Stock Market

According to Green Market Report whether you are an acquirer or an investor, performing due diligence on a cannabis firm is deeply nuanced and requires an understanding of how the industry is governed. Take a closer look at some of the diligence issues to keep in mind including transferability of the cannabis business, confirming licenses, banking relationships, cash management, 280E, regulatory compliance, insurance, and criminal issues.

Two years after recreational adult-use cannabis was legalized in Massachusetts sales have finally commenced in the estimated $1.8B market. According to Motley Fool’s Sean Williams MedMen Enterprises (NASDAQOTH: MMNFF), Innovative Industrial Properties (NYSE: IIPR), and KushCo Holdings (NASDAQOTH: KSHB) are flocking to invest in the Massachusetts market.

Monday Acreage Holdings Inc. (CSE: ACRG.U) announced its plans to enter the Michigan cannabis market by entering into an agreement to acquire the real estate assets of Blue Tire Holdings LLC. Together the companies will acquire licenses for the respective properties.

Seeking Alpha’s Jonathan Cooper provides a brief summary on some of the businesses jockeying for position in Florida’s medical cannabis market. With 22 dispensaries, Trulieve Cannabis Corp. (OTCPK: TCNNF) is the state’s top cannabis company followed by Curaleaf Holdings Inc. (OTCPK: LDVTF) with 17 dispensaries. Both MedMen Enterprises (NASDAQ: MMNFF) and Green Thumb Industries Inc. (OTCMKTS: GTBIF) intend to open dispensaries in the state.

With a 36% increase over the previous quarter, Aleafia Health Inc. (TSXV: ALEF) (OTCQX: ALEAF) announced Monday record revenues for Q3 at $1.6M. This marks the first quarter of profitability for clinic and product divisions.

After closing the acquisitions for ICC Labs (NASDAQOTH: ICCLF) and MedReleaf, Motley Fool’s Sean Williams estimates Aurora Cannabis (NYSE: ACB) has the potential to produce up to 1 million kilos of cannabis annually. While Aurora may leave its competitors in the dust in terms of production capacity, investors should beware. Investors should pay attention to Aurora’s need to diversify its product portfolio, find a brand partner, and minimize its ballooning share-based dilution.

Oregon seed-to-sale cannabis firm Grown Rogue (CSE: GRIN) announced Monday that the company’s common shares have begun trading on the Canadian Securities Exchange under the ticker symbol “GRIN”.

Cannex Capital Holdings Inc. (CSE: CNNX) (OTCQX: CNXXF) and 4Front Holdings LLC announced they have signed a binding letter of agreement to which 4Front has agreed to combine with Cannex in an all-stock transaction to create a multi-state, vertically integrated cannabis firm.

The Wayland Group (CSE: WAYL) (FRANKFURT: 75M) (OTCQB: MRRCF) announced it has entered into an agreement to acquire 51% of UK based Theros Pharma Ltd., a small firm that has successfully imported cannabis to the UK for medical cannabis patients.

Global News

NHS England asked the Association of British Neurologists to establish interim guidelines and frequently asked questions for prescribers regarding the use of cannabis-based products for medical use in adult neurological conditions, such as multiple sclerosis.

US Attorney James Kennedy announced the Western District and US Customs and Border Protection are taking a firm stance to deter people traveling from Canada from attempting to bring cannabis into the United States. Anyone caught traveling with any amount of cannabis across the border is risking felony charges.

US News

Because marijuana is considered a federally illegal substance, the world’s largest asset managers and custodians, such as BlackRock, are patiently waiting to invest in the $75B US cannabis industry. This could change however, if the States Act is passed. If approved, the Act should grant institutions clarity on how the federal government will treat banks and asset managers conducting business with cannabis firms.

Oregon has three agencies regulating cannabis: The Oregon Liquor Control Commission, The Oregon Health Authority, and the Oregon Department of Agriculture. The Oregon Cannabis Commission drafted recommendations asking the state to provide a unified and consistent vision on cannabis regulation by creating a new state agency to regulate cannabis.

Washington cannabis retailer Have A Heart, recently rated one of the best in the US, opened its first store in Salem Oregon Monday. Chief Executive Officer Ryan Kunkel performed the store’s green ribbon cutting ceremony.

Monday New Jersey lawmakers advanced a measure to legalize recreational adult-use cannabis. If approved the legislation would move to the floor of each chamber to be voted on. The legislation would legalize the possession of an ounce of cannabis, establish a five-person cannabis commission, and tax cannabis 12%.

California News

The changes proposed by the Cannabis Control Commission would jeopardize landlord-tenant relationships. In lieu of rent many landlords have been known to accept a share of the tenant’s profits. However, landlords may unknowingly expose themselves to burdensome regulatory disclosure and vetting that wouldn’t normally apply had the tenant not been a cannabis licensee.

Just days after celebrating a historical vote to legalize cannabis sales in the city, the owners of Malibu’s only cannabis dispensary are picking up the charred remains of their home in the aftermath of the Woolsey Fire.

Canadian News

While many are concerned about cannabis impairment in the workplace, navigating policies and facts could be murky. Safety sensitive companies want to know how long marijuana impairment lasts. While companies form policies around smoking and vaping, other subtler delivery systems have been developed such as edibles and topicals. A recent Dalhousie University survey found 45% of Canadians want to try edibles.

Parksville British Columbia’s newly elected municipal council recently decided to allow public consumption of cannabis. The new council’s decision to allow public smoking was in contrast with the last council who aimed to impose what would have been the province’s toughest cannabis-consumption rules.

Canada’s largest private cannabis retailer National Access Cannabis Corp. has a team of five people watching round the clock for new inventory to appear from Alberta’s provincial regulator which controls wholesale cannabis distribution.

Science

Extractors are now using ultrasonic vibrations to create more potent cannabis concentrates at a faster rate with a more complete palate of the plant’s compound profile. Through a process called sonication, ultrasonic extraction can yield 15% of a bud by weight in full spectrum concentrates.

While there are many testimonials and anecdotal reports claiming the health benefits of CBD, Evidence so far is underwhelming that CBD is the medical cure-all many claim it to be. Medical researcher Jason Dyck agrees that the most promising research will be analyzing how combinations of broad-spectrum cannabinoids and terpenes work together. Dyck is only interested in extracting broad spectrum cannabinoids, arguing that the combination of compounds has more benefit than CBD and THC isolate.

In January Yang Qu, one of Canada’s foremost anti-cancer drug researchers, will begin focusing solely on cannabis research at the University of New Brunswick. Qu hopes to develop synthetic cannabinoids, which will result in higher yields and purer compounds.

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