August 2019

Can marijuana help end the opioids crisis?

In states where medical marijuana is legal, doctors write fewer opioid prescriptions and patients consume lower doses

Legalization opponents call marijuana a gateway drug that leads users to more dangerous substances. But could it also be an exit drug that helps ease the opioids crisis?

The data is scarce, but the anecdotes are plentiful.

After more than a decade in the US air force, Jennifer Baxter needed foot surgery. It wasnt successful, and she had to have two more procedures to correct her severely disfigured, painful and mechanically incorrect foot.

Baxter had had surgeries before, and had taken opioids to recover. But, as she tells it, this time she connected with a civilian doctor known for his generosity with pain medication.

After receiving a medical retirement, Baxter was prescribed her 600 pills a month, including 480 oxycodone (a generic version of the opioid OxyContin), she said.

Soon the months oxycodone lasted only 21 days. She lost her career, gained an unhealthy amount of weight and contemplated suicide. I was watching the clock all day every day for three and a half years, she said.

She heard medical marijuana might be helpful and began using it in spring 2016. Balancing it with the slow-release morphine to stave off the symptoms of opioid withdrawal, she quit pills entirely in several months.

Today Baxter, 40, has a new life. She is engaged to be married. She volunteers with rescue animals and is involved in her church. She has lost weight and lives in Arizona, where she can legally obtain medical marijuana for her pain, PTSD and insomnia. She takes it nightly and sometimes during the day.

In 2017, a record 47,600 Americans died of opioid overdoses, according to the Centers for Disease Control and Prevention. The grim tally represents an increase of more than 10% from 2016, the previous record year. More Americans die from opioid overdoses than car crashes or gunshots.

In 2017, a record 47,600 Americans died of opioid overdoses, according to the Centers for Disease Control and Prevention. Illustration: George Wyleso/The Guardian

Almost no one considers marijuana to be as ruinous for individuals or society. But legalization activists and the industry have marshalled anecdotal evidence and personal testimonies to support the notion that cannabis can help people wean themselves off opioids.

As with all issues surrounding medical marijuana, theres not much good data. Despite encouraging stories like Baxters Ive heard lots of them there have been no formal clinical trials to determine whether cannabis is an effective treatment for opioid addiction. And cannabis remains unproven as an adequate substitute for opioids in treating chronic pain, which is how many addictions begin, sometimes after car or work-related accidents. Despite public perceptions, the evidence for cannabis as a painkiller is actually weak and riddled with limitations, the psychologist Jonathan M Stea wrote recently in Scientific American.

However, studies have consistently shown that in states where medical marijuana is legal, doctors write fewer opioid prescriptions and patients consume lower doses of opioids. (One study released in 2018 found evidence that states with legal medical marijuana saw fewer prescriptions for weaker schedule III opioids but not the more addictive and powerful schedule II drugs.)

Despite the paucity of data, the exit drug theory has led to overwhelming support for medical marijuana research among veterans. Several US states allow anyone with an opioid prescription to obtain a medical marijuana card.

The interest in cannabis as a substitute for opioids comes as opioid makers face escalating scrutiny and legal trouble. In March, a group of more 600 US cities, counties and Native American tribes filed a lawsuit alleging that eight people in a single family made the choices that caused much of the opioid epidemic. The family, the Sacklers, control Connecticut-based Purdue Pharmaceuticals, which introduced OxyContin in 1996.

The family denied the allegations in a statement.

Last week, Purdue and the Sackler family agreed to pay $275m to settle a lawsuit brought by the state of Oklahoma. (The family was not named as a defendant in the lawsuit.)

Whatever caused the opioid crisis, it is a deeply complex problem, one that few if any credible observers think will be relieved by cannabis alone. And some reject the idea of employing a drug as an appropriate response to a drug crisis.

When we are dealing with opioids as the single biggest health crisis this state has ever had, you are going to tell me legalizing more drugs is the answer? New Hampshires Republican governor Chris Sununu said last fall. Absolutely not.

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An Illinois man is sentenced to prison for ordering 42 pounds of marijuana-infused chocolate

(CNN)A man from suburban Chicago was sentenced to four years in prison after he ordered 42 pounds of marijuana-infused chocolate from California with the intention of selling it, the Kane County state’s attorney’s office said in a statement.

In February 2014, postal workers noticed a pattern of suspicious packages being delivered to Franzen’s home in Montgomery, Illinois, the state’s attorney’s office said. After obtaining a search warrant to open a package, they found more than 19,000 grams of chocolate infused with THC.
Authorities then got a warrant to search Franzen’s home and found cocaine and more than 100 additional grams of marijuana, along with items that are “known to be evidence of drug dealing,” the state’s attorney’s office said. Those items included a digital scale, more than $2,000 in cash and postal receipts for packages he had mailed to locations across the US and Canada.
    Franzen’s attorney, David Camic, said his client has had testicular cancer and was undergoing treatment for it at the time that he ordered the marijuana.
    “In recognition of the seriousness of Mr. Franzen’s medical condition, our office reduced a 12-year mandatory minimum sentence to 4 years, of which he is required to serve only 2 years,” Kane County State’s Attorney Joe McMahon said in the statement. “We did this in spite of evidence that proves that Mr. Franzen is a drug dealer.”
    Court records show prosecutors dismissed several more serious charges of marijuana trafficking, a felony that is punishable by six to 30 years in prison and a fine of up to $25,000.
    “He got the best disposition that was available given the constraints of Illinois law,” Camic told CNN.
    Franzen’s sentence came just one day before the Illinois legislature voted to legalize recreational marijuana. Gov. J. B. Pritzker has pledged to sign the law, which would take effect January 1, 2020.
    Medical marijuana is currently legal in Illinois, though the state’s attorney’s office said it had no evidence that Franzen had attempted to purchase marijuana legally in the state.
      “The marijuana-laced product found at Mr. Franzen’s home was not purchased from a medical marijuana business, and the amount he purchased far exceeds what would be used for personal consumption and is evidence that he is a drug dealer,” McMahon said.
      Franzen is due in court for a hearing on June 14, when he will present medical test results to a judge who will decide when he begins his prison sentence.

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      The Heady, Thorny Journey to Decriminalize Magic Mushrooms

      In an airy Denver café populated almost entirely by young people staring at laptops, Travis Tyler Fluck—dressed in an orange velour jacket, over which is draped a thin braided lock of hair—takes out his phone and pulls up Craigslist. A quick search lands him on a post advertising $10 magic mushrooms, with a poorly lit photo of said mushrooms. A good deal for anyone but Fluck, who helped lead the ballot campaign to essentially decriminalize magic mushrooms in this city by making enforcement an extremely low priority, a measure that passed by the slimmest of margins early last month.

      Instead of reaching out to the seller, he flags the post. After all, the measure says you can grow and possess mushrooms for personal use, but that doesn’t mean you can sell them. Selling on Craigslist is a bad look for a measure that a small majority of voters approved.

      Kevin Matthews—director of Decriminalize Denver, which led the ballot campaign—arrives and sits down on a couch opposite Fluck, who shows him the post on his screen.

      “Good,” says Kevin, who has used mushrooms, aka psilocybin, to treat his depression. “Have you noticed an uptick?”

      “No,” Travis says. “I think there might be other people doing the same thing I'm doing and flagging them. We were like, Oh we should totally follow up with them and meet them. But I don't have time for that.”

      Welcome to a murky new front in the war to bring psychedelics out of the shadows and into both legal recreational use and professional drug-assisted therapy. In recent years researchers have shown that psychedelics like mushrooms and LSD appear to treat a range of disorders, including depression and PTSD. The paradigm is so promising, in fact, that the FDA has granted MDMA breakthrough status in phase 3 trials, thus fast-tracking the approval process. Psilocybin itself is undergoing two separate clinical trials.

      Meanwhile, the psilocybin decriminalization movement is snowballing at an incredible clip. Last week, the Oakland, California, city council voted unanimously to decriminalize a range of psychedelic plants, including mushrooms and cacti. And Oregon is considering a measure in 2020 to allow access to “guided psilocybin services,” while lowering penalties for possession.

      The concern, as Michael Pollan—author of How to Change Your Mind, a recent book on psychedelic science—expressed in a piece in The New York Times last month, is this: The accelerating movement to decriminalize psilocybin risks a political backlash, which could derail that promising research. “It would be a shame if the public is pushed to make premature decisions about psychedelics before the researchers have completed their work,” he writes.

      Taking too much psilocybin won’t kill you, but you can certainly overdo it and put yourself in danger. And we need far more research on how psychedelics might affect different individuals, especially those with serious conditions like schizophrenia.

      How quickly is the push to decriminalize psilocybin progressing, exactly? So quickly that it’s even surprised psychedelics advocates. “The fact that it's happening so fast is kind of amazing,” says Brad Burge, spokesperson for the Multidisciplinary Association for Psychedelic Studies (MAPS), which leads studies of psychedelic therapies, including the aforementioned MDMA trial. “Here we have some of the very first policy measures ever to be proposed around the decriminalization of psychedelic substances and they're passing. This is so surprising, I've only just had a chance to start thinking about it.”

      MAPS wants to realize the legalization of psychedelics for adult use. But it’s not so simple as legalizing and calling it a day.

      “While it's definitely exciting, we also want to make sure there are notes of caution and there's adequate public education around the risks,” says Burge. When MAPS does psychedelic studies, the patient is under the constant supervision of therapists, who talk the subject through the experience. They’re free to move at their own pace and talk about past traumas, for instance. It’s a safe, comfortable, highly moderated space for a journey that can be jarring. Out in the wild, that experience may be harder to control.

      Matthews and Fluck very much respect the power of psilocybin. So as a next step in Denver, they're ramping up education for first responders and city officials and users. “In particular working with law enforcement, and if they need more training on things like harm reduction,” says Matthews. “Like how to actually work with individuals who are under the influence, versus seeing that person as a threat and potentially giving them an injection of something to calm them down and strap them to a gurney with handcuffs. That doesn't help that person.”

      In Oakland, the city government is going even further in its push to bring psilocybin into the mainstream. When its city council voted last week to decriminalize, it did so without pushback from local law enforcement, says councilmember Noel Gallo, who introduced the resolution.

      “The police were very receptive, and did bring up: well probably in a year's time they've only dealt with 25 cases when it comes to psychedelic plants,” Gallo says. “But we all agree that's not a priority any longer. We have plenty of serious crime issues on our streets.”

      It’s important to note that decriminalization in Oakland and Denver does not mean legalization, as both of their states have done with cannabis—police are just instructed to make psilocybin a low-level priority. In the eyes of the state and federal governments, this remains an illegal drug. You can possess psychedelic mushrooms for personal use, but you can’t go around selling mushrooms, on Craigslist or otherwise.

      That is, at least not yet. “I think we're headed in the direction of how do we make this more available to the public?” says Gallo. “And I think that's where we're going to wind up in a year. Maybe our next move is we can market the product, sell the product, create different businesses out of these native plants.”

      Which seems like it might attract regulatory ire. But then again, this is exactly how marijuana decriminalization started in the western US—though it’s worth noting that weed and psilocybin are two very different drugs with different risks. Indeed, Matthews and Fluck modeled their ballot measure after the one that decriminalized cannabis in Denver in 2005. “Oakland was also the first city to decriminalize, tax, and regulate marijuana, well before they could actually implement it,” says Burge. “Sure you could open a storefront and the city police aren't going to bother you, but a federal agent could come in there at any moment and put you in jail.”

      With that precedent comes a familiar tension: Prohibiting cannabis use has made it excruciatingly difficult for researchers to study the drug. Marijuana doesn’t come without potential harms, one concern being something called cannabis use disorder, in which around 9 percent of users develop a dependency. But we don’t know a lot about that—much to the detriment of the public—because the government makes it as hard as possible to study such things.

      Same goes with exploring the potential therapeutic charms and risks of LSD and MDMA and psilocybin. “It's a tension that plays out across medical marijuana, just as it does across medical psychedelics,” says Burge. “MAPS, for our part, we want to see legalization. We want to see legal adult use, and we want to see it available for use in therapy—with the very large asterisk that we need also to have this public education and enough research to know who it's good for, who shouldn't take it and who should.”

      Whether the decriminalization of recreational use interferes with the research side of things remains to be seen. “Regardless of what Michael Pollan thinks, ballot initiatives are moving forward, and there's nothing stopping this,” says Matthews. “So what's important here is we're staying in communication and working with the researchers too.

      “It's a small enough of a movement that we can all be connected and collaborate,” he adds. “At the end of the day, Denver is the first domino.”

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      Stassi Schroeder Finally Got Engaged To Beau Clark Betches

      Now that we all suffered through Brittany and Jax’s wedding, there’s finally some news out of Vanderpump Land that we can actually be happy about: Stassi Schroeder and Beau Clark are engaged. Praise be, hallelujah. After almost a decade of watching Stassi fall all over herself for men who treat her like hot garbage (hi, Patrick!), she actually ended up with a guy who treats her like the princess she thinks she is. It’s actually pretty funny that she said she feels like Meghan Markle in her Instagram caption, because she’s definitely the royalty in this relationship.

      I also love the photo that Stassi chose to post, because they look happy, but also she looks like she could rip him apart at any moment, which is the perfect description of Stassi’s personality. She is the devil, and don’t you forget it.

      View this post on Instagram

      OMG. I feel like Meghan Markle. 💍

      A post shared by Stassi Schroeder (@stassischroeder) on

      The best detail of the engagement, that I think a lot of people missed, is that it happened at a cemetery. Actually, Hollywood Forever is a super famous cemetery in LA, and Hollywood legends like Judy Garland and Cecil B. DeMille are buried there. Is there a location that could be more perfect for Stassi’s engagement? I mean, she literally had a murder-themed birthday party one year. Maybe this proposal could be seen as disrespectful to the dead or something, but I’m sure Judy Garland doesn’t mind.

      The Vanderpump Rules cast is still filming for season eight right now, so this proposal should be a refreshing moment after we have to watch several episodes of Brittany in full bridezilla mode. On one hand. I’m excited to see that wedding, but I also think it might kill me. Whatever, at this point I’m willing to lay my life on the line for Bravo. It’s a lifestyle.

      But Brittany and Jax’s wedding won’t even be the only one on the upcoming season of VPR, because last weekend, Tom and Katie finally legally tied the knot. I’m not sure if this was all a publicity stunt or not, but Lance Bass recently revealed that Mr. and Mrs. Bubba never actually obtained a marriage license when they had their wedding a few years ago. This was surprising to me at first, but also I distinctly remember Katie bringing up her medical marijuana license multiple times during the season she had her wedding, so maybe they just forgot.

      Stassi is pretty busy these days with filming the show and her upcoming book tour, so I don’t know when she’s going to plan a wedding, but if I had to guess, it’ll probably happen next summer when they’re filming the show. Or maybe it’ll be on National #OOTD Day, because you have to keep your brand strong. I’m just happy that Stassi finally stopped messing around with tragic guys and got serious with Beau, because he’s perfect. Congrats Stassi and Beau, you’re the only thing holding this friend group together!

      Images: stassischroeder / Instagram; Giphy

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      MedMen expands its cannabis retail empire to Florida

      San Francisco (CNN Business)MedMen Enterprises, one of the larger cannabis dispensary operations in the US, is zeroing in on Florida as it continues its US expansion.

      The store is MedMen’s first in the Sunshine State, but the company has big plans there: Of the 15 dispensaries it’s looking to open this year, 12 are slated for Florida.
      “Florida, it’s a very large market,” Nick Hansen, MedMen’s director of governmental affairs for the southeast US region, told CNN Business. “It’s a high focus for us.”
        In 2017, Florida began regulated medical marijuana sales in which doctors could authorize or recommend cannabis for patients with certain diseases and ailments.
        The state restricted the number of businesses licensed to sell to those patients. MedMen is one of 14 licensed operators in the state, each of which can open up to 35 dispensaries across Florida. The 35-store cap is slated to expire in April 2020.
        Florida has taken steps this year to loosen its medical marijuana laws, including allowing for the sale of smokable cannabis and increasing the number of licensed operators by eight. However, not all cities in the state allow cannabis sales, and some that do have regulations that limit where those businesses can and can’t operate.
        “It’s about getting into these markets where these patients are,” Hansen said. “They’re clamoring for [choice].”
          MedMen also has planted a flag and established a vertically integrated operation in the third-most-populous state. If Florida were to legalize recreational sales, MedMen would be ready to adapt, Hansen said, noting the company’s ability to serve the California market immediately following that state’s allowance of adult-use recreational sales in 2018.
          “We would be Day One,” he said. “No doubt.”

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          People smoked pot to get high 2,500 years ago, study says

          One of the tombs that archaeologists excavated on the Pamir Plateau. (Xinhua Wu)

          Getting high on marijuana may not be a modern pastime, as archaeologists have found the earliest clear evidence to date that people were smoking cannabis for its psychoactive properties some 2,500 years ago.

          They found evidence of burned cannabis with high levels of tetrahydrocannabinol (THC) (the cannabis ingredient responsible for the high) on 10 wooden incense burners, known as braziers; the burners were found alongside eight human burials at an ancient site known as Jirzankal Cemetery (also called Quman Cemetery) on the Pamir Plateau of western China.

          The burners all carried a mystery residue, which a chemical test soon revealed to be cannabis. “To our excitement, we identified the biomarkers of [cannabis],” study co-researcher Yimin Yang, a professor in the department of archaeology and anthropology at the University of Chinese Academy of Sciences, told reporters at a news conference. [25 Odd Facts About Marijuana]

          Researchers have known for decades that ancient people in eastern China cultivated cannabis as long ago as 3500 B.C. But this cannabis was grown as an oil-seed and fiber crop, and so it had low psychoactive properties. In other words, the ancient people harvesting cannabis for these purposes probably weren’t smoking or ingesting it for its high.

          The cannabis residues found in the braziers, however, tell another story. It’s likely that ancient people purposefully selected cannabis plants with high THC levels and then smoked them as part of a ritual or religious activity associated with these burials, “perhaps, for example, aimed at communicating with the divine or the deceased,” the researchers wrote in the study.

          Ancient cemetery

          Archaeologists began excavating Jirzankal Cemetery in 2013, and were intrigued to find the braziers, which held heating stones. To determine what these ancient people had burned, the archaeologists partnered with Yang’s team, which used a technique known as gas chromatography mass spectrometry (GC/MS) to analyze the chemical residues on the braziers.

          In the first test, the researchers found biomarkers of cannabis on the internal charred wood of a brazier. Then, they analyzed an ancient sample of cannabis from the 2,500-year-old Jiayi Cemetery in Turpan, China, where the plant was found laid across a man’s chest as a burial shroud. This test showed preserved components of cannabis, including cannabinol (CBN), cannabidiol (CBD) and cannabicyclol (CBL).

          While THC does not preserve well, CBN is a good indicator that it’s present. Intriguingly, the researchers found ample CBN on the wooden braziers and on two of the stones, indicating that its THC levels were higher than those typically found in wild plants. As a control, they tested samples from the outside of the braziers, but didn’t find any cannabinoids.

          Of note, the burials are more in line with the ancient mortuary practices from ancient Central Asia, including the modern-day countries of Uzbekistan and Kyrgyzstan, than they are from China, the researchers said.

          Where did the psychoactive pot come from?

          Most wild cannabis, as well as early cultivated varieties of the plant, contain low levels of psychoactive compounds. So where did this high-THC variety come from?

          The researchers have two main ideas. Perhaps a wild variety of pot with high psychoactive levels arose naturally, and then humans found and cultivated it. “I agree that humans are always going to be looking for wild plants that can have effects on the human body, especially psychoactive effects,” study co-researcher Robert Spengler, the laboratory director at the Max Planck Institute for the Science of Human History in Germany, told reporters. [7 Ways Marijuana May Affect the Brain]

          How did cannabis with high THC levels come about? Given that Jirzankal Cemetery is high up in the mountains — more than 9,800 feet (3,000 meters) above sea level — perhaps the plants encountered stressors there that led them to create more psychoactive properties, the researchers said.

          In this line of thinking, the extreme mountain environment — such as low temperatures, low nutrient availability, high exposure to ultraviolet rays and strong light intensity — may have caused the plants to change how they produced or metabolized certain compounds, which could lead to the creation of greater amounts of psychoactive compounds, the researchers said.

          “This is potentially linking these plants — the plants with higher THC production — to higher elevation,” Spengler said. “But that’s all fairly theoretical, so we really cannot pinpoint exactly what the mechanisms for the higher THC level are.”

          Another idea is that humans — either intentionally or inadvertently — played a role in increasing the plant’s psychoactive properties. Perhaps people bred different marijuana plants that led to varieties with higher THC levels.

          “Some of them may have been rapidly domesticated by humans simply moving them or transporting them [along trade routes such as the silk road] … from the Caucasus all the way to East Asia,” Spengler said. “So, it’s possible that humans were still inflicting evolutionary changes on these plants without actually intensively cultivating them.”

          That said, it’s still an “open debate” whether the psychoactive pot occurred naturally, or whether humans played a role, he said.

          The study is the latest to look at cannabis’s origins and historic uses. In May, another group of researchers posited that the cannabis plant likely originated high on the Tibetan Plateau, according to an analysis of fossil pollen. The new finding “provides yet another piece in the biomolecular archaeological puzzle of the ‘abiding mystery of Central Asia’ and its impact on human cultural and biological development through the millennia,” Patrick McGovern, the scientific director of the Biomolecular Archaeology Project at the Penn Museum in Philadelphia, who was not involved in the study, told Live Science. “Much more remains to be learned.”

          The study was published online today (June 12) in the journal Science Advances.

          Originally published on Live Science.

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          This longtime cannabis investor has funded Pax and Juul, among others; heres her approach

          If you’re a cannabis investor or a founder working on a cannabis-related startup, you’ve probably heard of Poseidon Asset Management.

          The San Francisco-based investment firm is one of very few that is focused narrowly on the industry, which remains fairly insular for now. Poseidon has also been at it longer than most outfits, having begun making bets on cannabis-related companies six years ago. More, Poseidon has managed to stuff checks into some of the fastest growing companies in the sector, including the cannabis vaporizer company Pax Labs and the e-cigarette company Juul, whose founders created the Pax vaporizer before peeling off to win over smokers. Indeed, because Poseidon has largely invested the money of high-net worth individuals and family offices, it hasn’t been constrained by the same vice clauses — or restrictions by backers like pension funds and other institutions —  that can often hamper where venture capitalists invest.

          Poseidon is notable for yet another reason, too. It was founded by siblings Emily and Morgan Paxhia, whose parents both died of different cancers at the ages of 46 and 52, respectively. In fact, despite — or because of — being a young teenager at the time, Emily Paxhia says she can still very much remember the hospice nurse who recommended to her father that he smoke pot to ease his pain. Little did Paxhia know then that the cannabis — then a surprising and exotic concept — would later inform the career she now enjoys.

          We talked about it earlier this week, as well as how Paxhia and her brother decided back in 2013 that cannabis was going to be the next big thing. If you’re curious about their path, and where they’re shopping now, read on.

          TC: You grew up in Buffalo and you say your parents were entrepreneurial.

          EP: Our dad restored homes in an economically depressed part of Buffalo, and our mom worked for a real estate agency. When began running his books, voila, we had a family business.

          TC: Then he became sick when you and your siblings were young. How did that impact you?

          EP: He was a dyed-in-the-wool hippy. We had Woodstock tickets in our home. He never really accepted the status quo, which I think informs the way we view the world. But yes, he became aggressively sick with cancer in 1994 and passed away in 1996, and it was this non-virtuous cycle, where they would put him on this or that medication and each had its own terrible side effects. Finally, a hospice nurse who came to our home said, ‘John, maybe you some smoke some pot.’ She told us it would help with his appetite and reduce his anxiety and help him sleep. It was this palliative care thing that had been stigmatized but she believed was useful. I don’t know if he tried it or not, but then he passed away, and five years later, our mother, who was very healthy and ran and took care of herself, also died of cancer.

          I’ve often looked back and thought that if my parents had [used cannabis at the end of their lives], they would not have suffered so greatly.

          TC: How did you get from Buffalo to starting a fund in San Francisco, seemingly out of the blue?

          EP: After college, I was spending time in New York and in San Francisco, working in market research, including on behalf of Amex and Viacom and Comedy Central — all companies competing in markets that were very saturated. It was hard to find white space. When I moved to California [full time], I started to see people lining up outside the doors of dispensaries and I thought, ‘Here are people who ordinarily wouldn’t break a law, but they’re doing something that’s federally illegal because they want cannabis. Brick-and-mortar is dying elsewhere and it’s thriving here. This is what product-market fit looks like.’

          TC: At what point did you decide to partner with your brother and why?

          EP: He worked for UBS during the downturn [of 2008] and then he landed in Rhode Island, working for a private registered investment advisor. And I called him, and I said, “Dude. I think the ‘thing’ of our generation is cannabis.” I actually remember where I was standing in San Francisco. We’d always though we’d be in business together, and he took me 100 percent seriously, and then we couldn’t turn it off. From that point on, we were figuring out how do we participate in this.

          It was Morgan who identified that a fund made the most sense, that the industry was happening and it was very underserved from a tech and investor perspective. He knew the industry was going to need funding and that investors would need an actively managed strategy.

          TC: How did you get started?

          EP: It was hard. It was very hard to find attorneys to work with us, but we did. The same was true of auditors and back office administration. Everything that’s normally a check-the-box type of process was hard.

          TC: What about investors? How did you begin lining these up with out a track record?

          EP:  I had that qualitative consulting experience, working with brands and helping them scale; Morgan had traditional investment experience. But there were no data sets at the time. All we could do was be ‘in market’ all the time. We traveled to be with companies. We traveled to different geographies because each has such complicated regulatory nuances to it.

          Raising money was really difficult. We got laughed at quite a bit. It’s funny, many of our earliest investors were lawyers because I think they understood the real, versus the perceived, risk involved in what we were doing.

          TC: Eventually, you began to assemble this evergreen-type fund and you began investing while fundraising. Where you shopping at at the outset?

          EP: We focused initially on the tech aspect of the industry. To us, that was where we saw the biggest gap and the biggest opportunity to potentially scale quickly. Also, those companies tended to be started by tech founders who were [secondarily] interested in cannabis.

          TC: How were you drumming up deal flow?

          EP:  It was going into stores, seeing what they were using in terms of tech, talking with retail associates about what people were buying, going to industry events and to cannabis job fairs to see was hiring, then starting to build relationships with those companies. We knew as entrepreneurs ourselves that being as founder friendly as possible would be the key to our deal flow. And we start having founders bringing us other founders. We’ve now led 20 rounds at this point, and our best deal flow has come from the founders themselves.

          But it’s also been a matter of getting out there and walking up to people and saying, “Have you thought about raising capital? If so, let’s keep talking.”

          TC: Do you feel like you now recognize founders who you shouldn’t back?

          EP: What 100 percent does not work in this industry is hubris. In other areas of business, a certain level of confidence bodes well for founders. But this is not a move-fast-and-break-things industry. There are so many regulatory challenges that you really need to know the lay of the land. I’ve seen people come in and bounce right out again because of their attitude.

          Founders also need to understand the extra costs in time and money that come with running these business and to model accordingly; otherwise, projections are off and valuations are off and you’re facing a potentially down round later in time.

          TC: You were able to return money to investors in January, after Juul distributed a special dividend. Is that your biggest exit to date?

          EP: That was a big one, but we’ve had other big exits out of [an earlier] pair of funds through [several investments in Canadian companies], including [medical marijuana company] Aphria [which went public last October] and Canopy Growth [which went public in 2014, is Canada’s second-largest grower, and is currently valued at roughly $15 billion]. Canada is a very different market. You can order cannabis from the government and it will arrive in the postal mail. It’s very top-down unlike in the U.S., where the market is very bottom-up and state by state.

          There’s a lot of investment going on [across U.S. and Canada]. It’s very permeable at this point. I was in Toronto last week, and licensed producers there want to invest more in California. We’re meanwhile looking at Latin America and Europe–

          TC: That’s interesting. Where in Latin America and why?

          EP: The cost to produce cannabis in Colombia is extremely low. Cannabis grows on a 12-hour cycle very well and the equator runs through the country’s southern sector [making its warm climate conducive to the plant’s growth]. Local companies can export the products at a lower cost than in Canada and Europe. [Operators there] also have distribution relationships with European markets [that are buying medical marijuana].

          Mexico is also expected to roll out its medical program in the fourth quarter of this year, which is exciting.

          TC: Obviously these places have been home to drug cartels for years. Do you worry that these same organizations will take an interest in what’s being built legally in their backyards?

          EP: We’ve gotten comfortable with both places. I think the cartels have begun to pivot to other places, like meth. I also don’t think it’s worth it to the cartels to get involved with legal government channels. And the groups that we focus on are themselves focused on medical cannabis and distribution to other medical touch points globally [and not the same places into which cartels are trying to move goods].

          TC: I’ve read that Poseidon is trying to raise a new, $75 fund. How far along are you?

          EP: We have capital commitments for half the fund and hope to close it this summer. We want to be able to deploy [more capital] before legalization is [more widespread] and we have to compete with bigger funds.

          TC: What is your pacing like? Relatedly, how fast do you have to move on this investments, or do you have all the time in the world right now?

          EP: We expect to invest this new fund in 15 companies over two years. We’ve funded five startups with it since November, but we were in diligence on one of those for months. I’d say the average deal takes 60 to 90 days to pull together right now. We start our own diligence before the company is considering a Series A, which is where we invest. We want to help structure the round, to lead it, to have a board seat — to demonstrate our value add.

          TC: Are you seeing many, or any, particularly frothy deals?

          EP: Valuations are not going crazy but the more popular a deal gets, the harder it becomes, as with any investment. We’re wrestling over a term sheet right now, because other groups got a look at it and want us to lead it, but we’re also getting negotiated against a little bit.

          TC: Any parting words for investors who want to jump into the industry? Any advice?

          EP: I’d say to go to events and walk the floor to see who and what stands out.

          I went to MJBizCon [the Marijuana Business Conference and Expo] that happens annually every winter. The first few years that we went, there were a few hundred schlubby guys walking the floor. The year before last, there were 3,000 people in attendance, looking a lot less schlubby. Last year, I think there were 27,000 people, which I took as an indicator that there’s some interest in this space. [Laughs.]

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          A Wrigley chewing gum heir and a former Patrn CEO go all in on cannabis

          San Francisco (CNN Business)William “Beau” Wrigley Jr. believes he can emulate the success of his family’s old chewing gum empire in the cannabis industry.

          The company, an Atlanta-based developer and retailer of cannabis products, raised $100 million to help fuel its rapid US and international expansion in the emerging cannabis industry. Among the investors participating in the round was Edward Brown, the former CEO and president of Patrón Spirits Company, which makes Patrón tequila and was sold to spirits company Bacardi last year.
          Brown, who retired from Patrón in December after 20 years, recently joined Surterra’s board as executive director.
            With the latest infusion, Surterra has raised a total of $350 million and continues to “curate” an executive team with deep experience in building and scaling companies, Wrigley said.
            “We understand how to execute,” Wrigley said in an interview with CNN Business.
            Surterra has a three-pronged strategy: Accumulating operations and licenses in existing cannabis markets; developing a “house of brands” that could sell globally; and advancing cannabis science and technology to disrupt not only sectors such as the beverages industry, but also the health care industry. That includes isolating various chemical compounds in the cannabis plant and targeting them for different health and wellness needs.
            “I truly believe, in many respects, that I’m building the next Wrigley Company,” he said.
            And he believes Surterra could be even bigger than the multibillion-dollar chewing gum and mint company, of which he served as president and CEO until 2006. Mars, the confectioner that makes M&Ms and Milky Way, bought the Wrigley Company for $23 billion in 2008.
            Surterra has been on an expansion bent since last fall when Wrigley invested $65 million in the firm and later took the helm as CEO. It has quickly grown from a holder of medical cannabis licenses in Florida and Texas to a multi-state operator, brand developer, and science and technology innovator.
            Surterra signed licensing deals with the company behind “The Endless Summer” surfing documentary and singer Jimmy Buffett to sell Endless Summer and Coral Reefer-branded cannabis, respectively. The company also acquired operations in Nevada and Massachusetts, and it entered into a $100 million agreement with biotech firm Intrexon (XON) on a fermentation-based cannabis cultivation technology.
              Earlier this week, Surterra bought Boston-based Molecular Infusions (Mi), a developer of cannabis therapeutic-focused products such as a fine-mist inhaler and additives that provide rapid onset and predictable dosing for cannabis-infused beverages.
              The privately held Surterra does not disclose financial information, but Wrigley said the company is profitable.

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              adminA Wrigley chewing gum heir and a former Patrn CEO go all in on cannabis
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              ‘A bleak prospect’: why legal weed in Britain may be a pipe dream

              While public interest is growing, experts say a mix of political and social factors is holding back change

              The legalization of cannabis in the US shows no signs of slowing down but the prospect of a green rush in the UK, experts say, is bleak.

              The consultancy Hanway Associates aims to bring North American-style cannabis capitalism to the UK and Europe. This month, the group is hosting the Cannabis Europa conference in London, but its CEO, George McBride, does not expect drastic change anytime soon.

              According to a 2018 survey commissioned by the drug policy thinktank Volteface, which has ties to Hanway, 59% of the British public supports cannabis legalization. But the political dynamics that have made legal marijuana all but inevitable in the US are absent in the UK.

              In both countries, there are racial discrepancies in drug enforcement. However, the aggressive and widely despised police tactics associated with Americas war on drugs never took hold in Britain, nor did they contribute to mass incarceration and other life-ruining consequences for perpetrators.

              Second, as McBride and his colleague Alastair Moore note, the UK hasnt experienced an opioid crisis, or the subsequent disillusionment with mainstream pharmaceuticals and the medical field. Nor is there an entrenched constituency of veterans suffering from PTSD, concussive brain injuries and other ailments, which have led to a desperate search for alternatives.

              While the British public is interested in medical marijuana, and CBD is advertised on many high streets in particular, there does not seem to be any significant constituency eager to implement a for-profit industry on a large scale. And there is not an industry-funded medical marijuana lobby insisting on the issues urgency.

              Last year, Charlotte Caldwell, a Northern Irish mother, arrived at Heathrow from Canada with her son Billy, a 12 year-old who has a severe seizure disorder, and cannabis oil she acquired to treat him. When authorities confiscated the medicine, it led to a public outcry, and within weeks the UK had legalized medical marijuana for a very limited number of patients. It was the biggest cannabis story in Britain since the scare about high potency skunk weed in the 1990s. But it hardly galvanized the country to legalize it for everyone.

              Experts say the prospect of a green rush in the UK is bleak. Illustration: George Wylesol/THE GUARDIAN

              Public support for legalization in the UK is broad but not deep, McBride said. In other words, its not an issue that decides how people vote. The same can largely be said for the Trump-era US, but the political levers American legalization supporters have wielded so effectively dont really exist in the UK. In particular, theres no equivalent of the state referendums which have been crucial to legalizing in many of the states that have legalized medical marijuana and almost all of those that have legalized the drug for recreational use.

              Finally, one of the most effective arguments for legalizing in the US is that it makes more sense to regulate and tax the drug, rather than allow lawless cartels to control it. Thus far, US marijuana taxes have not brought much money into state coffers, but the argument appeals to the American mind.

              In the UK, however, legalization actually polls lower when you ask about taxing it. McBride and Moore attributed it to skepticism towards business, coming both from the left and the protectionist right. The specter of violent drug traffickers doesnt loom as large in the British imagination.

              Still, major social developments in the US usually reach Britain somehow. I suspect a combination of social and corporate pressure could eventually change minds. Within two or three years, as attractive cannabis cafes become more familiar in Chicago, Boston and California, and more professional Americans incorporate cannabis into their lives, more Brits will become curious, not to say envious. As that happens, growing cannabis companies will start looking for effective arguments to persuade the public in Britain and other countries. Until then, theyve got their hands full trying to turn a profit in North America.

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              admin‘A bleak prospect’: why legal weed in Britain may be a pipe dream
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              Louisiana coroner claims first THC-related death, but some experts are skeptical

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              adminLouisiana coroner claims first THC-related death, but some experts are skeptical
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