hemp Archives - Green Market Report

Sean HockingSean HockingJune 7, 2019
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7min1950

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PUBLISHER:  CANNABIS LAW REPORT

 

 On May 22, AB 228 (Aguiar-Curry) passed the California Assembly unanimously and is now on its way to the Senate where it will first be heard next month in the Senate Health Committee. If passed, the legislation would help resolve issues in the state involving hemp-derived products, including products containing cannabidiol (CBD), and pave the way for the California Department of Public Health (CDPH) to regulate the processing and sale of these products.

 

In July 2018, CDPH issued an FAQ asserting the agency’s position, consistent with the FDA, that hemp-derived CBD is not an approved food ingredient, food additive, or dietary supplement. The FAQ did not address CBD in cosmetics. In deferring to the FDA’s position on CBD, CDPH noted that until the FDA rules that industrial hemp-derived CBD oil and CBD products can be used as a food, or California makes a determination that they are safe to use for human and animal consumption, CBD products are not an approved food, food ingredient, food additive, or dietary supplement. Consequently, if AB 228 is passed, California will have made such a determination as referenced in the FAQ (i.e., CBD is safe to use for human and animal consumption), and the issue of including CBD as a food ingredient/additive or dietary supplement under California state law will be resolved.

 

In AB 228, the state, by declaring that food and cosmetics are not adulterated by the inclusion of hemp (including cannabinoids, extracts, or derivatives), essentially finds that hemp-derived products, including products containing CBD, are safe for human and animal consumption. That said, to ensure consumer safety, CDPH needs regulatory authority over processors of hemp like all other food manufacturers. Thus, we can anticipate further amendments to AB 228 once it arrives in the Senate.

 

In other California hemp news, on the same day, AB 228 was unanimously voted out of the Assembly, SB 153 (Wilk) also passed out of the Senate without a “nay” vote. SB 153 principally conforms California’s hemp statute to the minimum requirements needed for a state hemp farming plan under the 2018 Farm Bill. Both of these bills are benefitting from a combined effort by their authors, industry advocates, government agencies, and the Governor’s office – a true testament to collaboration and coalition building.

 

Patrick Goggin is a Senior Attorney at Hoban Law Group. He has waged battle on the frontlines of industrial hemp and general cannabis reform for two decades. Earning an Environmental Law Certificate from Lewis and Clark Law School in Portland, Oregon, Mr. Goggin was admitted to the California Bar in 1996. Based in San Francisco, he served as co-counsel in the seminal HIA v. DEA cases in the early 2000s. Later, Mr. Goggin led the industry effort with Senator Mark Leno in 2013 to finally pass California’s Industrial Hemp Farming Act after three vetoes.

 

Ashley Simpson is of counsel to Hoban Law Group. Simpson received her law degree from Texas A&M University School of Law in 2011, where she was a member of the law review, and graduated magna cum laude from Texas Tech University in 2008 with a Bachelor of Arts in print journalism.

  

This article has been prepared for informational and general guidance purposes only; it does not constitute legal or professional advice. You should not act upon the information contained herein without obtaining specific professional advice. No representation or warranty (express or implied) is made to the accuracy or completeness of the information contained in this publication. Hoban Law Group, its members, employees, and agents accept no liability, and disclaim all responsibility, for the consequences of you or anyone else acting, or refraining to act, in reliance on the information contained in this publication or for any decision based thereupon.


Video StaffVideo StaffJune 4, 2019

1min2710

The Economics of the New Hemp Market is a panel that was held on May 7 at the Green Market Summit in Chicago. The legalization of hemp is so new that the regulations are still being written. Data will be key to unlocking this industry and industrial grade price assessments will be needed over the next few months to support futures trading on a major commodity exchange sometime early 2019. This panel was led by moderator Peter Vogel, CEO Leafwire and he was joined by Jonathan Rubin, Founder – Cannabis Benchmarks, Kevin Pilarski Chief Commercial Officer – Revolution and Bethany Gomez, Director of Research – Brightfield Group.


StaffStaffMay 14, 2019
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4min2010

Hemptown Organics Corp. raised  C$24 million in a round of financing from Canaccord Genuity Corp.who served as the lead agent on the brokered portion of the financing on behalf of a syndicate of investors that included Sprott Capital, Beacon Securities, and Pacific International.

The investment will allow Hemptown to embark on a multi-state expansion, purchase $5.5M in Oregon CBD seeds, begin the build-out of its processing and extraction facilities, research team, as well as planting and harvesting of its 2019 crop of feminized hemp seeds.

“Successful companies in this sector will be those with the ability to build a scalable, vertically integrated multi-state company,” stated Rod Wolterman, Founder and Chairman, Hemptown USA. “We have assembled a well-respected team that has already produced some of the highest quality feminized hemp in the country here in Southern Oregon’s Emerald Triangle. The capital infusion will allow us to expand operations to Colorado, Kentucky, Northern California, ramp up processing capabilities and develop disruptive product formulations in the CPG sector. Needless to say, we’re very excited to be executing on our vision and delivering sustainably grown feminized hemp flower and biomass on a commercial scale.”

With this capital infusion, Hemptown USA is now poised to become a formidable multi-state operation within this rapidly growing industry. Hemptown reported that it had a first-year yield of 110,000 lbs of feminized hemp biomass. The company said it is one of the largest CBG producers in the U.S. with our purchase of 1 million rare CBG seeds for the 2019 growing season. It also said that it is producing some of the world’s most coveted strain profiles containing 15% – 20% full spectrum CBD, CBG and other cannabinoids and terpenes.

Currently, the company is growing 1500 acres in Oregon, Kentucky, and Colorado with the capability to more than double the acreage in 2020 and each year after.

Looking Ahead

Hemptown plans to continue farming more novel cannabinoid strains in large quantities. Such as CBC, CBDV, and CBGV. The company also plans on acquiring a cGMP nutraceutical facility to develop unique cannabinoid products for the health and wellness industry.

“Successful companies in this sector will be those with the ability to build a scalable, vertically integrated multi-state company,” stated Rod Wolterman, Founder and Chairman, Hemptown USA. “We have assembled a well-respected team that has already produced some of the highest quality feminized hemp in the country here in Southern Oregon’s Emerald Triangle. The capital infusion will allow us to expand operations to Colorado, Kentucky, Northern California, ramp up processing capabilities and develop disruptive product formulations in the CPG sector. Needless to say, we’re very excited to be executing on our vision and delivering sustainably grown  feminized hemp flower and biomass on a commercial scale.”

 

 


StaffStaffMay 9, 2019
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3min3490

Just two months after announcing the launch of Arcadia Specialty Genomics™, a new cannabis-dedicated division of agricultural crop improvement, the company has released images of its first crop of sun-grown, Hawaiian hemp. Arcadia’s new cannabis unit, cultivates six Hawaiian hemp strains on its 10-acre Hawaiian facility.

In March, the company revealed it had been granted an Industrial Hemp Pilot Program (“HIHPP”) License by Hawaii’s Department of Agriculture. The license allows for the cultivation of industrial hemp for the purposes of agricultural and academic research. Hemp and hemp products produced under the program may be commercially sold.

With a 10-acre field station in Hawaii, Arcadia is producing its first research crop of hemp to test the impact of climate and geography on crop parameters like yield and quality. Arcadia Specialty Genomics’ scientists and agronomists are evaluating and characterizing the performance of a number of local strains against various climate and biological conditions to understand the attributes of each, as well as identify opportunities for improvement. In addition, the company has hired full time staff at its Hawaii facility to oversee the ongoing research and grow operations.

“It’s highly gratifying to see our first hemp research crop taking root in Hawaii, having planted six different Hawaiian strains,” said Matt Plavan, president of Arcadia Specialty Genomics and CFO of Arcadia Biosciences. “In order to solve for crop variability – a major concern for U.S. hemp farmers – we first need to understand its drivers. We’re applying the sound, scientific approaches we’ve used to improve other crops, such as wheat, to create new breeds of superior hemp.”

Hawaii is the first state where Arcadia Specialty Genomics has commenced its research and cultivation of hemp in federal and state legal cannabis markets, using non-GMO techniques to produce superior U.S. hemp crops.

While traditional agricultural crops can be difficult to grow and export economically in Hawaii, the rich soil and warm climate are ideal for cultivating high-value crops such as hemp.

Arcadia Biosciences is a recognized leader bringing deep experience and established capabilities in this kind of crop innovation and optimization, delivering proven results safflower, wheat and durum such as:

A 100 percent increase in the production of omega-6 GLA for safflower
Two to six times more fiber than standard wheat and durum with its proprietary GoodWheat™ flour
A 65 percent reduction in allergenic gluten content in its GoodWheat™ flour
30 percent more lysine, an essential amino acid, in GoodWheat™ compared to standard wheat
The company expects to harvest its first crop of Hawaiian-grown research hemp this summer.

 

 


AxisWireAxisWireMay 7, 2019
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8min2930

Arcadia Biosciences’ Hawaiian Hemp Farm in Full Bloom

Arcadia Specialty Genomics, the company’s new cannabis unit, cultivates six Hawaiian hemp strains on its 10-acre Hawaiian facility.

DAVIS, Calif. (May 7, 2019) /AxisWire/ – Just two months after announcing the launch of Arcadia Specialty Genomics™, a new cannabis-dedicated division of agricultural crop improvement leader Arcadia Biosciences, the company is releasing images of its first crop of sun-grown, Hawaiian hemp.

Arcadia Specialty Genomics focuses on the development of novel cannabis varieties possessing productivity, pest resistance and crop quality traits for license to cultivators in federal and state legal markets, and as products such as hemp-derived CBD oils for the nutraceutical and food industries.

In March, the company revealed it had been granted an Industrial Hemp Pilot Program (“HIHPP”) License by Hawaii’s Department of Agriculture. The license allows for the cultivation of industrial hemp for the purposes of agricultural and academic research. Hemp and hemp products produced under the program may be commercially sold.

With a 10-acre field station in Hawaii, Arcadia is producing its first research crop of hemp to test the impact of climate and geography on crop parameters like yield and quality. Arcadia Specialty Genomics’ scientists and agronomists are evaluating and characterizing the performance of a number of local strains against various climate and biological conditions to understand the attributes of each, as well as identify opportunities for improvement. In addition, the company has hired full time staff at its Hawaii facility to oversee the ongoing research and grow operations.

“It’s highly gratifying to see our first hemp research crop taking root in Hawaii, having planted six different Hawaiian strains,” said Matt Plavan, president of Arcadia Specialty Genomics and CFO of Arcadia Biosciences. “In order to solve for crop variability – a major concern for U.S. hemp farmers – we first need to understand its drivers. We’re applying the sound, scientific approaches we’ve used to improve other crops, such as wheat, to create new breeds of superior hemp.”

Hawaii is the first state where Arcadia Specialty Genomics has commenced its research and cultivation of hemp in federal and state legal cannabis markets, using non-GMO techniques to produce superior U.S. hemp crops.

While traditional agricultural crops can be difficult to grow and export economically in Hawaii, the rich soil and warm climate are ideal for cultivating high-value crops such as hemp.

Arcadia Biosciences is a recognized leader bringing deep experience and established capabilities in this kind of crop innovation and optimization, delivering proven results safflower, wheat and durum such as:

  • A 100 percent increase in the production of omega-6 GLA for safflower
  • Two to six times more fiber than standard wheat and durum with its proprietary GoodWheat™ flour
  • A 65 percent reduction in allergenic gluten content in its GoodWheat™ flour
  • 30 percent more lysine, an essential amino acid, in GoodWheat™ compared to standard wheat

The company expects to harvest its first crop of Hawaiian-grown research hemp this summer. For more information, visit www.arcadiabio.com.

About Arcadia Specialty Genomics

Arcadia Specialty Genomics is a strategic business unit of Arcadia Biosciences, Inc. leveraging the market-leading capabilities of its parent company to deliver crop innovation into developing proprietary, industry-leading cannabis germplasm. Focused on productivity, pest resistance and favored quality traits, Arcadia Specialty Genomics’ innovations serve the state- and federally-legal nutraceutical, food and industrial markets. For more information, visit www.arcadiaspecialtygenomics.com

About Arcadia Biosciences, Inc.

Arcadia Biosciences, Inc. (Nasdaq: RKDA) develops and markets high-value food ingredients and nutritional oils that help meet consumer demand for a healthier diet. Arcadia’s GoodWheat™ branded ingredients deliver health benefits to consumers and enable consumer packaged goods companies to differentiate their brands in the marketplace. The company’s agricultural traits are being developed to enable farmers around the world to be more productive and minimize the environmental impact of agriculture. For more information, visit www.arcadiabio.com.

Note Regarding Forward-Looking Statements

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially, and reported results should not be considered as an indication of future performance. These risks and uncertainties include, but are not limited to: Arcadia Specialty Genomics’ expectations about the cannabis industry and potential demand for our products; the uncertainty of the laws and regulations relating to cannabis and products derived therefrom; the inherent uncertainty associated with the development of new projects; our ability to obtain proper licenses and successfully complete research programs related to cannabis; the acceptance of our products in the marketplace; the impact of competitive products and pricing;  risks related to costs, delays and uncertainties associated with potential future scientific research, product development, clinical trials and the regulatory approval process; our partners’ and affiliates’ ability to develop commercial products incorporating cannabis related traits, and complete the regulatory review process for such products; our compliance with laws and regulations that impact our business, and changes to such laws and regulations; our future capital requirements and ability to satisfy our capital needs; our ability to develop, enforce and defend our intellectual property rights; and the other risks set forth in our filings with the Securities and Exchange Commission from time to time, including the risks set forth in our Annual Report on Form 10-K for the year ended December 31, 2018 and other filings. These forward-looking statements speak only as of the date hereof, and Arcadia Biosciences, Inc. disclaims any obligation to update these forward-looking statements.

Twitter: @ArcadiaAg on Twitter
LinkedIn: Arcadia Biosciences

Press Contacts:

Trailblaze PR
Lisa Weser
lisa@trailblazepr.com


StaffStaffApril 30, 2019
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4min3280

The Texas Tribune reported on Monday that the House of Representatives approved a bill that would decriminalize possession of cannabis. Rep. Joseph Moody (D), the chief sponsor of the bill, still had to amend it in order to get the bill approved. His original version had a lower fine of $250 and it would have dropped down low-level possession to a civil infraction instead of a class C misdemeanor.

Still, the paper reported that the chances of the bill turning into law would be slim. “After the House grants final approval for the bill — usually just a formality — it will head to the Senate, where presiding officer Lt. Gov. Dan Patrick has expressed opposition to the idea of loosening marijuana possession penalties.” The resistance is attributed to the fear that each move to loosen cannabis laws is another step towards full legalization.

If Texas manages to pass the law, it would become the 25th state to decriminalize cannabis. “Texans have suffered under failing marijuana policies for far too long,” Heather Fazio, director of Texans for Responsible Marijuana Policy, said. “Rep. Moody’s bill will help preserve valuable public safety resources and keep a marijuana charge from derailing someone’s life. Like a majority of Texas voters, Democratic and Republican lawmakers agree that marijuana laws need to change.”

Medical marijuana is legal in the state but on a very restrictive level. There is only one approved condition, which is intractable epilepsy. Several pieces of legislation have been filed in order to expand the condition list.

Hemp Farming Legalized

Just last week, The Texas House approved a bill that would allow farmers in the state to legally grow industrial hemp. House Bill 1325 from state Rep. Tracy King, D-Batesville, would also legalize hemp and hemp-derived extracts like CBD oil as long as they contain no more than 0.3% THC. “HB 1325 is right-to-farm legislation that will allow Texas farmers the opportunity to cultivate a drought-resistant cash crop — that being hemp,” King told other House members.

The bill has now headed to the Senate for approval. Texas Agriculture Commissioner Sid Miller is a strong supporter of industrial hemp production as a new market opportunity for Texas farmers to expand their operations and grow alternative crops.  Once authorized by the Legislature, TDA said it will create rules regarding licensing, production, testing, seed certification and other oversight as necessary.

“There’s no good reason for Texas farmers and ranchers not to have hemp as a crop option,” said Gene Hall, a spokesman for the Texas Farm Bureau. “I suspect a lot of farmers will choose this option once it’s available. It’s a drought-tolerant crop and can be grown anywhere where cropping is prevalent right now.”

 


Debra BorchardtDebra BorchardtApril 29, 2019
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4min4690

Canopy Growth Corporation  (TSX: WEED) (NYSE: CGC) announced a key milestone in establishing its Hemp Industrial Park in the Southern Tier region of New York State. It has secured a 308,000 sq. ft. facility on a 48-acre property in Kirkwood, NY.

The company said that design development would begin immediately with construction expected to start this summer. Canopy said in a statement that its vision for the property is to build the infrastructure necessary to support hemp-derived cannabinoid extraction and related manufacturing together with providing an opportunity for participation by other businesses in the hemp industry.

“As we establish a stronger foothold in the exciting US market, we want to do so in a way that prioritizes local vendors and creates meaningful career opportunities for people in the communities where we operate,” said Bruce Linton, Chairman & co-CEO, Canopy Growth. “The vision for our investment is to create an eco-system that inspires new entrepreneurs and generates more economic stimulus than a single company can offer. As we build the facilities, we’ll also attract like-minded businesses who share our excitement for the emerging hemp and hemp-derived cannabinoid markets.”

New York State of Mind

In a boost to the New York cannabis industry Canopy said it will begin hiring senior leadership in late 2019 and recruit the full workforce in mid-2020. Canopy Growth also noted that it has also begun securing farm capacity to supply enough hemp for its own future extraction and formulation activities within the park. The company intends to prioritize farms within New York State for the supply of hemp at this site.

“We welcome Canopy Growth to Broome County with open arms. We haven’t seen an investment like this in Broome in some time, and we’re so excited a company like them is setting up shop in our area,” said Broome County Executive Jason Garnar. “With Canopy Growth coming to Broome County we look forward to seeing the benefits in job investment.”

Now that Canopy Growth has secured its building, the company said it expects to begin work quickly on Pine Camp Drive and with local construction teams retrofitting the facility, operations will scale-up quickly. It was once a vacuum parts building. It is expected that the operations will create hundreds of new local full-time positions, in addition to the contracted construction workers.

NY Hemp

New York State granted a hemp license to Canopy Growth in January of this year, allowing Canopy to establish operations in the state and build a facility for hemp-derived cannabinoid extraction and processing for various applications. The new hemp facility will be capable of producing tons of hemp extract on an annual basis. In 2018, Canopy Growth acquired leading hemp research company, ebbu, Inc. The R&D, along with ebbu’s Intellectual Property will be applied directly to Canopy Growth’s hemp and THC-rich cannabis genetic breeding program and its cannabis-infused beverage capabilities.

Canopy also said in its statement that it will begin approaching third-party organizations to join the ecosystem. Canopy Growth is eager to attract businesses and researchers focused on every application of the hemp crop such as fibers, seeds, and hemp-derived cannabinoids.


Caroline CahillCaroline CahillApril 5, 2019
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5min7300

The CBD industry has been moving full steam ahead in 2019, bolstered by the 2018 Farm Bill and advancements on the federal level to ensure cannabis banking services, but that progress hasn’t been enough for some financial services institutions to continue working with the industry.

On March 14, 2019, Elavon, a payment processing subsidiary of U.S. Bank, notified its hemp and CBD clients that it had recategorized hemp and cannabidiol-based merchants as a prohibited business type and that accounts for such merchants would be closed within 45 days.  

“After several months supporting this merchant segment, it has become clear that the pace of an evolving Federal and State regulatory framework makes it extremely difficult to validate the qualifications required to operate within this industry,” said Elavon in an email to its hemp and CBD clients.

As an Elavon partner, FINCANN, a cannabis banking financial network, received Elavon’s notice and began sourcing solutions for its clients at once.

“We immediately reviewed remaining available options and within 24 hours had viable USA-based excellent alternatives available,” said Nathaniel Gurien, founder and CEO of FINCANN. “Since Elavon is not terminating their existing portfolio of CBD merchants until May 15, some merchants opted to immediately apply to one of our alternatives, others decided to wait and see until at least mid-April.”

Elavon isn’t the only merchant services provider rethinking its hemp and CBD clients. On March 19, Cannovia, a maker of CBD-infused products, was notified by Stripe that its account would be terminated. Having just launched its online storefront on March 14, Cannovia attempted to appeal Stripe’s decision but was denied.

“Prior to the notification of the merchant services cancellation, we were not fully aware of the limitations of the banking industry to support the needs of the CBD industry,” said Brian Baum, the CEO of Cannovia.

With both Stripe and Elavon out of the picture, Cannovia soon learned that finding a merchant services provider on its own wouldn’t be easy.

According to Baum, “What became clear was that the options were limited and any banks willing to consider supporting the industry were beginning to utilize the services of intermediaries such as FINCANN to assist them in managing the sheer volume of entities looking for merchant services solutions.”

Linking up with FINCANN to secure a new merchant services provider allowed Cannovia to remain operational and avoid any major interruptions.

Meanwhile, both financial institutions and industry stakeholders continue to keep an eye on the SAFE Banking Act, which would provide certain protections for depository institutions that work with cannabis-related businesses as well as the businesses themselves. The House Committee on Financial Services is currently drafting a report on the act to present to the House of Representatives. If the full House approves the bill, the Senate will vote on it.   

“If the SAFE Banking Act overcomes its estimated 40% likelihood of passing the Senate, it will only encourage banks currently contemplating ‘dipping their feet into the water’ to ‘take the plunge,’” Gurien said. Once financial institutions take the plunge, legal cannabis-related businesses will be able to bank just like any other legal business.

 


StaffStaffMarch 21, 2019
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4min11080

Canopy Growth Corporation  (TSX: WEED) (NYSE: CGC)  has acquired American hemp company AgriNextUSA in a cash deal for an undisclosed amount.  The company did note that purchase was not material to its current cash position and that the transaction would speed up Canopy Growth’s entry into key markets in the United States.

AgriNext is a hemp enterprise led by CEO Geoff Whaling, that has been at the forefront of hemp advocacy and building a vibrant hemp sector in the USA.

The United States is the next stop on Canopy Growth’s desired path to becoming a leading, revenue-generating company focused on all aspects of cannabinoids and their potential,” said Bruce Linton, co-CEO and Chairman of Canopy Growth. “Our significant investments, acquisitions, and compilation of talented leaders such as Geoff will position us for swift expansion throughout the United States. By collaborating with a pioneer like Geoff, who has been involved with our team since our earliest days in 2013, we will aim to turn hemp supplied by American farmers into a wide range of products.”

Canopy Growth had previously announced that it was on track to build the first Hemp Industrial Park in the Southern Tier of New York State, after receiving a state license to produce and process hemp. At that time, the company said that it had committed to invest $100M to $150M into a hemp operation that would lead to significant job creation and positive local economic impacts, as well as the produce CBD products for Canopy.

The vision proposed by AgriNextUSA and supported by Canopy Growth would involve creating Hemp Industrial Parks such as the one planned in New York State, where this super crop could be fast-tracked through a production cycle that would result in commercial applications for all parts of the plant, from root to tip. Camopy said in its statement that American farmers will benefit from a model that provides a single, regional destination for their hemp crops and connects them with the researchers, entrepreneurs, and innovators whose ideas will turn their crops into new products and industries.

“Hemp has the potential to become a multibillion-dollar industry that will boost the American economy for generations to come,” said Geoff Whaling, CEO of AgriNextUSA, Chairman of the National Hemp Association and newly appointed Strategic Advisor, Hemp and CBD, Canopy Growth USA. “By working with Canopy Growth, we will turn our vision into a reality, one that helps American farmers, small and medium-sized business owners, and the next cohort of innovators who see the extraordinary potential that hemp has to offer.”

Some industry insiders believe that hemp will be an even bigger market than adult use or medical marijuana. They believe hemp has the potential to disrupt several prominent industries like advanced materials, cosmetics, energy, fiber and textiles, food and protein production and the health and wellness sectors. Hemp is also a natural source of CBD, the non-intoxicating component of cannabis that can be used for health and wellness purposes in jurisdictions where legally permitted.

 


Debra BorchardtDebra BorchardtFebruary 25, 2019
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5min4750

SOL Global Investments Corp. (CSE: SOL) (OTCQB: SOLCF)  is forming a new international hemp-focused subsidiary, Heavenly Rx Ltd. Its initial focus will be on hemp cultivation, processing and the manufacturing of a diverse range of traditional CBD products including oils, tinctures, balms, and vape-ready products. The company said it plans on holding a controlling ownership interest in various industry-leading assets in the hemp/CBD and THC-free cannabinoid wellness space.

One of the first strategic assets will be its investment in Knoxville, Tennessee-based Blühen Botanicals LLC. Heavenly Rx is investing $30.6 million in Blühen, which will allow Blühen to expand its research and engineering teams as well as focus on the development and expansion of its retail operations. According to the statement, Blühen is an industry leading and technologically advanced hemp biomass processing and extraction company that will be GMP and EUGMP certified with farming and distribution partners across the southeastern United States.

Blühen also produces its own proprietary blend of wellness boutique products such as full spectrum hemp extract tinctures, capsules, creams, 100% THC-free hemp isolate, pet treats, pet care products, and oils. Blühen employs expert entomologists, plant pathologists, agronomists, chemists, and engineers on the 30-person team. Blühen intends to open its flagship retail location in Knoxville, Tennessee in May 2019 and plans to open a second retail location in Fort Lauderdale, Florida later this year.

“Heavenly Rx directly supports SOL Global’s continued hemp and CBD strategy in the U.S. and international markets and will serve as a critical launch pad for our hemp-related investment initiatives as hemp and related cannabinoid regulations continue to become more liberalized around the world,” said Brady Cobb, CEO of SOL Global. “SOL Global’s executive team has been at the very forefront of regulatory reform both in the United States and internationally, and we couldn’t be more excited to continue to build upon and execute our already robust long-term strategy for the global hemp/CBD industry.”

Additionally, Heavenly Rx intends to include several proprietary brands across numerous consumer product group verticals such as cosmetics and beauty products, bath and body products, infused foods (subject to governmental approvals and/or compliance) and a number of pet-related products.

“We are launching Heavenly Rx with the aim of acquiring a portfolio of battle-tested and proven hemp/CBD companies while also acquiring certain unique brands for which we believe CBD and hemp-infused products could drastically change their growth,” added SOL’s chief investment officer Andy DeFrancesco. “We are more bullish than ever about the future of the hemp and CBD industries globally, and Heavenly Rx will without a doubt be the vertically integrated leader in the space.”

Terms 

The binding terms of the LOI are as follows:

  • Heavenly Rx will acquire 50.1% of the membership interests of Blühen.
  • The Board of Directors of Blühen will consist of seven (7) individuals, three (3) of which will be nominated by Heavenly Rx, three (3) of which will be nominated by Blühen, and one (1) of which shall be an independent director to be mutually agreed upon.
  • Joe Fox, co-founder, and CEO of Blühen Botanicals, will become a member of the executive team of Heavenly Rx.

“Heavenly Rx’s investment enables us to exponentially scale our existing high-throughput capabilities while maintaining our commitment to providing the highest quality, pharmaceutical grade products on the market,” added Fox. “We have the largest network of expert farmers in the state of Tennessee who are growing hemp organically, and now, we’re empowered to scale our existing facilities faster, expand our farming network wider, and implement the highest international regulatory standards across the board.”



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