420 with CNW — Cannabis Firms Uplist Stocks in Canada in Preparation for US Listing

Multiple marijuana multistate operators (MSOs) are elevating their stock listings in Canada to higher-tier exchanges, setting a trend that more are likely to follow. However, their main objective appears to be listing on U.S. exchanges such as the NASDAQ or the New York Stock Exchange (NYSE).

The shift involves MSOs moving from the lower Canadian Securities Exchange (CSE) to the Cboe Canada Exchange or the Toronto Stock Exchange (TSX). This transition holds potential advantages, including increased liquidity and trading volume, access to institutional investments, and meeting stricter listing requirements, aligning these companies closer to conditions necessary for listing on the NYSE or Nasdaq.

Matt Karnes, founder of GreenWave Advisors, a New-York-based marijuana investment research company, states that the move to uplist is a preparatory step for these companies to position themselves better for a potential transition when federal policies, such as legalization, allow U.S. exchange listings for plant-touching companies.

Some of the MSOs that are uplisting include TerrAscend Corp. (TSX: TSND) (OTCQX: TSNDF), based in Toronto, which moved to the TSX from the CSE in July. Additionally, Verano Holdings, headquartered in Chicago, made a move from the CSE to Cboe Canada, while Curaleaf Holdings, based in New York, is in the process of transitioning from the CSE to the TSX.

The shift from the CSE to larger exchanges has provided these MSOs with increased access to a broader investor base, solving issues related to institutional investment and enhancing trading volume. TerrAscend’s executive chair Jason Wild noted the company’s increased trading volume and access to institutional investors since joining the TSX.

According to Darren Weiss, president of Verano, while listing on a more senior Canadian exchange offers the advantage of quicker access to U.S. equity markets when federal policy changes occur, it is still not on par with major U.S. exchanges such as the NASDAQ.

The primary obstacle for plant-touching cannabis companies listing on major U.S. exchanges like the NYSE or NASDAQ is the federal illegality of marijuana. However, some creative corporate restructuring, as demonstrated by Canopy Growth Corp.’s creation of Canopy USA, has allowed for a workaround to list on the TSX. TerrAscend also engaged in similar restructuring to meet TSX listing requirements, while Verano found a more straightforward path via Cboe Canada without needing significant restructuring.

The increasing trend of MSO uplisting in Canada is likely to continue, according to Karnes, unless U.S. regulatory or legislative reform permits domestic stock listings for plant-touching cannabis companies. That would allow these companies to bypass the Canadian exchanges and list directly on U.S. exchanges. However, the timing and likelihood of such reforms remain uncertain.

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CNW420 spotlights the latest developments in the rapidly evolving cannabis industry through the release of two informative articles each business day. Our concise, informative content serves as a gateway for investors interested in the legalized cannabis sector and provides updates on how regulatory developments may impact financial markets. Articles are released each business day at 4:20 a.m. and 4:20 p.m. Eastern – our tribute to the time synonymous with cannabis culture. If marijuana and the burgeoning industry surrounding it are on your radar, CNW420 is for you! Check back daily to stay up-to-date on the latest milestones in the fast -changing world of cannabis.

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420 with CNW — Massachusetts Marijuana Firms Challenge Federal Ban on Cannabis

Last week, an alliance of marijuana companies in the state of Massachusetts filed a lawsuit that challenges the federal prohibition of cannabis as it applies to individual states. Currently, marijuana remains classified as a Schedule I substance under the Controlled Substances Act. This is despite the fact that the medical use of marijuana is legal in 38 states, 4 U.S. territories and the federal District of Columbia. Adult-use marijuana is also legal in 23 states, 3 U.S. territories and D.C.

The Controlled Substances Act was enacted by the 91st United States Congress and signed into law by President Richard Nixon in 1970.

In their suit, the companies argue that the Controlled Substances Act, which prohibits the growing, manufacture, sale and possession of intrastate cannabis, is an unconstitutional ban. They maintain that this act deprives marijuana companies of their rights under the Fifth Amendment by depriving them of liberty without due process and by introducing unlawful and unwarranted federal government intrusion into their businesses.

The coalition has asked that the Massachusetts district court deem the act to be unconstitutional, in their quest for a declaratory judgment. The suit names its sole defendant as U.S. Attorney General Merrick Garland.

The challengers also note that the Controlled Substances Act subverts state cannabis programs, giving the example of the 2012 Massachusetts Medical Marijuana Initiative. During this time, voters in the state opted to legalize medical cannabis. A few years later in 2016, the Massachusetts Marijuana Legalization Initiative was introduced, with voters legalizing recreational cannabis for adults.

The lawsuit states that the comprehensive state regulations protect consumers while also ensuring that the regulated cannabis sold in Massachusetts is distinguishable from illegal, interstate cannabis.

The suit also claims that the Controlled Substances Act harms small and large businesses and threatens public safety. The companies argue that because of this act, marijuana businesses aren’t able to take part in federal programs. It also leads to issues with advertising, hiring, loans, payroll and insurance because most service providers have affiliations with the federal governments.

At the moment, state-regulated marijuana businesses are not allowed to use credit-card processors because financial institutions are regulated by the federal government. By relying on cash, most cannabis businesses have a higher risk of being robbed.

Following the suit’s filing, Verano president Darren Weis, stated that he was honored to be supporting this groundbreaking suit that pushed for equal treatment under the law. Weiss is one of the plaintiffs involved in the suit.

This lawsuit is likely to draw the attention of many cannabis companies that are operating in other jurisdictions such as TerrAscend Corp. (TSX: TSND) (OTCQX: TSNDF) since it could have implications for the industry across the country.

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420 with CNW — Lessons for Ohio from Michigan’s Recreational Cannabis Launch

Ohio may soon be the latest state in America to legalize recreational cannabis. Reform activists collected enough signatures for a legalization initiative titled Issue 2, and Ohioans are on track to vote on the measure in November.

Multiple polls have found that most Ohio residents plan to vote in favor of the initiative to legalize and regulate recreational cannabis in the state. For example, a September poll by the Coalition to Regulate Marijuana Like Alcohol found that 55% of voters would “probably” or “definitely” support the recreational cannabis legalization initiative.

Before Ohio potentially launches the latest recreational cannabis market in the country, the state could learn from neighbor Michigan, which legalized recreational marijuana in 2019. Soon after, border towns such as Adrian, Michigan, were home to dispensaries that regularly served customers from Ohio.

Amazing Budz dispensary general manager Chris Jacobson notes that half of his customers drive from Ohio, many of them wearing Ohio State University jerseys. Jacobson says some customers come in search of a sleep aid while others are looking for something to boost their appetites.

Ohio Issue 2 will legalize the cultivation, processing, distribution, sale, purchase, possession, home cultivation and use of cannabis for adults aged 21 years and older. It would allow adults to possess up to 15 grams of cannabis concentrates and up to 2.5 ounces of cannabis while also allowing the cultivation of up to six cannabis plants at home.

Local and state taxes on cannabis sales would be divvied up between social-equity and job programs, addiction treatment and education, funding for dispensary host communities, and administrative and regulatory costs.

If Ohio does legalize recreational cannabis, the state could learn some lessons from Michigan’s adult-use industry as well. This could include the average onboarding process for customers at cannabis dispensaries.

Jacobson says his dispensary serves all adults aged 21 and older regardless of their state of origin and uses state-issued IDs to verify customer identity and age. Like Michigan, Ohio first started with a medical cannabis industry and could copy Michigan’s format of dispensaries selling both recreational and medical cannabis.

For instance, Amazing Budz started out as a medical cannabis dispensary, incorporated adult-use marijuana two years later, and now serves both medical and recreational cannabis customers. Jacobson says the creation of cannabis testing standards reduced the risk of tainted products hitting the market, something that could also benefit the Ohio market and protect Ohioans from consuming contaminated cannabis products.

However, recreational cannabis operators in Ohio will also have to deal with the drawbacks of federal prohibition, such as lack of access to banking services.

If and when Ohio eventually launches its recreational marijuana market, opportunities will open up for many companies to potentially grow to the levels that other cannabis enterprises such as TerrAscend Corp. (TSX: TSND) (OTCQX: TSNDF) have risen to in the years that they have been in operation.

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420 with CNW — Cannabis Growers in Canada to Benefit from $2.6B Federal Funding Program

Eligible Canadian marijuana cultivators and processors can seek financial support through the new Sustainable Canadian Agricultural Partnership program (Suitable CAP), valued at C$3.5 billion ($2.6 billion). The program could bring relief to the smaller players in Canada’s marijuana industry that have been grappling with continuous deflationary pressures and intense competition, coupled with limited access to funds from private-sector lenders.

The support provided by the Sustainable CAP will be an addition to various other federal funding sources that Canadian marijuana companies have been leveraging. These include the National Research Council Canada (NRC), the Industrial Research Assistance Program (IRAP), and the Scientific Research and Experimental Development (SR&ED) program. The Sustainable CAP program is a collaborative effort between the federal and provincial governments under the umbrella of Agriculture and Agri-Food Canada, the governmental department responsible for agriculture.

George Smitherman, CEO of the Canada Cannabis Council, expressed satisfaction with the initiative, describing it as a significant shift in the agricultural department’s acknowledgment of cannabis as a value-added agricultural product. The council serves as the national industry association, representing the interests of numerous licensed processors and producers in the country.

Replacing the Canadian Agricultural Partnership (CAP), the Sustainable CAP program will be operational from April 1, 2023, until March 31, 2028. It comprises a C$1 billion allocation for activities and programs directly managed by the federal government, with an additional C$2.5 billion committed to cost-shared programs overseen by territories and provinces.

Until now, no marijuana companies have been involved in federal projects under the Sustainable CAP.

One of the federal programs of Sustainable CAP that marijuana-related enterprises may qualify for is the AgriAssurance Program, which includes two segments: the Small and Medium-Sized Enterprise (SME) and the National Industry Association (NIA). The NIA segment finances projects at the national level to facilitate the industry in creating and adopting tools, standards and systems that bolster safety and health claims pertaining to agricultural and agri-food Canada products. The SME segment aims to aid for-profit SMEs in executing assurance projects that cater to market and regulatory prerequisites.

Cannabis businesses are eligible to seek funding from both the AgriScience and AgriInnovate programs, provided that their proposals align with the program’s objectives, they possess valid licenses and their activities are consistent with their Health Canada licenses.

Applications for Sustainable CAP programs are evaluated on an individual basis, contingent on the specific program’s funding criteria. Additionally, applicants must already possess the requisite licenses and comply with federal and provincial laws and regulations, including the Cannabis Act.

Licensed operators such as TerrAscend Corp. (TSX: TSND) (OTCQX: TSNDF) could be pleased by these developments that show that the cannabis industry is now being embraced as any other industry that needs to be supported in any way possible so that it can thrive not just nationally but on a global scale too.

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420 with CNW — DOJ Defends Ban on Gun Rights of Medical Cannabis Users in Federal Appeals Court

A federal court of appeals recently held oral arguments in a case addressing the constitutionality of the federal ban that prevents medical cannabis patients from buying or owning firearms. The proceedings unfolded before a three-judge panel of the U.S. 11th Circuit Court of Appeals, where lawyers representing the Justice Department and Florida’s medical marijuana patients presented their respective arguments. The case has been extensively discussed through numerous briefings spanning over a year.

The plaintiffs’ attorney, Will Hall, outlined two key reasons supporting the federal ban’s unconstitutionality. Firstly, Hall argued that regardless of whether marijuana usage is lawful, committing a crime does not automatically deprive people of their Second Amendment rights. Secondly, he asserted that the Supreme Court has established new standards for evaluating gun limitations, declaring them illegal unless they are consistent with the historical background of the Second Amendment, which was passed in 1791. Hall said that prohibiting people who use medical cannabis is inconsistent with this historical setting.

While the Justice Department’s counsel conceded that illegal drugs were not widely used when the law was set, he argued that early laws restricting gun rights because of conditions such as mental health and intoxication serve as historical precedents consistent with the goal of the federal gun ban for regular cannabis users.

The discussion also delved into the definition of a law-abiding person whose Second Amendment rights should be safeguarded. One of the judges observed that it would seem incongruous to categorize state-registered medicinal cannabis patients as not adhering to the law in light of the federal rider, which has been extended yearly since 2014 and bans DOJ involvement in state medical-marijuana programs.

Both parties and judges acknowledged that the forthcoming Supreme Court case, U.S. vs. Rahima, which addresses the disarming of individuals with domestic violence injunctions, could influence the ruling in this case by clarifying whether Second Amendment rights can be systematically denied to nonlaw-abiding individuals for whatever reason.

The hearing also referenced a ruling by the U.S. Fifth Circuit Court of Appeals in Daniels vs. the U.S., which declared the ban on marijuana users possessing firearms unconstitutional, even for recreational cannabis users. The DOJ expressed disagreement with this ruling, reiterating its reservations about the foundation of the decision.

The plaintiffs in the current case are seeking a narrow declaration, distinct from Daniels, specifically addressing state medical marijuana patients who are law compliant.

Several district court rulings have also questioned the constitutionality of the firearms ban for marijuana users, including cases in Oklahoma and Texas. Additionally, the ATF has voiced concerns regarding state laws allowing medical marijuana patients to obtain concealed carry gun licenses, citing potential risks and conflicts with federal firearm licensing policies.

Major marijuana companies such as TerrAscend Corp. (TSX: TSND) (OTCQX: TSNDF) are likely to follow this court case keenly since it would address one of the big concerns that many people have about using state-legal marijuana products, which are regarded illegal by the federal government.

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420 with CNW — Top Minnesota Marijuana Regulatory Official Quits as Background Information Raises Questions

A recently appointed marijuana regulatory official in Minnesota has stepped down just a day after taking the post after an MPR-APM report revealed conflicts of interest and evidence of business impropriety. Minnesota Governor Tim Walz appointed Erin DuPree as the head of the new Minnesota Office of Cannabis Management on Sept. 21, 2023, and his office penned a press release praising her for leading research on cannabis and hemp-derived products while remaining compliant with state cannabis regulations and laws.

However, a background review by APM Reports and MPR News raised major questions about her background and the Walz administration’s verification processes, prompting DuPree to abdicate her post. The investigation by MPR News-APM Reports revealed that DuPree owned a business that sold products with more than the state-mandated THC limit, racked up tens of thousands of dollars in tax liens and was in debt to several former associates.

Starting in July 2022, a website for DuPree’s business Loonacy Cannabis Co. marketed cannabis products containing well over the allowed THC limits in Minnesota and advertised THC vape products that are illegal under Minnesota law.

Even though DuPree cleared out her strip mall storefront at Apple Valley on Friday and said that she had plans to sell the business to avoid conflicts of interest once she assumed a regulatory role, the report revealed that the location was involved in illegal activity. Prior social media posts by DuPree showed her advertising illegal vape pens and edibles that surpassed low-dose potency limits.

Following her exit from the cannabis regulatory post last week, DuPree released a statement saying she never “knowingly sold” noncompliant products. She also said that running a lawful business has always been her business objective and she removed all non-compliant products from her inventory once she learned they were not in line with Minnesota cannabis policies.

Even so, DuPree noted that she had “become a distraction” that could hinder the work that had to be done to launch Minnesota’s recreational industry.

Governor Walz released a statement saying that interim director Charlene Briner would remain in an interim capacity but did not mention DuPree’s resignation. Walz said that state leadership had a duty to guarantee Minnesotans that the nascent cannabis market would be lawful, well regulated and safe. He added that the administration was making progress toward this goal and had begun the process of hiring key leaders for the adult-use market.

DuPree’s decision to quit after questions were raised about her past alleged transgressions is a good one as it allows the industry to start on a clean footing that operators elsewhere including TerrAscend Corp. (TSX: TSND) (OTCQX: TSNDF) would appreciate from an official charged with overseeing the cannabis industry in any state.

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420 with CNW — US DOJ Starts Issuing Cannabis Pardon Certificates Following Mass Pardons by Biden

The issuance of formal certificates by the Justice Department to individuals who were pardoned by President Joseph Biden in October 2022 seems to have commenced. While neither the Office of the Pardon Attorney nor the Department of Justice have formally announced the issuance of these certificates, some applicants have received digital copies.

Last week, Kevin B. Gilnack shared an image of his pardon certificate on social media.

These pardon certificates will allow those whose marijuana possession convictions were overturned by the executive order to show that they received clemency. This will help prevent hurdles they may face in obtaining housing, education, employment and custody of children as a result of a federal criminal conviction.

Gilnack, who was arrested in 2006 by federal park police in Washington, D.C., for being in possession of roughly an eighth of an ounce of marijuana, is now a public affairs consultant. Following his arrest, he underwent six months of probation.

On his post, Gilnack revealed that applying for the pardon certificate was a straightforward and seamless process, adding that it was received one week after he’d applied for it. He encouraged eligible individuals who hadn’t applied yet to find out their case docket number as well as the date they were convicted.

Cumulatively, the president’s mass pardon affects about 6,500 individuals who were federally convicted of being in possession of marijuana.

This certificate program was launched by the Department of Justice earlier this year, with the Office of the Pardon Attorney estimating that it would take no more than 2.5 hours per person to present all the information requested on the application.

While this move by the Biden administration was a step in the right direction, some of the individuals affected and advocates have criticized the sluggish rollout of the certificate application. The program was launched almost six months after the mass clemency announcement by the president.

Despite this, some officials seem to be following suit at the state level. As of December 2022, almost two million cannabis convictions had been expunged or pardoned countrywide. In Oregon, for example, the governor granted a mass pardon for state-level cannabis possession offenses to offer relief to roughly 45,000 individuals.

In 2019, Gov. J.B. Pritzker of Illinois also announced that his office was pardoning more than 11,000 individuals who had previously been convicted of simple marijuana possession prior to the launch of legal cannabis sales. In Nevada, Gov. Steve Sisolak pardoned some 15,000 individuals who had been convicted for low-level possession of marijuana.

These marijuana pardons further address the harms that marijuana prohibition has wreaked upon different families and communities. As conditions improve, the cannabis industry, major players such as TerrAscend Corp. (TSX: TSND) (OTCQX: TSNDF) inclusive, will stand a chance to thrive even more as a bigger section of the population becomes less apprehensive about consuming the substance.

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420 with CNW — Study Shows Users of Medical Cannabis Register Improvements in Depression, Anxiety and Pain

A recent study in the “PLoS ONE” journal found that more than 2,300 individuals with persistent health issues experienced improved well-being and reduced fatigue within the first three months of using medicinal cannabis. The study was centered on the responses obtained from eligible Australian patients who participated in the QUEST Initiative.

The participants’ age spectrum spanned from 18 to 97 years of age, with an average age of 51. Among the participants, 62.8% were women while 37.2% were men. The majority of participants reported experiencing chronic pain (69%), followed by insomnia (23%), anxiety (22%), and a combination of anxiety and depression (11%).

Before starting cannabis treatment, the participants were tasked with completing initial surveys concerning their health-related quality of life (HRQL), pain levels, sleep patterns, fatigue levels, and depression and anxiety symptoms. Subsequent follow-up surveys were administered at the two-week mark and then on a monthly basis for three months.

All participants were prescribed Little Green Pharma’s medical marijuana oil, comprising CBD and THC dissolved in MCT oil. This product was available in four different formulations featuring varying THC-to-CBD ratios: 1:20, 10:10, 20:5 and CBD only.

When compared to initial baselines, patients who faithfully adhered to the three-month treatment regimen reported notable enhancements in their overall health-related quality of life. In contrast, individuals who only completed the first follow-up assessment demonstrated less progress compared to those who persisted with the treatment.

With regard to pain management, the study revealed that participants, on the whole, exhibited improvements in pain-related metrics. The magnitude of improvement, however, was more pronounced among those diagnosed with chronic pain conditions compared to those not receiving pain-focused treatment.

Sleep patterns did not witness any significant amelioration among the respondents; nevertheless, a reduction in fatigue levels was noted, signifying clinically meaningful improvements.

Regarding depression, the research disclosed that while scores shifted from moderate to mild severity, they failed to reach the five-point threshold indicative of clinically meaningful improvement. However, substantial improvement was observed among individuals diagnosed with specific conditions.

Anxiety scores displayed analogous trends, revealing significant improvements over time but falling short of reaching the expected threshold, except in cases where participants were diagnosed with anxiety conditions.

Throughout the three-month period, a total of 127 participants formally withdrew from the study, citing various reasons for doing so. These included perceived ineffectiveness of the treatment, alterations in treatment plans, unwanted side effects and the perceived high cost of cannabis products. However, the majority reported at least some degree of relief from their ailments.

Despite the generally favorable outcomes, the researchers acknowledged that certain reported improvements might be attributed to the placebo effect.

Looking ahead, the study intends to continue tracking patients for a full 12 months to assess the sustainability of the observed improvements in patient-reported outcomes. Additionally, further subgroup analyses will be conducted to ascertain whether patients with specific conditions experience superior outcomes when evaluated using condition-specific questionnaires.

This study pointing to the beneficial effects of medical marijuana could be good news to companies that are looking to popularize their medicinal cannabis products in different markets around the world, such as TerrAscend Corp. (TSX: TSND) (OTCQX: TSNDF).

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420 with CNW — Program Targeting Illicit Marijuana Operations Announced in California

Officials in California have announced the launch of a program to crack down on illegal cannabis operations in the state and boost the legal market. The program will connect Attorney General Rob Tonta’s office with local authorities and support them in efforts to combat the illicit marijuana market by targeting the finances of illegal cannabis operators. Tonta said that the anti-illicit cannabis program will deal with illegal marijuana as a land use and public nuisance issue.

Even though California is now home to the largest legal cannabis market on the entire globe, the state’s cannabis program has struggled to compete with the illegal market since its inception. Bonta noted that illicit marijuana is “problematic for many reasons” and said that constituents expect their leaders to team up and address the escalating issue of illegal cannabis.

Illegal operators regularly outsell California’s legal cannabis market, depriving the state of tax revenue and funneling funds into illegal operations. Furthermore, the illicit cannabis market has been implicated in illicit land use, significant water waste and environmental pollution. Cheaper cannabis from the black market has also made it incredibly difficult for licensed cannabis retailers to remain competitive as a myriad of fees and taxes makes legal cannabis significantly more expensive than black-market marijuana.

In addition, because illegal sellers aren’t subject to safety and quality controls, black-market cannabis can contain contaminants that endanger the health of unsuspecting cannabis users. In some cases, the criminal enterprises behind the illicit drug trade exploit and traffic their workers.

The new anti-illicit cannabis program will provide education and resources for enforcement programs and help collect evidence that could be instrumental in prosecuting large statewide cases. California’s Department of Justice will fund the program through administrative orders, fines, enforcement actions, lien, and settlements, allowing the program to be almost wholly self-funded. Fresno is the first city to join the program and will work with the justice department to help provide running costs.

A news release revealed that the statewide illicit cannabis enforcement efforts will supplement civil and criminal action by California Governor Gavin Newsom’s Unified Cannabis Enforcement Task Force and the state Department of Cannabis Control. According to Fresno City Attorney Andrew Janz, the city’s partnership with the attorney general’s office is meant to help boost Fresno’s legal cannabis industry and expand the city’s tax base. He hopes that other large cities in California will emulate Fresno’s joint venture and accelerate efforts to target the state’s massive cannabis black market.

It isn’t only California that is battling black-market operators. As multistate operators such as TerrAscend Corp. (TSX: TSND) (OTCQX: TSNDF) are all too aware, the challenge of illicit actors plagues all markets where marijuana is legal.

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