently.

It was about two years of research looking at technologies developed by pharma and nutraceutical companies to improve bioavailability and bypass first pass metabolism. We started looking into nano-emulsions and encapsulation of cannabinoids that help with bioavailability and reduce the onset time. These technologies envelop the cannabinoids like a disguise that tricks the body into absorbing the oily compounds more easily. The encapsulation bypasses the liver and is absorbed into the bloodstream quickly, so their effect starts within five to fifteen minutes. Since they are not processed in the liver, they deliver delta-9 THC instead of 11-hydroxy-THC, giving an effect I describe as a “smoker’s high.”

We trialed and tweaked many technologies before we landed on one that is truly effective and worked with our line of gummies. With this revolutionary technology inside, we then crafted delicious flavors and a new triangular shape to differentiate them from our classic gummies. Because they take effect so quickly and only last about three hours, we thought the Quick Fast-Acting Gummies were the perfect product to use during happy hour. So, we have Happy Hour inspired flavors like Pina Colada, Strawberry Margarita and Peach Bellini.

We launched in March, and already right now, these SKUs in Colorado are #4, #7 and #11 out of all edibles sold in Colorado. And overall, Wana produces eight out of the ten top SKUs in Colorado. That’s according to BDSA, so a pretty impressive achievement!

Aaron: Okay, great, I’d say so! The next question here goes deeper in the supply chain. How do you go about sourcing for the ingredients?

Mike: I am going to start with the cannabis side of things. As I mentioned earlier, cannabis is unique. It is not just one ingredient. It’s many different compounds like the cannabinoids THC, CBD and others, but also terpenes and other beneficial compounds. To make the most effective edibles we partner with growers that care about their genetics, how they are growing, and how they are extracting to create high quality cannabis extracts.

We also understand terpenes are so important in the entourage effect, and that different terpene blends synergize with cannabinoids to produce different effects. Some can be energizing while others are more relaxing. Wana has innovated the terpenes we use by formulating proprietary blends of thirty terpenes or more that replicate indica, sativa and hybrid strains.

We did this by strain hunting the best cannabis in each class and analyzing the strains to understand their profiles. Then using organic, botanically derived terpenes, we build blends in the ratios they are found in the plant and reintroduce them into our edibles. This means Wana edibles match the terpenes that you will find in cannabis, unlike other products that just use distillates where the terpenes are degraded and lost in extraction. This also means we can replicate these blends with our partners in other states, so when you consume a Wana indica or sativa product you’re going to have the same terpene blends and the same experience and feeling every time.

Beyond cannabis and terpenes, we are extremely selective in all of our ingredients. And in the near future we’re implementing an optimized recipe that is all-natural, with no high-fructose corn syrup, as well as moving towards organic ingredient sourcing.

Aaron: Can you give me an example in your role of a challenge that you run into frequently?

Mike: I think that is the exciting thing about working in R&D and new products: there is always a new challenge. I guess I would say if you are not making mistakes, you are not really trying to push the envelope in product development.

We are working with plant matter, terpenes and encapsulation technologies, things that don’t always taste good, and putting them all into edibles. That means we frequently run into the challenge of figuring out how to put the right ingredients for effect in a product, but still make it taste delicious. We are very selective in what ingredients we use and how we’re introducing them to make sure the product still tastes good. We oftentimes come across a great technology—such as a terpene blend or a quick onset delivery system—that does the job, but is not optimal for a gummie recipe, such as the resulting consistency or taste.“These developments are all heading in the direction of delivering consistent repeatable experiences for consumers, which is what I see as the future of cannabis.”

Aaron: Would it be correct to say that formulation is a common thing you run up against in terms of challenges?

Mike: Yes, especially because a lot of the ingredients and technologies we are working with are new. There isn’t a guidebook for how to incorporate encapsulated cannabinoids into a gummy, for example.

That’s the novel aspect of a lot of this: how do you take a terpene blend that’s designed to mimic the cannabis plant and put it in your gummies? What’s the right way to introduce it so they’re not degraded by heat? Formulating with cannabis is about problem solving, and is the backbone to what we do in R&D

Aaron: We’re getting towards the end of the conversation here. And these questions are more geared towards you individually. So, what trends are you following in the industry right now?

Mike: I’ve got to have my eyes on a lot of things. That’s how you innovate in this industry!

I would say No. 1 is still terpenes. We are already innovating there, but I think we’re just scratching the surface of where we’re going to go. I think terpenes are going to unlock a lot of potential in cannabis products in the future, and Wana is going to be innovating there, leading the pack.

Next is minor cannabinoids. Through decades of an illicit black-market, the genetics have skewed towards high THC strains, but the cannabis genome actually allows for many other cannabinoids to be formed. Through the right cultivation and breeding programs, we are going to see a lot more CBG, CBN, CBC, and even more rare cannabinoids like THCV and others.  These currently rare cannabinoids are going to be important for new product development as we learn more about their therapeutic effects.

Then there is continued innovation on delivery systems and bioavailability, functional ingredient blends and more natural products. These developments are all heading in the direction of delivering consistent repeatable experiences for consumers, which is what I see as the future of cannabis.

Aaron: Awesome. What are you interested in learning more about? This could be cannabis related or business related.

Mike: Well, fortunately, I am working on a master’s degree right now and so I get to learn a lot every day. I am most curious to see where science takes us with the endocannabinoid system. It was pretty much unheard of until a few decades ago, and now we understand that it interacts with almost every other system in the body. It is like missing the elephant in the room when you are talking about human biology. The amount of information that we’re going to unlock about how the ECS interacts and regulates our body is going to continue to revolutionize the industry There’s a lot more to be understood around how different compounds interact with the ECS and affect us, and I think we are going to learn how we can use it to tailor other products for  outcomes such as sleep, pain, anxiety, energy and focus.

Aaron: Just a clarification there. What are you working on for your master’s?

Mike: I’m getting a Master’s in Medical Cannabis Science and Therapeutics from the School of Pharmacy at the University of Maryland. It is the very first master’s level program of its kind, and is taught by doctors and pharmacists, so we discuss cannabis as a drug and how it effects the brain and the body. It has been really exciting and I’m looking forward to continuing learning more about this amazing plant!

Aaron: Okay, that concludes our interview!

Do Varying Cannabis Laws Adequately Serve Patients, Businesses or Government?

By Jason Warnock
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Cannabis laws are changing at a rapid pace across all 50 states and around the world. Currently, Cannabis is legal in 11 states for adults over the age of 21, and legal for medical use in 33 states.

Across the nation, many states have been struggling to enact a viable medical and potential adult use cannabis system since Initiative 59 and the “Legalization of Marijuana for Medical Treatment Initiative of 1998.”

Unfortunately, the program has been continuously impacted by the federal government’s presence, first with the passage of the Barr Amendment by Congress overturning the early legalization progress and continuing to delay the onset of the first medical sale at a dispensary until 2013. The federal government continues to exert influence and control over the program expansion including adding Congressional riders on every proposed update including the latest “Safe Cannabis Sales Act of 2019.”

In Washington DC for example, 18 organizations including the National Cannabis Industry Association (NCIA), the ACLU and Law Enforcement Action Partnership petitioned the US House and Senate Financial Services Subcommittees to remove the rider given that “[the] Current law has interfered with the District’s efforts to regulate marijuana, which has impacted public safety. Without the ability to regulate marijuana sales, the grey market for marijuana flourishes despite the need and want of the District leadership and residents alike to establish a regulatory model.”

States with limited availability of medical cannabis, possession laws or with the ability to legally gift up to one ounce and the constant pressure by the federal government, the grey market has expanded with public safety and the safety of these pop-up businesses put at risk. The current state health and safety laws require a seed-to-sale tracking system and testing at independent labs for all medical cannabis, however the grey market consumers are afforded no such protection. The District of Columbia is unique in the US cannabis landscape as it grapples with the local government trying to provide clarity, safety and equity to a medical and adult use community, but it is hampered by what it can and cannot control through federal influence.

As the United States continues to recover from the effects of the COVID-19 pandemic, control and use of tax revenue will move to center stage in all these communities and the cannabis tax revenue will return to focus.

Cannabis tax revenue has shown a massive disparity between projection and reality. In 2018, California projected upwards of one billion dollars in cannabis tax revenue, but in reality was only able to recover a third of that amount. California in response continues to increase the excise tax and even proposed changes to taxes dependent on the amount of THC, creating new pressure on producers, in-part pushing some back into the grey market.

During the pandemic, Colorado enacted emergency rules to extend cannabis sales online. Allowing customers to pay for cannabis via the web and then pick up their purchases at the store. In a testament to what is considered a “critical businesses” the cannabis industry is given opportunity to expand during the pandemic, but still hampered by severely limited access to standard e-commerce options as credit card merchants still remain concerned that cannabis sales are illegal under US federal law. Alaska, Massachusetts, Michigan, Illinois and Oregon also allowed online sales and curbside pick-up, but remain limited in sales as federal banking and access to credit is limited as the Secure and Fair Enforcement (SAFE) Banking Act remains in limbo.

Overarching technologies such as DNA tracking that provide a clear indicator that the cannabis is produced and tested from legal sources, can be proven safe and protects local legal businesses’ products against out of market cannabis would provide such clarity.

As the country moves forward from the COVID-19 health crisis, all legal and safe ways to rapidly restart the economy will be needed, the cannabis economy will be no exception. We should be looking to this emerging market right now to help safely drive revenue and taxes into our states.

Former Denver Cannabis Regulator Joins Allay Consulting

By Cannabis Industry Journal Staff
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Last week, Allay Consulting announced a new hire, a previous cannabis regulator for the city of Denver. Kara Lavaux has earned her Certified Professional-Food Safety (CP-FS) certification and supervised the Denver Department of Public Health & Environment’s cannabis program before joining Allay Consulting.

Kara Lavaux, Allay’s newest hire

“Demand is increasing for compliance assistance in the industry,” says Kim Stuck, CEO and founder of Allay Consulting. “Kara brings a robust background as a pioneer for cannabis public health regulations. With the hemp market gearing up for federal regulation, this was the ideal time to expand our team.”

“As one of the first Marijuana Specialists in the nation, I wanted to stay in the cannabis industry,” says Lavaux. “Joining the Allay team allows me to utilize my regulatory knowledge to support hemp and cannabis companies and help them thrive.”

Lavaux brings more than 14 years of experiences as a regulator in Colorado, with six years of experience overseeing the cannabis program.

Why You Should Consider Parametric Insurance to Protect Your Outdoor Cannabis Crop

By Evan Stait
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In May 2019, there were 4,400 reports of tornadoes, hail and high winds across the U.S. That’s the highest number of similar weather incidents on record since 2011. This increasing number of weather incidents has a huge effect on the cannabis industry, which has turned more frequently to outdoor cultivation since legalization.

While outdoor cultivation can develop the flavor of the cannabis crop, much like wine, it also brings with it some unique challenges. Each component of the weather – wind, rain, temperature – plays a role in whether a crop succeeds or fails. While conditions one year may easily lead to a bumper crop, the conditions the following year may not be as favorable. And as the weather becomes more volatile due to climate change, growers are ever more at risk, especially when they aren’t insured.

Evan Stait, author and commercial account executive for HUB International

Unfortunately, traditional crop insurance isn’t available for outdoor cannabis cultivators, primarily because of a lack of data on yield performances – and the impact the weather has on yields. Insurance companies don’t create policies until they have the data to back the policy. But meanwhile, the growers are assuming all the risk.

Enter parametric insurance. Parametric insurance is a program that pays out after a certain parameter is met. In the case of cannabis growers, the parameters are weather-related. The policy is triggered when the weather varies from the average – if there is too much rain during a specific period of time, for example, or an occurrence of large hail. Because the policy is related to average weather, it has to be tailored to the specific growing region – which means the parameters for Colorado won’t be the same as a policy for Maine.

For cannabis crops, coverage can be created for the following parameters:

  • Rain (recorded in inches of rainfall over a period of time)
  • Wind (recorded in miles per hour)
  • Early freezing (using recorded temperatures)
  • Hail (measures intensity and size of the hail)
  • Drought (for non-irrigated plots)

Once a parameter has been set, the policy starts to pay out at the strike point, or the average measurement specified in the policy. Coverage continues to pay out until the exhaust point, or the entire limit of the coverage is paid out. It works well because it’s straightforward: The further away from the average, the more the likelihood of catastrophic loss.

Parametric insurance isn’t for everyone. It’s a program designed to fill gaps that exist within the traditional insurance system. Nor is it designed to stand alone. But it can protect outdoor cannabis cultivators from weather risks that are truly beyond their control, especially given the hardening property insurance market.

In addition, it works for two simple reasons:

  1. Simplicity: Recorded weather events leave no room for ambiguity or dispute. You don’t even need an adjuster to guide the claims process. The official weather data proves what happened.
  2. Correlation: There is a high degree of correlation between measurable weather events and potential damage to outdoor crops.

Parametric coverage is not widely available. Many insurance professionals may not even know of it. But with the property insurance market hardening and a growing need to protect you and your cannabis business from weather-related disaster, parametric coverage may be your best bet. Make sure you speak to a broker who knows about it.

Shimadzu & Front Range Biosciences Announce Partnership

By Cannabis Industry Journal Staff
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According to a press release, Shimadzu Scientific Instruments and Front Range Biosciences (FRB) announced a partnership where they will establish the FRB Hemp Science Center of Excellence. The center will focus on genetics, biobanking, breeding and analysis, all with Shimadzu instrumentation. The center will host scientists performing chemical and genetic analytical research to “support the development of new hemp varieties for the production of cannabinoids, terpenoids and other compounds for medical and wellness applications; lipid, wax and protein ingredients for food and cosmetics applications; and fiber for industrial applications.”

Dr. Jon Vaught headshot
Dr. Jon Vaught, CEO of Front Range Biosciences

Located at FRB’s new headquarters in Boulder, CO, the new center will allow for collaborative efforts between researchers from the public and private sectors like academic, nonprofit and government agencies. The center will expand FRB’s collaboration with the University of Colorado at Boulder. Researchers at other institutions can apply for grants to support students, postdoctoral candidates and other researchers at the new center.

Dr. Jonathan Vaught, CEO of FRB, says they’re honored to work with Shimadzu and their instrumentation. “Front Range Biosciences is honored to partner with the world-class team at Shimadzu. Combining their innovative and proven cannabis and hemp analytical instrumentation solutions with our next-generation breeding program, we will be well positioned to continue advancing the industry with data-driven science so we can harness the incredible potential of this versatile plant for therapeutic, wellness, nutrition and industrial applications,” says Dr. Vaught. “We are confident that with Shimadzu’s cutting-edge technology, we will be able to drive forward-thinking solutions in this growing industry to better serve farmers, producers and consumers.”

Cannabis & COVID: Changes, Advances & Opportunities

By Laura Bianchi
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The onset of the COVID-19 pandemic sent shockwaves around the world, and they’re still rippling today. Businesses had to quickly pivot from in-person transactions and services to virtual operations, or close down until stay at home orders and other restrictions eased or lifted. While it varies from state to state, due to statutory and rule based operating requirements, requiring facilities to be open a certain amount of hours per week, many were deemed essential. These circumstances create a huge set of complex challenges for anyone in business to navigate, from workers and their families to management and owners, let alone vendors and ancillary businesses.

The bright side is being in an industry where plot twists are not uncommon. Cannabis is legal and highly regulated state by state, illegal on a federal level, so it’s always full of strategic problems to solve. With so many people, businesses, ever-shifting regulations, and financial interests at stake, the need for strategic legal services are the constant. From a purely business and regulatory standpoint, the pandemic has provided some in the cannabis industry with quantum leaps forward in operations and service, and many of them may likely become the new norm.

For people with anxiety (#everydemographic2020) and other debilitating medical conditions, perception is shifting towards the importance and benefits of cannabis as a medicine and alternative therapeutic treatment option, on pace with a larger global trend towards personal and shared wellness. There’s more freedom for consumers to participate recreationally in states with adult use programs too. Extended families and friends in other states may not have the same access to cannabis. We live in a socially driven world, and the awareness of the medicinal properties of cannabis has rapidly grown nationwide across broad demographics. The gateway drug stereotype and stigma is slowly but surely fading away.

Momentum and shift in consumer behavior, need and the shifting perspective of healthcare providers is affecting more state regulators. They’ve worked with the cannabis industry to modify and adjust operational rules as needed to ensure medicinal access during the ever-changing COVID climate. Although current rules and regulations haven’t been lifted in any way, this is a step in the right direction. However, recreational states are less likely to consider that portion of the cannabis market essential and look for ways to prioritize medical dispensaries over recreational.

Medical Cannabis Businesses Deemed Essential

The most immediate problems to solve in many states were social distancing and waiting areas – where to keep patients/customers? There are state guidelines and regulations for operations during COVID, plus CDC general safety and sanitation considerations for workers and consumers alike. Lawyers and regulators are working to make sure that these stores are open and operating safely, have established safety protocols, number of customers allowed inside the store, minimum hours of operation, and to allow for special elderly hours and accommodating patients with compromised immune systems.

One of the biggest operational changes has been an increase in the facilitation of online ordering and curbside pickup to help keep patients safe. Employees are wearing gloves and PPE as an added precaution. This puts the health of the patients and employees first, while still allowing businesses to operate.

More and more patients are not all that enthusiastic about making in-person appointments that may put them at risk. In every state, people waver between venturing out for necessities so they’re buying larger quantities and stocking up when they can, and cannabis is no different. Cash-paying customers must still pay in-person. As federal regulations continue to hinder additional payment options and protections, demand for change grows on both sides.

Staffing in a Pandemic

Like all employers, it’s easier for larger cannabis companies to accommodate employees who are sick or may have been exposed. It’s often more difficult for smaller operations. For many employees, the decision to go into work sick means rent and food, because the employer can’t offer additional sick pay.

In most states, employees have to have some type of state card to work in a store. It’s hard to find replacements and pay for sick leave. There’s no call for a temp agency solution due to clearance needed by cannabis employees. If the business has to shut down, it might not be able to bounce back. So in some states, cannabis businesses have suffered setbacks, but not to the extent as other industries such as hospitality, food and beverage, and tourism.

Crunching the Numbers

The cannabis industry is also excluded from PPP loans and other federal aid. True plant-touching cannabis companies can’t access those funds, adding extra financial stress to operations. The irony is for the majority of cannabis operations nationwide, the biggest change was not the increased regulatory requirements for social distancing, sanitation and safety, it was handling the incredible increase in product demand under circumstances that include financial and staffing stress.

One Arizona-based dispensary was averaging around $300K a month before COVID-19. Today, business has more than tripled to nearly $1 million a month. In mature legal state Colorado, a record $155 million in recreational product sales for June reflects a six percent increase over the previous month’s sales. The Colorado Department of Revenue collected $33.6 million from the industry in June. Colorado’s medical dispensary sales record was set in May, just shy of $43 million, dropping down to about $40.8 million in June. Both are still setting records for business volume. For 2020, revenue already exceeds $203.3 million, in contrast to roughly $302.5 million in cannabis-related revenue in 2019.

Heightened Supply, Demand & Opportunities

Heightened demand and the search for new market ventures means investors are taking notice. People sheltering or working from home are spending more time online, too. Many are searching for healthcare; others for promising investment opportunities. Legalization has been a long journey, state by state. Everyone inside the cannabis and hemp industries has learned to roll with the punches – expect ongoing legal needs, and to do strategic short- and long-term planning. How to anticipate change and pivot on a dime. It’s a must.

With the healthcare system struggling or strained in many areas of the country, non-essential primary care has shifted to telemedicine. Federally, the DEA granted permission to do so that extends for the duration of the COVID-19 public health emergency. The problem? State-level regulations may prohibit the prescription of Schedule III drugs via telemedicine, or limit the amount and refills. For essential healthcare, limited appointments or emergency-only availability remains a concern. Innovative new cannabis products help fill that gap.

There will be more challenges as elections approach and beyond. For those in cannabis, we’re used to being ready for anything. Stay tuned.

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.

New Cannabis Science Course Offered at University of Colorado at Boulder

By Cannabis Industry Journal Staff
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According to a press release, the University of Colorado at Boulder is offering a new course focused on cannabis science through the Continuing Education program at the university during the upcoming Summer and Fall semesters.

The class is called Modern Cannabis Science and will involve a lot of genetic research. The course is sponsored by the Agricultural Genomics Foundation, a non-profit dedicated to scientific research and education in cannabis. In the press release, they describe the course as meant for students who are well informed, but “seek a deeper appreciation of scientific advancements in cannabis genetics.”

Here’s a snapshot of what students can expect to learn from it:

In Modern Cannabis Science, we will explore the range of Cannabis research currently available covering topics such as evolutionary history and global distribution, sex chromosomes, genetic contribution to chemotype, and analyses to aid law enforcement and forensic investigations. We will examine how genetic data allow us to understand relationships between strains and common categories in the Cannabis genus, and why this is important for breeding, policy-making, and medical purposes.

The press release suggests students who enroll can expect to use this knowledge in the cannabis industry. “For example, a budtender will be able to more accurately recommend strains to users,” reads the press release. “Similarly, medical personnel will more fully understand the relationship between strains, the compounds they produce, and how to properly advise Cannabis patients.”

For more information, take a look at the course here.

Cannabis Retailers Considered Essential: Safety Tips for Running Dispensaries During COVID19

By Aaron Green
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Dispensary sales in key US markets (CA, CO, WA, NV) remain up in Q1 2020 over Q1 2019, though the end of March saw sharp declines in sales according to a recent Marijuana Business Daily report. Massachusetts is also on track for record Q1 sales despite the closure of recreational stores, according to a recent BDS Analytics report.

budtenderpic
A bud tender helping customers at a dispensary

While it is still early to say what the impact of COVID-19 will be on dispensary sales into April, it is clear that the cannabis industry’s position as an ‘essential business’ is likely to help. States like Massachusetts are just allowing medical use businesses to remain open while states like California and Washington are allowing cultivators, producers and dispensaries to remain open. Meanwhile, according to Locate.AI’s analysis of retail traffic, the rest of the retail sector is down between 44% and 99% recently, depending on the category.

On March 24, the Washington State Liquor and Cannabis Board declared cannabis an essential industry including producers, processors and retailers. For dispensaries, they are now allowing curbside pick-ups for all adult customers. Colorado has gone further to restrict adult sales to curbside pick-ups only for recreational cannabis. Medical customers are still allowed to enter stores, but must practice social distancing. Across the states, dispensaries are offering curbside and in-store pick-up. In addition, at some dispensaries, delivery fees are being waived for larger purchases.

The International Chamber of Commerce recently published “Coronavirus Guidelines for Business,” summarizing actions businesses can take to reduce risks for operations and employees. Going further, The New England Complex Systems Institute (NECSI) recently published practical business safety guidelines detailing how these essential businesses can stay open and ensure safety. The guidelines, which are typically one to two pages and easily readable, are applicable to dispensaries. Certain suggestions, such as avoiding crowded spaces and maintaining 6ft distance will be familiar. Other suggestions go beyond common advice offering sensible recommendations to reduce risk of transmission as much as possible, such as the following:

Consider setting up one or more ‘necessities only’ sections that enable a short shopping trip for most of the customers. Setting up such short shopping areas outside when weather permits, or at remote locations, can dramatically reduce the shopping density inside the store.” or

Use floor markings or other visual system to indicate a one-way loop (with short cuts, but no back way) inside the store to promote a dominant walking direction and avoid customers crossing paths or crowding.

While many cannabis businesses have already gone beyond recommendations from the local health authorities, there are some that would still benefit from adopting the NECSI Guidelines to further protect their customers and employees. The guidelines are written for laypeople and are easy to print and share.

NECSI’s coronavirus guidelines can be found on the group’s volunteer website endcoronavirus.org.

endCoronavirus.org is a volunteer organization with over 6,000 members built and maintained by the New England Complex Systems Institute (NECSI) and its collaborators. The group specializes in networks, agent-based modeling, multi-scale analysis and complex systems and provides expert information on how to stop COVID-19.

The New England Complex Systems Institute (NECSI) is an independent academic research and educational institution with students, postdoctoral fellows and faculty. In addition to the in-house research team, NECSI has co-faculty, students and affiliates from MIT, Harvard, Brandeis and other universities nationally and internationally.

Consumer Protection Laws & CBD Products—What You Need to Know Before Going to Market

By Jonathan C. Sandler, Alissa Gardenswartz
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By now, cannabis companies have heard that the Food and Drug Administration (FDA) has issued a slew of warning letters to sellers of CBD products for selling unapproved and mislabeled drugs and illegally adulterated food, as prohibited by the Federal Food, Drug and Cosmetic Act. However, companies marketing CBD products should know that making any health-related claims about their products also exposes them to liability under state and federal consumer protection laws. These laws additionally prevent CBD sellers from misrepresenting how much CBD is contained in their products, and even govern how companies communicate with their customers via text message. As the former head of consumer protection enforcement in Colorado and a lawyer routinely defending consumer protection class actions in California, we have seen firsthand how not considering these laws when developing a sales and marketing strategy can result in protracted and expensive litigation.

Consumer Protection Laws – Federal and State

Section 5 of the Federal Trade Commission (FTC) Act provides that “unfair or deceptive acts or practices in or affecting commerce . . . are declared unlawful.”1 The FTC enforces this law, and has clarified that “deceptive” practices involve a material representation, omission or practice that is likely to mislead a reasonable consumer under the circumstances.In other words, a claim is deceptive if an average consumer would believe and rely on the misleading claim to buy something. With the rise of social media marketing, the FTC has also issued disclosure guidelines for companies and influencers promoting products online.3 Every state has some form of consumer protection statute that similarly prevents deceptive marketing, and is typically enforced by the state’s attorney general. Many state laws also allow for consumers to bring actions themselves.

Both the FTC and state attorneys general have used these laws for decades against companies making scientifically unsupported health claims about their products. Just this month, the FTC and the Maine attorney general filed a lawsuit against two dietary supplement companies who were claiming that their products were a “miraculous natural solution” for life-threatening diseases. According to the lawsuit, the companies violated a 2018 settlement that required them to not make any health claims about their products without first conducting at least one randomized, double-blind, placebo-controlled trial to support the claims.4 While much of the enforcement around dietary supplements has focused on unsubstantiated health claims, other actions have been brought for improper “expert” endorsements as well as misrepresenting the amount of active ingredient contained in the supplement.5 In other words, these laws are used to police all manner of labelling and marketing of products, including those containing CBD. The FTC has already issued warning letters to CBD companies several times this year, and has stated that CBD sellers could be subject to enforcement for making unsubstantiated health claims.6

While consumer protection laws are largely focused on the content of advertisements, there are also laws that address how sellers can communicate with consumers. The Telephone Consumer Protection Act (TCPA) restricts telemarketing and the use of automated systems to contact consumers, and applies to both voice calls and text messaging. Both the FTC and state attorneys general can enforce the TCPA, and consumers can bring private TCPA actions as well. Because the TCPA allows for courts to award $500 per violation—that is, per illegal call or text—companies can face judgments into the millions of dollars.

Recent Consumer Protection Lawsuits in the Cannabis Industry

Cannabis is proving to be an attractive target for consumer protection litigation.All companies need to navigate consumer protection laws when they market their products, but class action lawyers may be pursuing cannabis companies in particular because of the products’ legal uncertainty, and because they provide opportunities for unique claims of deception. For example, a nationwide class of consumers recently filed a lawsuit in California against a CBD company that had received a warning letter from the FDA in November of this year, alleging that they would not have purchased the company’s CBD products if they knew selling the items was illegal.7 The consumers claimed violations of a variety of California and Arizona consumer protection laws, including those related to breach of warranty and unfair competition. Other lawsuits have been brought because products did not contain the amount of CBD as represented on the label, or because the product claimed to not contain THC when it did.8

Cannabis companies have been subject to TCPA class actions as well. Florida’s largest medical marijuana company has been accused of spamming customers with unwanted texts in violation of the TCPA.9 A dispensary with multiple locations in Colorado was also the subject of a TCPA class action complaint in Florida alleging that it did not obtain prior consent from consumers prior to texting them.10

Cannabis is proving to be an attractive target for consumer protection litigation. However, companies can head off lawsuits by thoroughly vetting their marketing strategies with experienced consumer protection lawyers before going to market.


References

 

  1.  15 U.S.C. Sec. 45(a)(1).
  2. See FTC Policy Statement on Deception, October 14, 1983.
  3. See Disclosures 101 for Social Media Influencers at https://www.ftc.gov/tips-advice/business-center/guidance/disclosures-101-social-media-influencers.
  4. See https://www.ftc.gov/news-events/press-releases/2019/12/ftc-state-maine-file-contempt-action-against-dietary-supplement.
  5. See FTC v. Nobetes Corp., Case No. 2:18-cv-10068 (C. D. Cal) (complaint against supplement company for using deceptive endorsements); “New York Attorney General Targets Mislabeled Herbal Supplements,” https://www.npr.org/2015/02/03/383578263/new-york-attorney-general-targets-mislabeled-herbal-supplements. (detailing the New York attorney general’s investigation of herbal supplements, and finding that they did not contain the ingredients as advertised).
  6. See https://www.ftc.gov/news-events/blogs/business-blog/2019/09/making-cbd-health-claims-careful-disseminating.
  7. Fausett et al. v. KOI CBD, LLC., Case No. 2:19-cv-10318 (C. D. Cal).
  8. Potter et al v. PotNetwork Holdings, Inc., Diamond CBD, Inc., and First Capital Venture Co., Case No. 19-cv-24017, (S. D. FL); Horn v. Medical Marijuana, Inc., Case No. 15-cv-701-FPG, (W.D.N.Y.).
  9. Jaslow v. Trulieve, Inc., Case No. 4:19-cv-RH-CAS (N.D. Fla.).
  10. Stinnett v. Hobby Farms, LLC d/b/a A Cut Above, Case No. 9:18-cv-81449-RLR (S.D. Fla.)