Cannabis Media Meltdown

Photo by Alex Halperin

High Times may have to cease operations due to lack of funds, the N.Y. Post reports. “Because of recurring operating losses, net operating cash flow deficits, and an accumulated deficit, there is substantial doubt about the company’s ability to continue as a going concern for one year,” parent company Hightimes Holding said in a recent SEC filing.

  • High Times, which began 45-years ago, has struggled to adapt to legalization. It acquired media brands Dope, Culture and Green Rush Daily, but a crowd-funded IPO fell short of expectations. There have also been problems with its signature Cannabis Cup events.
  • In its most recent earnings statement, High Times reported a net loss of $11.9M on $10.7M in revenue for the six months ending June 30, 2019.
  • High Times reportedly has $105.2M in debts.

It's not the only cannabis media company in a difficult position.

Meanwhile, Isaac Dietrich, CEO of once high-flying social media startup MassRoots, insists the company is in business, despite reports to the contrary.

  • MassRoots has also burned through millions in capital. Last week its stock was trading at about one third of a cent. At press time its web site was down.

Quick Hit

  1. A tough story in Grizzle calls MedMen's stock, "Nothing more than a speculative trading vehicle from now until the company runs out of money." Equity Guru spots "5 Red Flags everyone should have seen" at the multi-state operator.


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VAPI Linked to Legal Businesses in Massachusetts

Photo by Quinten de Graaf on Unsplash

Six Massachusetts patients with probable cases of Vaping Associated Pulmonary Injury (VAPI) reported using regulated cannabis products bought at legal dispensaries. Of the more than 2,300 cases identified nationwide, almost none have been connected to licensed companies.
Boston Globe

  • It's not clear what legal product(s) the patients used, or where they shopped.
  • The state's moratorium on cannabis vapes is likely to remain in place, though the ban on e-cigarette sales appears likely to be lifted.

The consensus remains that VAPI is caused by vitamin E acetate oil and that most of the risk is with unlicensed cannabis vapes. However, counterfeits of well known vape brands potentially pose a hazard to consumers who mistake them for regulated products.


California Industry Sounds the Alarm

Photo by Hugo Jehanne on Unsplash

Two years after REC went on sale, California cannabis businesses are calling for an "emergency summit" with Gov. Gavin Newsom (D) and regulators to address the licensed industry's ongoing woes. In short, high taxes, onerous regulations and the lack of access to legal dispensaries make it difficult for licensed businesses to compete with the illegal market. 🌴WW California has more.

Meanwhile in L.A., a well-known black entrepreneur and his company 4thMVMT have attracted suspicion and resentment for their success at winning coveted equity licenses.
L.A. Times

Quick Hits

  1. Colorado's new looser investment law isn't doing anything for equity in the state.
  2. Colorado authorities still haven't answered my questions about whether they can effectively regulate cannabis investments.

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Hemp Banking is a Go

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Federal and state regulators dropped a requirement which forced banks to treat hemp companies as suspicious entities. The move clears the way for hemp companies to access the financial system.
N.Y. Times

Canna Law Blog explains the change in greater depth, and has two posts answering questions about hemp regulations. Part 1 Part 2

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Bloomberg Moderates Tone

Michael Ciaglo / Getty Images
They used to call him bong-ripper

Billionaire former New York City Mayor Michael Bloomberg (D) might want to be president after all. While he previously called legalizing marijuana "perhaps the stupidest thing anybody has ever done," he's now moderating his tone. He now says he supports decriminalization and believes the feds shouldn't interfere "with states that have already legalized."

  • Bloomberg hasn't endorsed MED or REC legalization.
  • Before he ran for Mayor Bloomberg was asked if he'd ever tried marijuana. He responded, "You bet I did. And I enjoyed it."
    N.Y. Times (2002)

While more Democrats then Republicans favor REC legalization, supporters in both parties consider it one of their top priorities.
N.Y. Times

In other state political news:


Up Like Ayr

Ayr Strategies

Business Insider talks to John Sandelman, CEO of Ayr Strategies, a vertically integrated cannabis company which generates $12M in annual revenue per shop, twice as much as its closest competitor, Florida-based Trulieve.

Sandelman, a former Bank of America president, says Ayr's success depends on information flowing from customers to its cultivators and manufacturers.

  • Ayr is based in New York and operates in Massachusetts and Nevada.


How Green is your Cannabis Business?

Photo by Noah Buscher on Unsplash

MJBiz Magazine has a report on how cannabis businesses can improve their environmental practices. However, consumers looking to support environmentally responsible brands should be aware of "greenwashing:" environmental claims which turn out to be empty.

  • “Typically, a producer or a brand that wants to make a claim that they’re green makes those claims based on data or best practices or standards – all of which are largely missing in the cannabis industry,” Derek Smith co-founder of the non-profit Resource Innovation Institute said.


Brazil to Allow MED Imports

Agustin Diaz via Unsplash

Brazil's pharmaceutical regulator approved rules for MED products, which will be available in certain pharmacies with a prescription. The country will not allow it to be grown domestically, potentially creating a major import market.
Reuters, MJBiz

In other international news, New Zealand Prime Minister Jacinda Ardern declined to say how she'd vote in next year's REC referrendum.

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Get Ready for the 'Shroom Rush

Photo by Chris Arock on Unsplash

Former executives from some of Canada's largest cannabis companies are pioneering the psychedelic drug industry.

Toronto-based MindMed plans to test microdosed LSD as a treatment for ADHD and a molecule derived from the psychoactive compound Ibogaine as a treatment for opioid addiction. (Ibogaine is a psychoactive compound found in Iboga, a shrub native to West Africa.)
Globe and Mail

  • MindMed has raised C$6.2M from investors including former Canopy Growth CEO Bruce Linton and "Shark Tank's" Kevin O'Leary.



Photo by Jippe Joosten on Unsplash

The Growth Op inspects the top pot games for smartphones. They include Wiz Khalifa's Weed Farm, Weed Shop 2 and Hempire.

  • The latter features a "strain creator" who grows in an RV and looks like Walter White from "Breaking Bad."

Quick Hits

  1. Did Brad Pitt's cannabis use break up his marriage to Angelina Jolie? The Growth Op takes a look.
  2. The trailer is out for season four of "High Maintenance."
  1. Cannabis inspired pet names like Budder, Dank, Doobie, Blaze, and Kush are on the rise.
    Press Release

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