Martha Dishes Up Pot as Democrats Burnish Cred: Cannabis Weekly

(Bloomberg) -- The cannabis industry has added another celebrity.

This time it’s Martha Stewart, the 77-year-old lifestyle guru and convicted felon. Stewart, a pal of well-known pot connoisseur Snoop Dogg, is joining Canopy Growth Corp. as an adviser to help develop a new line of cannabis products for pets and people.

“I’m especially looking forward to collaborating on developing products that can help people and their treasured animal companions,” said Stewart, who went to prison in 2004 for lying to federal authorities in an insider trading case.

Canopy, the world’s most valuable cannabis company, is conducting clinical trials on various cannabis compounds, including CBD, the non-intoxicating hemp component that is showing up in drinks, beauty products, food and a host of consumer products. Vivien Azer, an analyst at Cowen & Co. who tracks the cannabis industry, now thinks the CBD market could be worth $16 billion in the U.S. by 2025.

The compound is everywhere these days but not much is really known about how it works or how much people need to take to ease anxiety or insomnia. While the passage of a farm bill in December opened up the U.S. CBD market, the Food and Drug Administration has still not given the go ahead to use it in food products. That’s kept big companies, like Coca-Cola, on the sidelines.

FDA Commissioner Scott Gottlieb, under pressure to create CBD regulations, said last week he’ll hold a public meeting next month on the issue.

Strange Times

We’re living in strange times for medical cannabis, with growing competition between pharmaceutical companies and over-the-counter retailers, Arcview Market Research and BDS Analytics said in a new report. Epidiolex, the CBD-based drug from GW Pharmaceuticals Plc, went on sale in U.S. pharmacies in the fourth quarter of 2018. The company hopes to sell it at an average price of $32,500 a year, given its approved use for two rare forms of childhood epilepsy.

But as Arcview Editor-in-Chief Tom Adams wrote in the report: “This is a drug with an active ingredient that is available not just in cannabis dispensaries in legal states, but in health food stores, grocery stores and every kind of general retail outlet in the country at a lower cost.”

CBD Trials

The FDA has said CBD products can’t be marketed using specific health claims, but there’s nothing stopping patients from buying the dosage they’ve been prescribed in retail stores, bypassing the costly drug route. With approximately 770 cannabis-related clinical trials underway in the U.S., it’s likely that many more medical patients will be looking for cheaper, over-the-counter versions of prescribed drugs in the years to come.

This may be why Arcview and BDS forecast that pharmaceutical cannabis drugs will make up less than 10 percent of legal cannabis product sales in 2022.

But the competition cuts both ways. For the first time, medical marijuana retailers face pharmaceutical-grade competition, setting up “one of the most consequential battles in the legal cannabis industry’s short history,” according to the report.

U.S. Action

As 2019 moves forward, weed watchers are waiting for news out of New York and New Jersey, two densely populated East Coast states that are expected to legalize adult-use marijuana this year. New Jersey’s governor, Phil Murphy, campaigned on a promise to legalize but has been squabbling with the legislature over how to tax pot. They reportedly are getting closer to an agreement to tax pot based on weight, rather than sales price.

In New York, Gov. Andrew Cuomo has also said he’ll legalize weed this year. Recently, Cuomo and New York Mayor Bill de Blasio laid out a plan to fix the subway system that included a proposal to use funds from a potential cannabis excise tax. In Vermont, where weed is legal but there’s no retail regulations that would allow stores to open, the state Senate voted to create a taxed and regulated marijuana market.

The 2020 presidential race, which is starting to heat up, is also expected to feature debate over pot policy. Sen. Cory Booker, a New Jersey Democrat who has thrown his hat in the ring, introduced a bill to legalize pot last week, with co-sponsors that included four other Democratic senators who are running for president, according to the Washington Post.