International News – MJ Shareholders

Flora Growth closes $30 million acquisition of Florida manufacturer JustCBD

MJ Shareholders — Tue, 20 Jun 2023 20:45:36 +0000

Toronto-based cannabis company Flora Growth Corp. says it has the United States, Germany and Mexico in mind as its closes a $30 million cash-and-stock acquisition of Miami-based JustCBD.

The deal announced Monday includes $16 million in cash and an additional 9.5 million privately issued Flora common shares to the companies that own and operate JustCBD, Just Brands and High Roller Private Label.

Flora Growth CEO Luis Merchan said the acquisition will strengthen the company’s foothold in the U.S. CBD market and give the company an “incredible opportunity to leverage our economically advantaged cultivation to support the expansion of the JustCBD brand in the global market.”

Flora Growth mentioned Colombia, Germany and Mexico as expansion targets because they allow CBD sales.

Flora Growth says it plans to leverage the CBD it grows in Cosechemos, Colombia, to reduce input costs for JustCBD products, which include tinctures, edibles, topicals and pet products.

The acquisition comes four months after Flora brokered a licensing agreement with Tonino Lamborghini, an Italian luxury lifestyle brand with food and beverage interests, to sell CBD-infused beverages in North America and Colombia.

Also, Flora Growth bought California vape maker Vessel Brand last November in another stock-and-cash deal worth $30 million.

JustCBD CEO Hussein Rakine will work on Flora’s U.S. expansion strategy, the companies said.

Flora Growth Corp. trades on the Nasdaq as FLGC.

Federal court: CBD drugmaker GW Pharmaceuticals didn’t violate extraction patent

MJ Shareholders — Tue, 20 Jun 2023 10:44:46 +0000

A Texas court has dismissed a lawsuit accusing pharmaceutical CBD maker GW Pharmaceuticals of violating another company’s patented method of cannabidiol extraction for its epilepsy drug Epidiolex.

The 2020 lawsuit from Canadian cannabis producer Canopy Growth alleged that GW, now part of Jazz Pharmaceuticals, knowingly used a Canopy-patented cannabis extraction method.

U.S. District Judge Alan D. Albright ruled in favor of GW on Feb. 25. His ruling leaves a path for Canopy to appeal he decision.

During the course of the case, GW produced “confidential technical documents” about their manufacturing process, Albright wrote.

Subsequently, the court interpreted the meaning of a specific technical term in Canopy’s patent, “CO2 in liquefied form under subcritical pressure and temperature conditions.”

In light of GW’s documents and the court’s interpretation of that term, the ruling noted, Canopy determined it “cannot prevail on the issue of infringement.”

Smiths Falls, Ontario-based Canopy has the right to appeal the court’s interpretation of the patent term in question.

GW, headquartered in the United Kingdom, was acquired by Jazz Pharmaceuticals in 2021.

On a Tuesday investor call, Jazz CEO Bruce Cozadd said the company was “pleased with where the court came out on the final judgment in the litigation with Canopy.”

Epidiolex is made from CBD extracted from marijuana grown in the UK.

“They do have the right to appeal that, but we’re certainly pleased with where we stand,” Cozadd added.

A Canopy spokesperson said in a statement to Hemp Industry Daily that, “as this matter is still ongoing and before the courts, Canopy Growth will not provide further comment at this time.”

Net sales of Epidiolex were worth $463.6 million in Jazz’s 2021 fiscal year, according to annual financial results released Tuesday. Jazz Pharmaceuticals trades on the Nasdaq as JAZZ.

Solomon Israel can be reached at solomon.israel@mjbizdaily.com.

Utah tech startup, Canadian tribe partner for $100 million carbon contest from Elon Musk

MJ Shareholders — Tue, 20 Jun 2023 00:44:55 +0000

A blockchain startup in Utah and an Indigenous-owned company in Alberta, Canada, are collaborating to use hemp to remove carbon from the atmosphere and compete for a $100 million prize from Tesla CEO Elon Musk.

The proposal from The Hemp Blockchain Inc. and the FFES Environmental, a company owned by the Sucker Creek First Nation in Canada, calls for the Canadians to grow hemp on First Nation land, with the Utah company measuring and verifying the crop’s carbon footprint.

The partners hope the plan wins funding from the XPrize Carbon Removal fund, a $100 million purse set up by Musk.

The prize is designed to incentivize technology to remove carbon from the atmosphere.

Winners must demonstrate technology that can:

Remove at least 1,000 tons of carbon per year.
Model their costs at a scale of 1 million tons per year.
Show a pathway to achieving a scale of gigatons per year in the future.

Sucker Creek First Nation is a Cree First Nations band government of about 2.000 people, located near Enilda, Alberta.

The Hemp Blockchain is a privately held company that provides blockchain verification for hemp growers and processors looking to buy or sell voluntary carbon credits.

Hemp Blockchain Chief Operating Officer Steven Prosniewski told Hemp Industry Daily the tech startup plans to detail the tribe’s plans to produce hemp-fiber products that can replace plastic and be used as construction components.

Blockchain technology, he said, will allow hemp growers to give investors verifiable data about how much carbon their hemp plants are sequestering.

He argued that the hemp industry needs hard data to verify the plant’s reputed ability to sequester carbon from the air and “sink” it in manufactured products.

“We see the demand out there,” Prosniewski said. “Everybody wants to see this happen.”

Read more about how hemp companies are using blockchain technology here.

Portugal Delays Recreational Cannabis Bills as Luxembourg Also Signals Delay

MJ Shareholders — Wed, 06 Oct 2021 08:44:59 +0000

These are curious days in Europe on the recreational cannabis question. On one hand, the stated intentions of both Portugal and Luxembourg to establish recreational markets as early as next year and certainly by 2023 has been on the drawing board for the past three years. On the other, as the clock ticks down to the final quarter of 2021, politicians in both countries are suddenly pushing the pause if not long-term delay button.

Luxembourg has the longest track record outside of Holland as a country committed to a recreational market, theoretically by 2023. That said, it is suddenly being reported as of the last week of September that the ruling coalition here is now also considering the delay of the same, citing concerns about the legality of the same given current policies at the EU level. This is a little strange given the fact that the Dutch seem to have no issue with the EU policies as they go about implementing a national recreational infrastructure for the first time. Regardless it also points to a need for at least a fig leaf of legitimacy at a regional level so far missing from the discussion.

Beyond the stalling now seen in Luxembourg, for those who were hoping that at least one country in the EU will commit to a recreational market before the end of the year, Portugal had remained a beacon of hope. Portugal has long had one of the most tolerant drug policies generally because of a reaction against the policies of the late dictator Antonio Salazar which ended four years after his death in 1974.

However, the parliament in Portugal has dragged its feet this year and as of last week, began delaying discussion on a bill, which was supposed to go into effect late this year or early next.

Indeed, the timing of both decisions may have everything to do with the German elections in however backward a manner. Namely, that other countries in the EU on the verge of real reform are now stalling to see what Germany will do.

It appears that as of now, Holland remains the only country in Europe with a recreational market that is now federally regulated, and Switzerland the only sure-fire bet to go forward on a rec trial as of next year.

What Gives in Portugal and Beyond?

There are all sorts of rumors flying about why the sudden slowdown of politicians to engage on the recreational reform question especially given the results of the German election. Beyond this, the Luxembourg discussion is particularly intriguing given the fact that Canopy Growth, according to local media, has just inked a deal to sell medical cannabis to the Luxembourgian government at 100 euros a flower gram. To put this in perspective, the German bid set the price of the same at 2.20 euros a gram as of 2017, dropping to 1.87 with volume sales.

The fact that officials in Luxembourg seem unaware of the same is one problem no matter how closely they have studied the Canadian market. The second of course is that this is highway robbery of a kind not even seen so far in the rest of Europe (even as the German market was opening). The closest comparison in fact to this kind of pricing is only seen in the liquid Dronabinol market in Germany (where prices are still at a shockingly high 100 euros a liquid gram wholesale).

The fact that this outrageous sale is occurring almost simultaneously with the news of a now slowed down schedule for a rec market on the timeline since the last national election is just one more reminder of how political the discussions about forward progress are—and how much the larger public Canadian companies still shape debate if not the speed of progress here.

Indeed, the slower the pace of change, the more of these kind of short term, arbitraged commodity medical plays will occur.

Will Germany Really Drive Rec Reform in Europe?

There are all sorts of speculations afoot these days about not only the shape of the coalition that will guide Germany through the next four years, but the pace of cannabis reform here. If the statements coming out of Berlin are to be believed right now, cannabis reform, even if only decriminalization, but probably something more than that (like rec trials) is clearly on the agenda. This is because it is a clear win politically for all those in the new coalition, whatever that is likely to be.

However, Germany is not necessarily the only if not most powerful driver here. The Dutch are proceeding with the region’s first completely federally regulated recreational market. And of course, just across the border with Germany, Switzerland, while not in the EU, is not likely to slow down with its own plans to launch trials next year.

This alone, beyond the elections will certainly allow local advocates in at least Germany and potentially Austria, both in the DACH trading alliance, to face up to the fact that the momentum may be slightly slowed, but there is no stopping the great green train.

The idea of recreational reform has hit Europe, and while it may hit legal objections at every level (see not only the political yellow lights of late but the decision of the court in Strasbourg against Albert Tió), the horse has left the barn.

Oregon CBD company latest to allege wrongful border seizure

MJ Shareholders — Wed, 24 Mar 2021 02:44:35 +0000

Oregon hemp manufacturer We CBD is the latest to accuse U.S. Customs and Border Protection of wrongly seizing legal hemp products.

The company in Sandy, Oregon, says that CBP seized 3,328 pounds of hemp biomass on Nov. 8 in Charlotte, North Carolina. The hemp was destined for an unnamed buyer in Zurich, Switzerland.

We CBD says that when its carrier stopped to refuel in Charlotte, CBP called a local officer to do a field test. The test revealed the presence of THC but not how much.

We CBD accuses Customs of taking the material” in a cloak of secrecy and shadow,” even though the carrier brought paperwork from Oregon authorities showing the plant material was grown legally and bound for legal export.

The company seeks an emergency injunction to prevent CBP from destroying some of the hemp. The company also seeks unspecified damages.

“Hemp is a unique commodity that will spoil or degrade if not properly stored,” the manufacturer told a federal court in North Carolina.

Law 360 first reported the case.

Organigram CEO predicts ‘tightening regulations’ on CBD

MJ Shareholders — Fri, 19 Mar 2021 22:44:57 +0000

Organigram, a Canadian marijuana company that recently partnered with a subsidiary of cigarette maker British American Tobacco to develop new products, is predicting increasing regulations coming to the CBD space.

Organigram CEO Greg Engel says the regulatory landscape for CBD is soon to change.

“We’re going to see tightening regulations, more restrictions, more focus not only on product claims, but you’re going to see more of a focus on input material, safety,” Engel told Marijuana Business Daily.

Engel says the collaboration will begin with a CBD focus.

“The initial focus is on CBD because that’s the larger global addressable market and there is more certainty on it. But we will be moving toward THC-based products going forward.”

Read more about the partnership and where Organigram is headed at Marijuana Business Daily.

Elixinol Global buys Germany’s CannaCare in cash-and-stock deal

MJ Shareholders — Fri, 19 Mar 2021 02:44:51 +0000

CBD maker Elixinol Global has acquired German CBD brand CannaCare Health GmbH as it executes its strategy to pursue market opportunities in Europe.

Elixinol said it is buying the company for 3 million euros in cash ($3.6 million) plus 6 million euros in Elixinol shares ($7.2 million). The deal calls for Elixinol to pay up to 24 million euros ($29 million) if certain sales goals are met.

CannaCare is based in Hamburg, Germany, and makes CBD oils, sprays and skincare products. The products are sold in 4,500 brick-and-mortar retail distribution points in Germany.

Elixinol CEO Oliver Horn said last summer that the global CBD company would focus on European CBD markets because the U.S. CBD market is “just so cluttered.”

Elixinol maintains headquarters in both Westminster, Colorado, and Sydney, Australia. Elixinol Global trades on the Australian Stock Exchange as EXL and on U.S. over-the counter-markets as ELLXF.

Largest human CBD trial launches with eye toward checking safety of trace THC

MJ Shareholders — Thu, 18 Mar 2021 16:45:29 +0000

The largest-yet human CBD toxicological trial has been launched in Europe to check the effects of consuming trace amounts of THC.

The European Industrial Hemp Association says it will assess 200 CBD users for a 30-day period.

The association tells UK-based Cannabis Health News that the goal is to demonstrate to European regulators that trace THC is safe to consume. The effort will cost 1.6 million Euros ($1.9 million).

It’s been two years since EU authorities classified all hemp extracts and hemp-derived products containing CBD and other cannabinoids as “novel foods.”

The EIHA has bristled against the designation, which means that manufacturers need to have their CBD supplements and foods evaluated before getting permission from EU authorities to place them on the market.

The hemp group is looking to show that full-spectrum CBD products should not be subject to EU novel foods requirements.

“When it comes to low levels of cannabinoids in food, this has been sold on the market for 25 years,” EIHA’s Lorenza Romanese told Cannabis Health News. “It is not novel.”

The study comes a month after the EIHA submitted three novel-food applications on behalf of its members to European and UK food-safety authorities. The UK says it will remove CBD products from shelves after March 31 if the makers haven’t submitted a novel-food application.

The EIHA submitted applications for three kinds of CBD products: an isolate-based product, a synthetic CBD product and a full-spectrum CBD product.

Mexico’s lower house approves landmark hemp, MJ legalization bill

MJ Shareholders — Fri, 12 Mar 2021 00:44:43 +0000

Mexico’s Chamber of Deputies has approved a bill to allow regulated marijuana and hemp industries. But the pending law still has hurdles to overcome and it could be years before a flourishing industry emerges.

Lawmakers in Mexico’s lower house voted largely in support of the bill, with 316 votes in favor and 129 against. There were 23 abstentions.

Next, the Senate needs to review and approve the bill’s revisions before it heads to President Andres Manuel Lopez Obrador for his signature.

After the law is enacted, Mexico will join Canada and Uruguay as the only countries to legalize an adult-use marijuana industry.

However, the scope of the industry and available business opportunities will be largely carved out by the regulations in support of the law.

Those regulations, yet to be developed, will limit opportunities in some cases and open the door to others.

That could have unforeseen implications for businesses and investors.

The Senate approved its version of the legalization bill in November.

Mexico’s Supreme Court earlier ruled that the absolute prohibition of recreational marijuana was unconstitutional, setting in motion the process to establish a formal law.

Read more about the Mexico vote at Marijuana Business Daily.

Hemp in the Time of COVID-19: Executives reflect on pandemic’s anniversary

MJ Shareholders — Thu, 11 Mar 2021 14:44:40 +0000

No part of the global economy has escaped the COVID-19 pandemic, which has claimed more than 2.5 million lives around the world and sickened countless more.

But few industries were in the kind of infancy the hemp industry was in when the World Health Organization declared the virus a global pandemic on March 11, 2020.

The resulting lockdowns, travel bans, economic collapse and distancing requirements hit just as many farmers were about to plant their first-ever legal hemp crops. Hemp acreage plummeted.

Nascent extractors and hemp processors saw equipment delayed by manufacturing shutdowns. Those that managed to find equipment couldn’t open for business because of mandatory stay-at-home orders.

And while many marijuana retailers were deemed “essential” businesses, depending on the state, hemp-specific retailers were generally closed.

CBD brands that had scrambled to get on shelves of mass-market retailers such as department stores had to immediately pivot to online-only sales.

Market analysts at the Brightfield Group, a Chicago-based data research firm, declared 2020 an “extinction event” for CBD brands, with 50% or more of an estimated 3,000 brands closing.

But the hemp industry didn’t fold up shop because of the challenges. Some companies successfully adapted business plans; others made new ones to adapt.

Hemp Industry Daily caught up (virtually, natch) with some hemp entrepreneurs to reflect on how the industry has reacted to the pandemic and get their predictions for what’s next.

Time to focus

The shutdowns and disease challenged all businesses, of course.

But some hemp entrepreneurs say the unexpected halt to business gave them time to breathe and refine business plans in a go-go young industry.

“It gave me an opportunity to pause,” said Larisa Bolivar, founder and CEO of Colorado-based Bolivar Hemp Co.

She developed a cosmetics line, bought property in Oklahoma to start a new cultivation site and even finished a book she had been working on for years.

“We were all feeling that same rush – you know, we’ve got to get to market, we’ve got to be No. 1,” she said. “But that’s not always good for launching a business.

“You really have to be strategic. Now, we have room to grow and we have plenty of time. I think COVID kind of reset that clock for everyone.”

One entrepreneur even started a new business, with locations on two continents.

Wendi Young set up an extraction company with locations in Colorado and Belfast, Ireland, while overcoming closed borders and shutdowns across jurisdictions.

Young said she was inspired in part by having to take time off to care for a sick relative.

“There was just a lot of time to really start thinking about, you know, what you want (and) what you want to accomplish,” she said.

Other entrepreneurs found new resilience from their own employees.

“We really saw our team come together in a very big way. Just looking at seeing how people are taking care of each other – I think that was such a big, monumental outcome of COVID,” said Priyanka Sharma, co-CEO of Kazmira, a hemp-derived cannabinoid extraction company based in Colorado.

“It was nice to be able to step back from your own process, see what could be changed with what you were doing over time. … When you’re so in the weeds, you don’t get to step back and see where you can make changes.”

Next normal

So, which changes from the COVID-19 pandemic will stick with the hemp industry?

Andrew Bish, chief operating officer of Bish Enterprises, a harvest-equipment manufacturer in Nebraska, said the pandemic has sparked market attention on non-flower uses for the plant.

“We’re seeing a dramatic upswing in the grain and fiber markets,” Bish said.

“I do think some of that increased demand in grain is coming from people eating at home and looking for more plant-based options, which is really exciting.”

In addition to opening new market demand, the pandemic gave operators an opportunity to close underperforming lines.

“It was a good opportunity to think about really what our primary goals were in the industry,” said Margaret Richardson, chief compliance officer and legal officer at Global Widget, a CBD manufacturer in Orlando, Florida.

“We could think about, in terms of product offerings, really what we wanted to offer.

“It gave us a chance to trim some of the products that weren’t as successful and refocus on formulation. … We came out on the other side, I think, stronger.”

The full discussion on COVID-19 impacts to the hemp industry can be seen below.

And share your insights and predictions live Thursday with Hemp Industry Daily editor Kristen Nichols at 4 p.m. ET/1 p.m. PT on Clubhouse.

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