PALM BEACH, FL — December 14, 2020 — In recent years, cannabis and products with cannabis components, such as CBD, are one of the hot topics in the life sciences industry. Many countries now allow the medical use of cannabis to treat numerous conditions, including chronic pain, cancer, multiple sclerosis, and many others. Additionally, more and more countries have recently allowed the recreational use of cannabis. Finally, hemp (cannabis grown without mind-altering substances), is another burgeoning industry worldwide.
Though there are international treaties in place, the production, distribution, and consumption of controlled substances (including cannabis) are still traditionally regulated by each country individually (even within the EU). Some countries still consider cannabis a dangerous illicit substance. Thus the legal landscape on cannabis and cannabis products is very fragmented and complicated, making it hard to get involved in the cannabis industry.
Alpha Green Research said that: "Cannabis has been making a splash in the wellness world in recent years, with the general public and medical community becoming increasingly supportive of its therapeutic potential. According to Grand View Research, the global medical cannabis market is expected to reach $55.8 million by 2025. The gradual legalization of cannabis and the growing interest in CBD products results in the growth of R&D investments in the cannabis industry. Cannabis companies that give consideration to research, among other things, such as supporting the voices of advocates, may find new therapeutic uses for cannabis and manufacture innovative products that will generate higher competition in the market. The main goal of further research and development is to produce cannabis products that better meet the needs of all users."
Mentioned in today's commentary include Aurora Cannabis Inc. (NYSE: ACB) (TSX: ACB), Sativa Wellness Group Inc. (CSE: SWEL), Aphria Inc. (NASDAQ: APHA) (TSX: APHA), Tilray, Inc. (NASDAQ: TLRY), Canopy Growth Corporation (NASDAQ: CGC) (TSX: WEED).
An article by the Regulatory Affairs Professional Society (RAPS) said the framework for regulating cannabis as a pharmaceutical product varies widely across the world, though increased clinical research into cannabis products means more approvals are likely under any scenario… "It's currently a complex patchwork of approaches," Michael Craig, a principal consultant at Parexel International, said during a session on cannabis regulatory challenges and harmonization at RAPS 2020 Convergence. "That is the embodiment of it being borne out by national legislation rather than an overarching EU or European Medicines Agency framework…" Though Craig was speaking specifically of the approaches within the European Union, the same is true in the United States, where states are passing medical marijuana legislation independent of federal action.
Sativa Wellness Group Inc. (CSE: SWEL) Breaking News: CBD and Cannabis Regulatory Progress from The United Nations, European Commission and US House of Representatives — Sativa Wellness Group Inc. wishes to announce that recent rulings from the European Commission, the United Nations, and the US House Of Representatives confirm the free movement of CBD products in Europe, pave the way for expansion of medicinal cannabis research, and the federal decriminalization of cannabis in the US.
Cannabis regulation around the world
European Commission — Sativa Wellness is pleased to confirm that the European Commission (EC), the executive branch of the European Union (EU), has concluded that CBD (Cannabidiol) is not considered to be a drug within the meaning the UN Single Convention on Narcotic Drugs of 1961, following the recent landmark ruling from the EU's highest court. As a consequence, the EC confirmed that CBD qualifies as a food, and is therefore subject to EU law on the free movement of goods among member states.
Subsequently, the European Food Safety Authority (EU FSA) has resumed reviewing novel food authorization applications for CBD products, a decision which is welcomed by the company, which operates CBD extraction and production in the UK and Europe.
The company intends to submit its novel food dossier that is being prepared for the UK Food Standards Agency (UK FSA) in parallel to the EU FSA, which will be a seamless process as the submission criteria for the two agencies are aligned.
United Nations — The United Nations has considered a number of recommendations from the World Health Organization (WHO) to reclassify cannabis and its derivatives, and recently voted in favor to remove cannabis from Schedule IV of the 1961 UN Single Convention, the category of the world's most dangerous drugs.
The company believes that this long-anticipated decision, whilst having no immediate effect on local government classification at a country level, opens the door to recognizing the medicinal and therapeutic potential of cannabis, and paves the way for additional scientific research, such as the company's research partnership with King's College London into the efficacy of different cannabinoids in treating respiratory conditions.
US House of Representatives — The US House of Representatives recently passed a federal bill to decriminalize cannabis at the national level. Whilst cannabis has been decriminalized in several states in the US, including California, Colorado, Nevada, and Washington, it remains illegal at the federal level. The House calls for removing cannabis from the list of federally controlled substances and clears the way to erase certain federal convictions.
Whilst this bill is the first step to approval at the federal level—to become law, the bill needs to pass the Senate and be signed by the president—if passed into law, it would bridge the gap between state and federal legislation, and facilitate the emerging industry and access to medicinal cannabis across the US.
"Sativa Wellness welcomes the clarity that these regulatory updates bring to the CBD wellness and medicinal cannabis industry in Europe, the US and globally. We believe that a well-regulated cannabis sector will lead to consumers benefiting from safe, compliant, and quality products, such as our Goodbody CBD brands, and opens the pathway for patients to benefit from further research into the efficacy of medicinal cannabis. This news will allow us to continue with our European expansion plans, and may facilitate the opening up of new markets in the future," said Henry Lees-Buckley, CEO of the Sativa Wellness Group Inc.
Recent news from cannabis companies
In other active company news in the markets this week:
Canopy Growth Corporation (NASDAQ: CGC) (TSX: WEED) and its medical division, Spectrum Therapeutics, have recently completed and published a new study on the long-term effects of cannabidiol (CBD), specifically focusing on toxicity and lifespan effects of CBD in the preclinical model C. elegans.
The study was commissioned to evaluate the solubility, stability, acute toxicity, thermotolerance, and effects on lifespan of CBD in C. elegans as part of Canopy Growth's ongoing commitment to provide the data required to support and influence public policy through research. To the best of the company's knowledge, this study represents the first long-term toxicity and lifespan research regarding the effects of chronic exposure to cannabidiol—one of the cannabinoids found in cannabis.
Tilray, Inc. (Nasdaq: TLRY), a leading company in the manufacture, research, and distribution of medical cannabis, recently announced that it has entered into a co-promotion agreement with Hormosan for its full-spectrum cannabis extracts in Germany effective January 1, 2021.
Hormosan is primarily focused on pain therapy and neurology and is part of the Lupin Group, an international entity that sells innovative drugs and generics. Hormosan will support Tilray in its marketing and sales activities of full spectrum cannabis extract in Germany. Through this strategic partnership, the expertise of both Tilray and Hormosan will be leveraged to expand Tilray's presence in the German market.
Aphria Inc. (NASDAQ: APHA) (TSX: APHA), a leading global cannabis company inspiring and empowering the worldwide community to live their very best life, recently announced it has closed the accretive, strategic acquisition (the "Acquisition") of SW Brewing Company, LLC ("SweetWater Brewing Company" or "SweetWater"), one of the largest independent craft brewers in the United States ("US") based on volume. Beginning with the flagship 420 beverage offerings, SweetWater has created an award-winning lineup of year-round, seasonal, and specialty beers, a portfolio of brands closely aligned with a cannabis lifestyle.
"We are excited to take this significant step forward to build upon our existing foundation in cannabis with the acquisition of SweetWater and their complementary cannabis lifestyle brands. Together, our company will further diversify our product offering, broaden our consumer reach and enhance loyalty with consumers," commented Irwin D. Simon, Aphria Inc.'s chairman and chief executive officer. "We are very pleased to welcome Freddy Bensch to our management team and the entire SweetWater organization to the Aphria family. We look forward to expanding our addressable market and leveraging SweetWater's existing infrastructure to accelerate Aphria's entry into the US ahead of federal legalization of cannabis to fuel sustainable profitable growth."
Aurora Cannabis Inc. (NYSE: ACB) (TSX: ACB), the Canadian company defining the future of cannabinoids worldwide, recently announced it has entered into a strategic supply agreement (the "agreement") with Cantek Holdings ("Cantek"), one of Israel's leaders in the medical cannabis field.
Under the terms of the agreement, Aurora will supply Cantek with dried bulk flower over a two-year period, with the option to extend. The company intends to provide Cantek with a minimum of 4,000 kgs of bulk dried flower annually, which will be processed into finished product, and co-branded under the Aurora and Cantek brand names for the Israeli market with the potential for additional international market sales. Having secured all necessary export and import permits, the initial shipment of cannabis under the Agreement occurred during the week of November 16, 2020.
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