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AUTHOR: Heather Allman
PUBLISHER:  CANNABIS LAW REPORT

Through late July, the 2019 Cannabis Crusade saw daily cannabis-related news and a literal state of medical marijuana commotion. A timeline of Florida’s battle for solid ground has been outlined in depth throughout my previous articles.

While the strong Florida medical marijuana Crusaders marched forward, the state itself and the legislators who comprise the Rear Battalion lost some footing

On July 11, 2019, a Florida Appellate Court ruled in the highly-publicized Florigrown lawsuit that the state’s vertical integration was unfair and unconstitutional.

Further explanation and clarity was offered by Beau R Whitney, Vice President and Senior Economist at New Frontier Data, with his insightful Florida Court Rules Vertical Integration Unconstitutional: So, What Now? :

A Florida court of appeals decision last month ruled that the state’s regulatory framework for its medical cannabis program mandating vertical integration was unconstitutional. What does it mean for Florida’s system, or for other states? What are the associated implications? They may prove vast, impacting not only Florida’s system, but other state regulatory structures throughout the country.

Immediately, regulators in other states with newly legalized programs will seek to avoid similar pitfalls while striking an effective regulatory balance: Oregon’s unlimited license policy is an opposite example of what other states yet prefer to avoid. Florida’s blueprint for vertical integration had been an obvious bulwark against unlimited licensure, but the court essentially deemed it to be an overcorrection.

Vertical integration allows a company to control all factors of production, from seed to sale in terms of the cannabis trade. The benefits of vertical integration are derived through being able to manage all aspects of the supply chain, affording ultimate control over internal costs of production. There are also associated tax advantages (for now), as one division can pass through costs throughout the chain.”

However, the state is slowly earning back some much-needed ground with tactical policy advancements. Coastal Breeze News reported on July 21, 2019 that Florida currently is Working Together to Fix a Broken Political System.

Florida’s marijuana future is showing promise. NORML Outreach Director Kevin Mahmalji reported that one Florida Municipality Is Considering Marijuana Decriminalization Measure. For such an initiative to come to fruition, Florida must consider and adopt good, balanced cannabis frameworks, such as the vital GCP Responsible Cannabis Framework.

On July 18, 2019, in the current spirit of national cannabis cooperation, Bipartisan Lawmakers File Congressional Bill To Encourage Marijuana and CBD Research: “A bipartisan group of House members introduced a bill on Wednesday that would eliminate barriers to research into medical cannabis, a bill that is gaining new co-sponsors weekly. 

Although thirty-three states and the District of Columbia have legalized the medical use of cannabis, according to the National Center for Biotechnological Information, 15 Challenges and Barriers in Conducting Cannabis Research still exist: “Despite these changes in state policy and the increasing prevalence of cannabis use and its implications for population health, the federal government has not legalized cannabis and continues to enforce restrictive policies and regulations on research into the health harms or benefits of cannabis products that are available to consumers in a majority of states.”

In late July 2019, Marijuana hearings and reform bills directly affecting the marijuana industry were introduced in the U.S. CongressCannabis has gone from the butt of jokes on Capitol Hill to milestone hearings and the introduction of landmark legalization reform packages that offer the potential to pave the way for billions of dollars in new business opportunities nationwide.

The current situation is in stark contrast to just a couple of years ago, showing how far and how quickly marijuana reform has come in Washington DC – even if it doesn’t appear at the moment to have a good chance to pass the full Congress. But the efforts could set the foundation for passage of major reform in the next few years.”

  • What specific growth did the current Florida program experience? It begins and ends with Curaleaf.

In mid July, Wakefield, Florida-based Curaleaf continues expansion as largest US marijuana company with $875M Grassroots merger, according to Shira Schoenberg: The Wakefield-based marijuana company Curaleaf announced Wednesday that it had signed an agreement to acquire the Illinois-based Grassroots. It is part of a continued expansion that Curaleaf says has made it the largest marijuana company in the world based on revenue, and the largest operational marijuana company in the U.S. Curaleaf’s revenues are expected to be nearly double that of its closest U.S. competitor.”

  • In more notable state growth, Liberty Health Sciences, another rapidly expanding Florida licensed dispensary, also made news.

Liberty Health Sciences Ranks #2 In Flower Sales In Florida, according to a report on cannabis sales: “It has the second highest sales of smokable marijuana in the state of Florida with 16 dispensaries open. Liberty was one of the first companies in the state to provide smokable medical marijuana in all of its dispensaries when bill (SB 182) was signed into law in March 2019.

Flower sales of Liberty and Papa’s Herb brands is the driving factor of the significant market success for this growing category and the Company continues to cultivate brand recognition and attract a constant stream of new patients.”

Greg Miller, Executive Director, NICI offered a fresh perspective on the strong foothold of Florida’s Liberty Health Sciences in his enlightening piece on how This Company Is Raking in the Cash in Florida: In terms of infrastructure, companies with a medical dispensary now have the edge over companies entering the market after recreational legalization. Current medical dispensaries pretty much already have everything needed in place to sell recreational cannabis.

With 10,000 new patients signing up each month, there’s a cannabis land rush in Florida right now. And if you’ve been following along with industry news, you may have seen that this company is second highest in sales for smokable cannabis in the Sunshine State.

Currently, Liberty Health Sciences Inc. has 16 open dispensaries in Florida, and it plans to open three more dispensaries in August. It is also one of the first companies in the state to offer smokable medical marijuana.”

Liberty Health Sciences » STOCK » Liberty Health Sciences Inc. (LHS.CN) (OTCQX: LHSIF)

Trulieve Cannabis has planted itself firmly in its home market of Florida. This state dispensary frontrunner announced that Availability Of Flower Boosted Florida’s Medical Marijuana Market In Q2: “Tallahassee, Florida-based Trulieve Cannabis Corp. benefited from 19% medical marijuana patient growth in The Sunshine State in the second quarter, fueled largely by the introduction of smokable flower in the state’s medical market, the company said Wednesday. 

Flower accounted for half of product sales in Florida in the quarter, the company said — a quarter-over-quarter increase of about 20%.”

Trulieve Cannabis Corp.» STOCK » Trulieve Cannabis Corp. (OTCQX: TCNFF

  • How did the setbacks of our current state program play out nationally in July 2019?

The latest assault on Florida’s fledgling cannabis program was highlighted by both CNN and Cannabis Business Times: FDA Issues Warning to Curaleaf for ‘Unsubstantiated’ CBD Health Claims: “The warning letter included some examples of how Curaleaf Hemp products have been marketed on the company’s social media accounts.”

The fallout for Curaleaf is examined further in A Bump in the Road to Cannabis Scale: Investors immediately slammed U.S. Cannabis stocks, which resulted in a decline of 3.6% for the NICI U.S. Cannabis Index. Curaleaf’s stock suffered more, selling off 7% and continuing its decline yesterday.”

MarketWatch continued to pay close attention to Curaleaf trading with a July 24, 2019 report stock fluctuations in Curaleaf shares tumble 8% after FDA sends warning letter over CBD health claims.

Paula Krasney outlines allowed CBD claims in Proceed with Caution: Marketing Claims for Cannabis and CBD Products. And yes, there are also solid cannabis advertising guidelines available for Florida to adopt statewide, such as the NACB National Advertising Standards: Cannabis advertising serves as the public face of the industry, and is thus essential to establishing a trustworthy, professional, and ethical business space. The NACB believes that self-regulation is the most effective way for the cannabis industry to control its own destiny. With consumer-targeted ads becoming more prevalent, we need to self-regulate or we will face charges by heavy-handed government-driven rules that may hinder business’s ability to market to and educate consumers.”

These NACB national advertising standards clearly establish how important it is “that the Cannabis industry develop a robust set of business-approved guidelines to build trust amongst market participants and local state and national regulators. The self-regulatory model has worked for organizations like FINRA and the MPAA, and it can work for cannabis.”

Curaleaf » STOCK » Curaleaf Holdings (CURLF:OTCQX) » LEARN » WeedWeek’s Green Rush Glossary– Alex Halperin

In early August, J. Phillip noted that Cannabis Stocks Bounce Back As FDA Signals Key Regulatory Developments: The industry got a massive boost after the United States Food and Drug Administration made efforts to speed up the process of creating the framework for the usage of CBD. The arguments in favor of CBD are compelling. It does not have a psychoactive effect and is well known for helping people deal with anxiety, pain, and inflammation among others. 

The agency is ‘expediting its work’ in order to address the CBD issue. Considering the fact that CBD is all set to become one of the biggest industries in the years to come, many of the leading cannabis companies want to have some regulatory clarity from the FDA regarding its stand on the substance.”

  • What Summer 2019 growth happened in the medical marijuana program at large?

With the newfound prevalence of CBD, there is plenty of misinformation to go around without unproven  health claims. On July 25, 2019, The Conversation published Cannabis: Misinformation About CBD Can Be Life-Threatening: “CBD is largely non-intoxicating and therefore is thought to be non-addictive. It also appears to be relatively safe to use. It’s no wonder CBD has garnered so much excitement and positive attention.”

By August, A Petition Milestone signals Recreational Marijuana Is One Step Closer in Florida made headlines, marking a big win overall for marijuana and allowing the possibility for advancement in our state’s medical program.

Exciting dispensary news that  another licensee Florida Pot Operator Gets ‘Okay’ For More Storefronts was announced on August 9, 2019: “State health officials have agreed to allow a second Florida medical marijuana operator to exceed a statutory limit on storefronts. The cap on dispensaries, now set at 35 for each operator, was included in a 2017 state law carrying out a constitutional amendment that broadly legalized medical marijuana in Florida.

Health officials on Monday agreed to allow Alpha Foliage, which operates as Surterra, to open six more dispensaries. The company sued after the Department of Health allowed a competitor, Trulieve, to exceed the statutory cap. Surterra attorneys asked the state to interpret the law consistent with the way it did for Trulieve.”

Now that the state has 148 locations, Florida lawmakers and department administrators must pay attention to patient demand and start the Edibles engine. Finalized rules for the state dispensaries to follow must be released so that production and sales can begin immediately. It is long overdue, two years overdue, and Florida patients are entitled to Edibles.

In the meantime, Floridians will have to celebrate the small victories: Palm Beach County law restricts Police Officers from searching vehicles under certain circumstances.

  • How is the current Florida education system experiencing growth from marijuana reform?  

The state’s policymakers at University of West Florida have developed a course called Changing Normative Environment, covering “Medical Marijuana (MMJ) to Recreational Marijuana (RMJ), and the many ways that medical marijuana has influenced social norms and behaviors related to marijuana usage.”

Brittany Shammas announced on August 7, 2019 that a Florida College Will Offer Medical Marijuana ClassesMiami Dade College officials are working on new classes and a certificate program that’ll prepare students for jobs in the medical marijuana industry. But, administrators stress, they won’t be teaching kids how to grow weed. Instead, they’re developing courses on the biology and chemistry of marijuana, as well as the plant’s historical usage and evolving regulation.

That means students will be taught the academic side of marijuana: the physiology of the plant, its natural properties, its medical usage, and how it relates to other medically important plants. They’ll learn about cultivation and extraction, but mostly from a ‘theoretical standpoint,’ says Mark Meade, chair of the college’s Biology, Health, and Wellness Department.”

Florida 2017 legislation “calls for FAMU to receive $10 from each $75 identification card obtained by those approved to purchase medical marijuana. As of last October, the university had received $885,000, according to the Florida Department of Health,concerning Florida A & M University and its inaugural MMERI, or Medical Marijuana Education Research Initiative, as reported by The Tallahassee Democrat. 

Nationally, University of California, Davis “Partners With DEA-Approved Company to Conduct Cannabis Research – Researchers Will Seek to Better Understand the Science of Cannabis,” as outlined by Amy Quinton. 

  • Are there corresponding educational setbacks with this new norm of marijuana use?

This USA Today’s opinion warns younger users that Marijuana needs warning labels like tobacco for associated mental, physical health risks.

  • What about physician educational setbacks concerning the new norm of cannabis use? 

Bottom line: physicians-in-training are not prepared to prescribe medical marijuana.

In November 2017, Drug and Alcohol Dependence, warned: “With even more states on the cusp of legalizing medical marijuana, physician training should adapt to encompass this new reality of medical practice. (1) While most physicians-in-training think education about medical marijuana should be required; (2) only 9% of medical schools have medical marijuana documented in their curriculum; and (3) education can improve physician preparedness to prescribe medical marijuana.”

“Why are some doctors still reluctant to prescribe medical cannabis despite evidence of its efficacy? The principal reason is the lack of education. Most doctors have never studied medical cannabis, they only know that cannabis is a drug and that it has no medical application, because that is what they were taught at the university.

This poses a problem because despite the fact that this plant has been medicinally used for thousands of years, doctors are not taught anything about the history of plants with medicinal properties, nor have they studied the endocannabinoid system, the endogenous system that we all have that is the basis of how cannabis works and acts therapeutically in our bodies.

This system was discovered more than 25 years ago, and yet it is still not taught in most universities. It is a shame because it’s such an important system brings balance – so called homeostasis to our bodies.”

For further insight, the Society of Cannabis Clinicians offers a comprehensive report on Educating Healthcare Professionals About the Medical Use of Cannabis.