Sunday, March 24, 2019
The title of this post is the title of a presentation to be made by one of my students in my Marijuana Law, Policy & Reform seminar this coming week. Here is part of his explanation of his topic and links to some background reading:
I will be looking at the prevalence (and in some cases, the dominance) of the black market for marijuana in jurisdictions that have legalized marijuana. I will specifically be looking at states that have legalized recreational use. However, I may still look at states that have only legalized medical marijuana because the black market still dominates in many of those states as well.
A major argument for marijuana legalization is potential revenue, but the black market can steal a significant amount of revenue from states. Additionally, the existence of a black market is detrimental to public health and safety for a variety of reasons, including the distribution of potentially laced products.
At first, I was surprised by just how dominant the black market remains in states that have legalized. For example, in California the black market is estimated to be worth 4 times the legal market. But consider major reasons why consumers choose to purchase cannabis products from the black market:
- The black market offers much cheaper weed with no sin taxes;
- The black market is able to sell higher potencies of marijuana;
- The black market is able to sell larger amounts of marijuana;
- The black market is oftentimes much more convenient.
Another reason people choose the black market is because they are familiar with it. Someone who has had a dealer for years is not all of a sudden going to switch to buying from a legal source. Additionally, the black market (generally) has no age restrictions, so the black market still exists for minors who wish to use marijuana products.
I also plan on talking about the regulations on legal cannabis providers and how those contribute to the struggle to subdue the black market (ex: marketing, banking, barriers to entry, supply problems, lax enforcement of black market). Finally, although I recognize that wholly eliminating the black market is infeasible, I will analyze potential solutions to the problem, such as deregulating (decreasing barriers to entry, lowering the age restriction, increasing enforcement, increasing strength of legal products, etc.) and working with the black market dealers.
"Can a marijuana dispensary’s budget pot put illegal dealers out of business?" (discussing Nevada’s lower cost product dubbed the Black Market Killer)
"Marijuana Black Market ‘Business Has Never Been Better’ In Canada Despite Legalization, Cannabis CEO Warns" (discussing Canada’s struggle with the black market)
"'I deliver to your house': pot dealers on why legalization won't kill the black market" (interview with two black market dealers in Canada)
"How marijuana entrepreneurs can outsmart black-market competitors" (discussing ways to possibly beat the black market)
"California’s black market for pot is stifling legal sales. Now the governor wants to step up enforcement" (discussing California’s black market)
"Marijuana Advertising Rules Challenge California Businesses" (discussing marketing regulations (including <30% of Minors Rule)
Friday, March 22, 2019
As mentioned in prior posts, my Marijuana Law, Policy & Reform seminar is now deep into the student presentation unit, and we will have four presentations each week in coming weeks and thus lots of great student-assembled content here on the blog The first presentation for next week will focus on updating employment policies, and here is how my student has summarized his topic, along with the background readings he has provided for classmates (and the rest of us):
As more states legalize marijuana for medical and recreational uses, the business community must acknowledge that larger portions of the American public will consume marijuana. Consequently, the labor market now includes more marijuana users than ever before. The zero-tolerance drug policies that employers use to discourage marijuana consumption are driving labor shortages throughout corporate America. To remain competitive and recruit the next generation of talented employees, Fortune 500 companies should revise their drug policies to permit off-duty marijuana use. Efforts to reform workplace drug policies should consider the labyrinth of federal and state laws that require certain employers to test for marijuana. Provided that corporate employers include exceptions for these rules, workplace drug policies will remain legally compliant.
Lisa Nagele-Piazza, How Do Recreational Marijuana Laws Affect the Workplace?, Society for Human Resource Management (Jan. 17, 2018).
Roy Maurer, Employers in This State Can’t Reject Job Applicants ‘Solely’ for Smoking Pot, Society For Human Resource Management (February 16, 2018) .
Judy Stone, The Sham Of Drug Testing For Benefits: Walker, Scott And Political Pandering, Forbes (Feb. 17, 2015).
Nelson D. Schwartz, Economy Needs Workers, but Drug Tests Take a Toll, N.Y. Times (July 2017).
Federal Laws and Regulations, Substance Abuse and Mental Health Services Administration (Nov. 2, 2015).
Tuesday, March 12, 2019
There is much discussion in marijuana reform circles about how states and localities can best ensure the new growing marijuana industry develops in a diverse, socially equitable way. The latest effort to advance this agenda comes from the Minority Cannabis Business Association (MCBA), which has now released this interesting new "Model Municipal Social Equity Ordinance." Here is part of the preface of this model ordinance:
This Model Municipal Social Equity Ordinance (“Model Ordinance”) is intended to be used by municipalities that have adopted ordinances to regulate, zone and license local cannabis businesses, or are currently considering draft ordinances to do so. As such, this Model Ordinance does not include recommended provisions for general license types (other than to add license types that lower barriers to entry or mitigate on-going criminalization of cannabis consumption), nor does it include detailed zoning and land use provisions. The drafters of this model ordinance assume those provisions are already incorporated within the adopting municipality’s general licensing ordinance, and that the general licensing ordinance already reflects the particular circumstances of its local community.
We also assumed that the types of licenses which may be available, and the general regulatory framework surrounding cannabis businesses will be largely predetermined by the state in which the adopting local jurisdiction sits. As such, the Model Ordinance contains only those provisions necessary to create a baseline framework for adopting and advancing social equity in the cannabis industry as official public policy -- a “minimum viable product” designed to be broadly adopted and tailored as necessary by each adopting jurisdiction. Prevailing political realities in each jurisdiction will vary, and the Model Ordinance includes bolded and bracketed substantive terms that may be revised as necessary....
The Drafting Committee finalized this version of the Model Ordinance after incorporating input received on two previous working drafts. The First Discussion Draft was previously circulated in October 2018 and presented to the attendees of the MCBA Policy Summit, as well as the members of the MCBA Policy Committee and the MCBA Board of Directors. Their input was incorporated by the Drafting Committee into the Second Discussion Draft. The Second Discussion Draft was circulated for input to the MCBA Board of Directors, the NCIA Policy Council staff, Drug Policy Alliance staff as well as other select stakeholders for additional input before being finalized. Finally, please note that this Model Ordinance is intended to be a living documents, and one that can be continually improved upon. The Drafting Committee invites any and all input on the Model Ordinance, and expects to publish updated versions of the Model Ordinance periodically.
Interestingly, though the heart of the Model Ordinance is a social equity program, these heading from the model proposal show that more is covered than just business issues:
Section 1: Short Title
Section 2: Cannabis Social Equity Program
Section 3: Good Faith Effort for Equity in Employment
Section 4: Community Benefits Agreement
Section 5: Community Reinvestment Fund
Section 6: Record Change Provisions
Section 7: No Additional Restrictions Allowed on Entry Into the Cannabis Industry
Section 8: Data Collection
Section 9: Lowest Law Enforcement Priority
Section 10: Permitting Social Consumption Lounges
Section 11: Eliminating Suspicionless Drug Testing
March 12, 2019 in Business laws and regulatory issues, Criminal justice developments and reforms, Race, Gender and Class Issues, Recreational Marijuana Commentary and Debate, Recreational Marijuana State Laws and Reforms | Permalink | Comments (0)
Saturday, March 9, 2019
This story at Leafy, headlined "As of 2019, Legal Cannabis Has Created 211,000 Full-Time Jobs in America," reports on Leafy's effort to account for job creation in the legal marijuana industry. Here is how the article starts:
How many jobs are there in the legal cannabis industry? It’s a common question — and one the government refuses to answer. Because cannabis remains federally illegal, employment data agencies such as the Bureau of Labor Statistics ignore all jobs related to the industry.
Over the past three months Leafly’s data team, working in partnership with Whitney Economics, has gone state-by-state to tally the total number of direct, full-time jobs in the state-legal cannabis industry.
There are now more than 211,000 cannabis jobs across the United States.
The Leafy accounting is set forth in this relatively short document titled "Special Report: Cannabis Jobs Count." Here is an excerpt:
In early 2017, roughly 120,000 Americans worked in the legal cannabis industry. At that time, 29 states allowed medical marijuana. Four states and the District of Columbia had legalized the adult use of cannabis. National sales in legal markets topped $6.7 billion.
Today, two years later, 34 states have legalized medical marijuana. Ten states and the District of Columbia have legalized cannabis for adult use. Annual sales nationwide are nearing the $11 billion mark. And the number of Americans directly employed in this booming industry has soared to more than 211,000.
When indirect and ancillary jobs — think of all the lawyers, accountants, security consultants, media companies, and marketing firms that service the cannabis industry — are added, along with induced jobs (local community jobs supported by the spending of cannabis industry paychecks), the total number of full-time American jobs that depend on legal cannabis rises to a whopping 296,000.
By comparison, there are currently about 52,000 coal mining jobs in the United States. American beer makers employ 69,000 brewery workers. And 112,000 people work in textile manufacturing.
Saturday, March 2, 2019
"Achieving Equity in the Marijuana Industry: Should State's Implement Social Equity Provisions into their Regimes?"
As mentioned in a recent post, this time of year students in my Marijuana Law, Policy & Reform seminar are advancing research projects/papers around topics of their choosing, and they are starting to gear up for in-class presentations. The presentation includes the requirement that they provide for posting here materials/links with background reading and information for the discussion they will lead. This coming week a student will be discussing the topic that serves as the title of this post, and here is his description of his plans:
I will examine how minorities have been disproportionately affected by the war on drugs and the consequences we still face today as a result of this enforcement. I will focus on the regimes that various states have put in place to address social equity, proposals states/localities are currently facing, the challenges of implementing these types of regimes, and what I consider the best solution to the social equity issue. Below are sources for the presentation: the first two examine why social equity regimes are necessary; the next three discuss regimes in place and the issues they have faced.
Trevor Hughes, New Marijuana Laws in 2019 Could Help Black and Drug Dealers go Legal, USA Today (Feb. 21, 2019)
Janell Ross, Legal Marijuana Made Big Promises on Racial Equity – and Fell Short, NBC News (Dec. 31, 2018) .
Laura Hancock, Judge Tosses Ohio Medical Marijuana License Requirements for Minority Groups, Cleveland.com (Nov. 16, 2018)
Celene Adams, Challenges – and Controversy – Swirl Around Marijuana Social Equity Programs in California, Marijuana Business Daily (Nov. 29, 2018)
March 2, 2019 in Business laws and regulatory issues, History of Marijuana Laws in the United States, Race, Gender and Class Issues, Recreational Marijuana Commentary and Debate | Permalink | Comments (0)
Tuesday, February 26, 2019
From the Akron Beacon Journal, "Ohio medical marijuana recommendations coming from clinics, not family doctors"
If you know someone who has received a recommendation to use medical marijuana, odds are the recommendation didn’t come from a family doctor or primary-care physician. The vast majority of recommendations in Ohio come from clinics that employ doctors solely to evaluate patients for medical marijuana, say people familiar with the industry....
“Marijuana-specific clinics fill a huge need,” said Dr. Joel Simmons, who runs the Ohio Herbal Clinic, a Near East Side cannabis clinic. While the clinics, many of which have out-of-state owners, have some critics, patient advocates say primary-care doctors are the ideal source for marijuana recommendations.
Those doctors better understand a patient’s needs and medical history, said Mary Jane Borden, co-founder of the Ohio Rights Group, which advocates for users of medicinal cannabis. When Ohio lawmakers wrote the state’s medical-marijuana law, they hoped that family physicians would be writing most recommendations, Borden said....
Clinics charge between $125 and $200 for an evaluation, which insurance won’t cover. Because the clinics don’t negotiate with insurance companies, they clinics can charge whatever they want, said Emilie Ramach, founder and CEO of Compassionate Alternatives, a Columbus-based nonprofit agency that helps patients pay for medicinal cannabis. Several clinic doctors, including Simmons, said they do their best to keep their prices reasonable.
From the Columbus Dispatch, "High prices keep many Ohioans out of legal cannabis market"
As Ohio’s medical marijuana industry finally takes off, some patients and advocates are griping about costs that put it out of reach for many people. A steep price tag stems partly from the lack of competition, as Ohio only has seven dispensaries spread throughout the state, mostly in rural areas, experts said. Costs are expected to drop as more dispensaries open and the industry finds its footing.
In the meantime, patients openly acknowledge buying the drug on the black market while they wait for prices to come down. And without insurance to cover the expense, some worry that low-income people might never be able to afford medical cannabis....
Several local patients said using marijuana has improved their quality of life, but they must stretch their budgets to pay for it or buy it on the street. “I’m not using as much as I probably need to be using,” said Mary Alleger, 31, of Reynoldsburg, who said she uses cannabis to treat post-traumatic stress disorder (PTSD) and ongoing pain from a botched medical procedure.
Katherin Cottrill, 33, of Newark, has worked with the patient advocacy organization Ohio Rights Group to acquire a medical marijuana card, but said current costs keep her from even getting started. “I would have to pay $200 to $250 (just to get a recommendation),” Cottrill said. “And then I have to drive to a dispensary and pay $50. It’s unreasonable for me to even try.”...
Just under 3 grams of medical marijuana costs about $50. Cannabis clinics charge between $125 and $200, and the state charges $50 in fees. Marijuana is cheaper on the street, patients said.
“On the black market you can buy an ounce for $200,” said Robert Doyle, 61, of Newark, who has a medical marijuana card but still buys the drug on the street due to the cost. There are about 28 grams in an ounce. Doyle said he’s visited dispensaries in Michigan with prices comparable to the black market, making him confident that Ohio’s costs will eventually fall....
But even if prices drop, clinic costs and fees will remain a barrier for some, Cottrill said. “What about low-income people who are desperately seeking medication?” she said. “They can’t even afford to pay $50 to get their card registered.”
February 26, 2019 in Business laws and regulatory issues, Medical community perspectives, Medical Marijuana Commentary and Debate, Medical Marijuana Data and Research, Medical Marijuana State Laws and Reforms, Who decides | Permalink | Comments (1)
Thursday, February 14, 2019
Federal judge finds Walmart unlawfully discriminated under state law against Arizona medical marijuana patient
As reported in this local article, headlined "Judge Rebukes Arizona Walmart for Firing Employee With Medical-Marijuana Card," a federal court last week issued a notable ruling on behalf of a medical marijuana patient in Arizona. Here are the basics:
An Arizona Walmart location terminated an employee in 2016 who held a valid medical-marijuana card after a drug test came back positive. But now a federal judge has ruled that because Walmart could not prove the employee was impaired at work, the company violated the nondiscrimination provision in the Arizona Medical Marijuana Act.
In a significant decision that recognized a private right of action for employment discrimination under the AMMA, Arizona U.S. District Judge James A. Teilborg said last week that Walmart was not justified in firing the worker based on the company's idea that marijuana metabolites in her urine meant she must have been impaired at work.
Whitmire's attorney Joshua Carden, who runs a Scottsdale-based law firm, said Teilborg's decision is "the first of its kind in Arizona."
"No court has officially decided whether a private right-of-action exists under the Arizona Medical Marijuana Act, so that was a big part of the decision," Carden told Phoenix New Times on Tuesday.
Before she was fired, Carol Whitmire had worked at Walmart stores in Show Low and Taylor for about eight years. On May 21, 2016, while working as a customer service supervisor at the Taylor Walmart, a bag of ice fell on Whitmire's wrist while she was leveling the bags, according to the lawsuit. The injury led to an urgent care visit and a drug test, pursuant to Walmart policy. Whitmire’s urine tested positive for marijuana metabolites.
A medical-marijuana cardholder for approximately the last five years, Whitmire smokes marijuana before bed to treat her shoulder pain and arthritis, and as a sleep aid, according to court records. She says she never brought marijuana to work or reported to the job impaired.
After the wrist injury, Whitmire informed the Walmart human resources department and the urgent care clinic that she holds a medical-marijuana card. She continued working until July 4, when she was suspended as a result of the urine sample. Her manager fired Whitmire on July 22 because of the positive result of the drug test, the complaint says.
In March 2017, Whitmire filed a discrimination charge with the Equal Employment Opportunity Commission and the civil rights division of the Arizona Attorney General’s Office. Three months later, she sued Walmart in federal court in Phoenix, alleging wrongful termination and discrimination in violation of the AMMA, the Arizona Civil Rights Act, and Arizona worker's compensation law.
In his decision last week, first reported by Law360, Teilborg granted partial summary judgment to Whitmire for her claim of discrimination under the AMMA. The judge, however, denied Whitmire’s claims alleging discrimination under the Arizona Civil Rights Act and retaliatory termination under Arizona employment protection and worker’s compensation laws.
The court will make a decision regarding damages or Whitmire's potential reinstatement in May, her attorney said. Under the AMMA, it is illegal for an employer to discriminate in hiring or firing based on a patient's "positive drug test for marijuana components or metabolites, unless the patient used, possessed or was impaired by marijuana on the premises of the place of employment or during the hours of employment."
In court, Walmart denied wrongfully terminating or discriminating against Whitmire, and said the company's drug testing policy is lawful and protected under Arizona's Drug Testing of Employees Act (DTEA). But Teilborg wrote that in the absence of expert testimony establishing that Whitmire's drug test shows she was impaired at work because of marijuana she smoked the night before, Walmart "is unable to prove that Plaintiff’s drug screen gave it a ‘good faith basis’ to believe Plaintiff was impaired at work."
Walmart could not meet the burden of proving that the urine sample after the accident “sufficiently establishes the presence of metabolites or components of marijuana in a scientifically sufficient concentration to cause impairment,” the judge wrote.
The full 50+ page ruling in Whitmire v. Walmart is available at this link. As the press report notes, the key to the ruling is the patient protective language in the the Arizona Medical Marijuana Act. Consequently, this ruling does not provide protection to medical marijuana patients outside the state. But the ruling is still notable and another recent example of lower courts growing more comfortable recognizing and enforcing rights under state law on behalf of some marijuana users in some settings.
Tuesday, February 12, 2019
House Subcommittee to hold hearing on Feb. 13 on "Challenges and Solutions: Access to Banking Services for Cannabis-Related Businesses"
Tomorrow afternoon, as detailed on this official webpage, the Subcommittee on Consumer Protection and Financial Institutions of the US House Committee on Financial Services will have hearing on the topic of banking access for cannabis businesses. One focal point for the hearing is consideration of draft legislation, the "Secure And Fair Enforcement Banking Act of 2019" or the "SAFE Banking Act of 2019," which is designed to allow marijuana-related businesses in states with existing regulatory structures to access the banking system.
In addition to being the first-ever congressional hearing on banking for marijuana businesses, I sense this is the first of a series of possible effects by the Democratic-controlled House to move forward on various possible federal legislative reforms. A few days ago, Click the Committee produced this Memorandum providing background, and here is the scheduled "Witness List":
- The Honorable Fiona Ma, California State Treasurer
- Maj. Neill Franklin (Ret.), Baltimore City & Maryland State Police Departments, and Executive Director, Law Enforcement Action Partnership (LEAP)
- Ms. Rachel Pross, Chief Risk Officer, Maps Credit Union, on behalf of Credit Union National Association (CUNA)
- Mr. Gregory S. Deckard, President, CEO and Chairman, State Bank Northwest, on behalf of Independent Community Bankers of America (ICBA)
- Mr. Corey Barnette, Owner, District Growers Cultivation Center & Metropolitan Wellness Center
UPDATE: Here now are links to all of the written testimony of witnesses at this hearing:
- The Honorable Fiona Ma, California State Treasurer
- Maj. Neill Franklin (Ret.), Baltimore City & Maryland State Police Departments, and Executive Director, Law Enforcement Action Partnership (LEAP)
- Ms. Rachel Pross, Chief Risk Officer, Maps Credit Union, on behalf of Credit Union National Association (CUNA)
- Mr. Gregory S. Deckard, President, CEO and Chairman, State Bank Northwest, on behalf of Independent Community Bankers of America (ICBA)
- Mr. Corey Barnette, Owner, District Growers Cultivation Center & Metropolitan Wellness Center
- Mr. Jonathan H. Talcott, Chairman, Smart Approaches to Marijuana (SAM)
Saturday, February 9, 2019
The cheeky title of this post is the thought I had in response to the news out of Oregon this past week, discussed in this Quartz piece headlined "Oregon has more legal cannabis than the state can consume in six years." Here are the details:
In 2018, Oregon’s legal marijuana producers grew more than twice as much as was legally consumed, leading to an oversupply that has 6.5 years’ worth of cannabis, measured by the psychoactive compound THC, on the shelves at dispensaries and wholesale distributors.
The latest data from Oregon, which adopted its legal regime in 2014, was released this week (pdf) by researchers working for Oregon’s Liquor Control Commission, which closely regulates cannabis from production to distribution....
“For Oregon, producing a lot of marijuana is not new news; producing a lot of marijuana that is tracked in the legal system is,” writes Steve Marks, the commission’s executive director. He notes that the state has garnered $198 million in tax revenue from the first three years of its legal cannabis regime, and that only 45% of estimated Oregon cannabis use is supplied by the medical marijuana market, legal home grows, or the black market.
But the current situation creates a “concern that [legally grown cannabis] may be diverted to the black market and/or out of state given current market conditions (high supply, falling prices, and a huge pipeline of applications for new entrants into the market),” writes Josh Lehner, an economist who works for the state government.
Now the question is whether the state government will take any action to push down supply by increasing producer license fees, limiting the maximum amount of marijuana grown in the state, or capping the number of licenses temporarily or permanently. The researchers do observe that the 6.5 years’ worth of THC on the shelves is a deceiving estimate, since some is likely to become stale or uncompetitive with new products.
Part of the challenge is that many legal producers are getting into Oregon’s market to lay the groundwork ahead of hoped-for changes in federal laws down the line, especially since Oregon removed a residency requirement for owners. “Businesses in Oregon’s recreational marijuana market are in some ways analogous to technology start-ups… willing to take the risk of losses today for potential large gains tomorrow,” the report notes. “However, this calculus depends on ‘tomorrow’ not being excessively far in the future and the license remaining in good standing.”
For now, the Oregon oversupply is more an “indication of speculative bets and pending market corrections,” but the longer the situation continues, the more pressure there will be on cannabis startups to make money outside the legal system.
In contrast to many other states, Oregon has relatively few limits on who can get a license to grow for the legal market. And marijuana's nickname "weed" is itself a useful reminder that marijuana is not all that hard to grown and it grows relatively quickly. So, absent certain types of regulation, it is not surprising to see an oversupply of product in the Beaver State.
February 9, 2019 in Business laws and regulatory issues, Recreational Marijuana Commentary and Debate, Recreational Marijuana Data and Research, Recreational Marijuana State Laws and Reforms | Permalink | Comments (0)
Friday, February 8, 2019
Notable new lobbying group, National Cannabis Roundtable, to be chaired by former US House Speaker John Boehner
When Acreage Holdings last year announced that former Speaker of the US House of Representatives John Boehner was now on its board of advisors, I was unsure whether Boehner was really interested in being a serious advocate for marijuana reform or was mostly to be a high-profile figurehead in this space. But in November, as noted here, Boehner penned a Wall Street Journal commentary headlined "Washington Needs to Legalize Cannabis." And today comes news that John Boehner is to be the Chair of a new industry lobbying ground calling itself the National Cannabis Roundtable.
The former lawmaker will also serve as an advisor, not a registered lobbyist, for the roundtable, Boehner said during a phone call with reporters Friday. Boehner said the roundtable will promote changes to federal law that make it easier to research cannabis and for regulated cannabis businesses to operate. Federally, marijuana is an illegal Schedule 1 controlled substance, alongside heroin and LSD, is not a top priority for the group....
But Boehner said removing cannabis from Schedule I of the U.S. Controlled Substances Act is not the group's top priority. "It would clearly be a big goal, but I think there are other steps that need to be taken along the way before we get to that," he said....
Boehner said the roundtable's members represent every aspect of the cannabis supply chain, including growers, processors, retailers, wellness centers, investors, entrepreneurs, and publicly traded companies.
The National Cannabis Roundtable website has the following sentences under the heading "Our Mission"
The legal cannabis boom promises to contribute billions of dollars to the US economy over the next decade - creating jobs, advancing new health science and adding momentum to criminal justice reform.
The National Cannabis Roundtable promotes common sense federal regulation, tax equality and financial services reform and supports changing federal law to acknowledge states’ rights to regulate and manage cannabis policy.
I like the reference to "adding momentum to criminal justice reform" in the first sentence, though the second sentence and other factors leads me to suspect that National Cannabis Roundtable will not have criminal justice reform as a focal point of its work.
Prior related posts:
- Former US House Speaker and former Massachusetts Gov join advisory board of major marijuana corporation
- Former House Speaker John Boehner says "Washington Needs to Legalize Cannabis"
February 8, 2019 in Business laws and regulatory issues, Campaigns, elections and public officials concerning reforms, Medical Marijuana Commentary and Debate, Recreational Marijuana Commentary and Debate, Who decides | Permalink | Comments (0)
Saturday, January 26, 2019
The title of this post is the headline of this lengthy new commentary piece authored by Jenni Avins appearing in Quartz. I recommend the piece in full, here is its powerful start:
Since California legalized recreational cannabis in January 2018, pot enthusiasts in posh sections of Los Angeles can sleep easily with a few drops of CBD oil under the tongue. They can stroll into dispensaries such as MedMen, the chain touted as the “Apple store of weed,” which recently reported quarterly revenues of $20 million. On Venice Boulevard, shiny sedans toting surfboards drive past posters for Dosist vape pens and billboards for delivery services such as Eaze, a San Francisco-based startup that has raised some $52 million in venture capital.
In places like this, weed is chic. But just a few freeway exits away, in largely black and Latino neighborhoods where cannabis was aggressively policed for decades, people saddled with criminal convictions for possessing or selling the plant still fight to clear criminal records standing in the way of basic necessities: employment, a rental apartment, or a loan. Marijuana legalization and the businesses that profit from it are accelerating faster than efforts to expunge criminal records, and help those affected by them participate in the so-called “Green Boom.” And the legal cannabis industry is in danger of becoming one more chapter in a long American tradition of disenfranchising people of color.
Here is more:
As the US teeters at the tipping point for marijuana going mainstream, it’s increasingly apparent that people and communities who were disproportionately punished for its criminalization were wronged. It’s a cruel footnote to the story of the plant’s legalization that punishment for past involvement with cannabis can remain a bar to entry in the lucrative newly legal industry. Now, policy-makers, entrepreneurs, activists, and everyday consumers are asking what reparations for those wrongs might look like.
Here’s one idea that many agree on: Those disproportionately affected by the War on Drugs—largely, black and Latino communities—should be first in line to benefit from the Green Boom, whether as business owners or beneficiaries of programs funded by earnings from the business.
The US’s legal weed explosion is an incredible story of de-stigmatization, entrepreneurship, and opportunity. It’s also at risk of becoming a staggering tale of hypocrisy, greed, and erasure. But as a deep-pocketed industry with political momentum, American cannabis is uniquely positioned to serve as a model for what racial reparations could look like.
“This is about harnessing the industry to embody the work of repair,” said Adam Vine, the founder of Cage Free Cannabis, an organization that pushes for “drug war reparations” in the form of criminal record expungement, job fairs, voter registration, health care, and social equity programs. “Otherwise,” he said. “Legalization is just theft.”
Go read the rest.
January 26, 2019 in Business laws and regulatory issues, Criminal justice developments and reforms, Race, Gender and Class Issues, Recreational Marijuana Commentary and Debate | Permalink | Comments (0)
NBC News has this new article, headlined "CBD goes mainstream as bars and coffee shops add weed-related drinks to menus," that is worth a read, and I especially liked its closing paragraph. Here are excerpts:
Coffee. Cocktails. Lotion. Dog treats. You name it, CBD is probably in it.
CBD, short for cannabidiol, is a compound found in the cannabis plant. It promises to deliver the calming benefits of marijuana without the high that comes from THC. Companies are adding CBD to just about everything — a trend set to accelerate as regulations ease and consumer interest grows.
Most CBD is now federally legal thanks to the farm bill President Donald Trump signed in December. Companies still aren't supposed to add CBD to food, drinks and dietary supplements, but many are doing it anyway. The Food and Drug Administration has said it plans to continue enforcing this ban but will also look into creating a pathway for such products to legally enter the market.
Some users swear by it, saying it relieves their anxiety, helps them sleep and eases their pain. And forget stoner stereotypes when thinking about CBD. Moms and even pets are experimenting with it. One research firm, Brightfield Group, expects the CBD market to reach $22 billion by 2022.
However, most of our current understanding of CBD is anecdotal — not proven through scientific studies. And because CBD products aren't yet regulated, the quality can vary widely. "There's a lot of interest and excitement, for good reason, but I think people are pushing it too hard, too fast and are overgeneralizing things," said Ryan Vandrey, a professor at Johns Hopkins who studies the behavioral pharmacology of cannabis.
We don't know what exactly CBD interacts with in the brain or the body, but researchers do know that CBD tends to turn down abnormal signaling in the brain, said Ken Mackie, a psychological and brain sciences professor at Indiana University. That's why CBD may help with epilepsy, anxiety and sleep. CBD and other cannabis compounds tweak systems in the body, a process he compares to lowering the volume. Other compounds, like opioids, ketamine and nicotine, simply turn them on and off.
There isn't much clinical research on the safety and efficacy of CBD. Studying cannabis has been challenging because it's technically illegal under federal law, meaning researchers must overcome a number of hurdles in order to study it. We don't know anything about indications like sleep, anxiety or pain, Vandrey said.
We do know it's safe and effective in treating seizures in children with Lennox-Gastaut syndrome or Dravet syndrome. GW Pharma studied its CBD-derived drug, Epidiolex, in numerous clinical trials. After reviewing the company's science, the Food and Drug Administration approved Epidiolex in June.
The lack of clinical evidence hasn't stopped consumers from trying it — and raving about it. "It's always nice to have strong proof in placebo controlled trials, but if someone's taking a drug and feeling any benefit, more power to them," Mackie said....
The farm bill signed in December legalized hemp. Most CBD hitting shelves is derived from the hemp plant, which contains less than 0.3 percent THC, the psychoactive chemical in weed. Hemp's close cousin, marijuana, can contain upwards of 10 percent THC. So you can't get high from CBD products if the proper dosage is followed, but the industry isn't regulated on a federal level so the amount of THC can vary.
Doses can vary, too. Some shops recommend six milligrams of CBD when taken as a tincture or added to food. Others recommend at least 30. Again, since there isn't much clinical research on CBD, most of the recommendations are based on trial and error.
As more people dabble with CBD, more people are following the money, worrying some that bad products will enter the market and taint CBD's allure. Or worse, harm consumers. "There does need to be some sort of regulatory framework for overall product safety and to protect the customer from purchasing products that contain false advertisements or make unsubstantiated claims," said Pamela Hadfield, co-founder of HelloMD, a medical cannabis company, while cautioning against strict regulations that would be "too difficult for most manufacturers to comply."
Joe Masse, beverage director at The Woodstock bar, added a CBD cocktail to the menu in September. Called The White Rabbit, the drink is made with Bombay Dry Gin, sage simple syrup, honey, fresh lemon juice and 1 milligram of CBD oil.... "It's trendy right now, so I don't know how it will be in six months when we redo the menu," Masse said. "A year ago, activated charcoal was popular and now you can't find it anywhere."
Because I am not hip enough to know that "sctivated charcoal" was once, and now is no longer, a big deal, I am not the right person to be predicting the trend lines on the CBD trend. But I do know how important and likely unpredictable it will be to see the FDA and/or state regulatory players take on CBD products and marketing in the wake of the new Farm Bill. Just another important front to watch in the coming months and years and marijuana products and industry players continue to emerge from prohibition's shadow.
January 26, 2019 in Business laws and regulatory issues, Federal Marijuana Laws, Policies and Practices, Food and Drink, History of Marijuana Laws in the United States, Medical Marijuana Commentary and Debate, Medical Marijuana Data and Research, Medical Marijuana State Laws and Reforms | Permalink | Comments (0)
Wednesday, January 23, 2019
I am so very pleased to be able to be a part of an exciting panel discussion taking place next week, the "Ohio State Cannabiz Roundtable." The event is described at this website, where one can and should register ASAP. Here is the event description and expected participants:
With cannabis being illegal at the federal level but many states moving to legalize it for both medical and recreational purposes, how does one navigate this new emerging market properly? The birth of this new multi-billion industry is being accompanied by a lot of unusual challenges, risks, and opportunities. Please join us for a discussion of the various aspects of this market – dealing with regulations and legal questions, raising funds, working through a financial system that is disinclined to serve them, and running a new business in an unchartered territory. After our panel discussion, students and attendees will have a chance to speak to each panelist in a small group setting to ask questions and network. This is a unique opportunity to better understand the rapidly rising market of cannabis, don’t miss out!
January 31, 2019 at 9am -- 2nd Floor Rotunda, Mason Hall
Tuesday, January 22, 2019
The question in the title of this post is prompted by this USA Today story headlined "CBS rejects Super Bowl ad on benefits of medical marijuana." (And if you do not know what prop bets are, here is a primer: "Prop bets popular for Super Bowl, but NFL wants them gone.") Here are excepts from the ad story:
CBS rejected a Super Bowl ad that makes a case for medical marijuana. Acreage Holdings, which is in the cannabis cultivation, processing and dispensing business, said it produced a 60-second ad that shows three people suffering from varying health issues who say their lives were made better by use of medical marijuana.
Acreage said its ad agency sent storyboards for the ad to the network and received a return email that said: “CBS will not be accepting any ads for medical marijuana at this time.”
A CBS spokesperson told USA TODAY Sports that under CBS broadcast standards it does not currently accept cannabis-related advertising....
“We’re not particularly surprised that CBS and/or the NFL rejected the content,” Acreage president George Allen said. “And that is actually less a statement about them and more we think a statement about where we stand right now in this country.”...
“One of the hardest parts about this business is the ambiguity that we operate within,” Allen said. “We do the best we can to navigate a complex fabric of state and federal policy, much of which conflicts.”
Allen said the company had not decided whether to run its 60-second ad or a 30-second version when it learned that CBS would not accept any ads for medical marijuana. CBS is charging an average of $5.2 million for a 30-second ad in this year's game between the Los Angeles Rams and New England Patriots on Feb. 3.
“It’s a public service announcement really more than it is an advertisement,” said Harris Damashek, Acreage’s chief marketing officer. “We’re not marketing any of our products or retail in this spot.”
An unfinished version of the 60-second ad introduces a Colorado boy who suffers from Dravet syndrome; his mother says her son would have dozens to hundreds of seizures a day and medical marijuana saved his life. A Buffalo man says he was on opioids for 15 years after three back surgeries and that medical marijuana gave him his life back. An Oakland man who lost part of his leg in military service says his pain was unbearable until medical marijuana.
“The time is now,” say words on the screen near the end of the ad. Then the screen shifts and viewers are asked to call on their representatives in the U.S. House and Senate to advocate for change. Fine print at the bottom says the testimonials in the ad come from the experiences of the individuals and have not been evaluated by the FDA. The fine print also says marijuana is a Schedule I controlled substance and medical use has not been approved in some states....
Acreage expects to post the ad online at some point so people can see it, even if they can’t see it on the Super Bowl. “It’s not quite ready yet,” Damashek said, “but we anticipate and look forward to getting the message out far and wide.”
I have to admit to being a bit suspect of the idea that the Acreage folks were really planning to spend $10 million to run "a public service announcement" during SuperBowl LIII. Dare I speculate that they knew full well that their ad would be rejected, but also knew that simply asking and getting rejected would result in beneficial attention. And I suppose I am now guilty of giving them some of this desired attention (but I am at least asking a fun question along the way).
Speaking of that question, I will answer by foolishly predicting that there will be a marijuana ad during Super Bowl LVI in February 2022.
Saturday, January 12, 2019
The title of this post is the headline of this recent commentary in USA Today authored by DJ Jaffe, who is the executive director of Mental Illness Policy Org. Here is an excerpt:
Before legislators legalize marijuana, they should require bold and direct warning labels to be placed on the packaging as is done with tobacco products. If the states fail to act, then the Food and Drug Administration should step in and require it.
In early 2017, after exhaustive review, the National Academies of Sciences, Engineering, and Medicine found that there are significant health risks associated with using cannabis and cannabinoids. Yet none of the 33 states that have legalized medical marijuana, or the 10 states that have legalized recreational use, gives adequate warnings of those risks.
The situation is similar to when cigarettes first became extensively marketed. The health risks were known but not disclosed, leading to disease and lives being lost. In addition to appearing on the packaging, the warning labels should be displayed prominently wherever the product is sold, in advertising and in mandated public service announcements funded by the marijuana industry.
The academies, founded by Congress, comprise the country’s leading researchers. They have become the nation’s most reputable arbiters of the science that should guide policy. The findings of the report, "The Health Effects of Cannabis and Cannabinoids," were particularly disturbing for people prone to mental illness and those who have a mental illness.
The report found either substantial or moderate evidence of an association between cannabis use and the development of schizophrenia or other psychoses; increased symptoms of mania and hypomania in individuals diagnosed with bipolar disorders; increased risk for the development of depressive disorders; and increased incidence of suicidal ideation, attempts and completions.
Schizophrenia and bipolar disorders are two of the most devastating neurobiological disorders and the ones that are often associated with homelessness and incarceration. If there is an association with using legalized marijuana, shouldn’t the public be warned?...
Washington and Colorado were the first states to legalize recreational marijuana. While both warn pregnant mothers not to use it, the only other significant warning on the packaging is that there “may be health risks,” a watered-down mealy mouthed warning that fails to give consumers the concrete information they need to avoid danger.
While the National Academies found "association," association is not the same as causality. Perhaps the increased risk of schizophrenia developing is because those who are prone to schizophrenia also are prone to use these products.
But until we know the chicken-or-egg answer, we should not follow the example of the tobacco regulation where the product was allowed to be marketed unencumbered by warnings, leading to more than 480,000 deaths a year, and subsequently the spending of millions of dollars re-educating consumers who had been misled in the first place.
Sunday, January 6, 2019
The questions in the title of this post are prompted by this new lengthy Rolling Stone piece fully headlined "Why 2019 Will Be the Year of Weed: From more states legalizing to a boom of new kinds of products, here’s what to expect from the cannabis industry this year." Here are excerpts from an article that merits a full read:
In 2018, pot reached a tipping point. A clear majority of Americans now wants to see the drug made fully legal. California and Canada began selling marijuana to anyone over 21. Corporate behemoths like Altria (parent company of Marlboro cigarettes) and Constellation Brands (parent of Corona beer and Svedka vodka) made multi-billion dollar weed investments. And Senate Majority Leader Mitch McConnell (R-KY) managed to include hemp legalization in the 2018 Farm Bill — de facto legalizing every part of the cannabis plant except THC.
But at the same time, pot prohibition is not over. Well over half a million folks are still arrested for possession every year. Smoking weed or working for a pot company can still threaten your housing, employment, immigration status, finances and freedom. Cannabis business models, regulatory environments and market valuations shift on a daily basis....
As for the 2018 Farm Bill, it’s not yet clear what the regulatory landscape will look like for CBD in 2019. [Some expect] researchers will soon be able to access CBD without jumping through the hoops necessary to acquire a Schedule I drug license from the DEA, which could finally allow scientists to provide more evidence of the compound’s uses and dosage. Still, many people in the cannabis industry are concerned about what the exact guidelines will look like on the commercial production side, and how the rollout will go.
For business owners who have been involved in the weed game for a while, another aspect of the 2018 Farm Bill has proven a troubling sign of the times: anyone with a drug felony conviction in the past 10 years will not be allowed to participate in the legal hemp and CBD market. “What the fuck is that?” asks longtime cannabis cultivator Bill Levers, who runs an influential Instagram account through his California-based company, Beard Bros Pharms. “No one got rich on hemp. There were no hemp cartels. So why would there be a restriction?”
The drug-felony provision in the Farm Bill cuts to the heart of one of the biggest unresolved problems facing the marijuana movement in 2019: the persistence of the illicit market, and the struggle to accommodate folks who have been illegally selling or growing marijuana for years. It is now widely acknowledged that barring people with drug felony convictions from the cannabis industry is racist, as white people with experience on the illicit marijuana market are far less likely to be arrested or convicted. But even without a criminal record, making the transition from outlaw to mogul has proven incredibly difficult, and many of the people who have tried have already given up....
Taxes, in particular, are a thorny issue. Local and state governments generally consider pot taxes to be a primary incentive for legalization, but if tax rates are too high, fewer growers and dispensaries will try to go legal. Already, lax oversight and an oversupply of legal cannabis in states like Oregon and Washington have led to diversion rates of at least 30 percent — meaning at a minimum about a third of legal pot is being sold on the illicit market. Meanwhile, in places like California, Canada and Michigan, hundreds of illegal storefront marijuana dispensaries compete with legal vendors, consistently undercutting them on price. Illicit operators tell me again and again that they cannot afford to survive in the highly taxed and regulated legal market, so they intend to continue breaking the law — sometimes while simultaneously operating a legal business.
Because wealthy (and typically white) applicants have an easier time covering high taxes and licensing fees, some states and municipalities have created so-called “equity” programs to ensure a more diverse industry. In 2017 and 2018, places like Oakland and Sacramento garnered fawning headlines for setting the lofty goal of legislating solutions to the catastrophic and racially disproportionate impact of the War on Drugs. But moving into 2019, California cannabis operators of all colors and political stripes now often describe equity a well-intentioned idea that is failing in practice. The words “tokenism” and “paternalistic” come up a lot.
“Equity is a marketing tool. All of the licenses are going to be given to the people with the most money,” predicts Ophelia Chong, the founder of StockPot Images and executive creative director of Aura Ventures. “Social equity will work for a few, but even then it will be 2 percent [from disadvantaged backgrounds], and those 2 percent will have to really climb a mountain to do it, with no help.” Outside of California, however, including equity and restorative justice in cannabis legalization remains an alluring prospect.
“What I like about California is they give a chance for minorities to get in. They doing the opposite in Michigan,” says Jason, whose cannabis social club, the OMS Dab House, has been a crucial gathering place for Detroit’s marijuana movement for the past decade. Michigan legalized adult-use cannabis in 2018, but as in California, quasi-legal medical dispensaries began proliferating years ago, serving stoners and sick people alike. (The ongoing legal confusion around sales and social spaces is why Jason preferred to not give his last name). Though the city of Detroit is more than 80-percent black, black activists there have previously asserted that only three to five percent of local marijuana dispensaries were owned by black people. Jason predicts that, as Michigan’s legal cannabis industry becomes increasingly corporate and consolidated, those numbers will only go down.
January 6, 2019 in Business laws and regulatory issues, Federal Marijuana Laws, Policies and Practices, Medical Marijuana Commentary and Debate, Political perspective on reforms, Race, Gender and Class Issues, Recreational Marijuana Commentary and Debate | Permalink | Comments (0)
Friday, January 4, 2019
Stateline has this new piece, headlined "‘Cannabis Equity’ Runs Into Roadblocks," which highlights that good implementation, and not just good intentions, must be part of modern marijuana social equity programs. Here are excerpts:
Now, as more states legalize recreational marijuana and the federal government moves away from incarcerating nonviolent drug offenders, several cities in California are trying to atone for decades of drug enforcement that fell disproportionately upon minorities.
They’ve created what are known as cannabis equity programs, meant to welcome more minority and low-income entrepreneurs into the now-legal industry. The programs provide business development, loan assistance and mentorships to eligible owners. Hundreds have applied in the past year. But “pot equity” has struggled with growing waitlists, and some participants allege that the programs aren’t fair to the people they’re meant to be helping....
The goal of “cannabis equity” is to lower the barriers to entry into the legal cannabis industry for people who were disproportionately impacted by the criminalization of marijuana. The programs base eligibility on a variety of factors, including marijuana convictions, residency in a heavily policed district and income.
Today, several city partnership programs require that established, non-equity businesses provide an equity business with space for several years rent-free. In exchange, the non-equity company receives faster processing for city approvals. Cities such as Sacramento plan to waive up to tens of thousands of dollars in application and permit fees for eligible cannabis businesses.
But pot equity has struggled to get going. Understaffing in San Francisco’s cannabis office has left a growing waitlist of applicants, and the city doesn’t expect to begin approving businesses until sometime in 2019, said Nicole Elliott, director of San Francisco’s Office of Cannabis. She could not be more specific on timing.
Some applicants argue that the waiting period has allowed other businesses to get an unfair head start. In Oakland, some pot equity businesses claim their incubator partners never followed through on the requirement to provide them with business development assistance or a space to operate....
Creating a program to atone for decades of unjust policing — on top of building the framework for a newly legal cannabis industry — is no easy task. Oakland is setting up a $3 million fund to provide additional capital assistance to pot equity businesses, Brooks said, but it remains unclear when the fund will become available.
San Francisco applicants have raised the same issue, said Elliott, the director of San Francisco’s Office of Cannabis. The office set up an investment fund to provide financial assistance to cannabis businesses, such as low-interest loans. But the city has yet to allocate money to the fund, Elliott said.
She said San Francisco will likely receive part of the $10 million that the state set aside for local cannabis equity programs in September, which could go toward the city’s cannabis investment fund. “There are equity applicants that need money now,” Elliott said. “We will advocate aggressively for that state funding.”
As of mid-December, San Francisco had 227 applicants that qualify for the equity program. Of those, about 110 want to join the city’s incubator partnership program and receive waived permit fees. Elliott said the city will begin approving applicants next year, but she could not say when. Applicants have criticized the lengthy timeline.
San Francisco’s Office of Cannabis, which just added two new staff members to bring the total to five, is tasked with reviewing permit applications and facilitating the equity program. Elliott said adding even more staff would speed things up. In the meantime, the city has established a partnership with the Bar Association of San Francisco to provide pro bono legal assistance to equity program participants.
Malcolm Mirage, an equity applicant in San Francisco, said the long wait has caused him to burn through capital at an alarming rate. He partnered with MedMen, a household name in the cannabis industry that is publicly traded on the Canadian Securities Exchange.
MedMen agreed to provide business development aid and an incubation space for one of Mirage’s businesses. The company also helped him negotiate leases on two other spaces, and he struck a deal that gave him six months of free rent to obtain his permits and become operational.
Mirage figured that was plenty of time. But those six months came and went, and he’s now paying expensive leases on spaces that sit empty. “I got out of jail for selling weed and now I’m trying to do this legally,” Mirage told Stateline. “But I’m drowning right now. My businesses are going to be in a tremendous amount of debt if the city can’t get these licenses out in the next six months.”
January 4, 2019 in Business laws and regulatory issues, Race, Gender and Class Issues, Recreational Marijuana Commentary and Debate, Recreational Marijuana State Laws and Reforms, Who decides | Permalink | Comments (0)
Thursday, December 20, 2018
Prez Trump signs Farm Bill, officially legalizing hemp, which means a notable statement from the FDA Commissioner
a whole lot, but there are lots of complications as to what this means for the development of products using parts of the cannabis plant. Right after the Farm Bill was signed into law, FDA Commissioner Scott Gottlieb released this lengthy statement highlighting some of these complications. Here are excerpts:
Today, the Agriculture Improvement Act of 2018 was signed into law. Among other things, this new law changes certain federal authorities relating to the production and marketing of hemp, defined as cannabis (Cannabis sativa L.), and derivatives of cannabis with extremely low (less than 0.3 percent on a dry weight basis) concentrations of the psychoactive compound delta-9-tetrahydrocannabinol (THC). These changes include removing hemp from the Controlled Substances Act, which means that it will no longer be an illegal substance under federal law.
Just as important for the FDA and our commitment to protect and promote the public health is what the law didn’t change: Congress explicitly preserved the agency’s current authority to regulate products containing cannabis or cannabis-derived compounds under the Federal Food, Drug, and Cosmetic Act (FD&C Act) and section 351 of the Public Health Service Act. In doing so, Congress recognized the agency’s important public health role with respect to all the products it regulates. This allows the FDA to continue enforcing the law to protect patients and the public while also providing potential regulatory pathways for products containing cannabis and cannabis-derived compounds.
We’re aware of the growing public interest in cannabis and cannabis-derived products, including cannabidiol (CBD). This increasing public interest in these products makes it even more important with the passage of this law for the FDA to clarify its regulatory authority over these products. In short, we treat products containing cannabis or cannabis-derived compounds as we do any other FDA-regulated products — meaning they’re subject to the same authorities and requirements as FDA-regulated products containing any other substance. This is true regardless of the source of the substance, including whether the substance is derived from a plant that is classified as hemp under the Agriculture Improvement Act. To help members of the public understand how the FDA’s requirements apply to these products, the FDA has maintained a webpage with answers to frequently asked questions, which we intend to update moving forward to address questions regarding the Agriculture Improvement Act and regulation of these products generally.
In view of the proliferation of products containing cannabis or cannabis-derived substances, the FDA will advance new steps to better define our public health obligations in this area. We’ll also continue to closely scrutinize products that could pose risks to consumers. Where we believe consumers are being put at risk, the FDA will warn consumers and take enforcement actions.
In particular, we continue to be concerned at the number of drug claims being made about products not approved by the FDA that claim to contain CBD or other cannabis-derived compounds. Among other things, the FDA requires a cannabis product (hemp-derived or otherwise) that is marketed with a claim of therapeutic benefit, or with any other disease claim, to be approved by the FDA for its intended use before it may be introduced into interstate commerce. This is the same standard to which we hold any product marketed as a drug for human or animal use. Cannabis and cannabis-derived products claiming in their marketing and promotional materials that they’re intended for use in the diagnosis, cure, mitigation, treatment, or prevention of diseases (such as cancer, Alzheimer’s disease, psychiatric disorders and diabetes) are considered new drugs or new animal drugs and must go through the FDA drug approval process for human or animal use before they are marketed in the U.S. Selling unapproved products with unsubstantiated therapeutic claims is not only a violation of the law, but also can put patients at risk, as these products have not been proven to be safe or effective. This deceptive marketing of unproven treatments raises significant public health concerns, as it may keep some patients from accessing appropriate, recognized therapies to treat serious and even fatal diseases.
Additionally, it’s unlawful under the FD&C Act to introduce food containing added CBD or THC into interstate commerce, or to market CBD or THC products as, or in, dietary supplements, regardless of whether the substances are hemp-derived. This is because both CBD and THC are active ingredients in FDA-approved drugs and were the subject of substantial clinical investigations before they were marketed as foods or dietary supplements. Under the FD&C Act, it’s illegal to introduce drug ingredients like these into the food supply, or to market them as dietary supplements. This is a requirement that we apply across the board to food products that contain substances that are active ingredients in any drug.
We’ll take enforcement action needed to protect public health against companies illegally selling cannabis and cannabis-derived products that can put consumers at risk and are being marketed in violation of the FDA’s authorities. The FDA has sent warning letters in the past to companies illegally selling CBD products that claimed to prevent, diagnose, treat, or cure serious diseases, such as cancer. Some of these products were in further violation of the FD&C Act because they were marketed as dietary supplements or because they involved the addition of CBD to food.
While products containing cannabis and cannabis-derived compounds remain subject to the FDA’s authorities and requirements, there are pathways available for those who seek to lawfully introduce these products into interstate commerce. The FDA will continue to take steps to make the pathways for the lawful marketing of these products more efficient....
It should also be noted that some foods are derived from parts of the hemp plant that may not contain CBD or THC, meaning that their addition to foods might not raise the same issues as the addition of drug ingredients like CBD and THC. We are able to advance the lawful marketing of three such ingredients today. We are announcing that the agency has completed our evaluation of three Generally Recognized as Safe (GRAS) notices related to hulled hemp seeds, hemp seed protein and hemp seed oil and that the agency had no questions regarding the company’s conclusion that the use of such products as described in the notices is safe. Therefore, these products can be legally marketed in human foods for these uses without food additive approval, provided they comply with all other requirements and do not make disease treatment claims.
Given the substantial public interest in this topic and the clear interest of Congress in fostering the development of appropriate hemp products, we intend to hold a public meeting in the near future for stakeholders to share their experiences and challenges with these products, including information and views related to the safety of such products.
Democrat wing of congressional Joint Economic Committee releases report on "The National Cannabis Economy"
This week the Democrats of the US Congress' Joint Economic Committee released this interesting short report titled simply "The National Cannabis Economy." Here is how it gets started and its final passages:
The National Cannabis Economy
Cannabis, or marijuana, is the most commonly used illicit drug in the United States. Though illegal at the federal level, states are taking action to legalize cannabis — from recreational use in states like Colorado and Maine to medical use in New Mexico and Florida. A record 66 percent of Americans now support legalizing cannabis, a dramatic increase from just 12 percent in 1969.
The legalization of cannabis has significant implications for state economies, as well as the national economy. The industry totaled more than $8 billion in sales in 2017, with sales estimated to reach $11 billion this year and $23 billion by 2022. There were more than 9,000 active licenses for cannabis businesses in the U.S. in 2017, with the industry employing more than 120,000 people.
As more states move to legalize cannabis, these numbers will only continue to rise, potentially providing a new stream of revenue and jobs to local economies. But to realize these benefits, policymakers must address conflicts between state and federal regulations that impede the growth of the cannabis economy....
There are a variety of proposals to fix the conflicts between state and federal cannabis laws. Of these proposals, the bipartisan STATES Act has drawn support from President Trump and the cannabis industry. The STATES Act would amend the Controlled Substances Act so that its provisions no longer apply to individuals acting in accordance with state laws. Importantly, the bill would also clarify that financial transactions with state-legal cannabis businesses are not drug-trafficking, creating a solution for financial institutions and the cannabis industry. Several states could be next to legalize cannabis. A bill to legalize cannabis is progressing through the New Jersey legislature, while New York lawmakers are preparing to consider similar legislation this year. Similarly, newly elected governors in New Mexico, Minnesota, Illinois, and Connecticut have all voiced support for legal cannabis, positioning their states to consider the issue.
The growth of the cannabis economy presents opportunities for greater job creation, more tax revenue, and better patient care. But current conflicts between state and federal law threaten to impede social and economic growth. Going forward, lawmakers and regulators should prioritize solutions that promote greater research into the health effects of cannabis and reduce regulations that restrict the industry’s ability to conduct business.
December 20, 2018 in Business laws and regulatory issues, Campaigns, elections and public officials concerning reforms, Employment and labor law issues, Federal Marijuana Laws, Policies and Practices, Recreational Marijuana Commentary and Debate | Permalink | Comments (1)
Tuesday, December 11, 2018
Federal farm bill officially includes provisions to legalize "hemp" defined as the cannabis sativa plant with THC levels under 0.3%
One of many reasons I typically use the work "marijuana" on this blog and in other discussions of marijuana reform is because I think it is the word most directly and commonly associated with the version of the cannabis plant (or the parts of the plant) containing the chemical ingredient (delta-9 tetrahydrocannabinol or THC) that gets humans high from consumption. But for various sound reasons, other researchers and many advocates like to talk only about "cannabis" because this is the scientific name for the plant often called marijuana and because there are so many possible uses for and derivatives from that plant that have nothing to do with getting high. Of course, regular readers surely know all this, and yet it is worth reviewing given this notable news as reported by this Marijuana Moment piece: "The Final 2018 Farm Bill ... Will Legalize Hemp." Here are the basics:
The final text of the 2018 Farm Bill was released on Monday, and industrial hemp legalization made the cut. Votes to send the legislation to President Trump’s desk are expected this week.
The bipartisan provision, championed by Senate Majority Leader Mitch McConnell (R-KY), will enable U.S. farmers to cultivate, process and sell hemp, the market for which is now a multi-billion dollar industry.
Following the announcement last month that lawmakers in the Senate and House Agriculture Committees had reconciled their respective versions of the agriculture legislation — with hemp legalization in the mix — questions remained about a controversial provision in the Senate version that would ban people with felony drug convictions from participating in the hemp industry. But a compromise was reached and the final version will allow such individuals to work for hemp businesses after 10 years....
“While this Farm Bill is a missed opportunity, there are some good provisions,” Rep. Earl Blumenauer (D-OR) said in a press release. “One of those provisions is to roll back our senseless hemp prohibition.”
“Our forefathers would be rolling in their graves if they saw us putting restraints on a versatile product that they grew themselves. We have farmers growing thousands of acres of hemp in dozens of states across the U.S. already. You can have hemp products shipped to your doorstep. This is a mainstream, billion-dollar industry that we have made difficult for farmers. It’s past time Congress gets out of their way.”
Under the legislation, hemp would no longer be in the jurisdiction of the Justice Department. Rather, the U.S. Department of Agriculture will lightly regulate the crop. If the bill passes and President Trump signs it, hemp legalization will go into effect on January 1, according to VoteHemp.
Here is the definition of "HEMP" as set forth in this draft legislation: "The term ‘hemp’ means the plant Cannabis sativa L. and any part of that plant, including the seeds thereof and all derivatives, extracts, cannabinoids, isomers, acids, salts, and salts of isomers, whether growing or not, with a delta-9 tetrahydrocannabinol concentration of not more than 0.3 percent on a dry weight basis." In other words, if and when this bill becomes law, it will be possible to produce and sell, without violating federal law, "certain version of the "plant Cannabis sativa L. and any part of that plant, including the seeds thereof and all derivatives, extracts, cannabinoids" etc. This seems to me a very big deal, though one that also seems certain to create even more confusion about what is and is not allowed under federal law with respect to so-called "medical marijuana."
This recent lengthy CNBC artice, headlined "Hemp legalization included in new farm bill could 'open the floodgates' on nascent industry," provide a review of what enactment of this legislation could mean and how we got here. Here is a snippet:
Hemp is a cannabis cousin of marijuana but it contains low levels of THC, the chemical that produces a "high" for pot users. Industrial hemp is used to make everything from apparel, foods and pharmaceuticals to personal care products, car dashboards and building materials.
"The vast majority of the market right now is going for CBD products," said Brightfield Group's [Bethany] Gomez. "You can find some hemp seed-based beauty products or hemp in some cereals and things like that, and there's such usage on the fibers for like clothes and other industrial purposes, but that's really minimal right now."
Brightfield Group estimates the domestic hemp market could reach $22 billion in the next four years. The estimate factors in the hemp amendment in the farm bill becoming law....
"There are three words why we have hemp now, and those words are tobacco state Republicans," said Kristin Nichols, editor at Denver-based Hemp Industry Daily, a publication owned by MJBizDaily. "There's been strong support from lawmakers and politicians up and down in former tobacco states looking for a replacement crop."
The hemp provisions in the 2018 Farm Bill were in the Senate version of the legislation sponsored by Senate Majority Leader McConnell. The Kentucky Republican put himself on the joint Senate-House conference committee formed to hammer out the details of the final farm bill. "I know there are farming communities all over the country who are interested in this," McConnell said in June when discussing the hemp legalization legislation before the Senate Agriculture Committee. "Mine are particularly interested in it, and the reason for that is — as all of you know — our No. 1 cash crop used to be something that's really not good for you: tobacco. And that has declined significantly, as it should, given the public health concerns."
December 11, 2018 in Business laws and regulatory issues, Campaigns, elections and public officials concerning reforms, Federal Marijuana Laws, Policies and Practices, History of Marijuana Laws in the United States, Political perspective on reforms, Who decides | Permalink | Comments (0)