Extraction Archives - Green Market Report

Debra BorchardtDebra BorchardtMarch 23, 2018


Canadian-based CBD manufacturer Isodiol International Inc. (ISOLF) announced that it has signed a letter of intent to acquire 100% of KURE™ Corp.  The company, a leading specialty vape retailer headquartered in Charlotte, North Carolina, calls itself the ‘Starbucks’ of the vape industry. The amount was not disclosed, but KURE reported unaudited annual revenues for fiscal 2018 of $8.8 million. The deal is expected to close by the end of April 2018.

KURE has tried to differentiate itself from other vape shops by creating the KURE Vaporium & Lounge, a retail environment, and lounge catering to the vaping community. The company operates a total of twelve e-juice bars and lounges today, with plans for international expansion.

“We believe KURE to be the Starbucks (SBUX) of the specialty retail vape industry,” said  Craig Brewer, Chairman & CEO of KURE Corp. ” With over 200,000 customer transactions per year and growing, KURE’s knowledge base in the vape industry is exceptional. In joining the Isodiol family, we will now be able to provide our devout customers the very best CBD products on the market.”

KURE specializes in the retailing of vaporizers and e-cigarettes, e-juices, and related accessories. Its products are available online and throughout its store locations across the United States. KURE Vaporium & Lounge, KURE Society, Kuriousity, Kurators are all respective trademarks of KURE  Corp. Its e-Juices can be purchased pre-bottled or freshly mixed by its staff of “Kurators”, well-trained and experienced mixologists who can “blend” over 500,000 unique flavors from the KURE Juice On Tap bar.

“KURE’s executives are highly experienced business entrepreneurs that have done a tremendous job in building the KURE™ brand,” said Marcos Agramont, Chief Executive Officer of Isodiol.  “Not only does this further entrench our footprint in the vaping and e-cigarette industry, but through KURE retail stores, the Company will set up its own distribution channels for its family of brands, including ISO-Sport and Be Tru Wellness.”

“When we acquired Bradley’s Bioscience, we were excited about the prospects of providing safer alternatives to smoking, while at the same time being able to enter a market poised to be worth over $60 billion by 2025,” said Agramont.   “With this partnership, we will further entrench our footprint in this fast-growing industry, and we look forward to the global opportunities it presents for the Company.”

Isodiol stock was lately trading at 90 cents, down from its 52-week high of $1.69.

StaffStaffMarch 14, 2018


CannaRoyalty Corp. (CNNRF) through its subsidiary, Trichome Yield Corp. will provide up to $2.5 million to 180 Smoke to fund an expansion of its retail footprint in anticipation of Canadian adult-use cannabis legalization.

180 Smoke was co-founded by world-renowned heart surgeon Dr. Gopal Bhatnagar, and is an Ontario-based vape products company. 180smoke.ca is the highest trafficked vaping website in Canada and currently attracts 64% of Canadian vape-related web traffic. The money will support 180 Smoke’s retail and cannabis product offering expansion and help the company open 11 new stores as well as expanding the company’s cannabis hardware offering. 180 Smoke and CannaRoyalty’s subsidiary, CR Advisory, will also work together to bring cannabis products to the Canadian marketplace.

“Forming a relationship with leading Canadian omnichannel retail leader 180 Smoke ahead of adult use legalization represents a compelling and unique first deal for Trichome. It also presents CannaRoyalty shareholders with multiple paths to value creation,” said Marc Lustig, CEO of CannaRoyalty. “180 Smoke’s harm reduction platform has enabled the company to develop an authentic and responsible Canadian retail experience that has served Canadian cannabis consumers for years. This unique model makes them a stand-out – not just in Canada – but also positions them favorably against established cannabis retailers we have seen in the mature California market, where we have benefited from investing in and securing distribution pipelines into retail sales channels.”

According to the statement, 180 Smoke will receive up to $2.5 million from the financing, with an initial investment of $500,000 to be followed by additional investments up to the $2.5 million maximum, subject to satisfactory due diligence and other customary conditions. The Financing will be secured against the assets of 180 Smoke. Further, 180 will issue warrants to acquire shares of 180 Smoke at a pre-determined exercise price for a three-year term.

180 Smoke reported $7.7 million in net sales for 2017 and currently has 16 retail stores in its network. 87% of its net sales come from vape and nicotine related products, while only 12% comes from cannabis vape products.

William SumnerWilliam SumnerFebruary 27, 2018


AXIM Biotechnologies (AXIM) announced today that it has successfully executed current good manufacturing practices (CGMP) methods to extract and microencapsulate cannabinoid molecules. AXIM claims it is the first company in the world to successfully perform the procedure; allowing the company to provide Active Pharmaceutical Ingredients (APIs) of unparalleled purity in various pharmaceutical delivery formats.

CGMPs are the United States Food & Drug Administrations main regulatory standard for ensuring pharmaceutical quality for human pharmaceuticals. Although several companies are currently in the process of developing cannabis-based pharmaceuticals, including GW Pharmaceuticals (GWPH) with its flagship product Epidiolex, none so far have been able to successfully manufacture a product that is CGMP compliant.

CGMP regulations include establishing strong quality management systems, comprehensive operating procedures, the ability to detect and investigate product quality deviations, as well as maintaining reliable laboratory testing conditions.

As the only company currently capable of producing CGMP compliant APIs, AXIM stands to profit greatly from the head start. According to a report by Ackrell Capital, the legal cannabis market is expected to grow to over $100 billion by 2029, half of which will come from cannabinoid-based pharmaceuticals.

The company’s proprietary process was developed in the Netherlands in accordance with regulatory guidelines, beginning with the initial growth of the cannabis plant. APIs are extracted from the cannabis plant using a two-step, solvent-free, extraction process.

The cannabinoids are then protected from oxidation and degradation using a microencapsulation process, allowing them to be manufactured into pharmaceutical-grade cannabis products. In addition, the company believes that the new extraction process can also be used to take unusable cannabis flow, such as those tainted by pesticides, and turn it into containment free cannabis oil.

We’re thrilled to be able to announce this new method to the industry,” said George E. Anastassov, CEO of AXIM Biotech, in a statement. “Our innovative extraction process achieves reliable and effective results while providing a high purity level. By microencapsulating these molecules, we are able to protect them and preserve the APIs while increasing their bioavailability and the potential therapeutic benefits for a variety of pharmaceutical applications.”

Debra BorchardtDebra BorchardtDecember 15, 2017


In the latest Green Market Report Executive Spotlight, meet Bloom Farms, Sally Nichols.

Sally Nichols started as an investor in California cannabis company Bloom Farms and ended up as the company President of distribution. Her classic Ralph Lauren look draws the inevitable comparison to Mary Louise Parker from the television show Weeds, but unlike the character, Nichols is strictly legal business.

“I’ve invested in several other cannabis companies, but with Bloom Farms I really fell in love, not just with the brand, but more importantly the people managing and building the company,” said Nichols. “The relationship slowly evolved until they asked me to come and build out distribution and sales with them.”

The Nichols, the family behind K-Swiss, sold the company in 2012. Sally and her husband then moved to New York from California and made numerous investments in cannabis. “I had been in medical and healthcare startups before and then I just gravitated towards cannabis. After living in California, I wasn’t unfamiliar with the industry.”

She chuckles that she’s the least likely person you would think is flying back and forth between Westchester New York, building, selling and distributing marijuana products. She said for the first couple of years, she kept it quiet, but now she’s very open about it.

Nichols believes that brands win. She describes Bloom Farms cannabis as a clean, fresh product. “We’re basically a lifestyle brand that is focused on bringing relief, relaxation, and creativity to people’s lives versus the highest high in the world.” She compared Bloom Farms to the soft drink Coca-Cola, which started as a medicine and ended up becoming one of the most popular beverages in the world.

Bloom sources its cannabis from sustainable California farms for its vape, pre-rolled flower products and oil pods for PAX vape products. The company supports local small farms and uses that as the source for its single origins line of products.

“It’s really our belief that cannabis as an agricultural product has the ability to be transformative for local, for agricultural communities and urban communities alike. It is also a socially responsible company. With every purchase, the company provides a meal to someone in need. It also works against the negative stigma of cannabis. “It’s shocking how many people that work in farming can’t afford to feed themselves,” she said. The products are consumer friendly with suggestions like ‘daytime friendly’ or ‘nighttime friendly.’

“I’m amazed every day that this is the fork I chose to take in the road,” said Nichols. “At this point in my life, I’m a suburban mom living in New York who is working in the California and Colorado weed business.”

Debra BorchardtDebra BorchardtNovember 2, 2017


The Federal government says marijuana is illegal but is sanctioning cannabis advertising in an airport. Organa Brands, one of the largest privately owned cannabis companies launched the first ever in-airport public service announcement (PSA) about cannabis. SecurityPoint Media is the company behind the campaign and whose programs have been vetted by the Transportation Security Administration (TSA).

The campaign will debut in airports in Southern California with branded trays across all terminals at security checkpoints. The message will read, “Cannabis is legal, traveling with it is not. Leave it in California.” It is expected to be seen by 15 million people.

Organa Brands approached SecurityPoint Media with the idea and is paying for the PSA. The airport has the ultimate say over the campaign and its wording. “The TSA doesn’t get involved in ad copy,” said Joe Ambrefe, Chief Executive Officer of Security Point. “All the airport people approved of it,” he added. Ambrefe did concede that the TSA does have its eye on it and would step in if it was problematic. “It’s a positive message,” he said.

TSA officers do not search for marijuana, but if they observe it can refer the matter to a law enforcement officer. The TSA was established in 2001 following the September 11 attacks to detect terrorism and was moved to the Department of Homeland Security in 2003.

“When we first came up with the plan, we thought there was no chance that the airport or the TSA would ever approve us running a PSA in this space. We are still so amazed to see them in use at the airport,” said Brittany Hallett, Marketing Director at Organa Brands. Organa Brands believes this public service announcement will lead the movement for the next generation of cannabis advertising and legitimize their position as a cannabis powerhouse.

“This is a step in the right direction toward further acceptance of cannabis as a mainstream business,” says Jeremy von Heidl, Co-founder, and President of Organa Brands International. “We wanted to get out ahead of recreational legalization in California with a meaningful public service announcement. The security trays have been a great way to reach our consumers and the reaction has been overall very positive. I think it’s a huge sign of changing perceptions around cannabis that you can walk into an airport and see our brands and our messaging in security trays at the checkpoint.”

The 12-month campaign is seeking to educate cannabis consumers as California enters its first year of legalized adult use marijuana. In a statement, the company said, “By running a public service announcement in a major airport for the first year that California offers recreational marijuana, Organa Brands hopes to ensure the focus at the security checkpoint remains safety and security.”

Hallett said, “The message the trays carry is an important one. We’re very excited for the public to have better access to this information as we move into a new recreational market in California.”

Debra BorchardtDebra BorchardtOctober 25, 2017


While some in the cannabis industry obsess over strains and the nuances of those flavors, the largest cannabis brand O.penVAPE has rolled out a new line of flavored vapes. The O.penVAPE ISH line was launched on Tuesday with three flavors: Bavarian Cream, Blue Raspberry, and Watermelon.

The company said that it was responding to a lot of customer feedback from people that wanted a flavored cartridge. “It appeals to a totally different market than say – the craft reserve. Plus, the addition of flavoring sets it apart in this category,” said Chris Driessen, President, Organa Brands U.S. “The customer is someone who is perhaps not a strain aficionado. It’s someone looking for rich flavor without a strong marijuana taste.”

The ISH in the new product name stands for indica, sativa, and hybrid. The indica dominant brand is Bavarian Creme flavoring, the sativa dominant is the Blue Raspberry flavoring and the hybrid dominant is the Watermelon flavoring.
O.penVAPE is known for its tight marketing and fresh packaging has refined the vape pen even more with this new product. It has a more sleek profile and now comes with a rechargeable unit instead of a throwaway battery. “The eco-friendly aspect stems from the rechargeable functionality of the pen. People love the disposable form-factor, but we hate the idea of all those batteries ending up in a landfill, so we added the ability to recharge,” said Driessen.
There certainly seems to be a customer desire for fruit flavored marijuana. High Times Magazine published a list of the top cannabis strains from the Cannabis Cup competitions a few months ago and the list contained names like Strawberry Banana, Orange Bangi, LSF Lemon Cookies, and Schlemons. Leafly’s staff picks included Tangie, which was described as a “citrus dream” and Strawberry Cough described as smelling “Like it grew wild in a strawberry patch.”

“We saw a need in the space for distillates with unique flavor profiles, and after months of perfecting the design and taste, we are thrilled with the end result,” said Driessen. “I didn’t know how much I would love these flavors until I tried them- but once I did, I was really impressed with the work of our R&D team. It’s not your typical cartridge and is definitely a refreshing take on flavored distillate.”

Debra BorchardtDebra BorchardtOctober 4, 2017


As the concentrate market grows among cannabis consumers, brands are finding that the customers are demanding a better product. Typically, extraction products or cannabis oils in vape pens use the trim, which is basically the marijuana trash. It’s the leaves that end up on the floor of the grow facilities after the trimmers take the good stuff for flower sales.

Joey Shepp, Chief Executive Officer of Humboldt’s Finest said, “Trim used to be thrown away. It was practically free.” Since many producers believed all cannabis oil is basically the same, trim was a profitable choice for a base vape product, while the nice flower was sold separately. However, the popularity of vaporizers because of their cleanliness and convenience is causing a decline in flower sales and an increase in concentrate sales.

Now, customers are pushing back and demanding a better vape experience and that means they want better product going into the oil. Brendan Baker, Founder & CEO of Sunfed Inc., which produces Bumblebee Vape said that with whole plant extraction, consumers are getting a cleaner, truer representation of what the flower is like. “It has a higher cannabinoid content and a higher terpene profile,” he said. “Whole plant extraction, when done properly, gives consumers a better product and better consistency.”

While there is definitely a trend of buyers equating price with cannabinoid content, i.e. “I want the most THC for the least amount of cost,” Baker said the market is shifting. “Sure you can buy 150 proof alcohol, but how does it taste? What’s starting to happen is that people are reintroducing terpenes back into the oil.” Some will argue, that at the end of the distillation process, it’s all the same and when compared to the alcohol market, the same can be said. Yet, there are numerous variations in the spirits market that capitalize on taste and alcohol content.

Another dynamic that is pushing the increased amount of whole plant extraction is scale. “As farmers are scaling up and the amount of pounds they are producing is rising, it’s just more efficient to do whole plant extraction.” He noted that trimming is a labor intensive job, that works on a small scale, but won’t work as California ramps up. “It’s being pushed from craft to a more industrial sized scale,” he said. “They are actually running out of waste product to trim.”

With sun grown farmers seeing margins getting lower anything they can do to cut costs is welcome, including selling the whole plant to processors. However, it does take a certain amount of retooling at the farm to deliver the whole plant and so the farms that are early adopters and first to market will benefit from the switchover. Even on the processor side, Shepp said it takes a higher skill set to do whole plant extractions versus labs that are just distilling trim. “You could do that in a garage,” he added.  The change also brings a new dynamic as to pricing the whole plant when before prices were based on flower vs. trim.

The farmers seem to be pleased with the change. While prices could be lower, the costs are lower as well. Like any farmer, they are generally happier to lock in fewer customers and less processing in order to focus on farming.

“It’s a win-win. A win for the farmer, a win for manufacturing and a win for consumers who get a better product,” said Baker. “It’s Whole Foods versus processed foods.” As the story continues to be about the clean and pure product, Humboldt’s Finest comes to mind. Consumers want to know the farm now and whether it’s sustainable and clean. Baker mentioned they may do bulk oil from Humboldt’s Finest that could be used in other products. Saying it’s quality in and quality out.

Debra BorchardtDebra BorchardtOctober 2, 2017


How is it that a man who knew little about marijuana ended up being the CEO of one of the largest privately held cannabis companies in the country?

Ralph Morgan is the current Chief Executive Officer of O.penVAPE, which is the largest branch of Organa Brands. He started his career in healthcare, but as he was climbing the corporate ladder he felt he was moving further away from healthcare.

I started a dispensary in 2009 with my wife because I knew how to speak to people with ailments and basically that was it,” he said. “I had very little experience with cannabis.” His research into the product told him it was the perfect place for entrepreneurial opportunity. “It’s controversial, a little bit of David and Goliath, a little bit of right and wrong. Great opportunity on the upside for a social change.”

His experience as a dispensary owner, however, showed him that there was a gap in the market for products that were consistent, reliable and safe. This encouraged him and his wife to invest in a MIP or manufactured infused product facility and this was the birth of Organa Labs in 2010.

He invested in CO2 equipment. “It was avant-garde at the time,” said Morgan. Then e-cigarettes started taking off and he started playing around that concept. By 2012, Morgan and his partners had decided that vaporizers were the ideal way to consume cannabis. They felt it was going to be a disruptive technology for the cannabis market and they were right. O.penVAPE was born and the company has grown into a business that does over $100 million in sales each year.

The challenge the company faces now is scaling and growing. Morgan said that picking great partners comes from surviving bad partnerships. “At this size, the stakes are just that much higher. A new partnership means we have to get it right, if we get it wrong, can we recover?” he asked. “Each mistake gets more expensive. We made a lot early on, but the costs were low.”

Morgan’s time as CEO is about to shift. “I started as CEO of Organa Labs, but I don’t act in that capacity anymore and I’ll officially change that to President of Wellness and CBD products,” he said. The company is planning on expanding the leadership to people outside of the cannabis industry. Morgan said they are looking for folks that have the experience to grow a company that’s on track to be a billion company in a few short years. “I’ve never done that before,” he said. “Despite my tenacity, I’m not qualified. We need better help. We’ve got one chance to get this right.”

Now he is focusing on the medical vertical and wellness line as he gets back to his roots. “It’s something that is near and dear to my heart.” We should have a full launch by Christmas of this year. It will be called OBA, Organa Brands Alternatives.”

With Organa Brands, it will be healthier alternatives to conventional products. Instead of a 5-hour energy drink like a Red Bull, OBA will have an energy option with CBD in it. Some will have THC in them, but the products without THC will be sold everywhere.

The OBA will have several categories, but none including vapes since that’s already available. There will be pressed pills for energy, sleep, relax and rejuvenation. A gel cap product called “Daily Dose” with a small amount of THC or CBD. A point of purchase kiosk is designed to educate the customer. It has a simple decision tree to help drill down into the product. There will be hard copy, plus a tablet to give information.

Morgan said the culture of Organa is hiring someone with the right attitude, passion and moral compass. “We work way too hard for this to be just a job,” he pointed out. “If you’re just here to make a buck you’re in the wrong industry.” Some of Organa’s company perks include free rides on Uber, matching the 401k two to one and generous pay. Morgan said, “If you have the right attitude, there’s a seat on the bus for you.” He’ll be driving the bus.

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