NEW YORK, April 5, 2021 /PRNewswire/ -- Presently, the medical cannabis sector accounts for a majority of the market share, as progress is slowly being made in removing the stigmas associated with such products. Overall, the legal cannabis market is permeating throughout the U.S. states and is helping to create a multi-billion-dollar industry. While medical cannabis still dominates that broad cannabis marketplace, the growing awareness and legalization efforts are expected to further propel the overall industry forward. For example, last week, New York became the latest state to legalize recreational cannabis, and in doing so is expected to become one of the nation's largest markets. New York's new law to tax and regulate cannabis includes various major provisions designed to create a diverse business mix of large and small operators, and it will invest 40% of the anticipated tax revenue into underserved communities; to expand medical marijuana access; and to allow for businesses such as delivery operations and cannabis cafes. Red White & Bloom Brands Inc. (CSE: RWB) (OTC: RWBYF), Trulieve Cannabis Corp. (CSE: TRUL) (OTC: TCNNF), Green Thumb Industries Inc. (CSE: GTII) (OTC: GTBIF), Cresco Labs Inc. (CSE:CL) (OTC: CRLBF), Taat Lifestyle & Wellness Ltd. (CSE: TAAT) (OTC: TOBAF)
The more welcoming perception towards cannabis legalization can be attributed to, in large part, the passage of the 2018 Farm Bill, which legalized production of industrial hemp, transforming it into a mainstream agricultural product. Soon after, numerous categories of CBD products started to appear. Now, the growing awareness about the therapeutic benefits of cannabidiol has influenced people to buy such products, even at relatively high costs. As a result, mainstream retailers are now focusing on selling CBD-based products, as these have a higher profit margin. According to data provided by the Brightfield Group and published by Hemp Industry Daily, a survey of more than 5,000 CBD users in the U.S. reveals that 24% have used it to help quit smoking and quitters are often replacing cigarettes with either smokable hemp or vaping. And, 41% of quitters have entirely replaced tobacco with hemp CBD.
Red White & Bloom Brands Inc. (CSE: RWB) (OTC: RWBYF) provided the following corporate update last week, "Brad Rogers, CEO of RWB stated, 'It is hard to believe that we are just finishing out Q1 2021. So much has changed both at RWB and in the markets that we focus on. We have seen a change in the US administration and have heard very encouraging statements about the intent of this administration to finally end the prohibition of cannabis in the US, as well as the much-needed support to those communities that have disproportionately suffered from the war on drugs. To that end, we at RWB are making investments to play our part in each jurisdiction that we will operate in as we embark on a significant expansion and transformation of our Company. In just a short few months we have closed on our acquisition of Platinum Vape, executed definitive agreements to enter the Illinois and Florida cannabis markets through acquisition and entered into partnerships to expand into Arizona and offer delivery to over 90% of Californians of our award winning Platinum line of products. There is no doubt that 2021 is quickly becoming the year of change for RWB, and we are committed to delivering a year of growth, operational excellence, and success for all stakeholders.'
Platinum ("Platinum Vape" or "PV") continues to see record weeks for sales of PV branded products. This past February was a record month for PV branded product sales in Michigan, with sales of approximately US$6.5 million in just Michigan. With the MRA reporting total Vape sales in both the Medical and Adult Use markets in Michigan of approximately US$23.5M for February, this represents an almost 28% market share in the category.
In California, PV continues to expand its product line with the continued expansion of its edible chocolate and gummy portfolio. In addition, the recently announced partnership with Budee (owned by Stem Holdings) has vastly expand availability of Platinum's premium cannabis products in California, as demand for home delivery of cannabis products continues to accelerate. Budee employs over 350 delivery drivers servicing customers from four distribution hubs strategically located in California, allowing for the fastest same-day turnaround in the industry. Budee is providing access to PV products via home delivery to 92% of California's population through e-commerce store: https://budee.org/brands/platinum-vape.
The High Times branded product launch has now seen multiple successful drops of curated flower in Michigan over the last three months. Once fully launched, the collection of products will feature over 30 High Times® SKUs. In addition to multiple strains of packaged flower already released, the line will bring pre-rolls, vapes and edibles in a number of varieties. To start, over 50 dispensaries in Michigan are expected to carry the High Times product line representing approximately 20% of the market. Michigan has recently reported to have seen sales top US$105 million in February 2021, a 160% year-over-year increase.
High Times is also gearing up for the Michigan Cannabis Cup and has been featured in multiple stories and on air, most recently on FOX 2 Detroit and WXYZ/TV-20. The Cannabis Cup is bringing additional exposure to both High Times and RWB, which has exclusive licensing rights to brand dispensaries as well as to manufacture and sell cannabis products for High Times throughout Michigan. The Company has sublicensed those rights to PharmaCo, an existing licensed operator in Michigan, to expedite the launch and availability of products.
The Company announced that it had entered into a definitive agreement to purchase medically and recreationally-approved cannabis cultivation center licenses in the State of Illinois, a 23,572 SF active cultivation and manufacturing operation, the associated inventory, and the real estate assets including 2 acres of land. Pre-planning for the first stage of expansion of the existing operations upon closing are near complete and the Company previously announced that it has secured the necessary financing commitments to close the transaction. The Company is awaiting regulatory approvals to close.
The Company continues to make progress on closing its previously announced, definitive agreement to acquire Acreage Florida, which is licensed to operate medical marijuana dispensaries, a processing facility, and a cultivation facility in the State of Florida. The deal also includes the sale of property in Sanderson, Florida that includes over 15 acres of land, a 113,546 SF facility for cultivation and a 4,360 SF freestanding administrative office building. In addition, Acreage Florida has 8 leased stores in prime locations throughout the State. Florida has one of the most robust medical markets in the US with cannabis revenue of over US$1.2 billion in 20202. It is considered a Limited License State with 22 licensed operators, of which only 16 are selling product in the state. Further to the Company's previous press release and subject to regulatory approval, this transaction is anticipated to close in Q2 2021.
The Company has begun the process of restructuring certain aspects of its previously announced put/call agreement to acquire PharmaCo, its investee in Michigan. Under the revised agreements, the consideration will remain unchanged, however, the Company will complete the transaction through an asset acquisition to allow for RWB to separate the significant real estate holdings from the operating assets. In addition, a wholly owned subsidiary of RWB will become the licensed entity that operates these assets (versus the previously contemplated assumption of existing licenses in the state through a share purchase of the investee). It is anticipated that the restructuring documentation will be complete in the coming days and additional details will be provided at that time…"
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Trulieve Cannabis Corp. (CSE: TRUL) (OTCQX: TCNNF) together with its subsidiaries, operates as a medical cannabis company. Lat month announced last month that it has entered into a definitive agreement pursuant to which Trulieve has agreed to acquire Mountaineer Holding LLC ("Mountaineer") and that it began planting at its Holyoke, Massachusetts cultivation and processing facility. Kim Rivers, Trulieve CEO stated, "West Virginia just became a lot more interesting with the addition of a cultivation permit asset to our processor and dispensary application wins. Trulieve is known for our quality flower. Combining our expertise for growing high-quality medical cannabis with our passion for producing a premium product portfolio and providing broad access to a wide variety of medicine for patients will allow us to bring our full Trulieve brand experience to West Virginia." The company cultivates and produces products in-house and distributes its products to Trulieve branded stores (dispensaries) in Florida, California, Massachusetts, Connecticut, Pennsylvania, and West Virginia, as well as directly to patients through home delivery. The company is headquartered in Quincy, Florida.
Green Thumb Industries Inc. (CSE: GTII) (OTCQX: GTBIF), a leading national cannabis consumer packaged goods company and owner of Rise™ Dispensaries, today announced it will open Rise Meadville in Pennsylvania, its 56th retail location in the nation, on March 31. Profits from the first day of sales will be donated to Women's Services, which strives to meet the needs of children and adults of Crawford County who are in crisis due to domestic violence, sexual violence or homelessness. "Our team is excited to introduce additional Pennsylvanians to the Rise™ retail experience and our selection of high-quality branded cannabis products," said Green Thumb Founder and Chief Executive Officer Ben Kovler. "Women's Services is doing incredible work on behalf of families in crisis situations who need shelter and support services and we are grateful to donate to the cause." The company was founded in 2014 and is headquartered in Chicago, Illinois.
Cresco Labs Inc. (CSE:CL) (OTCQX: CRLBF) reported last year the expansion of its Good News brand to Michigan, a state with accelerating adult-use cannabis sales and a growing medical program totaling nearly USD 600 Million in cannabis sales to date, according to data from Headset1. Good News launches with gummy edibles available at dispensaries throughout the state. Good News gummies (100 mg. total; ten, 10 mg. gummies per pack) are sold in approachable packaging and crafted with consumers' desired mood in mind — Me Time (Indica), Brunch (Hybrid), Friyay (Sativa) and Vegas (Sativa). "Since receiving our Medical Processing License in March 2020 and launching recreational sales in June, we have remained committed to our strategy of prioritizing wholesale distribution and I'm proud of our Michigan team for creating an outstanding operation that supports our brands and products," said Charlie Bachtell, CEO & Co-founder of Cresco Labs. "Michigan is a sophisticated market, and we believe our growth speaks to the quality and variety of the brands and products that we are offering to our dispensary partners, patients and customers. We are investing resources in the most strategic markets, and we continue to be excited about the growth potential of Michigan's cannabis program."
Taat Lifestyle & Wellness Ltd. (CSE: TAAT) (OTCQX: TOBAF) has entered into a memorandum of understanding ("MOU") dated February 24th, 2021 with Christina Lake Cannabis Corp. ("CLC") (CSE: CLC) to develop and distribute TAAT™ for the Canadian market. The MOU grants CLC exclusive rights to develop and distribute TAAT™ in Canada for a two-year renewable term, and provides for budgets, schedules, and contributions of both parties for each stage of product development to be agreed upon by way of written agreements to set out specific stipulations for each stage. After launching TAAT™ in Ohio in Q4 2020 as well as its U.S. online store on February 17th, 2021, the Company has captured the interest of numerous smokers aged 21+ in the United States who are now smoking TAAT™ as opposed to traditional tobacco cigarettes. The Company selected Ohio as its initial market for several strategic reasons, with a principal criterion being the state's ideal population size for an early-stage product launch (i.e., large enough to build meaningful market share, small enough to contain). Beginning this week, a major CPG sales agency is rolling TAAT™ out to wholesaler, distributor, and retailer accounts in an effort to expand the current footprint of TAAT™.
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