Welcome to Senior Cannabis Digest. This week we look at reports that the Department of Justice has finally decided to reschedule cannabis, cannabis stocks and rescheduling, cannabis museums in the U.S. and more. Enjoy.
Legal News and Notes
The Justice Department has confirmed that the Drug Enforcement Administration (DEA) has made the decision to move marijuana from Schedule I to Schedule III under the Controlled Substances Act (CSA).
Moving marijuana to Schedule III, follows the recommendation of the U.S. Department of Health and Human Services (HHS), and can carry major implications for state-legal cannabis businesses.
That’s the word from Kyle Jaeger, reporting for Marijuana Moment. For example, Jaeger notes that if the change is implemented as currently planned, it will mean that marijuana firms can officially take federal tax deductions that they’ve been barred from under an Internal Revenue Service (IRS) code known as 280E.
Such a change would likely enhance the ability of cannabis companies to become more profitable and make them more viable as investment targets. The proposed rescheduling would also free up research barriers that are currently imposed on scientists who wish to study Schedule I substances, such as cannabis, under its current designation.
However, Jaeger makes the point that moving cannabis to another schedule will not legalize it. Participants in state cannabis markets could still continue to face restrictions and penalties under federal law.
Justice Department Director of Public Affairs Xochitl Hinojosa said in a statement to Marijuana Moment, “Today, the Attorney General circulated a proposal to reclassify marijuana from Schedule I to Schedule III. Once published by the Federal Register, it will initiate a formal rulemaking process as prescribed by Congress in the Controlled Substances Act.”
Jaeger also notes that the next step in the rescheduling process is for the White House Office of Management and Budget (OMB), to review the rule. If approved, it would go to public comment before potentially being finalized.
If you care to learn more, we suggest you read Kyle Jaeger’s excellent reporting in the April 30, 2024 issue of Marijuana Moment.net.
Stats of the Week
This week’s magic number is 26 percent. According to Solomon Israel, reporting for MJBizDaily, that’s how much the AdvisorShares that make up the Pure US Cannabis ETF ( an exchange-traded fund that tracks U.S. marijuana companies) jumped within minutes of an Associated Press report that the DEA was finally planning to reschedule cannabis. Shares of the exchange-traded fund closed at $11.26, up almost 25 percent for the day.
Israel acknowledges that whether Tuesday’s marijuana equity rally will be temporary or long-lasting remains to be seen.
According to equity analyst Nadine Sarwat, director of North American cannabis with Bernstein Research, how long the rally lasts depends on the specifics of regulations or laws that stem from the DEA’s reported approval of rescheduling.
In an interview with MJBizDaily, Sarwat said, “Obviously, anything that loosens the regulation on cannabis, even for medical purposes, increases the total addressable market, which is hugely valuable to these companies.” He added,“The question still remains, where does recreational (cannabis) sit in this?”
In his article, Israel makes the point that Owen Bennett, a cannabis stock analyst with New York-based investment bank Jefferies, wrote in a Tuesday afternoon research note to clients that rescheduling could herald “much greater institutional ownership” of marijuana stocks.
Bennett added that rescheduling might also have implications for U.S. “plant-touching companies” that want to list their shares on Wall Street.
Wrote Bennett, “Whether Schedule 3 alone is enough for major exchanges to allow listing remains to be seen, but we think prospects are much improved if we see Schedule 3 and other incremental reform such as SAFE Banking and, potentially, a new Cole Memo.”
Authored by the Justice Department’s Deputy Attorney General James Cole in 2013, the “Cole memo” lays out expectations for federal prosecutors and law enforcement to follow in states with legal cannabis programs. It encourages them to use federal government resources to address threats “in the most effective, consistent, and rational way.”
In the meantime, Bennett noted that one anticipated outcome of rescheduling marijuana to Schedule 3 – the elimination of 280E taxation on U.S. cannabis companies – “would provide a huge boost to company cash flows.”
To learn much more, we encourage you to read the article by Solomon Israel that appeared in the April 30, 2024 issue of MJBizDaily.com.
mjbizdaily.com/us-canadian-cannabis-stocks-rally-after-rescheduling-report/?
Travel Tips
There’s good news for mature consumers and others who like to learn about cannabis—safely and legally—as they travel. It turns out that there are a number of museums in the U.S where the exhibits are focused on cannabis and related topics.
To help those who would like to spend a vacation visiting such institutions but don’t know where to begin, Vanita Salisbury, writing for the publication Thrillist, has identified what she thinks are the “the best, most engaging, and just plain coolest cannabis museums in America.”
Here are two of her favorites:
• THC NYC: The House of Cannabis
According to Salisbury, the point of THC NYC is to use interactive displays to celebrate all things cannabis—and maybe even make you a little lightheaded. One floor, marked The Culture floor, looks at cannabis through the lens of popularity, setting the scene with a distorted mirror installation called Disorientation. Next, a video sends visitors on a time-warp through 600 years of cannabis history.
A floor below, The Agriculture floor houses an urban grow farm, an interactive olfactory exhibit on terpenes, trippy macrophotography by Chris Romaine of Kandid Kush, and an immersive video poem by Curren$y called Seed to Soul. Then there’s the Hypnodrome, an audiovisual “guided levitation” by Australian artist Benjamin Gordon.
Tickets are $40 and there is an option to get cannabis delivered through a partnership with Union Square Travel Agency: A Cannabis Store. Consumers can also hang on the first floor for free, grab some coffee from Jamaican roaster Sangster’s, and shop cannabis-related decor—including items from Seth Rogen’s brand, Houseplant—watch glass bong-blowing demos, and take photos at a high-minded step and repeat backed by photos by cinematographer Ryan Postas for a series called The Art of Smoke.
• Dockside Cannabis Museum, Seattle, Washington
The Dockside Cannabis Museum celebrates what’s been called cannabis’s short-lived golden age before its prohibition in 1937. The museum features the Wirtshafter Collection of pre-prohibition era cannabis items (named after curator and collector Don E. Wirtshafter of The Cannabis Museum).
Visitors can view glass apothecary bottles that contained cannabis tinctures that were used to treat a wide array of conditions, including migraines anxiety, Parkinson’s and melancholia.
When visitors want to trackdown some medication of their own, they can visit an onsite budtender: The museum shares a space with the SODO location of Dockside Cannabis Recreational Dispensary.
SODO is the name given to a vibrant and diverse business district in Seattle that is also home to a burgeoning entertainment and nightlife scene, with bars, restaurants, clubs and event spaces opening up across the district.
To learn more, you can read Vanita Salisbury‘s article in the April 12, 2024 issue of the online publication Thrillist.com.
Senior Cannabis Digest is compiled and edited by Joe Kohut and John Kohut, You can reach them at joe.kohut@gmail.com and at 347-528-8753.
