Category Archives: Medical Marijuana

Why ISW Holdings Inc (OTCMKTS:ISWH) Could be the Next Crypto Stock Star

Why ISW Holdings Inc (OTCMKTS:ISWH) Could be the Next Crypto Stock Star

As we move inexorably toward 2021, there are several themes that should strike the diligent eye of the astute investor: money creation, central bank activism, the discovery of the “fiscal channel” in policy operations, and the coming impact of covid-19 vaccines.

Wrapped in all of these conceptual narratives is Bitcoin, with its newfound sheen of legitimacy following moves by major payment platforms (the key to this puzzle) to invest in the digital currency. As a result, the crypto space has been on fire from any reasonable perspective.

But there are very few small and micro-cap investment plays available to the quote-unquote “normal” investor. The point: while Bitcoin has doubled over the past couple months, market participants are sure to be searching for instruments that can offer them much bigger returns over the near term on a proxy basis relative to the coin.

That’s why we are taking a closer look today at ISW Holdings Inc (OTCMKTS:ISWH), a company that has strong momentum in two major growth trends and has now established a strong anti-dilution program that deserves a close look.

The key here is that ISWH has laid down a recent track record of success in its telehealth and home healthcare segment and is verging on a breakout in commercial-stage operations for its cryptocurrency mining segment, producing what may be a major topline growth story now and throughout 2021.

The Real Meal Deal

ISW Holdings Inc (OTCMKTS:ISWH) isn’t a pretender in the Crypto space.

The company has made a significant investment in developing the Proceso Pod5ive datacenter pod, which is capable of driving Megawatt-level cryptocurrency computational mining power, has been fully assembled and is now ready for shipment to the 100 MW renewable energy Bit5ive LLC cryptocurrency mining project based in Pennsylvania.

“The job now is about bringing in revenues from participation in the Bit5ive Pennsylvania project while simultaneously building a track record for the Proceso, Pod5ive Data Center Pods as a global best-in-class solution for mining facilities around the world,” remarked Alonzo Pierce, President and Chairman of ISW Holdings.

“We have begun sourcing partnerships in this endeavor, and we feel our technology division has an extremely bright future ahead in step with the growing success of Bitcoin and the broader cryptocurrency space.”

While it apparently has an industry leading Power Usage Effectiveness (“PUE”) score of 1.06, and while Bitcoin has thundered higher, ISWH is still a micro-cap trading on the OTC, which means it will take work to drive it into the slipstream of the current bull market’s energy. OTC stocks don’t get “the benefit of the doubt”. They have to earn it.

But ISWH may be on that track.

Shoring Up the Sheet

But there’s another important dimension to note: as we approach that key moment where the company’s “pod5” crypto mining solution goes live and starts churning out mining revenues and then starts to attract interest as a product in the mining equipment space, the company has also recently taken another big step: streamlining its capital structure by curtailing dilution risk, canceling debt, and reducing outstanding shares by a substantial margin.

To wit, in ISWH’s most recent release: the company announced that it and its largest noteholders have reached an agreement whereby about 50% of the current convertible debt owed by the Company will be exchanged for restricted preferred equity, eliminating a significant portion of the dilution potential from convertible debentures now carried in the Company’s books.

According to the release, the Company and its largest noteholder have agreed to exchange convertible debentures (principal and interest) with an aggregate value of $602K for restricted Preferred B equity, thereby reducing total debt and significantly curtailing dilution potential over the coming months and years.

“The Preferred B Shares will be restricted for a period of one year,” said Pierce. “After one year, the Preferred B Shares can only be converted at a maximum 12.5% per quarter of the original common share issuance (a total of 4.5 million common shares). So basically, no more than 562,500 common shares will hit the market in any given quarter.”

This article is part of JournalTranscript.com Networks. Read the JournalTranscript.com Networks Disclaimer.

Published at Wed, 16 Dec 2020 10:35:24 +0000

7 States That Could Legalize Cannabis in 2021

7 States That Could Legalize Cannabis in 2021

Leamington, Ontario and Nanaimo, British Columbia – December 16, 2020 – PRESS RELEASE – Aphria Inc., a global cannabis company, and Tilray, Inc., a cannabis research, cultivation, production and distribution company, today announced that they have entered into a definitive agreement to combine their businesses and create the world’s largest global cannabis company based on pro forma revenue. The deal is pursuant to a plan of arrangement under the Business Corporations Act, and the implied pro forma equity value of the combined company is approximately C$5.0 billion, based on the share price of Aphria and Tilray at the close of market on Dec. 15, 2020. Following the completion of the arrangement, the combined company will have principal offices in the United States (New York and Seattle), Canada (Toronto, Leamington and Vancouver Island), Portugal and Germany, and it will operate under the Tilray corporate name with shares trading on NASDAQ under ticker symbol “TLRY.”

The combined company, supported by low-cost, state-of-the-art cultivation, processing and manufacturing facilities, will have a complete portfolio of branded Cannabis 2.0 products in Canada. Internationally, the combined company will be well-positioned to pursue growth opportunities with Aphria’s medical cannabis and distribution footprint in Germany, and Tilray’s European Union Good Manufacturing Practices (EU-GMP) low-cost cannabis production facility in Portugal, which has export capabilities and tariff-free access to the European Union (EU) to meet increasing global demand for medical cannabis. In the United States, the combined company will have a strong consumer packaged goods presence and infrastructure with two strategic pillars, including SweetWater Brewing Company, a cannabis lifestyle branded craft brewer, and Manitoba Harvest, a leading hemp food manufacturer and a pioneer in branded CBD and wellness products. The combined company is expected to have a strong, flexible balance sheet, cash balance and access to capital giving it the ability to accelerate growth and deliver attractive returns for stockholders.

Under the terms of the arrangement, the shareholders of Aphria will receive 0.8381 shares of Tilray for each Aphria common share, while holders of Tilray shares will continue to hold their Tilray shares with no adjustment to their holdings. Upon the completion of the arrangement, Aphria Shareholders will own approximately 62% of the outstanding Tilray Shares on a fully diluted basis, resulting in a reverse acquisition of Tilray, representing a premium of 23% based on the share price at market close on Dec. 15, 2020 to Tilray shareholders. On a pro forma basis for the last twelve months reported by each company, the combined company would have had revenue of C$874 million (US$685 million).

Proven Leadership Team

The combined company will be led by a best-in-class management team and board of directors, with strong track records in consumer-packaged goods and cannabis experience internationally. Upon completion of the arrangement, Aphria’s current Chairman and Chief Executive Officer Irwin D. Simon will lead the combined company as chairman and chief executive officer. The board of directors will consist of nine members, seven of which, including Simon, are current Aphria directors and two of which will be from Tilray, including Brendan Kennedy, and one of which is to be designated. Aphria and Tilray are confident that the leadership team and proposed board of directors of the combined company provides a strong foundation for the combined company to accelerate growth. Additional senior leadership positions at the combined company will be named at a later date.

“This is an exciting day for both companies including our 2,500 employees, for the cannabis industry, and for patients and consumers around the world. We are bringing together two world-class companies that share a culture of innovation, brand development and cultivation to enhance our Canadian, U.S. and international scale as we pursue opportunities for accelerated growth with the strength and flexibility of our balance sheet and access to capital,” said Simon. “Our highly complementary businesses create a combined company with a leading branded product portfolio, including the most comprehensive Cannabis 2.0 product offerings for patients and consumers, along with significant synergies across our operations in Canada, Europe and the United States. Our business combination with Tilray aligns with our strategic focus and emphasis on our highest return priorities as we strive to generate value for all stakeholders.

“I am honored to work with Brendan Kennedy, a pioneer in the cannabis industry, and the Tilray team as they join forces with our talented employees at Aphria,” continued Simon. “I look forward to leading the talented teams of both Aphria and Tilray as we seek to create a leading global cannabis and consumer packaged goods company with a portfolio of medical, wellness and adult-use brands consumers love.”

Kennedy, Tilray’s chief executive officer, commented, “We are thrilled to bring together two cannabis industry leaders. At this nascent stage of development and expansion of the global cannabis market, we believe companies with leading geographic scale, product range and brand expertise are most likely to benefit long-term. By leveraging our combined strengths and capabilities, we expect to be able to meet the needs of consumers more effectively all over the world and advance patient care. With a strong financial profile, low-cost production, leading brands, distribution network and unique partnerships, we believe the combined company will be well-positioned to deliver sustainable, attractive returns for stockholders. I look forward to working with Irwin and the combined company’s management team to make our consumer products more accessible around the world.”

Strategic and Financial Benefits

The combined company will be the largest global cannabis company based on pro forma revenue for the last twelve months reported by each company with scale and breadth across major geographies and a complete portfolio of market leading brands in the major Cannabis 2.0 product categories. Aphria and Tilray each believe the business combination pursuant to the arrangement will provide the following financial and strategic benefits, among others:

  • Financial Strength and Flexibility: The combined company will enjoy an attractive financial profile with pro forma revenue of C$874 million (US$685 million) for the last twelve months reported by each company, the highest in the global cannabis industry. In Canada, the combination of Aphria and Tilray will create the leading adult-use cannabis company with gross revenue of C$296 million (US$232 million) in the adult-use market for the twelve months reported by each company. Aphria has generated positive adjusted EBITDA over the last six quarters, which in combination with the synergies to be realized, provides a robust platform for future profitability and cash flow generation for the combined company. This, collectively with the strength of the combined company’s balance sheet and access to capital, is expected to help accelerate global growth and value for the combined company’s stakeholders.
  • Creates the Leading Canadian Adult-Use Cannabis Licensed Producer: Together, Aphria and Tilray will be the leading adult-use cannabis Canadian Licensed Producer based on revenue for the last 12 months by combining their respective brands, distribution networks and world-class facilities. In Canada’s C$3.1 billion adult-use, retail market, the combined company will have one of the lowest cost production operations with its state-of-the-art facilities. In addition, the combined company will have a portfolio of carefully curated brands across all consumer segments that are sold through its distribution partners. On a pro forma basis, for the period August to October 2020, the combined company would have held a 17.3% retail market share, the largest share held by any single Licensed Producer in Canada and 700 basis points higher than the next closest competitor.
  • Increases Product Breadth and Commitment to Innovation: Leveraging both Aphria and Tilray’s commitment and culture of innovation and brand building, the combined company will serve clients with a complete portfolio of Cannabis 2.0 products and sales and service infrastructure supported by leading distribution partners. Aphria and Tilray’s complementary brands will be available across economy, value, core, premium and premium plus product offerings. In addition, the combined company will have a complete breadth of products in every major cannabis category, including flower, pre-roll, oils, capsules, vapes, edibles and beverages.
  • Establishes an Unrivaled European Platform: The combined company will be well-positioned to pursue growth opportunities with its end-to-end EU-GMP supply chain and distribution, which includes Aphria’s German medical cannabis distribution footprint and Tilray’s 2.7-million-square-foot European EU-GMP low-cost cannabis cultivation and production facility in Portugal. In Germany, Aphria’s wholly-owned subsidiary, CC Pharma GmbH, will provide the combined company with distribution capabilities for the Aphria and Tilray medical cannabis brands to more than 13,000 pharmacies. In Portugal, Tilray’s EU-GMP cultivation and production facility will provide the combined company with the capacity to cultivate and produce medical cannabis products in order to meet international demand and has export capabilities, which provides tariff-free access to the EU.
  • Enhances Consumer Packaged Goods Presence and Infrastructure in the U.S.: In the United States, the combined company will have a strong consumer packaged goods presence and infrastructure with two strategic pillars, including SweetWater, a cannabis lifestyle branded craft brewer, and Manitoba Harvest, a pioneer in branded hemp, CBD and wellness products with access to 17,000 stores in North America. The combined company is expected to leverage SweetWater’s craft beer manufacturing and distribution network to build brand awareness for the combined company’s brands via craft beers, hard seltzers and other beverages as it seeks to take advantage of opportunities for both the adult-use and health and wellbeing beverage trends. The combined company also expects to pursue the opportunity to expand with new or existing CBD or other cannabinoid brands leveraging Manitoba Harvest’s strong hemp and wellness product platform. When U.S. regulations allow, the combined company expects to be well-positioned to compete in the U.S. cannabis market given its existing strong brands and distribution system in addition to its track record of growth in consumer-packaged goods and cannabis.
  • Positions Combined Company to Continue to Grow in the Beverage Segment: The combined company believes it will be well-positioned to pursue an accelerated rate of growth in the Canadian and the U.S. beverage industries by leveraging SweetWater’s innovation, knowledge and expertise to introduce adult-use cannabis brands via craft beers and other beverages. This includes leveraging Aphria and Tilray’s proven distribution networks in Canada to sell SweetWater’s 420 cannabis lifestyle brand in Canada.
  • Substantial Synergies: The combination of Aphria and Tilray is expected to deliver approximately C$100 million of annual pre-tax cost synergies within 24 months of the completion of the transaction. The combined company expects to achieve cost synergies in the key areas of cultivation and production, cannabis and product purchasing, sales and marketing and corporate expenses. This is expected to include the opportunity for Aphria’s Leamington, Ontario operations to provide additional volume for Tilray’s brands and to replace the need for Tilray to use wholesale cannabis purchases from other licensed producers. Tilray’s London, Ontario facility will also provide Aphria with excess capacity to increase production of additional form factors including their branded edibles and beverages.  The combined company is considering utilizing Tilray’s existing Nanaimo, British Columbia facility for Aphria’s premium Broken Coast brand to increasingly meet consumer demand for its products. The combined company plans to capitalize on opportunities for growth through a broadened product offering and additional form factors, with the aim of increasing adult-use cannabis brand availability across certain Canadian provinces to an expanded customer base with the combined company’s scalable infrastructure. Internationally, the combined company will have the opportunity to reach additional pharmacies and patients via distribution relationships. The combination is expected to unlock significant shareholder value.

Agreement Details

Under the terms of the agreement, the arrangement will be carried out by way of a court-approved plan of arrangement under the Business Corporations Act (Ontario) and will require the approval of at least two-thirds of the votes cast by the Aphria Shareholders at a special meeting. Approval of a majority of the votes cast by Tilray stockholders will be required to, among other things contemplated by the agreement, authorize the issuance of Tilray shares to Aphria shareholders pursuant to the arrangement. Following completion of the arrangement, Aphria will become a wholly-owned subsidiary of Tilray, with Aphria shareholders owning approximately 62% of Tilray.

Completion of the arrangement is subject to regulatory and court approvals and other customary closing conditions. Regulatory approvals expected to be required include Competition Bureau (Canada), U.S. HSR and Germany FDI. The agreement includes certain reciprocal customary provisions, including covenants in respect of the non-solicitation of alternative transactions, a right to match superior proposals and C$65 million (US$50 million) reciprocal termination fee payable under certain circumstances. The arrangement is expected to close in the second quarter of calendar year 2021 following the receipt of such regulatory approvals, as well as court approval of the arrangement.

Each of Aphria’s and Tilray’s respective directors and officers and certain principal Tilray Stockholders have entered into voting support agreements agreeing to vote their Aphria Shares or Tilray Shares, as applicable, in favor of the resolutions put before them pursuant to the agreement.

For further information on the terms and conditions of the arrangement, please refer to the agreement in its entirety, which will be available on SEDAR at www.sedar.com and on EDGAR at www.sec.gov. Full details of the arrangement will be included in a management information circular of Aphria and in a proxy statement of Tilray to be delivered to Aphria Shareholders and the Tilray Stockholders, respectively, in the coming weeks.

Board of Directors’ Approval

Each of Aphria’s and Tilray’s respective board of directors has unanimously approved the agreement and the arrangement. Jefferies LLC provided a fairness opinion to the Board of Directors of Aphria on Dec. 15, 2020, stating that, as of the date of such opinion and based upon the scope of review and subject to the assumptions, limitations and qualifications stated in such opinion, the Exchange Ratio is fair, from a financial point of view, to the Aphria Shareholders. Cowen provided a fairness opinion dated Dec. 15, 2020 to the board of directors of Tilray stating that, as of the date of such opinion and based upon and subject to the assumptions, limitations and qualifications stated in such opinion, the Exchange Ratio is fair, from a financial point of view, to Tilray.

Advisors

Jefferies LLC is serving as financial advisor and DLA Piper LLP (US), DLA Piper (Canada) LLP and Fasken Martineau Dumoulin LLP are acting as legal counsel to Aphria. Cowen is serving as financial advisor and Cooley LLP and Blake, Cassels and Graydon LLP are acting as legal counsel to Tilray.

Conference Call & Webcast Presentation

Aphria and Tilray executives will host a conference call and webcast with a supplemental presentation to discuss the strategic business combination today, Dec. 16, 2020 at 8:30 a.m. Eastern Time.

To listen to the live call, dial (647) 427-7450 from Canada and the U.S. or (888) 231-8191 from international locations and use the passcode 4334816. A telephone replay will be available approximately two hours after the call concludes through January 13, 2021. To access the recording dial (855) 859-2056 and use the passcode 4334816.

There will also be a simultaneous, live webcast and supplemental presentation available on the Investors section of Aphria’s and Tilray’s website at aphriainc.com and Tilray.com. The webcast will be archived for 30 days.

Published at Wed, 16 Dec 2020 19:46:00 +0000

The Emerald Triangle, Sonoma and Del Norte to Be Included in Research Study of Northern California’s Cannabis Economy

The Emerald Triangle, Sonoma and Del Norte to Be Included in Research Study of Northern California’s Cannabis Economy

George Weiblen, a professor in the College of Biological Sciences at the University of Minnesota and the science director and curator of plants at the Bell Museum, has been working since 2002 to discover the genetic differences between hemp and marijuana.

He’s recently cracked a major component of the code.

A research team led by the Weiblen Lab has developed a genetic test that can predict whether cannabis will produce mostly cannabidiol (CBD) or tetrahydrocannabinol (THC), having broad implications for both cannabis and hemp industries.

The team’s findings were recently published in the American Journal of Botany.

While Weiblen acknowledges that other similar tests have been developed, the University of Minnesota’s research and test delve deeper into the biology and mechanisms behind why the test works. In other words, they’ve discovered on the molecular level why certain cannabis varieties produce more CBD and why others produce more THC.

“We are looking at the genes that are ultimately responsible for the pattern we see,” Weiblen tells Cannabis Business Times and Hemp Grower. “What we’ve done is proven our model across lots of different kinds of cannabis, from industrial hemp to medicinal cannabis to feral ditchweed [wild hemp].”

How it Works

Weiblen says across all types of cannabis, a small area of their chromosomes determines whether the plant will be one of three types: CBD-dominant, THC-dominant or intermediate with approximately equal levels of each.

The team found these consistencies by studying more than 350 different samples of cannabis. (The Weiblen Lab has a DEA research registration and obtained drug cannabis from the National Institute on Drug Abuse.)

The lab test developed by the research team homes in on one gene: the gene for CBD. This gene has two variations that result in it either producing CBD or failing to produce CBD, Weiblen says. Those variations are different sizes on the chromosome, so the test measures the length of the gene to determine which variation it is.

“Just like in humans, where we have two copies of each chromosome, so does cannabis,” Weiblen says. “As a plant, you can either have two working copies of the CBD gene, two faulty copies of the CBD gene, or one of each. How much CBD [the plant makes] depends on which of those three combinations you have.”

It’s much like hair types for humans. For example, if a mother has curly hair and a father has straight hair, their child’s hair could be either curly, straight or something in between.

Interestingly, Weiblen’s team also found the gene for THC is tied to the gene for CBD, and the two interplay to produce the three different types of cannabis.

A Surprising Discovery

During the team’s research, they studied feral hemp populations across Minnesota. And while a majority of those samples met the legal definition of hemp at 0.3% THC or less, others were more complex.

In an unexpected finding, Weiblen discovered that roughly one in 10 feral hemp plants in Minnesota had potential to exceed the legal definition of hemp at maturity. They found 11% of their samples were intermediate-type cannabis, while 1% was THC-type.  

“We found a marijuana needle in the hemp haystack,” Weiblen says.

It’s important to note that the amount of cannabinoids cannabis produces is a different story. Even if cannabis is THC-type, it could still potentially produce so few cannabinoids that it remains within compliance of the federal definition of hemp. While “the ratio of cannabinoids is entirely a genetic phenomenon,” Weiblen says, different environmental factors have been shown to dictate how much cannabinoid content cannabis actually produces.

Still, this finding raised questions for Weiblen, especially as many hemp growers and all cannabis growers are looking to not only produce cannabinoids, but also maximize them.

As such, the researchers have suggested changing the definitions of “hemp” and “marijuana” to align with their findings—instead of defining different cannabis varieties by the amount of cannabinoids they produce, which is reliant on outside factors and can vary wildly, the researchers propose defining them by their cannabinoid “types.”

“As a botanist, we don’t classify plants based on how people use them, but how they differ [genetically],” Weiblen says, adding that the definitions of hemp and marijuana carry both confusion and, in some case, negative connotations. “Now that we see public policy and public perceptions around cannabis really changing, we suggest maybe it’s time to define types of cannabis around their cannabinoid content rather than carry with us all the historical baggage.”

“We found a marijuana needle in the hemp haystack.” -George Weiblen, professor, University of Minnesota

Implications for the Hemp Industry

Beyond public policy implications, the research team’s findings could also make it easier for cannabinoid producers to choose their genetics—an improvement that is sorely needed in the nascent hemp industry especially.

Some hemp farmers are still having difficulty with hot crops that exceed the federal THC limit. This has been due, in part, to troubles sourcing reliable genetics.

Weiblen says this new test could be a good first step in preventing hot crops. Successful crops start with good genetics, and Weiblen envisions seed certification organizations using this test to help eliminate THC-type cannabis from ever reaching hemp growers’ hands.

“One advantage of our test if it’s applied is that it can give farmers some assurance of what is the predominant cannabinoid they’re going to see in their plants,” Weiblen says. “They don’t have to wait until end of growing season to learn that.”

Published at Tue, 08 Dec 2020 18:40:00 +0000

 Neptune Wellness Solutions Inc. (NEPT) Wellness Chief Executive Officer Michael Cammarata on Successful U.S. House of Representatives Vote to Decriminalize Marijuana

 Neptune Wellness Solutions Inc. (NEPT) Wellness Chief Executive Officer Michael Cammarata on Successful U.S. House of Representatives Vote to Decriminalize Marijuana




 Neptune Wellness Solutions Inc. (NEPT) Wellness Chief Executive Officer Michael Cammarata on Successful U.S. House of Representatives Vote to Decriminalize Marijuana | Marijuana Stocks | Cannabis Investments and News. Roots of a Budding Industry.™
























Published at Mon, 07 Dec 2020 14:06:09 +0000

The Rise of Tongji Healthcare Group Inc (OTCMKTS:TONJ)

The Rise of Tongji Healthcare Group Inc (OTCMKTS:TONJ)

Tongji Healthcare Group, Inc. (OTCMKTS:TONJ) isn’t a healthcare company. It is actually the ticker for a marketing and consumer brands company with a starting-point reach of over 70 million through its social media influencer vehicle, The Clubhouse.

The story is quite interesting. To our knowledge, it’s basically the only pure-play to focus on putting a massive social-media-based marketing infrastructure at the front of the ticket, with a strong foundation of influencers already established.

That opens up tremendous opportunities, so we thought it would be a good idea to take a closer look.

Turning the Page

After announcing the transition for TONJ in August following news that the company had signed a Share Exchange Agreement to acquire West of Hudson Group Inc, Tongji Healthcare Group, Inc. (OTCMKTS:TONJ) is now nearing its coming out party after announcing last week that the company has taken the initial steps toward changing the Company’s name from “Tongji Healthcare Group, Inc.” to “Clubhouse Media Group, Inc.” and changing the Company’s ticker symbol.

“We have taken the first steps toward effecting our corporate name and ticker symbol changes and are very excited to move forward,” commented Amir Ben-Yohanan, the Company’s CEO.

According to the release, on Aug. 12, 2020, the company announced the signing of a Share Exchange Agreement to acquire West of Hudson Group, Inc. (“WOHG”), the sole owner of “The Clubhouse,”  a collection of branded content houses that house some of the most prominent social media influencers. Upon closing of the share exchange, the Company will acquire WOHG, with WOHG becoming a wholly owned subsidiary of the Company. The Company expects that the acquisition would move the Company’s business away from healthcare completely and entirely into social media.

The release also noted that, in addition to filing a certificate of amendment to the company’s articles of incorporation with the Nevada Secretary of State, the company also filed an Issuer company-related Action Notification Form with FINRA regarding the proposed corporate name change and ticker symbol change. The name change and symbol change are subject to review by FINRA and will not be effective until FINRA clears the actions. The company apparently expects that the name-change and symbol change will be effective on or about Nov. 20, 2020.

In other words, the superficial factors in this story are potentially about to be lined up with the explosive underlying story. At that time, we could see this stock catch some serious buzz, which is why we point it out here.

The Back Story

Tongji Healthcare Group, Inc. (OTCMKTS:TONJ), as noted above, is now WOHG, for all practical purposes. And WOHG, as alluded to above, is the sole and singular owner of the Clubhouse, a network of content creation mansions in Southern California housing a collection of some of the most widely followed and talented social media influencers on the planet. According to company materials, the Clubhouse provides residence to influencers who, in aggregate, boast a total base of over 70 million followers.

The real play here is that the Clubhouse also has an in-house talent agency, Doiyen, that effectively owns the rights to capitalize on those 70 million followers to ink lucrative branding and marketing deals with outside brands or to popularize in-house brands created by WOHG.

“The Clubhouse provides a picturesque living environment complete with inhouse photographers and videographers, so we can maximize the depth, breadth, and scale our influencers can build across popular social media platforms while having fun and just being themselves,” commented Ben Yohanan. “Cultivating a large and committed following and then pursuing the popularization of in-house brands has demonstrated stunning recent success as a model. We would point to Kylie Jenner’s Kylie Cosmetics, which was valued at nearly $1.2 billion when it sold a controlling stake to Coty, Inc. last November. That value was built by first cultivating a broad influencer following. With this acquisition, we will have that value to harness.”

The upside of putting the marketing arm ahead of the product specifics is important to appreciate given how the world works today. And the Kylie Jenner reference should be appreciated through that lens. When a company decides to launch a branded product line, the old path was to do market research and then decide on the product, manufacture it, and then invest in trying to market it to the end-market consumer – to tell people how great it is and that they should buy it.

The Clubhouse is a means of driving interest and then figuring out what to popularize after the fact. At this point, TONJ is a stock that contains the already-achieved success of the first piece in this equation, which is the hard part in the grand equation underlying this space.

COMPENSATION DISCLOSURE: Section 17(b) of the 1933 Act requires publishers to disclose who paid them, the amount, and the type of payment. In order to be in full compliance with the Securities Act of 1933, Section 17(b): Tiger Global Management Partners LLC has compensated a third party to produce and present weekly content for various companies for the publication. For more information, please click here. In addition, this article is part of JournalTranscript.com Networks. JournalTranscript and network websites have not been compensated for distribution of this content. Read the JournalTranscript.com Networks Disclaimer.

Published at Mon, 16 Nov 2020 05:23:41 +0000

Is it All Coming Together for Cannabis Strategic Ventures (OTCMKTS:NUGS)?

Is it All Coming Together for Cannabis Strategic Ventures (OTCMKTS:NUGS)?

The drumbeat is getting louder. Can you hear it? We can’t hear anything else. It sounds like this: “Pot Stocks! Pot Stocks! Pot Stocks!” And on and on.

Check out the marijuana ETF (ticker: MJ). Check out Aurora (ACB) or Tilray (TLRY). Check out GRWG making new all-time highs this month. Check out the AdvisorShares Pure US Cannabis ETF (MSOS). The whole space is skying.

That means it’s time to start to digging around for unappreciated and excessively promising stories – the overlooked plays in the space that haven’t gotten the same fanfare, but may start to draw attention. That’s where the opportunity may be at this point.

And, with that in mind, our attention turns to Cannabis Strategic Ventures (OTCMKTS:NUGS), an interesting story on the OTC as a rapidly growing and potentially underappreciated cannabis stock with strong metrics and signs of increasingly productive positioning in the ecosystem of the booming California cannabis market.

The story for NUGS right now is about timing, luck, and execution – and raw numbers that tell a story of performance that can’t be easily dismissed.

Firing on All Cylinders

It was easy to look away from the cannabis market earlier this year after the pandemic got going at full blast. And, it turns out, most companies in that space seem to have done just that, with reduced headcounts, lowered production, and chopped investments in capacity and innovation.

The result was an undersupplied market for cannabis that hit the end market as an actual shortage in many places in May and June.

But Cannabis Strategic Ventures (OTCMKTS:NUGS) was one of the few players that went the other direction, stepping up its investment, driving increased product quality, and adding to its production capacity as its competitors were pulling back.

It was a contrarian bet that has paid off in a big way, but investors and market participants don’t seem to realize it yet, suggesting there may be an opportunity here.

Our thesis is that this type of contrarian bet doesn’t just lead to a short-term burst in superficial growth rate – by stepping into the gap in the market. But it leads to a sticky upgrade in market positioning as end market retailers come to rely on a new a reliable source of high-quality goods when the context is one of scarcity.

The Big Point

That has a long-term impact on relationships. We would argue that we have seen precisely that type of transition for Cannabis Strategic Ventures (OTCMKTS:NUGS) so far this year.

If you look back through the company’s releases so far in 2020 and at the close of last year, you will see the following the sequence: a projection about revenues late last year looking for “$5 million in 2020 sales related to cannabis products”, a better than expected push to start the year, a series of investments in expanded production capacity and improved product quality, reports of increased pricing out the door on a per-unit volume basis for production, increased output as capacity increases start to pay off, and an unmistakable trend in sales growth across basically every conceivable period-to-period comparison.

Now, here we sit with results crushing guidance and every sign that the company has made undeniable progress in execution and market positioning in a sector with widely understood cyclical tailwinds in a massive structural growth boom.

Long story short: Cannabis Strategic Ventures (OTCMKTS:NUGS) ticks all the boxes right now and should be worth a closer look.

COMPENSATION DISCLOSURE: Section 17(b) of the 1933 Act requires publishers to disclose who paid them, the amount, and the type of payment. In order to be in full compliance with the Securities Act of 1933, Section 17(b): Tiger Global Management Partners LLC has compensated a third party to produce and present weekly content for various companies for the publication. For more information, please click here. In addition, this article is part of JournalTranscript.com Networks. Read the JournalTranscript.com Networks Disclaimer.

Published at Mon, 09 Nov 2020 07:38:19 +0000

Opponents Plan to File Lawsuit Over Montana’s Cannabis Legalization Initiative

Opponents Plan to File Lawsuit Over Montana’s Cannabis Legalization Initiative

Updated: 8:49 a.m. Eastern Standard Time, Nov. 5 

As Election 2020 results continue to pour in across the U.S., we are monitoring cannabis-related down-ballot races in several states.  

California 

Unofficial election results show Costa Mesa, Calif., voters are in favor of allowing adult-use cannabis dispensaries and delivery services; and Laguna Woods, voters support that city allowing dispensaries. A measure in La Habra to permit “up to four cannabis delivery licenses” received more “yes” than “no” votes.

Ventura County, Calif., voters said “yes” to Measure O. ” The Ventura County Star reported Oct. 3, “The initiative on the Nov. 3 ballot allows up to 500 acres of cultivation of cannabis in greenhouses and 100 acres in nurseries in certain unincorporated areas.”

Patch has reported preliminary voting results out of Banning, Calif., favoring a tax on cannabis distribution businesses. The “gross receipts tax — capped at 10 percent” will go toward 911-emergency services.  

And Calabasas, Calif., a city that doesn’t currently allow cannabis dispensaries, is likely to approve an ordinance that would impose a tax on cannabis business, according to Patch.  

As the ordinance states, the 10% tax would be imposed “on the privilege of conducting the following activities within the city’s jurisdiction: transporting, dispensing, manufacturing, producing, processing, preparing, storing, testing, providing, donating, selling, or delivering, or distributing cannabis, cannabis products, cannabis accessories, or cannabinoid preparations delivering, or distributing cannabis, cannabis products, cannabis accessories, or cannabinoid preparations … in the City of Calabasas, under the Control, Regulate and Tax Adult Use of Marijuana Act and the Medicinal and Adult Use Cannabis Regulation and Safety Act (California Business and Professions Code sections 26000, et seq.) ….” 

In Jurupa Valley, Calif., a measure designed to affect changes that would bolster city revenue from cannabis sales, was rejected by voters in a vote of 6,543 to 6,139, according to final election results posted on The Press Enterprise.  

A citizen-led initiative in 2018 permitted adult-use cannabis sales, “But city officials said the 2018 law has generated little revenue for municipal coffers,” according to The Press Enterprise

Measure U – City Of Jurupa Valley Tax Increase On Cannabis Businesses For General Municipal Services “would boost marijuana tax dollars while allowing as many as nine stores, or dispensaries — up from the current ceiling of seven,” The Press Enterprise reported. “Measure U would let the city council set the tax rate as high as 6%. Jurupa Valley officials estimated the tax could bring in $2 million to $3 million per year. Existing marijuana stores would be allowed to continue operating under Measure U, and a lottery would be established to determine who gets licenses to open new cannabis shops.” 

Colorado 

Three Colorado cities voted to legalize adult-use cannabis sales, according to preliminary election data.  

Voters in Littleton, Colo., voted to allow adult-use cannabis sales, according to early election results Nov. 3, reported Colorado Community Media.  

“Voters approved Ballot Question 300, allowing the city’s three medical marijuana dispensaries to begin recreational sales, with 64.6% of the vote in the first round of election results at 7 p.m. on Nov. 3,” according to the report. “The vote ends years of opposition to retail sales from city council, which first banned retail marijuana sales in 2014, after Colorado voters passed Amendment 64. That statewide measure, which also passed in Littleton, established a constitutional right to possess marijuana for personal use, but allowed municipalities to regulate whether sales were allowed.” 

Voters in Lakewood, Colo., also voted to allow adult-use cannabis sales. The language for Ballot Question 2B, which was voted in by a vote of 66.02% to 33.98%, asked voters whether the City of Lakewood should “adopt an ordinance adopting regulations governing the operation of retail marijuana stores and retail marijuana cultivation facilities.”  

And voters in Buena Vista, Colo., approved retail cannabis sales in a vote of 54.88% to 45.12% as well as a cannabis sales tax in a vote of 66.14% to 33.86%, according to the Heart of the Rockies Radio.

Voters in Broomfield County, Colo., passed Ballot Question 2A, 59.56% to 40.44%. The measure says the city and county of Broomfield will place a new 4% sales tax on adult-use cannabis and cannabis “products” and “dispensaries” “if the prohibitionon retail marijuana stores is allowed to expire on February 1, 2021.” Broomfield City Council can increase the tax but not to more than 10%.

Illinois 

Seven Chicago suburbs have voted on whether to allow adult-use cannabis sales, according to the Chicago Tribune. These are the unofficial results with all precincts reporting: 

A few hundred miles south, voters in Murphysboro, Ill., voted Nov. 3 to allow adult-use cannabis sales in the city, reversing a previous vote by city leaders to ban adult-use cannabis, according to WSIL TV. As WSIL reported, now that the advisory question has passed, “The city of Murphysboro will now determine how to move forward with marijuana businesses in town.” 

Maine 

In Maine, voters in the towns of Surry and Southwest Harbor have expressed their support to allow adult-use cannabis retail businesses, according to The Ellsworth American. These are the first municipalities in Hancock County to allow adult-use retail. 

The news outlet said the vote was particularly close in Surry, with 572 people voting for and 504 people voting against allowing the businesses. 

To the southwest, in Portland, Maine, a measure to scrap the city’s 20-retail-store cap and allow dispensaries to be closer together passed with roughly 53% of the vote, according to the Portland Press Herald

Maine legalized adult-use cannabis through a 2016 ballot initiative; however, municipalities must opt in to the program, and legal sales in communities that opted in didn’t begin until Oct. 9 this year. The adult-use program was initially delayed when former Gov. Paul LePage in November 2017 vetoed a bill that, if signed into law, would have taxed and regulated recreational cannabis. “On May 2, 2018, the Legislature overrode the Governor’s veto of LD 1719, An Act to Implement a Regulatory Structure for Adult Use Marijuana,” according to the Government of Maine’s website. A regulatory structure was finally signed into law by Gov. Janet Mills on June 27, 2019, per the government report. 

Michigan 

Voters in Pinckney, Livingston County, Mich., on Nov. 3, ended a ban on marijuana businesses, according to Livingston Daily. The ban had followed adult-use legalization in the state; Michigan voters’ approved Proposal 1, which legalized adult-use marijuana for people age 21 or older, in November 2018. As Livingston Daily reported:  

“Pinckney will be the first municipality in Livingston County to allow marijuana businesses after voters approved a proposal to end a ban on such establishments. 

Voters approved the measure, 54.3% to 45.7%. It passed by 117 votes, with 743 votes in favor of the proposal and 626 against it.”

Michigan’s Kawkawlin Township (Bay County) said no to adult-use cannabis. Voters there rejected by a marginal vote of 1,537 to 1,149 a proposal to nullify the township board’s previous decision to opt out of adult-use cannabis business under the Michigan Regulation and Taxation of Marihuana Act and to allow an unlimited number of adult-use licenses in the township, according to MLive.com.  

Oregon

Voters in Sherwood, Ore., approved a measure to end the prohibition on recreational cannabis facilities with 54% voting in favor. “I think it is great that voters of Sherwood have voted to allow adult use cannabis retailers to open shop,” Jesse Bontecou, director of membership service for The Oregon Retailers of Cannabis Association, says. “They have shown once again people love cannabis and the legal jobs and taxes it generates for communities. Cannabis legalization is here to stay locally and nationally!” 

Meanwhile, residents of Winston, Ore., rejected a measure to ease zoning restrictions on cannabis retailers, while voting in favor of an additional 3% sales tax for items sold at existing retailers.  

Also, Deschutes County residents rejected a measure that would have allowed new cannabis producers, processors and processing sites to be located in unincorporated areas.  

Cannabis Business Times and Cannabis Dispensary Senior Editor Brian MacIver contributed reporting.

Published at Thu, 05 Nov 2020 16:55:00 +0000

Cannabis and CBD Stocks on Election Watch (YCBD, CBGL, MJNA)

Cannabis and CBD Stocks on Election Watch (YCBD, CBGL, MJNA)

Who won? It’s pretty clear: Cannabis, Hemp, and CBD.

The sticky plant was legalized on all grounds in Arizona, Montana, New Jersey, and South Dakota. The most important piece of this story is really about the crossover along cultural lines – three of these four states qualify as canaries in the coalmine for national legalization by extrapolation as the cannabis plant becomes accepted and mobilized around product development and distribution on a mainstream, bipartisan basis.

It’s just a matter of time.

With that in mind, we take a look at a few of the more active and interesting stocks with direct exposure to the CBD theme, including: cbdMD Inc (NYSEAMERICAN:YCBD), Cannabis Global Inc (OTCMKTS:CBGL), and Medical Marijuana Inc (OTCMKTS:MJNA).

cbdMD Inc (NYSEAMERICAN:YCBD) is perhaps the top-tier player in the pure-play CBD space. The company promulgates itself as a company that produces and distributes various cannibidiol (CBD) products.

It owns and operates the consumer hemp-based CBD brand, cbdMD. The company’s product categories include CBD tinctures, capsules, gummies, bath bombs, topical creams, and animal treats and oils. It also offers pet related CBD products under the Paw CBD brand name. The company distributes its products through an e-commerce Website, wholesalers, and various brick and mortar retailers in the United States.

cbdMD Inc (NYSEAMERICAN:YCBD) just announced that the company was proud to support MMA champion Daniel “DC” Cormier, a premier member of “Team cbdMD”, which is the CBD industry’s premier athletic sponsorship program, as he prepares for the fight of his career. This past Saturday, August 15, 2020, Cormier headlined a primetime MMA showdown against heavyweight champ Stipe Miocic in a highly anticipated ‘rubber match’. ‘Miocic vs. Cormier 3’ aired live at 10 PM ET (ESPN+ PPV) from the UFC APEX facility in Las Vegas.

“My mind is ready, and my body is ready to do something great. This fight is the build-up of years of hard work and preparation. Thousands of hours on the mat and endless amounts of time training. This fight means everything to me, literally everything. And I am so thankful for cbdMD and put my trust in their CBD ‘Recover’ Inflammation Cream, CBD bath bombs, and CBD gummies to help me get ready for this major fight,” said Cormier.

Even with that news, the action hasn’t really heated up in the stock, with shares moving net sideways over the past week. Shares of the stock have powered higher over the past month, rallying roughly 7% in that time on strong overall action.

cbdMD Inc (NYSEAMERICAN:YCBD) managed to rope in revenues totaling $10.6M in overall sales during the company’s most recently reported quarterly financial data — a figure that represents a rate of top line growth of 32.2%, as compared to year-ago data in comparable terms. In addition, the company has a strong balance sheet, with cash levels far exceeding current liabilities ($15.1M against $4.4M).

Cannabis Global Inc (OTCMKTS:CBGL) continues to make progress. This is one of the most interesting names in the CBD space given its strong IP backing – with more than a half dozen provisional patents in process at the USPTO – and its innovative movement toward non-CBD cannabinoid production technology.

This includes beverages, a range of CBD products, explorations into exotic cannabinoids, and its line of Hemp You Can Feel™ products, which now include both alcohol substitute cocktail mixers and a range of infused sweeteners.

Cannabis Global Inc (OTCMKTS:CBGL) recently announced the filing of a new patent application resulting from its Project Varin research program. The application addresses new methods for the creation of highly bioavailable and ultra-fast acting cannabinoids for use in beverages, food, topical, and other applications. The non-provisional application expands on the developments and technologies outlined in the provisional applications that were filed on November 4, 2019.

According to the release, the Company believes this technology is revolutionary, holding the potential to rewrite the efficacy and cost equations in the cannabis industry. Additionally, the technology will allow for significantly faster onset of active cannabinoids ingredients, which are expected to be experienced in minutes, versus oftentimes in hours for current generations of cannabinoid infusion technologies.

“We believe what we have created is highly significant to the cannabis industry, especially as nationwide cannabis legalization looms on the horizon,” commented Arman Tabatabaei, CEO of Cannabis Global. “This new cannabinoid delivery system is designed to allow beverage, food, and cosmetic product formulators to use significantly less cannabinoids in products while achieving similar or meaningfully greater efficacy. Our patent filing covers not only the new processes developed to create the new forms of cannabinoids but also the nanoparticles and nanofibers using the outlined processes and ingredients. We are especially proud of the fact we have been able to use food-grade ingredients in many of the formulations allowing consumer product companies to produce the clean labels consumers are increasingly desiring.”

If you’re long this stock, then you’re liking how the stock has responded to the announcement. CBGL shares have been moving higher over the past week overall, pushing about 14% to the upside on above average trading volume.

Cannabis Global Inc (OTCMKTS:CBGL) just cracked the surface on commercial-stage operations in its last quarterly update. And, given the strong R&D foundation, we could imagine big things ahead if it executes on its current strategy.

Medical Marijuana Inc (OTCMKTS:MJNA) is a chronic loser in the space, but one that can occasionally get hot and run in a spike on some sort of announcement. However, the long-term trajectory has been overpromising, underperformance, and a dilution-filled trip down the chart.

The company operates in the medical marijuana and industrial hemp markets. Its products range from patented and proprietary based cannabinoid products to seed and stalk or isolated high value extracts manufactured and formulated for the pharmaceutical, nutraceutical, and cosmeceutical industries. The company licenses its proprietary testing, genetics, labeling and packaging, tracking, production, and standardization methods for the medicinal cannabinoid industry.

Medical Marijuana Inc (OTCMKTS:MJNA) recently announced that the Japanese division of its subsidiary Kannaway® had its best month ever in Company history in July 2020.

“Kannaway has made tremendous progress around the world as consumers in Japan and across Asia continue to show an exciting increase in interest for cannabidiol (CBD) products,” said Medical Marijuana, Inc. CEO Dr. Stuart Titus. “Our team has truly shown what can be accomplished with passion, hard work and high-quality products designed to support the body’s crucial endocannabinoid system.”

If you’re long this stock, then you’re liking how the stock has responded to the announcement. MJNA shares have been moving higher over the past week overall, pushing about 2% to the upside on above average trading volume. Shares of the stock have powered higher over the past month, rallying roughly 5% in that time on strong overall action.

Medical Marijuana Inc (OTCMKTS:MJNA) managed to rope in revenues totaling $11M in overall sales during the company’s most recently reported quarterly financial data — a figure that represents a rate of top line growth of -46.9%, as compared to year-ago data in comparable terms. In addition, the company is battling some balance sheet hurdles, with cash levels struggling to keep up with current liabilities ($5M against $10.5M, respectively).

This article is part of JournalTranscript.com Networks. Read the JournalTranscript.com Networks Disclaimer.

Published at Thu, 05 Nov 2020 07:41:42 +0000

B2Digital Inc (OTCMKTS:BTDG) Ready for Two Major MMA Events as PPV Performance Ramps Up

B2Digital Inc (OTCMKTS:BTDG) Ready for Two Major MMA Events as PPV Performance Ramps Up

With all the gloom surrounding the resurgence in pandemic cases and hospitalizations over the past two weeks, it’s easier than ever to lose sight of what’s working.

A case in point – if a surprising one – is the brand being built with great success so far this year for B2Digital Inc (OTCMKTS:BTDG), a rapidly growing OTC player in the live sports media space with a strong focus on Mixed Martial Arts pay-per-view events, branding its niche as the “development league for the MMA”.

It would be easy to assume that live sporting events – even those in the fastest growing sports market – might be suffering over the past couple months. But the story is very much the opposite for BTDG. And the company is looking to put that momentum back to the test again this weekend with two major events: HRMMA 116 in Elizabethtown, Kentucky, on November 6, and Strikehard 57 in Northport, Alabama, on November 7.

The HRMMA 116 event on Friday is also the 12-year Anniversary Show, according to information from the company on social media over recent days.

The momentum is unambiguous, with the company recent setting a new record for pay-per-view viewers in its last event, which follows a string of successful events this fall.

The key here has been an expanding total pool of potential viewers, an innovative marketing initiative, and what appears to be a successful model of running this type of event and distributing it to a widening circle of fans and followers.

A Perfect Storm of Execution?

As noted above, B2Digital Inc (OTCMKTS:BTDG) has benefited in recent months from progress in the company’s execution on multiple fronts.

We have seen a big expansion in distribution reach, with the company adding access to both Amazon Fire TV and Apple TV over the past few weeks, which may have added an addressable OTT market reach of over 70 million new potential viewers, based on data from Ampere Analytics and quoted in the Wall Street Journal earlier this year.

That jump in potential reach comes on the heels of the company’s establishment of its B2InstaStore marketing model, which provides a convenient, fast, and simple way to sign up for the Company’s new B2 Social Media Storefronts platform, where fans and followers can actually get a piece of the action by helping to sell PPV tickets for BTDG events.

According to the company’s release from late August, “The B2 Instastore feature is really something we feel has the potential to revolutionize the live-event PPV marketing game. Imagine all of your fans and followers deciding to become a giant distributed affiliate marketing team helping you sell tickets to your event. The technology is seamless. We are already seeing a strong response. And the timing couldn’t be better – having this system up and fully functional ahead of our first major event in the busy B2 Fighting Series Fall Season carries the potential to provide us with a defining boost in the months ahead.”

In addition, the company has added partners and extra resources on the distribution side, helping to push out a product that minimizes the company’s dependence on in-person audience attendance, which has helped to buffer its model against the uncertainty posed by the pandemic.

Picking Up Steam

Not only are we seeing B2Digital Inc (OTCMKTS:BTDG) maintain its momentum in terms of live MMA events in a challenging context, but we are actually seeing the pace of events pick up, with two major PPV shows scheduled for this coming weekend.

That’s a testament to how the company has navigated the obstacles placed in its path.

One important principle we would highlight – and which we have highlighted frequently in this strange context – is as follows: the companies that manage to thrive through flexible and effective execution during the worst of the pandemic could be poised for significant growth tailwinds as the context normalizes next year. Competition will be thinned out, resources will be accessible on the cheap, and teams will have the momentum that can only come from passing a tough test.

BTDG looks well-situated to find itself in good shape around the corner.

COMPENSATION DISCLOSURE: Section 17(b) of the 1933 Act requires publishers to disclose who paid them, the amount, and the type of payment. In order to be in full compliance with the Securities Act of 1933, Section 17(b): Tiger Global Management Partners LLC has compensated a third party to produce and present weekly content for various companies for the publication. For more information, please click here. In addition, this article is part of JournalTranscript.com Networks. Read the JournalTranscript.com Networks Disclaimer.

Published at Mon, 02 Nov 2020 03:45:13 +0000

South Dakota Makes History by Passing Both Medical and Adult-Use Cannabis on Same Ballot

South Dakota Makes History by Passing Both Medical and Adult-Use Cannabis on Same Ballot

Editor’s note: Election results reported are projected, and subject to change. CBT/CD will update its election coverage as necessary to accommodate changing election results.

Voters in South Dakota made history on Nov. 3, helping the state become the first in the union to pass a constitutional amendment legalizing adult-use cannabis sales without first having an established medical program.

Amendment A, the constitutional amendment that voters passed on election night with 53.4% of the vote with 95% of precincts reporting, per the Associated Press, legalizes the recreational use of cannabis for adults aged 21 and over and allows the possession of up to one ounce of cannabis per adult. Additionally, the law requires that the state legislature pass laws for a medical cannabis program and for hemp sales no later than April 1, 2022.

The Marijuana Policy Project (MPP) was heavily involved in supporting both ballot measures (Measure 26, the medical cannabis program ballot measure, also passed with 69.2% support). Matthew Schweich, deputy director of the MPP, said in a statement: “South Dakota has made history by becoming the first state to legalize medical marijuana and legalize marijuana for adults on the same day. Furthermore, it is arguably the most conservative state yet to enact marijuana legalization. This victory has added significance at the federal level with top-ranking Republican Senator John Thune now representing a legalization state.”

“What we really support is that it creates two distinct pathways to a shared goal, and it keeps those two pathways separate so that our medical program for our patients will always be there. It will never get absorbed by the adult-use and it puts both of them into the constitution,” Melissa Mentele, executive director of New Approach South Dakota told CBT in August of the medical provisions in Amendment A.

Under the constitutional amendment, municipalities can ban cultivation businesses from operating on its territory, as well as testing facilities, wholesalers, and retail operations. However, if an individual lives in a jurisdiction with no licensed retailers, that person can cultivate up to three plants in a locked space in a private residence.

The amendment also puts into place a 15% excise tax on cannabis sales to consumers. That revenue is to be used to cover the costs of launching and maintaining the amendment, with 50% of the remaining revenue going to the state’s public schools and 50% going into the state’s general fund.

Morgan Fox, media relations director and committee manager for the National Cannabis Industry Association (NCIA), also said in a statement, “South Dakota made history today by becoming the first state to approve a measure regulating cannabis for adults without a preexisting regulated medical cannabis program already in place. Voters should be commended for leading with their hearts and common sense. We encourage the few states where cannabis is still not legal for any purpose to follow South Dakota’s lead and stop punishing responsible adults and seriously ill patients for cannabis, and to providing safe, regulated, and legal methods to obtain it.”

NORML’s Executive Director Erik Altieri said in a statement: “No state has ever moved from marijuana prohibition to allowing both medical use and adult-use access, quite literally, overnight. These votes are a stunning rebuke to those elected officials that for decades have refused to move forward with substantive marijuana law reform legislation, and they are yet another indication of the near-universal popularity of these policy changes among voters in all regions of the United States.”

History in the Making

South Dakota became the first state to place both medical and adult-use measures on the same ballot, as CBT reported in January. With help from MPP, both campaigns coordinated efforts to support one another. At the time, Schweich told CBT that South Dakotans should vote for both ballot initiatives.

“Hopefully, we will pass both initiatives with strong margins and those strong winning margins can serve as a mandate from the people, a message to the legislature that these policies should be implemented in a timely manner,” Schweich told CBT in January. That message stuck, based on the results.

MPP has generally avoided allocating resources toward legislative lobbying in South Dakota, however, as it has proved challenging to get any meaningful bills passed through the legislature.

“Last year, the legislature passed a hemp law and the governor vetoed it,” Schweich said in January. “If they can’t get a hemp law passed, it’s very unlikely that they can get a medical marijuana or adult-use legalization law passed through that legislature, which is conservative and overwhelmingly controlled by the Republican party. So, really, to make progress in South Dakota, a ballot initiative is our only recourse.”

Today, the initiatives’ passage means that both medical and adult-use cannabis now are enshrined in The Mount Rushmore State’s constitution.

Additional reporting by Melissa Schiller

Published at Wed, 04 Nov 2020 14:07:00 +0000