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Good morning folks! Nicolás Rodríguez and Patricio Liddle here, helping you power through this Wednesday with the week’s top cannabis stories. From the DEA’s new test potentially fast-tracking cannabis rescheduling to High Tide’s record-breaking earnings, we’re covering it all. Plus, California families fight for access to life-saving hemp CBD, and New York cracks down on illicit shops while Pennsylvania pushes for legalization. Let’s dive in!

DEA’s New Test Could Fast-Track Cannabis Reform

The DEA has embraced a new, simpler two-part test to determine a substance’s medical use, which could pave the way for cannabis rescheduling. This replaces the old, more complicated five-part test, and focuses on whether healthcare providers use the substance and if there's scientific backing for its medical benefits.

While critics claim the change is politically motivated, this shift might not just affect marijuana but could also set the stage for future decisions on psychedelics. Stay tuned—this debate is heating up!

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How Did High Tide Do It?

High Tide (NASDAQ: HITI) is riding high, with its CEO Raj Grover crediting record-breaking earnings and a growing 12% market share to strategic store expansions and a successful discount club model. In Q3 2024, the company posted CA$131.7 million in revenue and a net income of CA$0.8 million—quite the turnaround from a CA$3.6 million loss last year. With over 1.55 million Cabana Club members, High Tide continues to lead the pack in Canada’s cannabis retail scene.

'This Is Life Or Death'

California families of disabled children are in crisis after Governor Newsom’s proposed emergency hemp CBD ban, which threatens to strip away access to critical treatments. Parents, who have relied on full-spectrum CBD to manage their children’s severe conditions, are panicking and exploring legal action. They argue Gov. Newsom is overstepping, placing the well-being of vulnerable communities at risk by lumping safe, life-saving hemp products with unregulated THC items. This decision has left families scrambling to stockpile products or even consider relocating to access essential care.

Meanwhile, Georgia is also tightening its hemp regulations, introducing age limits and banning CBD-infused food products like chocolates. The new law takes effect on October 1, targeting products that might appeal to children while still allowing items like gummies and oils.

Instead of clear, sensible regulation, both states join the states favoring prohibition, leaving everyday people paying the price for poor policy choices.

Coast To Coast: Cannabis Markets Evolving Fast

New York’s aggressive crackdown on illegal cannabis shops has closed over 1,000 businesses, giving a much-needed boost to legal retailers. Meanwhile, Pennsylvania is moving forward with a bipartisan bill to legalize adult-use cannabis, focusing on small business support and reinvesting in communities harmed by prohibition.

Out West, California is struggling with declining cannabis sales and rising taxes, but Michigan is thriving, with booming sales and more dispensaries per capita. On the East Coast, New York and Massachusetts are reporting strong growth in cannabis tax revenue.

The $25B race between states is heating up—but who’s really winning?

High On Data: Search Trends Cannabis Businesses Must Know

Semrush's (NYSE: SEMR) 2024 Global Issues Index reveals mental health and the War on Drugs as top global searches, offering valuable insights for cannabis businesses. By leveraging search trends, companies can refine their marketing strategies to meet consumer needs, tap into high-traffic keywords, and stand out from the competition.

Looking For Cannabis Insurance Solutions?

Würk and The Baldwin Group (NASDAQ: BWIN) have teamed up to launch a new Employee Benefit Captive insurance program tailored for cannabis businesses. This innovative program uses AI-driven tools and Predictive Risk Scoring to help operators optimize insurance management and reduce costs. By providing cannabis-specific, data-driven solutions, this partnership offers businesses more control and flexibility over their employee benefits, marking a major step in addressing the industry's unique challenges.

Stories In The Spotlight:

• Legal Medical Cannabis Could Save US Healthcare $29B Annually, New Study Finds

• NASDAQ-Listed Cannabis Giant Misses Tech Rally: What Investors Need To Know About MAPS' Stock

• Cannabis Investors Should Move Past 'Hopeful Phase' And Focus On Business Fundamentals, Expert Says

• 'A Moral Duty To Disobey Unjust Laws': Irish Activist Convicted For Planting Weed In Public Spots —Including City Hall

Our Writers Today

Nicolás holds a B.A. in International Relations, an M.A. in International Affairs, and an M.Phil in Public Policy. He is a doctoral student in Public and Urban Policy at The New School in New York City. After working for the United Nations in 2014, Nico pivoted his research to studying the relationship between the cannabis industry and economic development.

Patricio is a development economist with extensive experience in IT, finance, and banking. He writes about the economic and social opportunities obscured by over fifty years of drug prohibition. Beyond his professional expertise, Patricio is a committed advocate for social change, passionately working to promote harm reduction and reform drug policies.

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