Week In Review: MedMen Exits California; Florida Cracks Down on Hemp; Maryland Supreme Court Sidesteps Hemp THC Case; U.K.’s Medical Cannabis Use Rises Amid ADHD Medication Shortage

LOS ANGELES–Welcome to the far too-exciting world of cannabis and psychedelics, where it’s earnings season with updates from some of the leading MSOs outlined below.

Capital Markets: Positive Quarterly Earnings from Leading Cannabis Companies Amidst Sector Volatility

In the realm of cannabis investments, recent market fluctuations have been notable. Over the past five weeks, both the US cannabis MSOS ETF and the global YOLO ETF experienced declines, with MSOS dropping by 8.68% and YOLO by 7.99%. However, the year-to-date performance shows MSOS with a 19.64% increase and YOLO with a 10.59% rise.

The cannabis sector faces uncertainties despite positive earnings and political gestures. Notably, President Joe Biden referenced cannabis in his State of the Union address, highlighting plans to review federal cannabis classification and expunge possession-related convictions.

Since its peak on February 6, where it hit $10.64, MSOS has seen a significant decline of 23.87%. Despite this, the fund attracted $77.13 million in inflows during this period, indicating continued investor interest.

BDSA’s latest forecast paints a promising picture for the industry. US sales are projected to grow from $29.5 billion in 2023 to $32.4 billion in 2024. Moreover, the US cannabis market is expected to achieve a 9% compound annual growth rate (CAGR) from 2023 to 2028, reaching $46 billion in sales by 2028. International markets, while currently small, are forecasted to experience rapid expansion, with sales outside the US and Canada expected to reach $7 billion by 2028, driven by a 24% CAGR.

In earnings news, Curaleaf (TSX: CURA, OTCQX: CURLF) and MariMed (CSE: MRMD, OTCQX: MRMD) see below released their financial reports recently, indicating further insights into the market dynamics and company performances.

Cannabis Business News

#1 Maryland Supreme Court Sidesteps Hemp THC Case: The Maryland Supreme Court has decided against reviewing a case that challenges a provision of the state’s adult-use cannabis legislation, effectively allowing the continued sale of hemp-derived THC products by unlicensed retailers across the state. This decision follows a lawsuit initiated by the Maryland Hemp Coalition and other hemp-related businesses against a specific prohibition within Maryland’s Cannabis Reform Act.

#2 .Revive Therapeutics Advances Clinical Research with Completion of Funding Round: Revive Therapeutics Ltd. has successfully concluded the final tranche of its previously announced private placement, marking a significant milestone in the company’s fundraising efforts. This move, detailed in press releases dated January 24, 2024, and January 31, 2024, saw the issuance of 33,917,428 units at a price of $0.035 per unit, culminating in gross proceeds of $1,187,110. The combined total from the initial and final stages of the offering amounts to $2,100,610, showcasing robust investor confidence in Revive’s strategic direction and potential for innovation.

#3. MedMen: The closure of several MedMen cannabis retail locations in California, except for two, signals the end of an era for the once-prominent chain. Following a period of financial instability marked by plummeting stock values and executive changes, the company shut down branches in Santa Ana, Long Beach, and San Francisco, among others. The closure trend extends beyond California, with stores in Illinois and Nevada also ceasing operations. The shutdowns come amidst a turbulent period for MedMen, which saw its CEO and executive chairman ousted earlier this year. The closures reflect broader challenges facing the cannabis industry, including regulatory hurdles and market competition. MedMen’s decline serves as a cautionary tale for cannabis entrepreneurs navigating the complexities of the evolving industry landscape.

#4. Florida: In a decisive move that could reshape the landscape of the hemp industry in Florida, the state legislature has passed a bill aimed at regulating hemp-derived products, including the prohibition of certain natural cannabinoids such as Delta-8 THC. Senate Bill 1698, which now awaits Governor Ron DeSantis’s approval or veto, proposes stringent controls over the sale and distribution of hemp-based products, sparking concerns among farmers, manufacturers, and consumers within the state.

Psychedelic Market Highlights:

#1.U.K.’s Medical Cannabis Use Rises Amid ADHD Medication Shortage: The United Kingdom is witnessing a notable shift towards medical cannabis as an alternative treatment for Attention-Deficit/Hyperactivity Disorder (ADHD) amid a severe shortage of stimulant-based medications. The scarcity of these essential drugs has pushed patients towards exploring alternative remedies, with medical cannabis emerging as a viable option for many.

#2 Ohio Moves to Drastically Reduce Medical Cannabis Registration Fee to One Cent: In a significant step toward making medical cannabis more accessible to patients, Ohio has announced plans to reduce the registration fee for medical cannabis patients to a nominal one cent. This move, aimed at providing immediate financial relief, precedes the state’s ultimate goal of eliminating the fee entirely. The decision reflects a broader trend among states to lower the financial barriers for medical cannabis access. Check out our ebook on Ohio with an in-depth look at that new canabis market. 

Hall of Flowers Cannabis brands & business exposition March 13 & 14; Ventura, California

InternationalCBC Cannabis business exposition 14 March, Barcelona Spain

The Cannabis Summit European Cannabis networking event; 11-12 April 2024

Benzinga Cannabis  April 16-17; Hollywood Florida

More dates are added regularly so follow Highly Capitalized for more information.

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