Last week we summarized the various states that had marijuana or industrial hemp on their ballot this mid-term season. Voters in four of the five states with marijuana or industrial hemp on the ballot passed their various measures.
Cannabis is a hot topic in the news. On October 17, 2018, our friends to the north made headlines when cannabis was officially legalized for adult use. As the November 6 midterm elections draw closer in the United States, we’ve compiled a round-up of ballot initiatives across the country that will ask voters to weigh in on a variety of marijuana and industrial hemp initiatives.
Husch Blackwell is proud to support @TheNCIA Northern California #CannabisCaucus on Tuesday, October 9 in Santa Rosa, CA. NCIA’s Cannabis Caucus event series has quickly become the gold standard event for professionals serving the cannabis industry! Join the industry’s most influential leaders for an evening of hors d’oeurves, cocktails (cash bar) and the latest organizational and federal policy updates. A registration link can be found here. Please use promo code HUSCH75 for 75% off tickets to this event.
Husch Blackwell Cannabis team attorneys Steve Levine and Meghan Brennan will participate in today’s #DENStartupweek events by speaking on a panel on the topic of the States of Cannabis. Since Colorado legalized the cultivation, manufacturing and sale of cannabis, cannabis has grown from small mom and pop operations to a large scale agribusiness, and regulations have followed suite. Attendees will learn about the spectrum of state, local and international regulations that have developed since initial legalization. Panelists will also discuss the impact such regulations have on the industry and trends they are seeing due to the very different approaches to cannabis regulation. The panel will discuss the differences between the United States and the uncertainty at the federal level and Canada, where cannabis was legalized at the federal level. Megan and Steve will join other panelists Alyssa Samuel and Dylan Sheji. The panel will be held from 10:15am – 11:15am. Location is the offices of Akerman LLP at 1900 Sixteenth Street, Suite 1700.
On Friday, August 10, Husch Blackwell Partner Chris Ottele will speak on the topic of Coats v DISH at the Marijuana and Banking Conference held at the Grand Hyatt Denver in downtown Denver, CO. This program is designed to provide critical information to bankers interested in serving the burgeoning marijuana industry and those who want to avoid banking it – as well as to public officials and others who want to understand the issue. The full conference brochure can be found here.
Husch Blackwell is a lead sponsor of the Northern California Quarterly Cannabis Caucuses – next of which is to be held on Tuesday, July 10 in San Francisco, CA at the Hilton Financial District. The 3rd Quarter Cannabis Caucus will bring together executive level industry professionals, policymakers, regulators, and movement leaders to network, learn about emerging topics in the industry, and plug into NCIA’s efforts to advance the industry nationally. A registration link can be found here. Please use promo code HUSCH75 for 75% off tickets to this event.
On Thursday, March 29, the Cannabis team at Husch Blackwell and Navigant, will host a cannabis seminar on developing quality systems for the cannabis/hemp industry. We will discuss the process, validations and preparation for Good Manufacturing Practice (GMP) certification. For more details, please read more here.
Yesterday, details of the Fiscal Year 2018 Budget were released. Congress has once again elected to prohibit the Department of Justice (“DOJ”) from spending money on actions that prevent medical marijuana states giving practical effect to their state laws that authorize the use, distribution, possession, or cultivation of medical marijuana. Congress also continued existing provisions shielding state industrial hemp research programs from federal interference. Adult-use was left off.
What does this mean?
It’s a nice reassurance for industrial hemp/medical marijuana businesses, their employees and patients acting in compliance with state rules. Note, this does not prevent the DOJ from using funds to prevent adult-use marijuana programs. However, just last week, a bipartisan group of 59 lawmakers wrote a letter that the DOJ should be blocked from enforcing federal marijuana prohibition in states that have enacted legalization, medical AND adult-use. It is still unclear when there will be enough appetite in Congress to get adult-use marijuana shielded from the DOJ, but I remain hopeful.
Canada’s attempt to finalize its marijuana legislation making it the second country to legalize adult use marijuana (after Uruguay) hit a snag when Health Minister Ginette Petitpas Taylor conceded yesterday it won’t be done in July 2018. New timetables based on legislative necessity target August or September of 2018. As a result, many of the publicly traded Canadian cannabis companies stock price took a multi-point dip today. As the various states in the United States that have legalized adult-use marijuana can contest, implementing regulations for a brand new industry is full of complexity and challenges. Canada’s marijuana market will continue to be frothy in the near term but they are well on their way to being a dominate player in the marijuana industry because of the full support of its government (unlike the United States).
The state’s marijuana shops raked in $1.51 billion sales of medical and recreational flower, edibles and concentrate products during 2017, according to Colorado Department of Revenue data released last Friday. Adult-use sales topped $1.09 billion in 2017, with the remaining $416.52 million coming from medical marijuana. Cannabis sales in the state were up 15.3 percent in 2017 compared to sales growth of 31 percent in 2016.
What does this mean?
Colorado continues to have solid growth in state-legal marijuana sales but have slowed down considerably compared to 2016. Clearly the market is moving towards a plateau or possibly even a regression in 2018 due to new adult-use markets like California and Nevada recently coming online. Operators in Colorado need to be prepared for market consolidation, tighter margins and increased competition.