As always, it’s been a busy week in the world of cannabis. This week’s fresh crop of news includes possible medical coverage for MMJ patients, long overdue changes to banking and tax regulations, and so much more!
Top 5 Cannabiz News Stories
1. PayPal executive enters cannabis industry
David Peck, former Global Head of Social and Digital Marketing at PayPal, decided to abandon the mainstream life and contribute to the growing cannabis industry. Peck, who has developed social media strategies for PayPal, Coca-Cola, Wells Fargo, and the Grammys, will be the new Chief Marketing Officer at KIND FINANCIAL. KIND is a cannabis compliance tech company that tracks plants from seed to sale, handles order and cash operations, and oversees industry regulations.
KIND’s mission statement is to “ensure greater credibility for the cannabis industry through full compliance with rapidly changing regulations.” Peck’s experience handling marketing and influencer relations is exactly what the cannabis industry needs to build their brands while remaining legally compliant.
“In this business environment I think it’s vital for every marketing professional to stay ahead of social and technology trends, and I’ve sought to do that throughout my career,” Mr. Peck noted. “I also love the idea of getting into an industry as it gains mainstream recognition. When it comes to cannabis, there’s clearly a great need for ensuring ongoing compliance with the patchwork of laws and regulations that vary based on state and region. It will become even more critical as new companies enter the market, while different states and jurisdictions grapple with existing and evolving laws. I’m very excited about joining KIND Financial, because this is the company that could make all the difference in the market.”
2. Medical coverage for medical marijuana
Thinking logically here, if cannabis is prescribed as a medication, by a doctor, it should be covered by insurance like any other medication right? Wrong. And despite the plant’s positive role in reducing opioid dependency, which is reaching epidemic proportions in the United States, it remains unaffordable for some of the patients who need it most. “The affordability of medical cannabis is one of the most urgent issues facing users. Over 50 percent of patients are choosing to use less quantities of cannabis because of financial considerations,” Jonathan Zaid, founder and executive of CFAMM, explained.
New Jersey resident Andrew Waston has been a registered medical cannabis patient since 2014. He uses it to manage neuropathic pain that developed in his left hand after an injury on the job, while simultaneously reducing the number of prescription pain pills he needs. After a few months of using pot, Watson applied for reimbursement for his purchases and was ultimately denied. He took matters to courts and after a neurologist and psychiatrist both testified on his behalf, a state judge issued a ruling that could eventually lead to insurance companies offering coverage for medical marijuana.
The same situation is unfolding in Canada. Natalie Morin, a 35-year-old single mother of two, suffers from herniated discs, nerve damage, torn ligaments and chronic pain after being involved in 2 separate car accidents. After developing a dependency on opioids, she wanted to wean herself off the pills with medical cannabis. Unfortunately, the $200 monthly price tag keeps this life-saving medicine out of her reach. Rescheduling cannabis would do wonders to get insurance companies more willing to cover the costs of medical cannabis.
3. Secret Service, secret tokers
As the Secret Service plans to increase the agency’s size by more than 3,000 personele, they’ll be loosening up the strict cannabis policy for new hires. New director Randolph Alles, who was hired in May, issued his first press briefing last Thursday, stating that “We need more people. The mission has changed. It’s more dynamic and way more dangerous than it has been in years past.” The new policy officially went into effect a few weeks ago, and according to secret service officials, it’s an “acknowledgment that marijuana is more prevalent in today’s society. This way, young, dedicated applicants won’t have to be barred from the agency for experimenting with pot in the past.
4. Border state study
A study from the Bureau of Economic Research, titled the Cross-Boarder Spillover Effects of Recreational Marijuana, indicates that legalization has no impact in teen cannabis use, or increased use in adults for that matter. However, arrests rates have increased nearly 30%. “Legalization has no impact on juvenile marijuana possession arrests,” the report says. “Police officers might adopt new techniques or use more resources toward cracking down on what they perceive to be more illegal marijuana possession.”
As states continue to legalize and revamp existing cannabis programs, people remain hopeful that federal laws will evolve as well. The problem is, some states prefer that legalization be at the discretion. They don’t want to feel forced into changing their laws before they feel ready.
5. Legal News: breathalyzer testing on the way
Silicon Valley investment firm, Benchmark Capital, led the funding initiative to funnel money into Hound Labs, an Oakland-based startup company that will be producing cannabis breathalyzer tests. Benchmark provided nearly $8.1 million to Hound Labs, and it’s not the first prominent startup they’ve invested in. Their financial ventures include Dropbox, Snap, and WeWork.
Trying to determine how long ago someone smoked pot can be tricky. Even if their urine is dirty, that doesn’t necessarily mean they’ve been stoned recently as cannabis can stay in the system for days, even weeks. Michael Lynn, Hound Labs CEO, hopes their product will simplify the process of field sobriety tests. “With alcohol, it doesn’t matter what your car looks like or … whether you’re a man or a woman. At the end of the day, everybody pretty much knows if you’re above a .08 [blood-alcohol level] you’re going to be arrested,” stated Lynn, who is also an emergency room physician in Oakland. “We want to do the same thing for THC and take the subjectivity out of it, make sure that everyone is treated fairly.”
As of now, the device is in the clinical trial phase at San Francisco General Hospital. Once available in a retail setting, it’s expected to sell for $600 to $1000, and the cartridges used to collect samples that accompany the breathalyzer will be around $15 to $20.
New federal bills- Banking and Tax Regulations
H.R. 2215 – Safe Act of 2017 – This would allow canna-businesses to finally use major financial institutions for their banking needs just like any other enterprise, which is long overdue. It hasn’t passed yet, but it has 35 sponsors so far, with three new ones registering just last week. According to the full text of H.R. 2215, the goal is to “create protections for depository institutions that provide financial services to cannabis-related legitimate businesses, and for other purposes.”
H.R. 1823 – Marijuana Revenue and Regulations Act – Basically, the purpose of this bill is to streamline cannabis legalization by proposing a sensible tax structure. Drafted by Earl Blumenauer and Senate Finance Committee member Ron Wyden, the 55-page bill seeks to “amend the Internal Revenue Code of 1986 to provide for the taxation and regulation of marijuana products.” For the first 5 years, marijuana will be taxed by price but eventually transition into a weight-based tax system for the long run.
H.R. 1810 – Small Business Tax Equity Act of 2017 – Taking into account deductions and profits related to cannabis sales, H.R. 1810 aims adjust the ridiculous, 280E tax penalty the cannabis industry is currently saddled with. This bill has a total of 14 sponsors so far, and more are always welcomed as this piece of legislation is expected to be a vital piece of the legalization pie.
Cannabis rights in the workplace (or lack thereof)
If cannabis is legal in your state, you should be able to smoke at work right? Not exactly. Despite state reps and citizens all jumping on board the legalization train, employers remain strict and conservative when it comes to pot use in the workplace. But what happens if a weed smoker fails a drug test, but then discloses the fact that they use cannabis for medicinal purposes? Would that information change anything? It might, and it definitely should. Many states that have medical marijuana programs, Arizona, Delaware, and New York for example, offer MMJ patients protection from adverse employment consequents relating to their cannabis use.
This is great news considering cannabis use appears to be on the rise in recent years. According to a study by Quest Diagnostics, since Colorado and Washington legalized recreational weed in 2012, there was a stark increase in use. “Ninety-nine percent of drug panels we perform in Colorado and Washington still test for marijuana,” mentioned Bary Sample, a scientist with Quest. “Urine tests that detected pot rose by 11 percent in Colorado and 9 percent in Washington.”
When pot first became legal in Colorado, almost immediately an influx of tourists started traveling to the Rocky Mountain state. Many cited cannabis as the number one reason they chose to visit Colorado. Living in the strict, prohibition state of Indiana, I actually know quite a few people who take annual weed trips to legal states. For a true stoner, being able to buy pot in a store and not have to worry about getting arrested makes for a great vacation in and of itself.
It’s still a thing, and if states decide to open cannabis resorts it could even become a new booming niche, but without any kind of gimmick, pot tourism has been dwindling in recent years. “Since we’ve had [legalization] for a few years now, the novelty has worn off a little bit. They’ve seen interest—from the Colorado Tourism Office—in marijuana waning a little bit over the last few years,” said Northern Colorado Community Radio’s Luke Runyon. “Not as many people are coming to Colorado specifically for that reason, to consume marijuana in whatever form you want. So, I think it’s had an effect. How large an effect, it depends.”