Tag Archives: Marguerite Arnold

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Aurora Expands Canadian (And Global) Footprint

By Marguerite Arnold
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With the summer season (and recreational reform) fast approaching and the continued growth of the European medical market, Canadian LP Aurora has continued to power forward with another corporate acquisition. This time, the firm is medical cannabis firm MedReleaf (TSE:LEAF). The price? $3.2 billion in stock.

Aurora shareholders will now own 61% of MedReleaf.

The firm has also, of course, solidified its place as a global leader in the cannabis space with production capacity of over 570,000 kilos of cannabis a year.This purchase will absolutely ensure that the company is in a strong position

According to a statement by chief executive Terry Booth, “Our complementary assets, strategic synergies and strong market positioning will provide us with critical mass and an excellent product portfolio in preparation for the adult consumer use market in Canada.”

It also does a bit more than that.

With the German cultivation bid in what appears to be at least a three to six month delay, exports, including from Canada, are the only real way into Europe’s largest cannabis market. And Aurora, with it’s on the ground partner, Pedianos, isright in the middle of it. This purchase will absolutely ensure that the company is in a strong position as the next level of cannabis reform begins to unfold particularly in Europe.

Cannabis Is SO Expensive!

In fact, per this report just produced by one of the leading German public health insurers, Aurora, via Pedianos, and MedCann (the company that became both Spektrum Cannabis and bought out by Canopy Canada), appear to be the two Canadian LPs supplying the vast majority of all reimbursed medical cannabis to German patients. Further the vast majority of product is still coming from Canada – not the satellite grow or production facilities now being built in Portugal (Tilray), Denmark (Aurora and Canopy), Spain (Canopy) or anywhere else in Europe where legal cultivations are being established.

Techniker Krankenkasse report
“The Cannabis Report” produced by Techniker Krankenkasse (TK) and the University of Bremen, p.20

However, this also makes for an expensive product here in Germany, land of the generic drug (and where most of them can be bought by consumers, with a prescription, at a regular pharmacy for about $12). In fact, this report was produced in part to underscore the still-evolving medical position on the use of medical cannabis and its efficacy. This highlights how much Germany’s import policy is now costing even public insurers.

What is even more intriguing about the TK report is that the Germans are clearly moving into new research territory. Sure AIDS, chronic pain and muscle spasms (in particular MS) are conditions for which the drug is increasingly being prescribed, but so is ADD. And research studies are now mushrooming around the country.

The Germans have engaged on the medical cannabis efficacy question. And while it is still unclear what doses and of what kind of cannabinoid, have yet to be standardized into protocols, such conversations are well on their way.

And Aurora is also, of course, right in the middle of them.

Another Aurora Acquisition

Given the importance and size of the German market, in particular, it is also no surprise to see another strategic Aurora acquisition coming less than a week after the announcement of this report in Berlin. Specifically, Aurora has also just sunk another 1 million in an investment in CTT– an Ontario-based firm leading the development of thin film wafers that can provide dose specific, smoke free delivery of medical cannabinoids.

The Teutonic cannabis market is clearly in the company’s sights. Not to mention absolutely driving investment and positioning strategy both at home and abroad.

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Berlin’s ICBC: Meeting the European Cannabis Industry

By Marguerite Arnold
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margueriteICBC

The International Cannabis Business Conference (ICBC) in Berlin is now officially over. The speeches have been made, the parties have been attended. The hard-working crew behind it all has wrapped up, checked out and is off to Vancouver. And most of all, the marathon of meetings and deal discussions that were the mark of this budding and certainly by now established market are done. Even if there are still details to be ironed out in all the new business in the coming months.

As always, the dilemma for conference attendees was how to spend the limited time in this concentrated cannabis gathering. With all of the networking and excitement, people still wanted to hear the experts who spoke on topics ranging from cannabis financing to actually doing business in Germany to new medical advances. Traffic in the expo section was also heavy, as attendees visited the wide range of vendors. Producers and distributors of both plant and derived product were present, along with vape companies brave enough to compete with Storz and Bickel on their own turf, various tech solutions and of course, international consultants.

As the dust clears and the contracts get signed, what are the takeaways from the second edition of the ICBC in Berlin?

Germany Is Going Green

The simplest takeaway? The ICBC Berlin is not a market to be missed in the future for the global cannabis executive. Even if you are an American firm (and for the most part still largely excluded from a rapidly expanding worldwide trade that is establishing itself now with authority), you need to be here. The contacts you make are global, and you do not want to be left out. For foreign investors interested in this market, it is a must. For everyone else, this is a meet and greet, not to mention education, barnone. The German medical and even prosumer CBD market is attracting the world.

Yes, there have been ups and downs even in the last three weeks that include the crashing of the German bid along with news stateside that the Trump Administration is going to hang Jeff Sessions out to dry for Russia with his latest “Make American States Great For Cannabis Again” contortion.

Guenther Weiglein
Guenther Weiglein, activist patient, being interviewed in front of MedPayRx booth

But here on the other side of the Atlantic, it is clear that the federal cannabinoid horse has left the barn. There are now rumorsfloating that the bid is not yet entirely dead (now apparently in a legal purgatory of appeals and even potentially “bid amendments”) that nobody is willing to go on record to discuss. Beyond that, however, as was clear from the frenzied deal-makingon the floor and off it at the ICBC, the market is open, distributors are finding new channels to move product, and patients demanding access are not leaving the streets.

Far from it. In fact, the budding nascent umbrella national non-profit campaign designed to open access for patients and educate doctors, The German Patients Roundtable, had a huge second meeting during the conference, with both German and international attendees from countries including Israel and South Africa.

The CBD and THC genie cannot be stuffed back into the local bottle. And everyone knows it. This is federal medical reform, and even better, covered under German national public health insurance. Despite the hiccups and challenges that still remain, this is open blue water for a medical market that has never existed anywhere to date.

ICBC logoAnyone with a GMP facility, Euro cleared export rights and crop or product ready to ship will be welcome here in a market that at this point, cannot get enough plant or oil. Edibles are still a to-come discussion.

To the extent that this is also negative, it is very clear that the market is still highly inefficient. Producers who do have productare not being found by those on the ground who want to sell it to patients. That will also begin to change. But for now, many on the ground are playing a digitalized Rolodex game of “who do you know” that still consists of personal emails between conference-met colleagues if not LinkedIn contacts and impromptu (and freebie) favors. Those who hope to gain an income merely by connecting the source of product and outlets the old fashioned way are also about to be left in the dust by a market that will not be held back and activist businesses who are eyeing both the United States and Canada right now (if not Israel and Australia), and translating all of that into both euros and German.

It is also very clear that the savvy Germans who were largely left out of the bid proceedings last time do not mean to sit this party out – and are angling to get into the game however they can. This is taking some interesting forms, but processing and testing are going to be huge issues of the market here for a long time to come. And so is home-grown, high-quality CBD. The German government is even offering tax credits for growing certain kinds of hempright now. Sound familiar Kentucky?

Trends and Takeaways

It is not just the Canadians who are going to get market share. The Canadian LPs are still in a good position to dominate the early market but it is clear that there is still room for others to enter. Whether the government allows an appeal of the court’s decision to hold up, there is a quick bid “redo” for the top 10 finalists, or a second bid, the market has now arrived and is in its second year.

margueriteICBC
Marguerite Arnold presents on the impact of blockchain on the cannabis industry

CBD is going to be an important path to other kinds of provision and cultivation. Despite the widespread misconceptions about Germany being a “CBD only” market (it is not), it is clear that a consumer CBD only strategy will be an interesting path into the market here but not one for the faint of heart. The Canadian companies in particular are beginning to move into the realm of big pharma (their market caps certainly are). But it is also clear that more local competition is hip to the same. And as a result, even this part of the market will be a highly competitive one.

German firms are first at this gate, beyond the big Canadian LPs, but they are not the only ones now in the market. See Dutch, Austrian and Swiss firms, many with pharmaceutical company credits and market entry already under their belt.  Not to mention producers from both Greece and the Baltics. Everyone on the import side is eyeing the opening market and stalled bid as a fantastic opportunity. Look for products from these locales as testing and certification protocols become more effective.

Central to all of these developments? The conference is theplacefor the global cannabis industry to meet and get to know one another, put together by Alex Rogers and a seasoned, international team behind the ICBC.

French flags blowing in the wind in Le Havre

France Considers Fining Cannabis Possession

By Marguerite Arnold
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French flags blowing in the wind in Le Havre

The French have always been known for possessing a certain national savoire faire. In English, that translates to a phrase meaning innate understanding of how to do things with a certain amount of panache, if not bonhomie. International diplomacy was long conducted in French as a result.

However, when it comes to the famed French silver tongue or sophistication on the cannabis issue, and well, not so much. As is widely acknowledged, even by the French, the country is stuck in the Dark Ages when it comes to cannabis. Almost literally. Including having the strictest and harshest penalties for possession anywhere in Europe. Such penalties do not include a stint in the Bastille. But they can involve prison time, and they are ridiculously harsh. Quelle Horreure! Not mention, Vive la Revolution!

Nobody has said (yet) “Let them eat spice cake.” But France is now clearly an outlier in a continent moving towards cannabis reform of (at least) the medical and decriminalized kind.The most recent statistics suggest that 17 million French people have tried cannabis.

And herein lies the French paradox. Despite the highest per capita usage of any European country, French cannabis consumers have not turned into effective advocates on the political front.

Why not?

How High Are The French?

The most recent statistics suggest that 17 million French people have tried cannabis. 1.4 million use it regularly, about half of those on a daily basis. And here is the exciting (read: terrifying part). Users (not dealers) face up to a year in prison on the first offense, plus a fine of 3,750 euros (about $4,000).

Mon Dieu! Who on earth do the French think they are? A southern American state? One that probably actually banned “French” fries during a dull day at the state ‘lege when politically inspired to do so a few years back?

But even that epithet doesn’t cut it anymore in an environment where Florida is getting in on the action, and the first medical dispensary just opened in Texas.

French flags blowing in the wind in Le Havre
Image: Richard Akerman, Flickr

It is also not like the French big wigs also do not know they are out of step. France’s boyish president, now in office for about a year, Emmanuel Macron, promised decriminalization by the end of 2017 (it didn’t happen). Now a new parliamentary report, released, fittingly on Valentine’s Day, recommends swapping out the current draconian punishments for a fixed fine of between 150-200 euros ($250) per offense. The report also specifically concludes that current legislation is not working.

In 2015, there were 64,000 drug related convictions in France. 40,000 were for use, not dealing. While just over 3,000 of those convicted actually served a prison sentence, even the more conservative aspects of French society have had enough.

Like Germany recently, where the head of the country’s largest police union came out last week for decriminalization, the French police do not want to continue a charade that results in more paperwork for them, rather than a real shift in policy with concrete results. And now, neither do its politicians.

don’t expect this current diplomatic impass to hold for long, even if it gains enough traction to get passed into federal law.In an environment where political gridlock is the name of the game, however, it is very clear that cannabis is just one more issue dropped into a toxic mix that also includes topics like “what’s up in the EU.” Not to mention the nascent separatist and populist sentiments of neighbours like Spain and Germany. Countries, ironically, also far ahead of France on the cannabis front.

The hope of French activists on the ground is that cannabis is actually caught on the right side of history now. Even if, finally, it is changing the law to decriminalize the drug and only penalize patients (and others) with a ticket.

That too, is unlikely to succeed, as many such experiments elsewhere have failed before. That said, it is clearly a step in the right direction and an inevitable one at that.

Caught in the Middle

The great irony of this of course, is what is happening as France becomes an unwilling partner in the cross-border cannabis ménage-a-trois now afoot thanks to changing medical cannabis laws elsewhere in the EU. Namely, cannabis may remain off the reform agenda to parliamentarians and out of reach to the average French patient. That said, cross-continental transport of the drug will inevitably create a situation where a significant amount of cannabis products consumed by medical users elsewhere in the EU is trucked and or trained across France while out of reach to the locals.

Portugal and Spain are shaping up to be low-cost producers to the West. On the East, Germany, Switzerland and increasing numbers of Eastern European countries are looking for cheap product. That means there is going to be a great deal of medical grade cannabis crossing the continent by way of French territory. There is already a trickle. It is about to become a flood. What happens to reform in a country clearly caught in the middle?

As a result, don’t expect this current diplomatic impass to hold for long, even if it gains enough traction to get passed into federal law.

French cannabis policy is far from a la mode. Even to its own citizens. And on this issue, for sure, absolutely old fashioned in the most un-French way possible.

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Head of German Police Union Calls for Official Decriminalization of Cannabis

By Marguerite Arnold
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Facing the same conundrum as police everywhere after the start of a medical market only this time with federal authorization, the head of the German police union has called for recreational use of cannabis to also be decriminalized.

On the first Monday of February, the head of the BDK – the Association of German Criminal Officers told The Bild (sort of like the New York Post but a national “tabloid” here) that his group, the largest organized union of German police officers, favoured a change in German cannabis laws. Andre Schulz argued that the current laws stigmatized those charged with minor amounts and created opportunities for “criminal careers to start.”

“The prohibition of cannabis has historically been seen as arbitrary and has not yet been implemented in an intelligent and effective manner,” says Schulz. “My prediction is that cannabis will not be banned for long in Germany.”

Why this sudden pronouncement? It is actually not all that sudden and has been long in the offing. One of the largest contingents at both the ICBC and the IACM last year (the biggest cannabis-focussed business and medical conferences in Germany) were police officers from California and Deutschland. And all were singing the same tune.

André Schulz
André Schulz, chairman of the BDK

However beyond a realistic assessment of changing political reality, there are actually several other concrete reasons for not only the statement but the timing of it. In a country where patients can now pick up bud cannabis from the local apotheke (which is that easy for some, although it is still hard for most), the police have the unappetizing prospect of potentially arresting patients. On top of that, the idea of someone being arrested for CBD flower (rather than THC) gives the German polizei plenty of pause. Not to mention that they face this possibility at a time when many of them potentially could be patients themselves (or their families). The idea of arresting an activist in this situation is also one the police do not relish. Legalization rallies here get formal police protection when they march. Ask the average beat cop what they think about cannabis legalization and they tend to roll their eyes.

Then there is this: In stark contrast to the wars over prescribing medical cannabis at a state level in California in the late 90’s, here in Germany, there is a cultural commitment to the concept of sick people having a moral and civil right to obtain the medication they require. The idea of the police arresting them in the process of obtaining the same or because they might be recreational users, is as antithetic to core German sensibilities as the concept of Donald Trump as U.S. President. So is the idea of branding someone a “criminal” if not “drug user” for possession of a drug that is now used as medicine in Germany.

As has been rumoured for some time now, one of the few things that all political parties in Berlin can agree on is a change on the current cannabis laws.As a result, the very idea of both arresting the sick or labelling someone for the rest of their life with a police record for a drug “crime” that nobody considers as such anymore, causes a shock to the system. In many ways, German culture is far more conservative than the U.S. On another, there is a deeply humanistic, liberal strain to German life that also allows nudity, alternative healthcare and lifestyles to flourish (and not just all in Berlin). The current situation over cannabis, in other words, is becoming a political and legal embarrassment even to the beat officers who have to implement such laws.

And then of course there is this: One of the country’s top judges, Andreas Müller, a man well-known to the senior level of BDK, has recently written a book about the horrible situation that faces his own brother because of drug laws in Germany called “Kiffen und Kriminalität.”

Cannabis also falls into this crevice of cultural questioning if not the national zeitgeist of the moment, in multiple ways. It is, beyond the stigma, a natural medicine that is now federally recognized as such and one that the statutory health insurers (public healthcare) is required to cover. No matter that only 64% of submitted rezepts have been formally approved 11 months into Germany’s foray into this world. There are doctors writing them. And there are insurers picking up the tab.

It also means that there are at least 10,000 legal medical cannabis patients that der polizei have no wish to bother. And 10,000 German patients, who look the same as anyone else, are already too many legal users for current laws to stay in place.

Decriminalization, Cultivation & Changing Culture

There are some who say that Europe is “backwards” if not slower than the United States. Certainly those who experience German culture as Auslanders are struck by the procedural requirements of everyday life. Things do move slower here.

However when things do move, they are determinative shifts. Right now, it is impossible to live in the country and not be aware that Kiffen – a slang term for pot auf Deutsch – is legalizing in the U.S., Canada, the rest of Europe and of course other places. Further, Germans with their distrust of bureaucracy and authority and certainly currently rebellious mood, are looking to a way forward for the country in a sea of uncertainty both locally and regionally not to mention globally on any issue, no matter how “symbolic.”

As has been rumoured for some time now, one of the few things that all political parties in Berlin can agree on is a change on the current cannabis laws. The idea of decriminalization, now suggested by one of the country’s top cops, is a natural solution to political deadlock, if not a changing society.

The idea that other countries are also moving on this topic, from the now Brexiting UK to France next door, not to mention all the cultivation focused reform in many European countries, seems to indicate that decriminalization and even recreational reform are coming and now officially on the schedule, and not just to Germany but the entire continent.

Marguerite Arnold

Mainstream Media Picks Up On Cannabis

By Marguerite Arnold
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Marguerite Arnold

The British online newspaper, The Guardian, has just begun to cover cannabis. The regular feature, part of their “society” section, is clearly attempting to cover cannabis a bit more consistently and regularly as the California rec market begins to gain (legal) steam.

The writer now helmed to lead this effort is Alex Halperin, a business journalist in the U.S., who landed the gig apparently on the success of Weedweek – a highly cryptic weekly summary blog of mostly U.S.-based industry events and updates.How the Guardian will cover the industry and related issues will be interesting to follow.

This is also not The Guardian’s first foray into the topic. The media outlet, which got its start in the 1800’s in Northern England and expanded dramatically to reach a global digital audience over the past decade, has covered cannabis legalization on a fairly regular basis for the last four years. This new focus also comes at an interesting time. Apart from events in the U.S., Canada is moving forward with recreational this summer. And in Europe, the medical discussion continues apace. That said, it appears the Guardian is going to focus on the U.S. market, at least initially.

It will be interesting to see if that focus shifts (and if they allow other journalists outside of the U.S. to participate in the expanded coverage). While California might well be the largest state economy in general, the Canadian market is already larger and more developed, being regulated nationally across multiple provinces.

Another Mainstream Media Cannabis Column?

This is hardly news. The Guardian is actually treading on ground established already by most of the big news and business publications – including niche publications, blogs and of course, the trade press.

How the Guardian will cover the industry and related issues will be interesting to follow.

The purpose of the column apparently is to spark an “adult conversation” about cannabis – and how it is “changing modern life.” The initial focus on the U.S. market (and California in particular) may have seemed to make sense to a media outlet looking for outrageous stories. But as everyone knows, the U.S. is only one market – and further one still without federal protection.

However, the Guardian is also now competing with other business and mainstream publications that are already in this space. Main Street, the online business ‘zine helmed by Jim Cramer, created one of the first mainstream specialty cannabis sections almost four years ago with the coincidence of the Colorado rec market. Other notable publications and media outlets have significantly increased their coverage of cannabis as well. CNN has been reporting consistently on cannabis topics like legalization and U.S. federal reform efforts for some time now. Business Insider and Forbes have covered ongoing and growing investments and the financial side of things for several years. The Denver Post has its own entirely cannabis-focused subsidiary, The Cannabist.

And as public companies, in both the U.S. and elsewhere have begun to move through the legal thickets of legalization, business-focussed journals and blogs are even beginning to cover cannabis stocks. Starting with Motley Fool and Seeking Alpha (although again, most of this coverage is of companies outside the United States). Specialty publications are also of course, flourishing online, particularly with the beginning of an advertising market that is also beginning to establish itself, albeit around some still thorny regulatory issues.

In general, although the Guardian has a reputation as critical of the British monarchy, with strong left-leaning tendencies, its coverage of the industry has been fairly mainstream – so far at least.

Will that begin to change? And what will really be tackled and covered? And while the ostensible focus is what is going on in the world of cannabis in California (and presumably other foreign markets) could the Guardian’s ostensible new feature also be geared to drive reform at home? The U.K. has yet to even approach the topic of criminalization.