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Who thought CBD could be so scandalous?
Pruning The Folium: Australis Capital, a publicly traded cannabis investment firm, has terminated its planned acquisition of Folium Biosciences, reportedly the “largest fully vertical cannabinoid biomass producer, utilizer and extractor in North America”. Australis, which spun off from Aurora Cannabis to focus on the U.S. market in 2018, did not comment on the reasons for the termination. However, the breakup seems likely tied to the (I believe this is a technically accurate term) absolutely bonkers stories emerging about Folium, which include lawsuits, explosions, and even murder-kidnap plots.
Why It Matters: If you didn’t check out the above link, let me repeat for you again: lawsuits, explosions, and even murder-kidnap plots! There’s also a (quite) weird Australis transcript with a semi-anonymous investor representative floating around. So what’s the takeaway? It’s not just THC-focused businesses that get the spicy storylines - check out major CBD producer Isodiol’s almost equally nuts FAQ page for more adjacent reading. When there’s huge dollars in play and the rules are grey, it’s not necessarily the most qualified or scrupulous individuals who are first to the line, irrespective of which cannabinoid you’re dealing with. So... do your homework before you invest, you know?

Pay To Play: Marijuana brands are increasingly encountering slotting fees, where brands can pay $500 - $1,500 per month for the best retail space in dispensaries. The practice, common in many other industries, started cropping up in California in 2018 and has remained largely unregulated as it’s moved to other states like Nevada. For businesses, it can pose a problem if not correctly incorporated into forecasts, an issue further exacerbated by the fact such expenses are not tax deductible.
Why It Matters: It’s all about market structure, right? On one hand, it’s not like slotting fees are a new idea - it’s incredibly common in, say, the groceries business, where chains sometimes earn more profit off fees than they do selling merchandise. On the other hand, you don’t see it in all industries - consider, for example, the liquor business, where pay-to-play rules can get you in a lot of trouble. If you’re a fan of startups or the idea of “craft cannabis”, slotting fees are another expensive barrier that benefits larger incumbents. 

Soul Searching: Shawn Gold knows a bit about brand building in cannabis, having previously served as Chief Marketing Officer at Lowell Herb Co. and an advisor to brands like MedMen and Charlotte’s Web. We talked with him about what to expect in the oncoming wave of next generation cannabis brands and how his new brand, Pilgrim Soul, fits into the equation. Check it out.

What’s Next: Final chance to decide  - we’d love to get your thoughts on what you’d like to see next - just click below to let us know:

Quick Hits

Smoking Hot Product Of The Week: Invincibowl
Groundbreaking (Not Glass-Breaking): We spend a lot of time talking about new consumption forms on Cannablurbs, but innovation is occurring across the industry. Case in point: Invincibowl’s rugged new bowls are a potential gamechanger for the bong enthusiast, as the all-aluminum construction aims to solve the risk of breaking your bowl, while screen construction makes clean up a breeze. If you're interested, you can use the code CANNABLURB20 for 20% off the entire purchase.

Research Rips

👍 Cannabinoids Show Potential In Combatting Non-Small Cell Lung Cancer 
👍 CBD May Be Helpful In Treating Multiple Substance Use Disorder
👍 Cannabinoids May Be Beneficial Bone With Regards To Bone Marrow-Derived Stem Cells
THC Use Is Associated With Small Increases In Testosterone

State Legalization Watch: 0/5 

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