Cannabis in the news June 12, 2019

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News on cannabis stocks and on developments in the industry haven’t let up in today’s volatile markets. Here are this week’s stories that we believe will mean most to you as a Canadian investor.

1. It may be the industry’s first employee strike, with 21 unionized workers at a Quebec-run cannabis outlet voting in favour of a walkout.

The Rosemont workers are member of the United Food and Commercial Workers (UFCW) union affiliated with the FTQ labour alliance. They contend their pay fails to reflect the higher level of knowledge and training needed to educate consumers on cannabis use.

Many elements of a new contract have already been successfully negotiated with management over the course of 10 negotiating sessions.

The UFCW also represents employees at the province’s cannabis stores in Rimouski and Mirabel. Still, no action is planned for those locations.


2. The federal government is lobbying its counterparts in Washington to take careful note of criminal pardons granted to Canadians for pot possession

Public Safety Minister Ralph Goodale says he brought up the issue with acting U.S. secretary of homeland security Kevin McAleenan during a meeting in Washington this week.

“It is important for the records that are kept on the American side to reflect the accurate legal status of Canadians,” Goodale said in an interview.

Ottawa continues to study proposed legislation to make it easier for Canadians to get a pardon for possessing a small amount of cannabis.

Under the legislation, now before the Senate, anyone convicted of simple pot possession over the decades before legalization could apply for a “record suspension.” The government is also seeking to waive the usual fee or waiting period.

Currently, Canadians convicted of cannabis-related offences can be refused entry to the U.S., even if they have been granted pardons in Canada.

Goodale wants the U.S. to place more weight on those officials suspensions when deciding whether to grant some access to the U.S.

“There may be old information, or it could be conflicting information,” he said. “And we just want to make sure that it’s as complete and accurate and current as it can be, so that people are not unduly or improperly impeded at the border.”


3. The fund endowment arm of the Church of England may be the first mainstream religious organization to express its willingness to invest in the medicinal cannabis industry.

“There has been no change to our overall position on medicines,” a spokesperson for the Church Commissioners told ABC News. “We will hold medicinal cannabis to the same standards as we hold other pharmaceuticals, and invest only if properly licensed and regulated for medicinal use.”

The announcement follows a change in U.K. law last year that legalizes medicinal cannabis use.

The Church Commissioners manages assets worth £8.2 billion (or about $10.4 million U.S.). The Church Commissioners is a closed fund, meaning it does not take in new contributions. Profits from the investments are used to pay for bishops and ministry costs, supporting local dioceses and clergy pensions.

The Church of England’s willingness to invest in medicinal cannabis may speak to how fast the industry is growing around the world. A recent study pegged the global cannabis market at $11 billion in 2018. That figure is expected to rise to over $50 billion by 2029.

Any investments the Church makes in cannabis still have to conform to its ethical standards, which restrict on how it generates profits from industries such as gambling, alcohol and tobacco.


4. Canada’s legalization of pot edibles later this year may face the same kind of product shortages as the initial rollout of cannabis in October 2018, say industry insiders.

“At least that time we knew what the permissible product types were going to be and were already making them in the medical context,” said Trina Fraser, a partner at Brazeau Seller Law in Ottawa.

While the federal government will add edibles, extracts and topicals to the list of legal cannabis products before October 17, it has yet to issue regulations for the sale and production of those formats.

That could make it difficult for producers to prepare product for distribution in the first few weeks after full legalization.

Health Canada is already grappling with a licensing backlog for growers, with as many 614 applications now waiting final approval.


5. A new study appears to undercut hopes that medical marijuana could someday lower opioid overdose deaths.

Earlier research appeared to link medical marijuana laws to slower-than-expected increases in U.S. prescription opioid death rates between 1999 and 2010. The authors of that study speculated patients might be substituting marijuana for painkillers, but they warned against drawing conclusions.

However, new research published in “Proceedings of the National Academy of Sciences,” includes data all the way up to 2017; it suggests that states passing medical marijuana laws saw 23% higher death rates involving prescription opioids.

Legalizing medical marijuana “is not going to be a solution to the opioid overdose crisis,” said Chelsea Shover of Stanford University School of Medicine. “It would be wonderful if that were true, but the evidence doesn’t suggest that it is.”


 

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