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Editors’ Note: This is the transcript version of the podcast. Please note that due to time and audio constraints, transcription may not be perfect. We encourage you to listen to the podcast, embedded below if you need any clarification. We hope you enjoy!

Bryan Fields (Twitter: @bryanfields24) and Kellan Finney (Twitter: @Kellan_Finney) broke down the Medical Cannabis Industry with Dr. Jean Talleryand of MediCann.

Dr Talleryand’s 20 years in the medical field make him an expert when it comes to Cannabis as a form of medicine. Listen now to hear Bryan, Kellan and Dr. Talleryand discuss the following:

  • What is The Dosing Project™?
  • Why is the medical industry slow to adapt to new changes?
  • How does one decide if medical marijuana is a good fit?
  • How are providers being educated on what products to pick?
  • What are the most common uses for Medical Cannabis?

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[00:00:00] Bryan Fields: This is the dime, dive into the cannabis and hemp industry through trends, insights, predictions, and tangents. What’s up guys. Welcome back to the episode of the dime as always. I’ve got my right-hand man Kellen Finney here with me. And this week we’ve got a very special guest back the T in the building back to tea.

[00:00:21] Thanks for taking the time. How are you doing today?

[00:00:23] Dr. Jean: Doing well. Thanks for asking me to be alive.

[00:00:29] Knowing how you doing,

[00:00:30] Kellan: doing well, just a Scott down and joined the 4th of July out here in Colorado. So it’s another sunny day. Just looking forward to the rest of the week

[00:00:39] Bryan Fields: for sure.

[00:00:40] Dr. T it’d be great to kind of get into your background and how you got into the

[00:00:44] Dr. Jean: space.

[00:00:44] So I first heard about cannabis in California during my residency, so that’s more than 20 years ago. I finished residency. I started in 1995 and finished in 92. Toward the end of my residency, I had a patient come to me and asked me to sign this form. And I guess I had known cannabis in college and pretty much dropped it from there.

[00:01:07] You know, medical school training is pretty rigorous and it’s tough to keep yourself together and be using regularly. So the patient really struck me because. Was not asking for opiates for his chronic pain. In fact, he was handing them over to me and asking me to sign this paper and said, that’s just fascinating as well.

[00:01:29] I, you know, I I’m trained in family medicine and was specifically looking at complimentary and alternative. Medicines. So things like traditional Chinese medicine puncture, so Canada’s fit right into the herbalism paradigm. And so really worked with what I was interested in. And here I was in Northern California watching the community using cannabis.

[00:01:53] It was perfect to learn more about it. So I signed a paper and the patient was pretty happy. Pain under control. And I said, wow, this big, you know people handing out, usually they come into your office and they’re asking for pain medicines or for hope prescriptions. And so this was before the whole crackdown on opiates.

[00:02:12] But to see this was really looking into the future and going, wow, this is going to change the medical industry as it’s still doing that.

[00:02:21] What year was that?

[00:02:22] That was 98. So my last year of residency, and then back then, there were some clubs in, that’s what they call them in San Francisco, Dennis Perone clubs.

[00:02:35] There’s a club called champs. And, you know, once they heard that, that I was a doctor willing to entertain their use of cannabis, that they. Budding to me. So I began to learn more from my patients and more about the plan and how it works. See that it had many benefits, including treating chronic pain,

[00:02:55] Now,

[00:02:56] Bryan Fields: let’s kind of dive into that.

[00:02:57] Obviously 98 was a very different time than we are now. Were you hesitant at the time to kind of sign off on that because you took a very different route than many of your peers would have taken. And some might’ve been very hesitant to kind of sign off on that. That would be the road less traveled. So can you kind of hear how you thought about that decision?

[00:03:18] That’s a tough one.

[00:03:18] Dr. Jean: Absolutely.

[00:03:19] Well, you know, complimentary and alternative medicine is also a bit less travel than surgeries, traditional pharmaceutical. Medicine. So I was already putting myself from their friend. Yeah. At first I kind of laughed at it cause I didn’t know the science behind cannabis.

[00:03:35] And I just saw you ask them folks just trying to get hot. But as I learned the science side, you know, and learn the impact. Wow. It really changed my spine. It was good to get introduced to, you know, some physicians that had been doing this for awhile, you know, since the seventies trying to advocate for patients like that.

[00:03:56] Yeah, I’ve heard and rattler Todd Mikuriya, who were really pioneers in California in being advocates for patients. But yeah, I definitely put me in the fringe of the medical world. It’s something I was probably born to be anyway. I’m third generation physician. So I came in. Medical school was a little bit of a chip on my shoulder and having grown up with dinnertime conversations on the medical industry anyway.

[00:04:24] So it fit me pretty well

[00:04:27] Bryan Fields: after that first patient did a second patient come with a similar request, because like you were saying, others kind of flooded towards you. You know, if you’re interested in kind of taking a different route than the opioids, and you’re looking for a doctor to prescribe medical marijuana, that likely could have been one where either it took a little while, or it could have been quickly after.

[00:04:46] So how long roughly.

[00:04:48] Dr. Jean: Well, you know what one friend tells two friends and then so on, and then pretty soon the dispatch history or the club gets to know your name and what wasn’t long. I took a, a break, you know, after residency, wasn’t long, probably around 2000, 2001. I was seeing more patients than I could handle.

[00:05:08] And I took a little break and eventually realized that, Hey, this could be a business, you know, of course. Training as a physician doesn’t necessarily make you a good businessman. So it took a little while for it to distract me. Oh yeah. I guess this could be a business. So we started medic Canon in 2004 and Medi-Cal essentially was the Referral service that said patients interested in medical cannabis to two physicians to evaluate

[00:05:38] them.

[00:05:40] Bryan Fields: Some of those other physicians that kind of joined the network were, were there some that were hesitant to kind of be a part of it, obviously from a research standpoint, there might’ve been not as abundant of information back then. So like how did you communicate to them? All these opportunities and upsides, because one of the area to we’re looking to expand on is kind of the educational gap and communicating all the possible values.

[00:06:02] But where did you go there?

[00:06:04] Dr. Jean: It’s still a work in progress 20 years later, just to, you know, heads up the medical industries, just getting around to this idea of computers are a good thing. We’re really slow and conservative in regards to adopting new ideas. And cannabis is definitely one. At first, it wasn’t great.

[00:06:23] You know, I definitely would run into the fringe physicians, you know, who were just doing it to make money or, or do something out of different rebellious and sort of trying to train them to apply the science was a little hard, but over time I developed. A method. And now it’s interesting because what my goal is is to train physicians, to be, you know, a little bit researcher, a little bit prescriber, you know, using the idea of an equals one, you know, a case to look at the patient that way, rather than me telling them how to use the cannabis and what mostly it’s about education, rather than talking to the patient rather than.

[00:07:07] Dictating what they’re going to do. And that’s a little hard for physicians. We’re so used to knowing all the answers, you know, so teaching them to sort of regain their scientific explorative training and really be, you know, a research scientist rather than. Prescribers in the field, that’s really the goal.

[00:07:25] So it’s still hard to burden physicians because relinquishing that powerful position is part of the, how you become a medical cannabis physician. But it’s a very interesting, and you learn from the patients and you end up. Sharing that educational approach, educating, educating patients in your interaction.

[00:07:47] So, yeah, I don’t know if your experiences, when you seen physicians, is that was what the approach they had or just kind of find the paper and see you later. But really that’s what I’m trying to get docs to do is document what the use patterns are, understand the dosage and get specific about what you’re treating.

[00:08:07] And really worked with an experiment patients with new products, burying products, too. I have, for an example, I did. And you can stop talking, but I will talk forever. That’s for an example, I have one of my early patients was a four year old girl, a little girl. Who had that Mannix Gusto syndrome that was made popular or famous with Dr.

[00:08:33] Gupta’s using Charlotte’s web, but I had that patient also, or, and and we did also notice how CBD was really stop her seizures. But the problem of course, with the industry is that the plant is married. And so we would get great results for several months. And then when the batch change and here comes the seizures again, and we didn’t know what the, what was wrong.

[00:08:59] Well, it is different where we, you know, what had changed in the batch and I’d ask the growers. Did you change? Are the turpines changing? Well, of course they’re changing. Yeah. Probably causing her to have her seizures come back. So that really highlights the biggest issue with the industry now is how to take a variable plan, multiple chemicals, energy, and getting it to something predictable where we dose it and where we can understand exactly what combination of active ingredients are affecting the outcome.

[00:09:34] Right now, she is 13 and Using Epidiolex. So she’s come full circle on it. And it’s working by the way, trying to convince her neurologist to use Epidiolex years ago. It was a no go. We’ve actually, they’ve come around and now she’s successfully being treated with.

[00:09:58] Bryan Fields: It’s an amazing story. And Kellen, I want to go to you because I got a question about the variability of the, and then the PR person response is hear you’re building up the product and the variability of the individual.

[00:10:08] Are those going to be counterintuitive when approaching the success of a product?

[00:10:13] Kellan: Yeah, I

[00:10:13] mean, at the end of the day, I think this is why a lot of people nowadays, especially myself, Kind of criticized big pharma for only using like a one chemical approach for treating illnesses. But at the end of the day, it’s the most sound scientific approach in terms of trying to get results.

[00:10:35] Right. Just change one variable at a time. With cannabis there’s instances where you will create a product. And just like Dr. T was saying in terms of the variability from a terpene perspective, but there’s a bunch of other final chemicals that are present in an extract from cannabis. And when you start changing 8, 10, 12, 20 different chemicals in a quote-unquote medicine.

[00:10:59] It really, really makes it challenging to have reproducible results from a treatment

[00:11:04] Dr. Jean: perspective. Yeah, absolutely. I think it’s going to be a challenging for pharmacology and pharmacology is not developed with that in mind. So it really is sort of breaking new ground in pharmacology, but very exciting because it could really produce a whole group of new medicines.

[00:11:26] With multiple active ingredients that are acting synergistically. So yeah, very exciting to, you know, grab a cannabis, maybe an old plant, but it’s really pushing our, our methods to newer methods. So excellent. Direction thickness. I think

[00:11:42] Bryan Fields: sometimes those newer methods are challenging for people and for older generations, particular to kind of adjust to the possibilities.

[00:11:51] Maybe I haven’t prescribed cannabis before medically for these patients, but who am I to kind of pull this option off the table for some of these individuals and these poor children that are suffering from some of these upper, from some of these diseases, because there is that challenge, like you were saying, Dr.

[00:12:06] T of like, understanding that true nuances of the plan and then prescribing it sometimes is looked at as like a last resort when unfortunately. It’s too far down the line. It should be considered as an option upfront in order to help these people, because we’ve seen early signs that are positive. Sure.

[00:12:23] There’s not been an overwhelming amount of evidence early on to kind of give a strong sample size, but the early indications are strong. How do we communicate? It’s small sample sizes as a powerful starting ground to a larger material.

[00:12:38] Dr. Jean: Well, that’s a great question. Yeah. We just have a handful of folks who are well, you know, to bring back my, my example of the little girl who was on multiple medications and the seizures were not going away.

[00:12:52] And as you know, had surgical procedures to try to stop the seizures and they weren’t working completely either. So in, in the end, when you’re out. Options and you sort of brought up you know up against the wall, you know, and there is this one option it’s working, it forces you to go into it.

[00:13:11] So that’s kind of what I think it’s going to do in some ways unfair, you know, it’s pretty safe. I think pretty, because I think often many people say it’s completely safe and, and, you know, there are incidents, instances of folks getting hurt by using cannabis. Now, something as simple as having a fainting episode, as, as you take a to-be for, while you’re driving, you know, things like that.

[00:13:39] That we don’t talk about very much. So there are negatives to it, but overall it’s pretty safe, especially compared to some of the pharmaceuticals

[00:13:48] Bryan Fields: that are out there to push back on Callan’s biggest enemy. And if you’ve listened to a podcast for Kellen versus pharma is a reoccurring theme here. So, I mean, big pharma obviously is not going to want to give up their market share because it is a really in dollar and it might be even understanding the financial impact.

[00:14:05] What role is big form of going to play in the advancements of medical marijuana? Can they be an ally or are they going to be kind of this back and forth enemy? So partner in this, I want

[00:14:17] Kellan: to just take one quick, second. I think they can be an ally, but I think that the benefit of having cannabis not institutionalized within big pharma provides one benefit at this juncture.

[00:14:29] Say there is something really negative that happens. And it happens to an individual who has a very strong legal team from an experience standpoint. They could come after and shut the whole thing down because say it’s a couple big companies doing. The liability aspect and the legal lawsuits and all of that will come in and just crush a lot, a big company because they have the bank account to pay those punitive damages.

[00:14:58] And so if something negative happens, having a fragmented space right now, while we still work out the kinks from a medicinal standpoint, Could potentially help the industry stay afloat and continue to move forward. Because at the end of the day, the reason big pharma focuses on one chemical medicines is because of liability and lawsuits.

[00:15:19] You know what I mean? And, and at the end of the day, they’re trying to develop a medicine to treat a specific illness that is variable within every human, because humans are all different, right? Like personalized medicine is a thing, but it’s gonna take time. And while we work out the kinks of understanding how you put the five keys in the lock, instead of just one key in one lock it’s best to kind of have that on the fringe where some angry person can’t go after all of the capital required to continue that company to continue to work out those kinks.

[00:15:51] So that’s, I’m just going to I’ll end it right there, but that was my one little pro pro thought about the big pharma being involved.

[00:15:59] Dr. Jean: Yeah, I agree with you that Rick farmer can be an ally, but it really is frame shifting. Well, you know, first we all have this sort of enamored vision of the magic bullet, right?

[00:16:12] The magic bullet that can do all, you know, in one. And it’s just not realistic, but it’s great for industry because if you happen to own and produce the magic bullet, then, then it’s very simple. And every time. Add an extra active ingredient. The complexity is exponential, right? And so it’s not just the linear it’s, it’s an exponent.

[00:16:36] So going down that road is, you know, as, as my partner Dr. Abrams say, it’s like going down the rabbit hole, you know, you can get lost very quickly trying to figure out what magic bullets or what active multiple activities. I will do. And then people are very different and that’s something new in the pharma.

[00:16:58] I mean, the whole idea of precision medicine, where we actually will do a genetic swab, figure out what type you are right now. If you’ve got high blood pressure, you know, there are a handful of medicines we might prescribe to you for high blood pressure, but we wouldn’t really swab your cheek and figure out what your genetic makeup is before we prescribe the medicine.

[00:17:20] And that may be the future. So that may be where pharma is going, where we’re, we’re getting more and more precise. We’re dialing in through multivariate analysis and understandings, which group of chemicals may work for your individual position.

[00:17:39] Bryan Fields: Well, I want to agree with both of you. I just don’t think that’s how real life works.

[00:17:44] Big pharma is interested in owning their moat. They’ve got a stranglehold on how it works. They want less variables because they want to control how it works and they want to control the prices because at the end of the day, Kaelin, while I’d love for that to be accurate about fragments in a protected meaning.

[00:18:00] You don’t care about these personal gratitudes for people and actually helping people. In my opinion, they care about dollar signs, right? Like, because the opioid manufacturers didn’t really care that people were having all these issues. They cared about dollar signs. And at the end of the day, my opinion, what motivates big pharma.

[00:18:20] Kellan: I know, but one thing to just remember when you kind of stand that is big pharma cannot own the moat because these are chemicals that nature makes right. They cannot patent chemicals from nature. So that is where the it’s the most challenging aspect. And so with Epidiolex, They own a formulation that includes all of these products from cannabis plant, and then they also own the genetics.

[00:18:44] They keep it under lock and key. There’s a ton more trade secrets involved in how GW does business than most pharma companies. Most pharma companies are like, here’s our patents. Here’s our acts. Here’s our, why it’s out in the open. And there’s more trade secrets in terms of, they only source there, the biomass from one cultivator, right.

[00:19:05] They had to do it this way because they have to control the genetics and it’s under super, super lock and key the exact environment that they are cultivating it because those are dictating the chemical profiles and they can’t own that. And so like, that’s the biggest obstacle. And I know there’s a lot of really smart lawyers involved in big pharma, but at the end of the day, they’re not gonna be able to patent th.

[00:19:28] They’re not going to be able to patent CBD. Right. And so it’s going to have to be this special formulation and they’re going to have to get creative and start adding in synthetic chemicals that are not ubiquitous to nature.

[00:19:38] Dr. Jean: I believe the Epidiolex is just CBD oil,

[00:19:45] Kellan: but it’s a formulation, right? CBD is not schedule one, but it’s what they did.

[00:19:51] And this is just smart lobbyists, right. Is what they did is they formulated a various mixture of CBD and other oils to create Epidiolex. And then the formulation of Epidiolex is what was rescheduled to, to schedule three or whatever. Right.

[00:20:09] Bryan Fields: Is it just CBD? Isolate? I thought there was turpines and some THC in there.

[00:20:14] Dr. Jean: No,

[00:20:14] because every time they thought of leaving those in the complexity, Yeah, so they just ended up now, there is a formulation, how to, how they got to it, how many milligrams per kilogram. And then of course, you know, making it stable, which is what the rest of the non-pharmaceutical companies, manufacturers haven’t quite gotten onto it.

[00:20:40] Make the same thing every time doing that when you’ve got multiple ingredients gets tricky, but yeah, at 10 milligrams to 25 milligrams per kilogram, which is a whopping dose by the way. And not really what’s available out there in the industry in terms of, you know, can you get that by going to start at dispense?

[00:21:00] Very hard to get that dose. It requires you getting, you know, a couple of hundred milligrams per tablet for an adult size. So

[00:21:11] Bryan Fields: did your endocannabinoid system evolve over time? For example, if you’re five years old and then you’re 25 years old, do you need a different sort of formulation in order to kind of still attack that same issue?

[00:21:24] I’m

[00:21:24] Dr. Jean: not sure if the endocannabinoid system changes over time, but your body weight changes and we prescribed medicines based on body weight. It becomes less of an issue as you grow older part, especially for children. You know, as they’re rapidly changing body weight, better adjust the medicines. To that, that’s why I said that, you know, milligrams per kilogram body weight, then that’s what we were using to try to dose the Lennox, Gusto kids who were having those seizures.

[00:21:55] Bryan Fields: Grandmom’s perfectly says that a many to many problems as we just continue down this rabbit holes. Let’s talk about consumers from a medical standpoint, what type of common issues are you seeing directed towards medical marijuana and kind of take us through just everyday conversations that our consumers are having.

[00:22:14] So for example, if someone is dealing with an issue internally, and they’re just not sure if medical marijuana could be a good fit, what sort of everyday things are you hearing that you, you can share with?

[00:22:24] Dr. Jean: So in terms of, you know, what are patients presenting to me with? Yeah. They’re, you know, the, I’d say the top four in the four corners of the yard are, you know, trying to improve pain, this sort of pain, you know trying to get sleep.

[00:22:43] A lot of insomnia up there improve anxiety. Or mood is really, you know, improve mood because, you know, anxiety or depression, improve mood and then appetite, everything to do with your guts. So those are the four corners of the world. You know, I was thinking about the other day, and I don’t know how geeked out you want to get with this, but it’s the autonomic nervous system, you know, if you think about the sympathetic.

[00:23:11] Fight or flight and the parasympathetic really controlling your your Your basic functioning involuntary functioning. There’s, there’s a link between them autonomic nervous system and the endocannabinoid system, which is where cannabis active ingredients are affecting. So it’s going to be interesting to sort of tease those two out, see how they would.

[00:23:34] Bryan Fields: Yeah, and I appreciate you breaking those up into the quadrants. So then I guess my follow-up question would be for someone like myself, who likely has all four of those issues, but would I be picking individual products to kind of suit that? So for example, in the, during the day, if my anxiety is running wild, I would lean towards this recommended product.

[00:23:52] And if I’ve got pain from my anxiety, then you would take this one. So is there kind of like the individual based approach you would take or how would you recommend. I usually

[00:24:01] Dr. Jean: start with the dominant, active ingredients in the products and really sort of trying to you know, present this THC. Or TMCA, you know, versus CBD or CBDA.

[00:24:14] So which one are you going to take one? Are you going to take the other, or you’re going to take a mix of the two and that sort of really helps the simplify because it isn’t experimentation. Right? So by understanding what THC does, what its effects are an advert. Affects it helps the patients, you know, choose one or the other.

[00:24:36] And I like to explain it to the patient this way. I’d like to, I say so the endocannabinoid system, imagine it as, as a car engine and engine is running and you’re going to be adding either fuel THC or oil CBD. So they work differently, but they both helped the engine work a little bit better or help a little bit better.

[00:25:00] So, you know, obviously, you know, a little gap and a little oil in the engine is better than just one or the other alone, you know, is sort of the assumption and probably pretty close to true. And so let’s start with those ingredients and w what you’re feeling and. What what it’s affecting. So it doesn’t have to be just, you know, this product is going to, you’re going to get better with anxiety by taking 10 milligrams of THC.

[00:25:27] That’s what I have to convince other doctors that we can’t be prescriptive prescriptive at this point. It’s going to take us years to really get prescriptive. We’ve got to be experimental and introduced. The players in the game and let them have the patient, understand the players and, and then start experimenting with dosing.

[00:25:47] And of course, starting low and creeping up discussing which modes of administration work for you. It could be that your headache gets better by rubbing a topic. Application on your forehead, or it could be that your headache gets better by taking a tincture or are smoking the flower. So it is not really one way, one path to getting the headache better.

[00:26:11] There are many paths and many active ingredients. So it’s, you know, what’s, what’s going to be your direction. Let’s explore. And that’s really, I think the best approach at this point, and maybe always the best approach with all the complexities of it. Eventually we’re going to get specific formulas, helping a large crowd of people where they’re going to be.

[00:26:33] We’re going to be able to say, okay, you know, five milligrams of THC and 20 milligrams of CBD. Alleviate the 90% of the headaches in this cohort of this core population. But at this point we are not there yet. We’re still trying to figure out I was telling those. We’re still trying to figure out how to categorize the different products out there, where to put one product versus the other.

[00:26:59] Bryan Fields: How did we get there?

[00:27:00] Dr. Jean: Wow. How do you tease apart a tag or math? You know, I think the, I love the crowdsourcing approach. I really love it. I think it’s a stroke of genius too, because we have the ability. To get information from the crowd. And let me explain it a little bit more. So traditional clinical studies follows a very specific route where there are four phases to studies from studying the safety of a particular active ingredient, all the way to producing the active ingredients, figuring out what dose works best for groups of people.

[00:27:36] And then. It works, you know, phase 1, 2, 3, once it goes through the different phases of clinical trial, the last phase is phase four, where it’s now the product is now out in the market and we’re gathering information on the safety. And the efficacy of the product from when it’s out there in the market.

[00:27:58] Well, cannabis really needs skips phase 1, 2, 3, and jumps into phase four. So it almost allows us to get information that feeds back to improving a product and then running it through phase one, two and three. Does that make any sense or am I talking to much. Yeah. So I love this phase four approach.

[00:28:19] People are trying it now. Let’s sort of sample the crowd, see what’s working for who and then sort of zero in on the magic formula up there. And then take that and then go through the traditional approach. Making sure it’s. In, in a group of people, typically phase one studies are just a handful of people.

[00:28:43] Phase two, three. If you’ve got, you know, a couple of hundred people in your study, that’s the large study phase four is sampling the masses and sampling everyone. So you get things like rare adverse events from phase four. That’s why you see certain products get released into the market pharmaceutical products.

[00:29:03] After going through phase one, two and three. They get released into the market. And then you find out years later that it’s being recalled because now that everybody’s got a chance to try it, we’re really seeing what the, what the problems are with it. Rather than that small study studies are models for the environment, but now we don’t need the bottle everyone’s using.

[00:29:24] We’re going to get the data from that and really get a good understanding of how

[00:29:29] Bryan Fields: it’s this, the dosing project. Can you kind of shed some light on how you think yeah. Is this, is this the dosing project? I was hoping you’d say the name, but now I just want to confirm, like, this is, this is the intention.

[00:29:45] Can you shed some light on that?

[00:29:47] Dr. Jean: Right. Right. So the promoting our research started the dosing project. We figured, you know, we, we started a research group thinking, okay, we want to get a lot of different companies collaborating on cannabis research to improve the industry and improve the medicine folks out there.

[00:30:07] The thought, okay. Maybe we’ll go through the traditional route, but it’s a very long and lengthy process and choosing which magic formula to bring through the traditional path is it was starting. I mean, how many different possibilities could be out there? I think people are trying that and they’re running into dead end because it’s like searching for a needle in the haystack with all this.

[00:30:35] So we just decided let’s sift the haystack through our fingers and see have the needle fall out, you know? And so let’s sample the crowds and see what they’re using and see what’s working that really what the dosing project is. So what we’re doing is basically crowdsourcing. We’re getting folks to try different products.

[00:30:54] We’re getting information on the product that they’re trying and how it works. And using that to come up with a good understanding of how many milligrams per kilogram of a magic formula that requires to improve pain and improve sleep. I was just going

[00:31:13] to

[00:31:13] Kellan: say, I think it’s a really cool time to be alive right now because of the infrastructure from a illegal and medicinal market standpoint at this, at this juncture, because this wouldn’t have been possible 10 years ago without the amount of testing and compliance.

[00:31:28] That’s been forced on the industry. Because now individuals can see exactly what the active ingredients are in the product, because they’re required to get a tested before they can sell it to the consumer. So that’s a, I think I just wanted to point that out to the general listeners, because I think that that’s a unique aspect that the dosing project is working with right now that wouldn’t have been possible 10 years ago or

[00:31:49] Dr. Jean: yeah, even 50 years ago, you know, because we can use the.

[00:31:54] And we can crowdsource a lot easier now than we could. 30, 50 years ago. It’s going to really revolutionize, I believe pharmaceutical development to a different paradigm of where, where we can use phase four information, much more rapidly to improve formulations.

[00:32:17] Bryan Fields: Can I be a part of the study. Do I have to buy certain types of products like medical versus black market versus recreational?

[00:32:23] Like if I’m interested in being a part of this study, is there a certain path you are looking to take purchase certain types of products and where I purchased them from?

[00:32:32] Dr. Jean: Well, you know, at first we just decided to just as a proof of concept, we decided to. Study, what most people are using out there, which is the flower smoking, the cannabis flower we’re able to to rapidly, you know, fairly rapidly just after 700 responses, but really after a hundred responses, we were able to see statistical significance and we’re able to see that there’s a group of people that had significant pain relief after.

[00:33:05] Smoking the flower, a high THC flower at an estimated dose of 0.9, four milligrams per kilogram. What does that mean to the it’s about three quarters of one grand joint. So if I talk to patients there, if I said, wow, you know, we’re, most of our patients are getting complete relief with that. A lot of my patients.

[00:33:27] I would have difficulty with that because that’s a lot to consume for some folks who are used to just taking a puffer to, and, and that’s all they can tolerate maybe because it makes them anxious to take more, the smoke bothers them. All sorts of reasons why they can’t take more. So it gets difficult for them, but those who are able to take it or have been reporting significant pain relief at that, at that dose.

[00:33:53] So it starts to put a stake in the sand and lets us know, okay, maybe this is something we can work with and develop, you know, products that are based on that dosage. Hence the name of the project, that dosing project, you know, it was crowdsourcing. Seeing what they’re using and then creating a dose effect relationship that we can communicate to the world so that they can predict what the product is going to do to

[00:34:21] Bryan Fields: them, for people who want to be involved.

[00:34:23] So people, listeners that are hearing this for the first time and being aware, is there, can they contribute? Do you want additional participants share some more information on that? So instead of Kellan and I fielding a hundred questions of people wanting to be connected, We can just send them directly to where it’d be most valuable for you.

[00:34:41] Dr. Jean: Yeah. We’re well, you know, we’re in the second phase of the docent project where now we’re getting, you know, we were sampling for proof of concept. We’re just staring. Cannabis because that’s, what’s available and that’s what most people are doing. But we are transitioning to specific products that are available out there.

[00:35:01] And yeah, we’re looking for sponsors who want to put their product into the dosing project to see. What comes out of it, what dose is really effective. This is a great opportunity for a sponsor to start to make label claims and begin to, you know, help the consumer, understand what the majority of people are experiencing with their product pretty rapidly.

[00:35:28] I mean, we were able to get significances in just six months of work where your traditional study takes years. So it’s a quick, fast way to get to an answer

[00:35:39] somewhere,

[00:35:41] Bryan Fields: but it’s the number one question you get asked when people find out your role in the industry?

[00:35:48] Dr. Jean: The number one question I get asked by my patient?

[00:35:51] Bryan Fields: Just if you’re walking the street, introduce yourself and say, this is who I am. This is what I do. What, what would be kind of like a generalized, common question you get approached with.

[00:36:03] Dr. Jean: Can I have your number and I make an appointment, honestly, that’s probably the, you know, it, it seems, and maybe I’m a little skewed being in California, but it seems that everyone has tried cannabis and understand that.

[00:36:23] Not everyone has looked at it from a, the medicinal viewpoint. And, and so, you know, folks who were struggling with, you know, the four corners, the anxiety, the pain, or they want to find something that’s working for them. And often pharmaceuticals have issues. And so it’s, you know, they’re interested. They want to interest in, and it doesn’t work for everyone for us.

[00:36:49] I mean, that’s, that’s normal, but to explore. And to go through it and see how it might work for you is, is pretty interesting too. And you know, we’re also uncovering old methods of, of using, you know, for example, in Jamaica, the medicinal way to use cannabis. Might be the, take a, the flower and boil it in water and then strain the flower out and drink the water.

[00:37:17] And this is what might be given to kids or elderly, whereas smoking, it may be more considered back. And so taking that medicinal and looking at the active ingredients, and if we saw that. Most of the ingredients were, are acidic cannabinoids, which are not active, but have potential anti-inflammatory anti-anxiety effects.

[00:37:45] So it’s interesting to sort of, you know, take the crowd and help them change the way they’re using cannabis or offer them different options so that you can dress through.

[00:37:57] Bryan Fields: If you could sum up your experience into a main takeaway or lesson learned to pass on to the next generation,

[00:38:04] what would that be?

[00:38:06] Dr. Jean: I really love this crowd sourcing approach.

[00:38:07] I think it’s going to, you know, using technology. Using computation to really dial into precision medicine. It seems very confusing to have all these ingredients, you know, many to many problem, all these ingredients and many different people with different chemistries, but we have. Technology now to sort of match people and create this better effect than the one size fits all approach.

[00:38:37] That has been the dominant way of the pharmaceutical industry. So I think that’s going to really exciting medicine down the road. It’s going to be the future. You know, where you are, personal your medicine is personalized and cannabis is going to be a great candidate for that. That’s what I’m looking for.

[00:38:56] Bryan Fields: Prediction of time, 10 years from now, medical marijuana, will it be accepted as widely as some of the other pharmaceutical ads forward? And if so, which area will be the biggest youth face?

[00:39:15] Dr. Jean: Well, sorry to say. I mean, I thought we would. I, you know, in fact, I, I would talk with the other doctors and we’d put that song on whether it’s going to be 10 or 20 years before things were going to really progressed to, you know, cannabinoids and other active ingredients in the plant being part of medicine.

[00:39:39] And I was on the 10 year side. But it’s been 20 years and we’re not even close. So I say, I don’t know, it’s moving slowly. So in 10 years, I think we’re still going to be trying to figure out the right pattern of, hopefully it moves. But it hasn’t so far, we’re still stuck in, in, you know, the fear of THC, the fear of the psychoactive or the and, and the unknown, you know, as doctors are, you know, conservative generally slow to progress to new things.

[00:40:11] So it’s going to be slow. W we’ll be maybe a little further on as we are now. Turns out science is hard.

[00:40:22] Kellan: I do think that it’ll be more accepted than it is today. And I think that’s just going to be a product of having legal cannabis available. And I think most states at that point. And so I think when. When you legalize it and recreational use becomes standard. I think people then, or who are skeptical about it in general, are going to have at least a curbed opinion related to the medicinal benefits of it.

[00:40:49] Right. And so I think, I think it will be more accepted, but at the end of the day, the complexity of the plant, I mean just the amount of chemicals and natural products within a typical cannabis plant over 400 from an active chemical ingredient standpoint. It’s going to take a lot of not only kind of phase four dosing project kind of trials, but we’re also, we, we forget to mention that there is an entire foundation of the endocannabinoid system that is still currently being built out from an understanding perspective.

[00:41:20] And a lot of this work needs to be done by institutions and universities, and that requires federal support and federal funding. And we’re only starting to barely see. This kind of research being conducted and yeah, there was a record amount of primary literature publications last year associated with an endocannabinoid system in cannabis, but it’s only the tip of the iceberg.

[00:41:41] And I mean, we’re talking like traditional pharmaceuticals had hundreds of years and especially in the last, I would say 75 years from the 1930s on. There has been, there’s been an exponential amount of primary literature associated with the, the human body and our understanding of it. And that’s how we’ve been kind of, we’ve been using all that information to treat individuals and develop new pharmaceuticals in terms of.

[00:42:06] The chemical structure of specific proteins that different chemicals fit into and cause these different reactions within the human body. So, I mean, it’s just, it’s a massive undertaking and it’s a mountain that needs to be climbed and it needs to be climbed in so many different fashions. And there’s just so, so many people that need to get involved to be able to kind of push this forward.

[00:42:29] It’s going to be an army of scientists. Yeah.

[00:42:31] Dr. Jean: That’s a great point, Kelly. And I really think that the collaboration. Is gotta be a big focus if we’re going to move this quickly. And yeah, if we’re going to do this in silos, it’s going to take a lot longer. So a good

[00:42:45] Bryan Fields: point. Yeah. We’re fighting so many battles on, on so many fronts.

[00:42:49] Right. And in addition to all the science and the research, it’s the stigma though, right? Like you can still have the conversation. With your physician about, Hey, like I’m in pain, I need help. And he’s like, here here’s opioids. And I’m like sick, thanks. Or he’s like, Hey, you interested medical marijuana. And even, even me, who’s in the space.

[00:43:07] It kind of feels different where like, it doesn’t feel the same type of conversation I’m having. And I think that starts with it being more widely accepted and more conversations happening in plain sight, more research coming out and more breakthroughs and understanding all these benefits. And over time that stigma will follow.

[00:43:25] We go away in 10 years. Yeah, you’re right. We’ve got a ton we need to accomplish in 10 years for it to be as widely accepted. And in addition, big, pharmacist’s not going to give up their wrong financial decision. Not in a way, man. They’ve got that. They’ve got the pockets of the lobbyists and money talks, right?

[00:43:42] So for them to be open to this, I think it involves them taking a different strategic opinion because obviously we discuss some of their challenges. I think that there’s so many variables, 10 years with all the challenges we have. I don’t think we’ll get there, but I’m also optimistic and hopeful that we can get there.

[00:44:01] They could be the

[00:44:01] Kellan: next Kodak though. Visual camera came. They never saw it. They’re like, no, come on. Hey, this is an optimistic

[00:44:09] Bryan Fields: opinion. We’re going to get a cease and desist letter from big format.

[00:44:19] Dr. Jean: But, you know, from a doctor’s point of view, if you look at the clinical studies that they’re producing on clinical studies.gov clinical trials.gov, you’ll see that most of the studies right now are about cannabis use disorder. You know, they’re not really looking therapeutic, they’re looking into, so it’ll show you that the perspective is still skewed, you know, from, from traditional medical perspective.

[00:44:46] You know, this use disorder, but not, you know, treatment oriented or, or beneficial.

[00:44:53] Bryan Fields: I traveled internationally with my, my medicine.

[00:44:58] Dr. Jean: I don’t think so. You know federally, I don’t, I guess there are some countries that have. Except it cannabis, but typically it requires a doctor’s approval and, and that doctor needs to be from the jurisdiction of where you’re going.

[00:45:19] And so. Try to go to a place and then get a an evaluation there. Even from state to state, you know, technically you can’t travel. There are some states that for example, Maine has a program where if you have your medical cannabis now from New York, you can go to Maine and apply and get that transferred to me.

[00:45:41] And then you can have access to the name that you’re going up there for the summer vacations.

[00:45:46] Bryan Fields: Sure. And I just kind of wondering out loud because my pain and my anxiety, when I get in the car and cross the state line, it doesn’t just go, oh no, this pain anxiety is just stuck in New York. You’re fine, Bri.

[00:45:57] Like you don’t go worry about it here in Maryland and Jersey life is good, but I mean, just traveling, right. If you’re going to go from New York to, let’s say Maryland, you’ve crossed over four states, like I’m just going to leave my medicine at home. I mean, that seems pretty rigid.

[00:46:09] Dr. Jean: It’s a very common problem.

[00:46:12] Yeah. I’m constantly having to coach patients on how they’re going to handle that. They traveled from state to state.

[00:46:19] Bryan Fields: Good thing. Anxiety has boundaries, right?

[00:46:23] Dr. Jean: Not state boundaries.

[00:46:27] Bryan Fields: See, thanks for your time for our listeners that want to get in touch and learn more. Where can they get in touch?

[00:46:31] Dr. Jean: Our research is at www dot the T H E C E S C, Charlie, Edward, Sam, charlie.org.

[00:46:42] So yeah, go to our website and see what fun things we’re doing. If she needed a recommendation go to www dot Metuchen, EDI, C a N n.com. W we’ll see what we can do to help you. Thank

[00:46:55] Bryan Fields: you very much. We’ll link that up all in the show notes. Take care, right.


Thanks so much for listening to The Dime . Subscribe or follow us on Seeking Alpha, Libsyn, Apple Podcast, Spotify, Google Play or Stitcher. And we’d really appreciate it if you could leave us a review on Apple Podcasts. It helps others find our show.

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Editors’ Note: This is the transcript version of the podcast. Please note that due to time and audio constraints, transcription may not be perfect. We encourage you to listen to the podcast, embedded below if you need any clarification. We hope you enjoy!

Bryan Fields (Twitter: @bryanfields24) and Kellan Finney (Twitter: @Kellan_Finney) were fortunate enough to sit down with Mona Zhang (Twitter: @ZhangMona) , Cannabis Policy Reporter from Politico.

We were able to pick her brain on cannabis legislation as more states legalize cannabis.

In today’s episode you will find:

  • What will future legislation and policies look like?
  • States that are pushing forth THC Caps
  • How can we get pro and anti-legalization advocates on the same page.
  • Do limit licenses in certain states benefit the business or the consumer?
  • Big Companies vs Small Business in Cannabis industry
  • Corruption and political favoritism issues within the Cannabis Industry

Be sure to subscribe to The Dime Podcast to hear new episodes the moment they are released!

https://www.eighthrevolution.com/the-dime-podcast


[00:00:00] Bryan Fields: This is the dime, dive into the cannabis and hemp industry through trends, insights, predictions, and tangents.

[00:00:11] What’s up guys. Welcome back to another episode of the dime as always. I’ve got my right-hand man Kellen Finney here with me. And this week we’ve got a very special guest Mona John states cannabis policy reporter from.

[00:00:23] Mona. Thanks for taking the time. How are you doing today?

[00:00:25] Mona Zhang: Thanks so much for having me. I’m doing well then crazy few months on the canvas

[00:00:31] Bryan Fields: there. Imagine we’re excited to dive in and tell him, how are you doing today?

[00:00:34] Kellan Finney: Doing good, just enjoying another sunny day out here in Colorado. Excited to talk to Mona Ramona

[00:00:38] Bryan Fields: before we dive in.

[00:00:39] I think it’d be great for our listeners to kind of get a little bit about your backstory and how you got into the cannabis.

[00:00:45] Mona Zhang: Yeah. I mean, I used to cover media. I went to school for journalism and I, you know, I worked at some media publications like media bistro and ad week. And I just saw a lack of good cannabis journalism, especially after the first states, Colorado and Washington legalized.

[00:01:01] And so, you know, I had this idea of starting a cannabis magazine that never panned out. And I thought, well, you know, I could start a newsletter. That’s like low barrier to entry. So I started my own cannabis newsletter and eventually started freelancing and doing like freelance journalism on the Cannabis That was in 2015. And that was really cool to see a place like Politico and national outlet hire a team of cannabis reporters, which they did in 2019. And so it’s been, it’s been really great to work at, you know, an organization like Politico and really delve into all of the nitty gritty of policy issues.

[00:01:37] Cause it’s just such a fascinating topic.

[00:01:40] Bryan Fields: Yeah, I think that’s really exciting and I’m excited to kind of dive in there. So what’s it like covering cannabis versus other industries? Do you think, as a whole politicos team of reporters kind of looks at canvas a little differently, like in some other industries, you know, can you kind of shed some light?

[00:01:55] What it’s like covering cannabis specific.

[00:01:57] Mona Zhang: Yeah, it’s really interesting because you know, political has a lot of policy verticals. I think cannabis is a special hole because it intersects with so many other policy issues. You know, like we’ll collaborate with our colleagues on the finance fee or the agriculture B, and these are reporters who have expertise in those areas and we’re kind of able to combine our expertise.

[00:02:20] But it’s interesting because of the federal state conflict, it just creates so many policy issues like banking, like taxes, you know, you have this state patchwork of regulations. I’ve been learning a lot about FDA, like food and dietary supplement regulations lately. And it’s just like, it’s really interesting as a policy reporter because you learn about all these other areas.

[00:02:43] Bryan Fields: Awesome. And what are those areas that I heard recently on your weak ass podcast? About anti legalization advocates. So on this podcast, we always talk about positives, but I don’t think we shed enough light on exactly why some people have hesitancy with cannabis. So what is the main driver? What do you think is the main reason these anti legalization efforts and what is their main stance?

[00:03:05] Mona Zhang: I think it really depends on the advocate. You know, I talked to a lot of anti legalization advocates and they range from just, I think like some people have still this like kind of reefer madness mentality. I think people have very valid public health concerns, you know, especially with regards to impaired driving or you use.

[00:03:25] And so it’s, it’s an interesting kind of spectrum of advocates. You know, a lot of times it’s like public health advocates or people. You know, fields like psychiatry and that type of thing, but it is. It’s interesting to see how that world has kind of evolved because I feel like a lot of anti legalization advocates are now sort of pushing things like the bill in Colorado to limit THC potency and canvas concentrates.

[00:03:51] The approach is shifting from being like anti legalization to like THC potency caps. And like, what else can we get in legalization bills from like a public health perspective?

[00:04:02] Bryan Fields: Dive in there, obviously from Colorado, that’s a big standpoint. Do you think Wayne maleness is describing that is the direction that most are taking or are there other areas that you see in Colorado that you think are kind of

[00:04:13] Kellan Finney: pausing it?

[00:04:14] I mean, I think Colorado is probably unique example because it has been legal for five years now, plus, right. And so it’s forced a lot of the people on the opposite side of the argument to mold new approaches and new angles to try to combat cannabis as it is. And I think that potentially. This is just my personal opinion.

[00:04:36] I think a lot of the advocacy and like the individuals that have a strong opinion, opposing cannabis, I think are slowly beginning to change as society. And as our culture changes and adapt. To cannabis being legal. And so with that, I think that it’s slowly starting to move that opinion from super, super far against cannabis to, okay.

[00:05:02] There could be some potential positives to cannabis. Now we need to regulate it. And, and I mean, with, with capping potency, I think that that’s important anyways. I mean, from a scientific perspective and a toxicology perspective, the dose is what makes the poison right. I don’t know anyone that really truly needs to consume 99.9, 9% THC on a regular basis.

[00:05:25] Right? I mean, you even look at like aspirin or other kind of medicines and they’re all dosed out properly, according to the person’s weight and their metabolic and all of these other. Variables so that you don’t poison them, right? Like you can drink too much water and die from drinking too much water.

[00:05:40] So I think with, with cannabis potency caps, I think that’s needed just to, to regulate it. I mean, you can’t go by 99% alcohol either. Right? You can get moonshine. And I think they cap it. Every state might be different than Colorado. 90% ethanol moonshine, right? And so there’s a need for those kinds of regulations.

[00:05:58] And I think that it’s in part, a safety feature that needs to be built into the regulations as well as it’s being driven by individuals that have started to accept cannabis as an illegal substance. With certain stipulations. What are your thoughts on that? Brian? I kind of go back and

[00:06:16] Bryan Fields: forth because at the end of the day, it sounds to me and please correct me if I’m wrong.

[00:06:21] It doesn’t sound like they’re like, Hey, we need more research in order to understand limits and putting people in safety places where like no cannabis is bad. The devil’s lettuce and all those outrageous stigmas like, oh then, and to me, maybe that’s just a more optimistic, welcoming stance of saying like, Hey, sometimes new facts are hard to quote Ben Culver and maybe some people in the older knees are a little more.

[00:06:44] Stuck in their ways. So I wonder how we kind of progress forward without the research, because even after we have the research, there’s going to be pushback, right? There’s going to be scientific saying, Hey, we need to do more extensive studies or, Hey, we didn’t study on this person. So, I mean, with all these, these areas, obviously the federal government is trying to balance this act.

[00:07:03] They’re deferring to the states to kind of go forward. Mona, what do you think is kind of the best way to kind of communicate through these anti legislation with people that there are positives in these? Yeah.

[00:07:15] Mona Zhang: Actually to the research point and the Colorado potency cap bill, there are a lot of research provisions and it is very much like we have to set up a way to research this stuff.

[00:07:25] And then this committee will do the research and then recommend like policies to us. So that’s like a really. Great thing about the Colorado bill. I think in some other states you do see a move to like, you know, Vermont was the first state to have any sort of PhD potency cap. And that was 30% for flour, which, I mean, flour usually doesn’t go above 30% anyway, and cannabis concentrates at 60%.

[00:07:50] But I think it is hard to have a policy discussion between. Pro legalization, anti legalization advocates, because the research is so recent and because the research is so mixed, you know, when I listened to these debates on state legislatures, it’s, you know, cannabis supporters citing all of this research to support their point.

[00:08:12] And then People who are against legalization, citing all this research. They, and the truth is there are studies that show youth use going up in states that have legalized marijuana. There is research showing youth use going down in states that have legalized marijuana. So the research is mixed and it’s really hard to like, you know, it’s just people taking whatever numbers, support, their

[00:08:32] opinions, last example.

[00:08:33] Bryan Fields: So what do you think would be beneficial in order to kind of help? Let’s say, get people on the same page. Do you think that’s just people on both sides of the debate, just kind of laying it down to the numbers. Like what efforts do you think would be beneficial in order to help kind of progress the conversation?

[00:08:48] Mona Zhang: I think

[00:08:49] that, you know, engaging with opposing points of view are a good thing, and I think it’s, it’s a lot easier done, I think on the state level than the federal level, especially in state legislatures where they’re debating marijuana, legalization, bill. And they’re really getting into the policy details and committee.

[00:09:07] There are anti legalization advocates saying, Hey, we don’t want marijuana legalization, but if you’re going to do it, please consider this amendment. You know, please consider, you know, doing some sort of public education campaign on impaired driving or, you know, and, and they are engaging with the issue in a more substantive way, rather than saying, we just oppose it.

[00:09:28] They’re saying we oppose it, but like here. I think this would make the legislation better. So I feel like that shift is just naturally been happening in state legislatures as the issue moves forward in the U S

[00:09:39] so then let’s kind of continue on that path. Why are states looking to overturn these initiatives that are majority approved by their local Reynolds?

[00:09:48] In

[00:09:49] theory, they are procedural legal challenges, you know, and Mississippi and South Dakota and Nebraska too. These are all legal challenges saying, Hey, these initiatives weren’t qualified for the ballot and a way that conforms to the state constitution, it violates a single subject rule that violates whatever.

[00:10:07] Provision of the constitution. However, I did talk to an illegal expert in state constitutional law, and he told me that all procedural challenges are really screened for, you know, policy issues. They don’t agree on the policy and they figure out a way to challenge it procedurally. And so I think you know, the fact that.

[00:10:29] Governor Kate Reeves of Mississippi. He’s very, very conservative. But he recently said he would be open to having a special session for medical marijuana because the court, the state Supreme court overturned the medical marijuana legalization law. And I think for politicians. You know, 74% of people voted for that.

[00:10:46] A kind of just like it causes a big issue in 74% of voters vote for something that the Supreme court overturns. It’s not great politically for him. So I think just like the sheer support for these issues are going to help move things along on that front. Even if the courts do strike it down.

[00:11:06] Bryan Fields: I think that’s really well said, and I want to go to you Kellen.

[00:11:08] Cause it seems like the cannabis wave is coming and some politicians are trying to slow the wave and others just kind of get gobbled up of it. We’ve talked about governor Rick, it’s talking about, if you legalize marijuana, it will kill your kids, which I will put on the top five best quotes of all time, because I still need to figure out how he came up with that statement.

[00:11:26] And if he just went off the Casper, if someone was like, Hey, like this is the word choices you’re going to use because we’re supporting this. So like, As a politician. Do you think that there’s a balancing act that they’re doing, trying to figure out how to keep their constituents happy, but also from a conservative nature of trying to slow down?

[00:11:44] Kellan Finney: So my disclaimer is I’m not a politician and I, my view on how a lot of these issues kind of play out is that I tend to favor. Yeah, they are playing by the rules of the law, but the motive behind how they’re playing the game. As underlying objectives that they’re trying to fit into the rules of the law.

[00:12:09] Right? So I think at the end of the day for Mississippi to overturn it, I think that there’s other people within the state that have alternative motives and they wield power and they are able to, to overturn those kinds of things based on non-legal motivations, right. Versus their own personal opinion.

[00:12:30] And I think that there’s a lot of like hidden agendas that drive these kinds of situations. But at the end of the day, I think the most important thing for people that are pro legalization of cannabis either medically or adult use that clearly this has been a very, very long. Battle. That’s been fought over the last 70 years or 80 years from a prohibition standpoint.

[00:12:53] Right. And so, or I guess 90, right, 1933 or something when it was. And so for the last 90 years or so they’ve been fighting this prohibition and we’ve made a ton of progress as a society in terms of adult use medical use across the United States. And I think that spending time to try to. Address, these underlining agendas they’re pushing, I don’t think is productive to the overall stance of marijuana legalization.

[00:13:23] Right. And so I think that just continuing to. Stand on the scientific literature that shows the positive attributes of cannabis consumption and the positive attributes of all these minor cannabinoids, as well as, I mean, hemp for instance, right. Hemp is part of the cannabis plant. Right. And there’s a ton of building benefits that it can provide society.

[00:13:46] I mean, hemp rope and create, right. So I think that if we just continue to fortify the positive sides of the. I think that eventually these kind of underlying hidden agenda topics from my perspective will kind of just fall to the wayside. I don’t think they’ll ever just completely go away, but I do think that as support continues to be generated for it, if we just continue to look at it from a positive stance and continue to have the conversations, right.

[00:14:14] I think it’s important that scientists talk to politicians and politicians talk to scientists and, and there’s this ether that all of the information is communicated. As fast as it can. I think that’s the only way to really, really approach it. I don’t think that you’re going to make any progress standing in the mud and playing the same game that the other side is playing in my opinion.

[00:14:33] I mean, I could be wrong and that’s my nonpolitical opinion, I guess. Right. What are your thoughts though? I think that’s all

[00:14:38] Bryan Fields: really well set in, and it’s such a challenge from understanding how like the policies go with politicians, but I want to kind of switch gears because there’s an area that you lightly touched on.

[00:14:47] When we’re talking about the limit licenses in certain states, obviously some states have gone ahead and limited the amount of licenses they’ve given out. And there’s obviously a bunch of different ways that that can be evaluated. So Mona is that intended to benefit the state, the businesses or the consumer when they limit the number of licenses that are given out?

[00:15:05] Oh,

[00:15:07] Mona Zhang: is it intended to benefit the state or the consumer? I mean, I think it depends on the state. You know, when Virginia was having its legalization debate, I was really surprised the lawmakers put a statutory cap on licenses and the reasoning behind it was to prevent any big marijuana companies from harming smaller businesses.

[00:15:31] I question whether that is the best way to achieve that goal from a policy perspective, because we haven’t really seen that happen in other states with limited licensing. Generally speaking, when they’re limited licenses, it is the better capitalized, bigger companies that are, you know, favored in such a market, but that was their reasoning behind it, which I found pretty surprising.

[00:15:54] So, I don’t know, you know, it really just depends on the state and in Connecticut, for example, you know, I was talking to one of the policy. People at Lamont’s office. And he was saying like, we don’t have a statutory cap on licenses and it’s going to be awarded by a lottery instead of some sort of like merit-based process, precisely to avoid some of the pitfalls that you’ve seen in other states.

[00:16:17] And so, yeah, I mean, and I think there’s also a sort of fear when it comes to legalization that you’re going to see pot shops on every corner. And I think that kind of fear also drives some of this you know, license, cap policy.

[00:16:30] Bryan Fields: What are some of those pitfalls? Some of the other states I’ve seen just in case our listeners aren’t familiar.

[00:16:35] Mona Zhang: Yeah. I mean, there’s, there’s corruption issues, especially when there’s limited licensing. There’s definitely, I mean, there’s outright corruption issues. And then there’s sort of like political favoritism issues where people who want licenses, you know, make these huge donations to certain politicians, campaigns or whatever.

[00:16:52] And then there are a lot of. Entrepreneurs who lose out on licenses. And it ends up being like in Missouri, for example, there’s this like huge legal issue with all hundreds of entrepreneurs appealing their licensed denials and the state is spending millions of dollars on like fighting these appeals on outside attorneys.

[00:17:10] And. it Can delay the launch of the market. It can delay the growth of the market. And, you know, it’s interesting because it’s a sort of area of common ground between more, you know, lefty cannabis advocates and like the right leaning, more libertarian free market types who are like, everybody should get a shot at this.

[00:17:32] And, you know, we should let the market decide the winners and losers rather than the state deciding the winners or losers. Through what is often a dubious merit based scoring process. Once you have that, it opens up a whole other can of worms.

[00:17:47] Bryan Fields: That’s perfectly said. And I think, you know, we’ve had conversations with operators who are looking to kind of expand their licensed opportunities and ask for recommendations on which personnel to put on this.

[00:17:56] And they say, Hey, we’re just looking for someone for the license. And we kind of like you were saying muddies the conversation because these people aren’t really attached and they are there just for the merit base. I can see the corruption aspect, right? If people are doing favors or even differently said making donations for political campaigns, obviously that’s a huge issue and it does favor some of the bigger players, but at the end of the day, cannabis is very expensive.

[00:18:21] And I kind of look at it like a golden ticket opportunity. In these limited licensed states, you kind of agree with that. Like in the Willy Wonka style, like you open up, if you, if you get that lottery ticket and you open it up, you’ve gotten herself out opportunity to touch some market share in an untapped market, especially here on these.

[00:18:36] Mona Zhang: Yeah, absolutely. It is a golden ticket. And because of the cap, these licenses are worth more. And it is an interesting debate because there are states that, you know, really wanted to send our social equity and their legalization bills. And they’re like, well, we need to cap the licenses because of this.

[00:18:53] And there are other states that are like, we really care about social equity and that’s why we shouldn’t capital licenses, you know? So it’s interesting. And I think, you know, I recently. Wrapped up a story on main and social equity was never really that big of a discussion in Maine, but they’re low barriers to entry.

[00:19:11] Make it really easy for anybody. You can pay a few hundred dollars and start your canvas business with a growth hat and a few hundred dollars licensing fee. Like the barriers to entry are very low. And the medical program, at least right now. And it raises some interesting issues with these other states that have approached social equity with these, like, you know, convoluted programs that they’re having trouble implementing.

[00:19:36] And it’s like, You know, some states are achieving some of those goals by not even having one of those programs and just having low barriers to

[00:19:43] Bryan Fields: entry, you know, find balance. So Kellen, what do you think they should do? Obviously, the software equity is a huge deal and letting people out of prison is a huge deal and kind of adjusting for some of the wrongs of the past.

[00:19:55] But how do you stay at school? Balancing those.

[00:19:58] Kellan Finney: I would like to say I’ve seen a successful social equity program played out in a state. I just haven’t yet, as far as what the vision has been and the execution associated with that, I think Mona makes the best point when she said that it seems that states that have completely ignored that have actually provided the best opportunity for minorities to get involved in the industry.

[00:20:22] Right. And, and better themselves from that perspective. As far as releasing individuals from prison, I think that that’s a no brainer and that should completely be the forefront of all of these discussions. I think it should actually take precedence over the social equity aspect of it. Right. I think we should fix what we did wrong before we kind of keep moving forward.

[00:20:43] Right. And so that’s my, my stance on it. As far as limited license states versus not limited licensed states. I mean, I worked in, in Washington where you could just go buy a license if you had enough money and they just kept giving them out. And it created a really Rocky start to the industry versus Colorado, because you would walk into a dispensary and there would be.

[00:21:04] 2,500 different brands on the shelf because it’s a free market. The best will survive. They want to encourage competition. And if you show up, like, let’s see what you got kind of the situation, right? It makes it a lot harder to regulate. You saw from a business perspective, I experienced a lot more shady interactions and a lot more bad actors because.

[00:21:25] Anyone could come and show up and just play the game. But it turns out the game was really challenging to play from a traceability standpoint and, and following all the rules properly. And it led to a lot of sour, a sour taste in my mouth when dealing with a lot of different companies, trying to outsource certain aspects of, of the supply chain.

[00:21:45] And so that was a huge challenge. But then the ops side of that would be Colorado where they didn’t give out a ton of licenses and yeah. I think the logic behind it was, it’s easier to regulate a couple really large players than it is to regulate everyone in their mother kind of getting involved. And so I understand the logic associated with that.

[00:22:08] What that created from a negative standpoint is it created these quote unquote almost like monopolies. Like you can look at Florida too, right? Like queen camp might have a monopoly depending on how you look at it. Right. And I’m not downplaying that or applying it. I’m just kind of stating the facts that when you own over 60% of the retail stores available for consumers to go purchase their product.

[00:22:31] Might be close to monopoly, you know what I mean? And, and you can make arguments that that could be good. It could be bad. And we’re not here to really do that. But I think that no matter limited license versus not limited license you from a conversational standpoint, it can be framed. As either positive or negative, depending on who is kind of framing it up.

[00:22:54] And so on the east coast, at this juncture with like New York being in the limited license state, there is no question that it will favor the big MSLs that are highly capitalized that have teams, lawyers that can go through these two, 300 page doc it’s to follow the rules. The barrier to entry. Is much, much greater than any other state from, from that perspective.

[00:23:18] And so it’s challenging if you’re a small mom and pop. In New York that was looking to get in the Canada space. Unfortunately you should probably consider relocating somewhere like Maine or, or even New Mexico. Right. New Mexico had these, these caps on the big licenses. Right. Which I think they have a good hybrid system right now, but they also have a small micro license.

[00:23:39] Where you can go grow 200 plants. The barrier to entry from a financial standpoint is much smaller. You can be completely vertically integrated. And so I think that that is an attractive way to approach this. I think that there’s also potentially some scientific experiments going on. I guess you could say from a social perspective.

[00:24:00] So if the federal government wants to see what works best, it makes sense to let some states have limited licenses, but some states, everyone in, I have a couple of hybrid models and then they’re like, all right, let this play out for five years and we’ll see what works the best. So when we go to, to implement this on a federal level, that it’s actually something that works and we don’t have to.

[00:24:21] Sit there and revise it year after year and cause all of these struggles, I mean, you got something to say to that.

[00:24:26] Bryan Fields: Brian, let’s hear doesn’t that make it harder for people like poor Mona. Who’s got to cover all these different states with all these different policies and all these different obstacles. I mean, what you described to me is pretty much saying that in New York, If your mom and pop moved with smaller, safe, cause you don’t have a chance.

[00:24:42] And I think that’s kind of unfair because at the end of the day, this is America, right? The land of the opportunity. And if you’re telling people that here’s their opportunity to dive into cannabis and to fulfill their entrepreneurial spirit, but they can’t do it because they don’t. Billions of dollars in teams of lawyer.

[00:24:57] I don’t think that’s really so fair. And for, for Mona, I mean how she she’s covering all these states and then she’s got to communicate to her readers. Oh yeah. That was this state. And then with this state, it’s different. I mean, we’re talking about an educational difference between all in all the information and then being able to comprehend where like over complicating the policy, if that’s the way that’s going, what do you think about that?

[00:25:18] Mona Zhang: Yeah, I think cannabis policy can be really convoluted. And you see with these legalization bills, they’re hundreds of pages long because to legalize marijuana, you have to, you have to change all these other laws that intersect with the criminal justice system or with the education system or whatever.

[00:25:36] That’s why these bills are so long. I think with the licensing issue, it’s like, it doesn’t necessarily have to be this binary of like limited licensing or not, you know, States where the law gives the power to the regulators to sort of roll out licenses as they see fit. I think that strikes a good balance between just like a free for all which leads to, you know, an Oregon situation where you have this boom and bust and like people go out of business.

[00:26:01] Cause it was just so oversaturated. But if you give regulators the flexibility to be able to like, Give out licenses as they see fit. And as the market will take, you know, that seems to be an approach that has yielded less problematic outcomes.

[00:26:20] Bryan Fields: I want to dive into a recent conversation. Your colleague now the FERC had with Bernie Sanders, and if you haven’t heard it, it’s definitely worth Googling the short story as it is.

[00:26:30] She approached Bernie to ask him a question. She introduced herself as a cannabis policy reporter for Politico and his immediate response was, are you stoned? Mon is that like a traditional, do you think, like most politicians are going to have some sort of normalized response like that? Like, I don’t think that’s a fair response, but I mean, obviously he answered honestly, but what do you feel about.

[00:26:50] Kellan Finney: I actually

[00:26:51] Mona Zhang: was surprised by that exchange. I don’t think that is a question that Natalie gets regularly when she’s reporting on the hill. So coming from, you know, a Senator that has been like a long time champion of legalization is a little bit surprising, but also just funny. I mean, the exchange is funny and if you haven’t listened to it, it’s it’s online.

[00:27:12] And we released the audio on dispatch as like a short episode. But yeah, it does. It does show how far this issue still has to go. If you’re like, you know, reporting on cannabis policy and people are asking if you’re stoned, it is like, you know, we, we were talking earlier about like, if you are, I don’t know, an alcohol industry, reporter people, aren’t asking you when you’re doing your job, are you drunk?

[00:27:36] You

[00:27:36] Bryan Fields: know, I think that’s perfectly wasn’t, especially for someone like Bernie, who, you know, they always talk about how he so far released policies for him to say that it’s kind of opening and I’m sure. There’s some Midwest states out there that are using that as like a championing ground and be like, Hey, see, like, if Bernie feels this way, you know, it’s normalized where the stigma still exists.

[00:27:55] So countless, I mean, your thoughts on it.

[00:27:57] Kellan Finney: I think it just, honestly, I think it just highlights how far we still have to go from a cultural stigma perspective, right? Like, Even individuals that live out on the west coast and in California or Oregon or Washington, or even Colorado, we cannabis has been legal for some time.

[00:28:15] Now, especially in California, that’s kind of been legal since the nineties. You could potentially make an argument, right. And the, that amount of time has allowed the society as a whole. To kind of assimilate to cannabis, being another recreational outlet for humans to consume for whatever reason.

[00:28:39] And that’s, that’s led to the change in overall opinion and perception associated with the plant and the use of the plant versus over on the east coast where it hasn’t been so prevalent and it still is treated. As it was 30, 40 years ago, you can just see that, that it takes time for these kinds of and cultural changes to actually precipitate.

[00:29:06] Right. And I think that that right there, it just perfectly sums up. Yeah, we’ve come a long way from prohibition, but we still have a long way to go to change the minds of the general population across the entire country and across multiple demographics.

[00:29:24] Bryan Fields: I think I brought that and overall, like I think it hurts the industry.

[00:29:26] I think that continues to solidify a stigma. That is a negative one. And at the end of the day, people use cannabis solely for medicine. And when you ask that question with the connotation and the perspective behind that, usually at least for me, feels like a negative one. So I’m hopeful that in the future, politicians and people will understand that that’s not likely the best initial response when being approached by people.

[00:29:49] Sort of quickly switch gears, Delta eight, very popular subject. We’ve talked about this a bunch of times. Mona, do you think Delta aid is a fad or do you think it’s here to kind of.

[00:30:00] Mona Zhang: I think it’s here to stay. I think there are people who are, you know, I’ve heard a lot of anecdotal stories from people who are legitimately helped by Delta eight, from a medical perspective who have tried CBD, who have tried Delta nine, THC and medical marijuana products.

[00:30:17] And they say Delta eight has helped me the most for like, you know, neuropathic pain and those sorts of issues. Again, all anecdotal, no science on this at this point, but I think. You know, it is a different compound that Delta nine THC. And I can see it staying, but I there’s obviously like a fad aspect of it.

[00:30:37] And it’s recent. I don’t know, recent growth in the market. Because of various factors because of, you know, states that don’t have legal cannabis because of, you know, the sheer amount of CBD isolate that’s been sitting around in the hemp market and people need an outlet for that. And there, there are all sorts of things contributing to this.

[00:30:58] It is a trend in some respects.

[00:31:01] Bryan Fields: Yeah, I think growth might be understanding it’s like an explosion, right? Especially here in, in some of the like New York, for example, where it’s not, you know, adult use is not possible. So people kind of lean towards products that they can purchase over the internet and are a little more trusting of it.

[00:31:16] So Kevin and I have kind of dove into this from understanding whether it’s a fat are here to stay. And we wonder if, whether or not this is just kind of a short term. Temporary and public, government’s kind of like, Hey, you know what? Like this is illegal, but then my opinion, and then I want to go to you telling is that maybe the CBD market will look for like another sort of compound to kind of find another offshoot for a revenue stream Kaelin.

[00:31:37] Kellan Finney: What’s your thoughts? I think that there’s no denying that when humans ingest Delta aid, it does cause Affects right. More so than CBD, but less so than Delta nine THC. There’s no denying that as far as the manufacturing practices that are being implemented to produce Delta eight, I think that’s where the majority of the questioning is now being centered.

[00:32:00] And I think that’s where Colorado has. The department of health, that’s where they took their stance on. It is just from the lack of regulations and the lack of understanding and the lack of testing associated with the manufacturing of Delta eight. And I think that’ll get sorted out in time, right?

[00:32:15] It’s just a matter of kind of trial and error and figuring out. The best way to do it, what’s the safest way. And how do we regulate it? Right? Because the last thing we need from an industry standpoint is some kid in New York to consume a Delta eight product. And it just so happened to have some sort of chemical that was really toxic in it, that wasn’t removed from the manufacturing process, and then they get really sick.

[00:32:38] And now there’s this front, this headline story. Kid dies of consuming, dealt ADHD in New York. You know what I mean? I think that’s the last thing the industry needs, but we’ll work through all of those as a society. And then as far as outlets for CBD, I do think that this is just the very beginning of the iceberg, right?

[00:32:57] Delta 10 is probably next. I know that when they start moving around that, that double bond, in terms of Delta eight, Delta nine Delta 10, it does have different binding affinities to your CB one receptor. And it interacts with the endocannabinoid system slightly differently, which is why you see these anecdotal claims associated with a better consumer experience with Delta eight versus Delta nine.

[00:33:22] I know that it doesn’t have as high of binding efficiencies. A lot of people say they can actually function. More so on Delta eight than Delta nine. But I mean, at the end of the day, there is. The, our understanding of cannabinoids and the endocannabinoid system is in its infancy. And as we continue to move forward, there’s just going to be more and more breakthroughs from a scientific standpoint on these minor cannabinoids and how they interact with the human body.

[00:33:49] And I think this is just the beginning. And so Delta 10, if I had to. If I was a Batman, I would say Delta tens, the next big one to kind of take off and we’ll see how that differs from Delta nine and Delta eight, a and then, I mean, there’s just a JC acetate, right? There’s another one that makes the water soluble.

[00:34:08] And so there is a whole plethora of different molecules that can be achieved by using CBD as a starting material.

[00:34:16] Bryan Fields: We got a lot of science and research studies. So more

[00:34:20] Kellan Finney: content,

[00:34:20] Bryan Fields: right? Delta 10, for sure. For us, we’ve already heard the rumblings there and we’re going to do another episode coming up on that because people start asking questions and, you know, the only way for us to understand is to kind of just dive in and figure out, you know, what about it?

[00:34:33] So Mona, the biggest misconception since you started working in the cannabis.

[00:34:40] Kellan Finney: I mean,

[00:34:40] Mona Zhang: I guess just to go back to the Bernie thing is like this idea that it is some sort of like silly topic, which I think the fact that, I mean, hopefully more major news organizations will hire cannabis, beat reporters, but it’s.

[00:34:58] You know, consequential subject and it intersects with so many other areas, whether it’s criminal justice or public health or financial services, or what have you. That’s a really complex and important issue that affects a lot of people. And I think one big misconception now that I think about it is that there’s this idea that like, oh, people don’t really go to jail for cannabis anymore.

[00:35:24] And. You know, there are still tens of thousands of people incarcerated for cannabis. There are people thousands of people who are serving de facto life sentences for marijuana offenses. So it, it is a really, still an important social justice or criminal justice issue. Even though a lot of states have decriminalized cannabis, it’s there’s still a lot of issues on that

[00:35:43] front.

[00:35:44] Kellan Finney: Absolutely.

[00:35:44] Bryan Fields: Well, today you could sum up your experience into a main takeaway or lesson learned to pass on to the next generation. What would it be? I think

[00:35:53] Mona Zhang: it’s important to be clear headed when looking at the impacts of policy with these social equity programs. Like I covered Oakland social equity program when it first came out and it was, sounded so good on paper.

[00:36:09] And I was like, wow, this is so innovative. It’s so cool that Oakland is doing it. And when other jurisdictions started doing it, I was like, wow. Like, it’s amazing how much this has shifted the conversation around cannabis policy and how the sort of debates in the legislature are about this issue. But I also think there is a sort of like desire to seem like you’re addressing the problem from a political standpoint.

[00:36:35] You know, we’ve have not seen one of these programs be really effective in terms of their stated goals and achieving their stated goals. So I think it’s important to just look at the data from, from all of these various different policy proposals. Really think hard about like what, what is actually effective at achieving these outcomes.

[00:37:00] And I think a lot of states are starting to do that. You know, a lot of states are looking at Illinois as a cautionary tale. Now, instead of like, in the beginning, Illinois was hailed as like, it’s going to be this leader in social equity,

[00:37:10] Kellan Finney: you know, the Illinois thing. I it’s just incredible. Right. Like, absolutely.

[00:37:15] They still haven’t given out one. Have they? Yeah.

[00:37:18] Bryan Fields: What do we think is the issue there? It’s an

[00:37:20] Mona Zhang: implementation issue. This is actually. What’s been sort of like possibly delaying the launch of new York’s market is because there is this sort of disagreement between the governor and the Senate about who should be in charge of implementing the cannabis legalization law.

[00:37:36] And you might pass a law that looks good on paper, but if you stumble on implementation, then you know, you’re not achieving those goals

[00:37:45] Bryan Fields: plays a big factor.

[00:37:47] Mona Zhang: Yeah, absolutely. I mean, with all of these licensing things, lawsuits are just one of the big reasons why things get held up. People don’t get a license and they Sue, you know, they, a judge just overturned Detroit’s licensing regime, which is supposed to favor legacy applicants and, you know, ruled it to be probably unconstitutional.

[00:38:06] And it just, it just creates all sorts of delays and

[00:38:09] Bryan Fields: problems. Yeah. Lawyers just continue to win. All right. Let’s do prediction time. Do you think. In president Biden’s first term, he will find federal legislation. No, I don’t think so.

[00:38:23] Kellan Finney: I don’t think so. Either

[00:38:25] Mona Zhang: things can change crazier. Things have happened on the cannabis beat.

[00:38:28] You might not think something’s going to happen and it happens, but as it stands now, I am skeptical that it will happen.

[00:38:34] Kellan Finney: I wrote a, I read a headline though. That might be interesting. And we talked, talked about this on a podcast last week as well. I read a headline. Amazon taking the stance that they did.

[00:38:44] It was actually in the cannabis scientists, the day that we talked to on the column and MC and it actually said that Amazon taking their stance on no longer drug testing, their employees. And I didn’t read the article, unfortunately, but then the headline also integrated the aspect of Amazon showing support for the Moore act as potentially a catalyst to facilitate federal legalization within the next couple of years.

[00:39:13] Is that where you’re gonna go, Brian steal your thunder.

[00:39:16] Bryan Fields: So I always tend to believe that like, sure. Like from a news standpoint, they haven’t made much noise. Sometimes the smaller moves and the smaller announcements kind of compound these bigger ones, right? Like Amazon making these public stance, the NFL saying they’re going to invest all this money.

[00:39:32] It just seems like people are starting to slowly adjust their thought process. And to me, these big became, this are making public stances differently than they normally had. Makes me believe. There’s some aggressive momentum that they’re like, Hey, we need to kind of change our PR tune. I’ve got a different stance on why Amazon said that.

[00:39:51] I think there was a variety of reasons that I’m not going to kind of spoil it and how you have to read it in the monthly playbook, because I just finished that pizza. Definitely. It’s definitely not just one time. Amazon is pretty strategic with how they take their stances and there’s a variety of different reasons why I believe that they said that.

[00:40:08] At the end of the day, I’m going to take the opposite of both of you and say, yes, he does. Obviously I don’t think it’ll happen, but I’ll just say it for counter stance. I think he does it. And I think it’s a, it’s a quick one. As we’ve seen on each post, I mean, a year ago, we didn’t have any of these states and now like they’re just falling like dominoes and who knows.

[00:40:25] We could meet up in six months and be like, wow, that was crazy. We all said, no, look it’s for sure. Yes. And I think in the cannabis industry, it moves super, super fast. And sometimes by not thinking something’s gonna happen. It means maybe things will happen faster than we believe.

[00:40:38] Kellan Finney: Yeah, that’s

[00:40:39] Mona Zhang: a good point.

[00:40:39] And the Amazon point is an interesting one too, because I mean, at the end of the day, it’s like, are there 60 votes in the Senate? And does Amazon change that? And with. Legislation. It’s so hard. Like people can agree on legalizing cannabis, but then agreeing on actual legislation is a different matter.

[00:40:58] That’s why New Jersey took so long. That’s why New York took so long. And so getting everyone who might support legalization as a concept, In the Senate to agree on an actual legalization bill as another matter. And to get 60 votes on that, it’s looking tough at this point, but it’s not out of the realm of possibility.

[00:41:17] Kellan Finney: And what you’ve just

[00:41:17] Bryan Fields: said is just so perfect, but also so frustrating and the same thought, right? Everyone agrees that this is supposed to happen, but to vote on it a whole nother Stanton. And at the end of the day, not saying money moves, votes. Money moves boats.

[00:41:31] Kellan Finney: Amazon has a little

[00:41:32] Bryan Fields: bit of money to John’s.

[00:41:35] So Mona, before we wrap, where can our listeners get in touch? What areas on social media are you available? And we’ll link it all in the show.

[00:41:42] Mona Zhang: Yeah, I’m on Twitter. It’s my last name. First name Z H a N G M O N a M. You can follow all of our coverage at politico.com/cannabis. And. Yeah,

[00:41:56] Bryan Fields: thanks so much for your time, Mona.

[00:41:57] Thanks for having

[00:41:58] Mona Zhang: me. This was fun. Thank you.


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Editors’ Note: This is the transcript version of the podcast. Please note that due to time and audio constraints, transcription may not be perfect. We encourage you to listen to the podcast, embedded below if you need any clarification. We hope you enjoy!

In This Episode, Bryan Fields and Kellan Finney sit down with Collin and Mike, founders of MJ Research Co

Colin and Mike set out to revolutionize the Cannabis market and provide insightful and professional-grade research for investors.

This episode of The Dime Podcast explores the market trends and investments of the Cannabis industry as well as:

  • What trends do we see in the current Cannabis Market?
  • How can reading margins and scalability help Investors?
  • How will pricing be impacted as more states legalize?
  • Will the demand for Cannabis change with growing licenses increasing?

Learn More at https://mjresearchco.com/


[00:00:00] Bryan Fields: This is the dime, dive into the cannabis and hemp industry through trends, insights, predictions, and tangents.

[00:00:11] Bryan Fields: What’s up guys. Welcome back to the episode of the dime as always. I’ve got my right-hand man Kellen Finney here with me. And this week we’ve got a very special guest Colin Farian and Mike Regan of MJ.

[00:00:22] Bryan Fields: Gentlemen, thanks for taking the time. How are you doing today?

[00:00:27] Bryan Fields: Yeah, we’re still have to kind of dive into a variety of different topics. And I think before we can get into MJ research and the, and your backgrounds, I think we should start with one of the hardest questions there is in the game, which is living in your ceased.

[00:00:40] Bryan Fields: Gentlemen, who is your ideal cannabinoid session with ,Collin go first

[00:00:46] Colin Ferrain: ideal cannabinoid discussion.

[00:00:49] Colin Ferrain: So smoke cessation

[00:00:51] Colin Ferrain: session. Ooh, man, it’s hard because there’s a lot like between, you almost have to subsection it between the folks that really [00:01:00] established the industry and the folks that are moving into long.

[00:01:02] Colin Ferrain: I would say in the folks that are moving along, Ben cobbler is probably an easy option. And folks that have got us to where we are now. I mean, is Steve de Angelo to even option. I go with those two.

[00:01:17] Mike Regan: I will get certain listen in that, as you’re saying, like we’re actually, everyone’s smoking up and actually discussing everything because I’m not an enormous consumer.

[00:01:27] Mike Regan: I actually do have a good memory of one. Which was a, the fish show and Worcester in June, 2012, where I think the entire hockey arena was hotbox. So that was a pretty good stock session. No, it was really good music. And when you know, just a good vibe for nano 10,000 feet, that’s nice that

[00:01:47] Bryan Fields: 10,000 people to put that on for everyone else.

[00:01:51] Mike Regan: It is like, I’ve seen this in a minivan. I’ve never seen this in the DCU center choices.

[00:01:59] Bryan Fields: You’re going to have to have [00:02:00] us come back to that. So, uh,

[00:02:06] Kellan Finney: Elon Musk, right? Just like Joe Rogan on his podcast. It’d be nice to have him on and smokes weed. And Chad,

[00:02:12] Bryan Fields: what about you, Brian? Cuban probably you’d probably be too, too high energy for me though. I’d probably give me some anxiety because we’d just be ripping through ideas on it, like, all right. The session went completely.

[00:02:24] Bryan Fields: Let’s have back to the, to the question. So let’s dive into your backgrounds. Obviously cannabis is a really unique space. How did either of you guys get into the space? Mike, do you want to go first? Sure. In terms

[00:02:33] Mike Regan: of getting into the cannabis space I joined about two years ago. Well, it really gets more again, more about three years ago.

[00:02:40] Mike Regan: My background is, uh, basically a life-long long, short equity investor, uh, various hedge funds and on the sell side, Uh, doing primarily fundamental bottoms up, uh, research, you know, investment research, uh, but had done some quantity as well. Uh, two years ago it was [00:03:00] looking at, uh, Scott’s miracle grow on something totally unrelated to cannabis.

[00:03:04] Mike Regan: Uh, it was a pricing power thesis versus home Depot Lowe’s. And I had to figure out what this Hawthorne division was. Uh, they had, which you know, was became pretty quickly obvious what it actually was really doing so that I was like, this is actually pretty interesting. Which also coincided, I guess, with the Canadian, the Canadian stocks ripping up to same valuations, uh, through that, just doing that research, I found MJ biz daily is like good source of information for the industry.

[00:03:31] Mike Regan: You know, just looking at dedicated myself. I’m like, look, this whole thing could be, and then they had a job posting for we’re launching. Premium financial service. Uh, we need someone like we can teach you cannabis, but we need someone who knows everything. That’s not cannabis, like, you know, financial analysis, company analysis, company strategy, you know, valuation, things like that.

[00:03:52] Mike Regan: So I joined them in 2019, uh, to write for them. Their premium investment service or calling investor [00:04:00] intelligence at the time. And then that was going great until COVID hit. Uh, and they had to retrench given that, uh, there was no conference in Vegas, uh, you know, no MJ biz con. Uh, but I still thought the general concept was a good idea and yeah, pretty convinced of the overall long-term macro freight train investment theme, you know, for the next 10, 20 years, you know, I think cannabis will be a pretty interesting investment thing to, to know better.

[00:04:26] Mike Regan: And it has a lot of market inefficiencies. So I’ve launched M J research go to basically continue that concept of, you know, institutional professional grade investment research. Um, this nascent industry. Yeah, we’re going to have a lot of lights to it and, you know, Long, and I think eventually short opportunities across both the sector and other sectors and you know, the whole supply chain and disrupting traditional industries as well.

[00:04:51] Mike Regan: So that’s, that’s basically what that brings me to here. Uh, making my column jumping. So I started

[00:04:59] Colin Ferrain: like pretty [00:05:00] traditional finance background. Um, up in Craig Hallam in Minneapolis is a boutique research-driven investment bank and was lucky enough to get hired for a long short fund in Boulder, Colorado.

[00:05:11] Colin Ferrain: And after a couple of years working, uh, doing equity research analysts, uh, analysis on the bicycle. Actually underwrote a company called Mr. Dean back in 20 16, 20 17 or 2015, maybe regardless. This is at the time when cannabis companies were literally grown out of a storage locker in Boulder, they had rented out three of them put on the wall.

[00:05:34] Colin Ferrain: They had this huge cultivation, just like right off of Pearl street, which is downtown Boulder, if you’re familiar. So underwrote that, that did not go well. I can still, I think it’s publicly traded at this time, but sparked my interest in the industry and moved from equity research and want to get a little bit more empathy for the operator role.

[00:05:53] Colin Ferrain: So I switched into the cannabis industry where at first I had, co-founded a company that I was doing [00:06:00] computer vision over. Uh, called deep green, weird, sexy, and like pests and pathogens and doing a bunch of IPM work with companies and that transition into a role at urban grudge to the picks and shovels company, where I was directing all MSO accounts, uh, doing strategic operations.

[00:06:16] Colin Ferrain: Cultivations and then ongoing, uh, operations for cultivation. So like IPM and then design strategy. And then I found Mike probably like a, yeah, couple of years later, uh, listening to a podcast and it was thinking that I wanted to get back in the investment world. And so I reached out to Mike and said, yeah, okay.

[00:06:32] Colin Ferrain: I want to build the exact same thing that you’re building. Um, would you, would you have me and. It

[00:06:38] Bryan Fields: proved cannabis love story. Let’s dive into MJ research, you know, what is the value that it brings the industry and who does it really target from an informational time?

[00:06:49] Mike Regan: It’s we, we think we’re stronger together than apart as well.

[00:06:52] Mike Regan: So I was like this, this will work. Uh, we, you know, our strengths, uh, sort of compliment each other just in terms of. More [00:07:00] experience. Yeah. Living through the internet, boom and bust and resurgence and the housing, boom and bust and, uh, you know, multiple market cycles and looking at every industry. And Collin is super deep knowledge on, you know, the plants and the cannabis itself in terms of the firm, you know, we’re basically trying to target credited.

[00:07:20] Mike Regan: Institutional grade or just institutional investors. We’re basically providing what the research that we would want if we were running a fund or if we were at a fund and we’re like, Hey, this has been morning email to my portfolio manager of the things I’ve been saying that we should be doing. And we’re basically trying to bring that institutional level professional.

[00:07:41] Mike Regan: Great analysis to this sector. Uh, yeah. Cause we, we, we see a need for it. Uh, as an increasingly matures, I think that’s also, there’s going to be an increase in demand for that among a lot of investors that currently can’t, you know, because of the federal illegality of their own, you know, investment mandates or the, you know, what are [00:08:00] the things trade.

[00:08:00] Mike Regan: They can invest directly in this space, but we think that’s going to keep changing with increasing legalization. So. And on top of that, it’s a very, very complex space, especially like in the capital structure. We can go into that later. Never seen capital structures. This complex, the regulations are always changing.

[00:08:15] Mike Regan: It’s a bunch of micro markets. So that’s basically what we’re trying to do. So we’re providing, we sort of mentally divided into tools, which are, you know, the things that investors need if they want. to truly have accurate, actionable information and sort of make their own decisions. You know, these are the tools they’ll need, you know, in terms of like our, our dynamic top table, we’re working on some supply demand, analyses, normalizing things across industries to help prepare the companies.

[00:08:44] Mike Regan: Um, and then also, you know, just actionable company, specific research. Like we think this company is interesting. You should buy it. This is, we’ve done the research on it. You know, here’s the consensus view. Here’s our contrarian tape. Uh, on it, then, you know, here’s our evaluation. [00:09:00] We’re sort of bouncing those out as well as we’re building those up.

[00:09:03] Mike Regan: And then if there’s anything else I’ve missed column that you’d like to throw in.

[00:09:06] Colin Ferrain: No, I think that’s, that’s great, Mike. Um, I think what got us here and, you know, what makes us different is that when we were both evaluating the business model, we found that a lot of the folks that are providing research have a.

[00:09:19] Colin Ferrain: And a bias for whatever reason, if you’re a sell side bank, you’re trying to get a banking deal. If you’re running a research site, that’s driven by ads. You often have relationships with the folks that are providing the advertising with you. So what we have built as a no pay to play web or platform for investment research.

[00:09:36] Colin Ferrain: And I think that sets us apart as being, you know, you know, skeptics and neutral among all the ideas we’re looking at.

[00:09:42] Bryan Fields: So before we dive into some of the. Do each of you have a favorite operator from like a large scale and a small scale that you’re kind of rooting for one, that’s kind of caught your eye, that you, you know, you have some information that you can share that just kind of gives some insight into some of the tremendous value that MJ research brings to the table.[00:10:00]

[00:10:00] Colin Ferrain: Yeah, I’ll start, but I’ll do a contrarian one to kick us out. Especially right now, the Cresco labs has been trading down pretty significantly. The capital structure is not great. The financial disclosures and accounting have been. Not great, but an operational standpoint, if you look at their organizational structure and their team relative to the other, MSOC, they’re about as mature as it gets.

[00:10:22] Colin Ferrain: These folks have an entire lean manufacturing division that’s going out and figuring out how to optimize processes from dispensary down to cultivation. And this is a team of 25 to. 35, um, across the entire, um, and GTI has a similar organizational structure, but it’s, I mean, honestly, it’s been mostly replicated from the folks across the street at Cresco labs.

[00:10:44] Colin Ferrain: Um, and they do really deep data analysis on every single decision that they’re making. Um, which I think is a unique differentiator. Whereas everyone else in the industry seems like they’re just trying to keep up with operations and it’s like, they’re gonna, like, they’re gonna throw a reverse osmosis [00:11:00] system in their cultivation.

[00:11:01] Colin Ferrain: Just because they don’t exactly know where the city water is testing that. And they think that that might be a fixed. Whereas you’re going to have Cresco labs is running individual pilots in a single grow room at each of their cultivation facilities. And then making that decision, which is something that’s always really impressed me.

[00:11:18] Mike Regan: So let’s say something you’re saying it’s something you really like, and you’re rooting for. I try to, you know, Try to always be independent on the, you know, I have, you have an investment thesis, it’s a good buy at this price. I think it can go to that price versus the agrees. And, uh, well, I’ll go into a little bit that, uh, we wrote up for our premium clients.

[00:11:37] Mike Regan: Couple of weeks ago when it was about 16 was a Weedmaps, which now is just the specs that we wrote about was still silver spike, but, you know, looking forward on it, when I first came out, I was very excited about it. Cause I’ve been looking for the, uh, you know, the NASDAQ traded ancillary company that has a good business model that can, uh, you know, at this point beyond, by [00:12:00] institutions, looking for cannabis exposure that can’t actually touch the plants.

[00:12:04] Mike Regan: Uh, and also it doesn’t have, you know, it doesn’t have a lot of, any of the questions around, um, you know, supply and demand on the plant side. And then when we met, just came out and, you know, we started writing up actually back in January. Um, and those are only riots are actually available. Uh, you know, they’re free.

[00:12:21] Mike Regan: You just have to sign up. The concern was always that the, uh, illicit stores that they had in the past and the, the investigations as to whether they were still aiding and abetting that, so first it was saying, you know, they removed all the stores back in 2019 in California that were unlicensed. Uh, and when we started doing our research, we actually then found that there was, uh, you know, some stores that seem to be, to take advantage of a C uh, like a CBD only loophole where the listing is CBD only.

[00:12:50] Mike Regan: But if you look around at other sites, you know, if it’s a store and say 1, 2, 3 main street CBD, there happens to be 1 23 main street, THC at the same address with the same [00:13:00] logo. Yeah, that’s the only THC on Weedmaps. So yeah, you’re not breaking any laws, but it looks like you’re, you know, it looks like you’re doing something else on the side.

[00:13:09] Mike Regan: Then it was like, this seems a little too risky because you can’t capitalize revenue that could vanish overnight. Right. If, if there’s a risk that, um, government cracks down and says, okay, you know, 300 of your listings have to be taken off immediately then, you know, investors don’t like that. And we actually discovered, uh, than a may was they seem to have actually cleaned up.

[00:13:30] Mike Regan: You know, all those, all those listings that we had originally found back in January were then gone. And then on top of that, they, uh, also remove the unlicensed stores in Canada, which should then if you actually do the math. All the Canadian revenue was unlicensed. So they basically abandoned all the Canadian revenue.

[00:13:47] Mike Regan: And that actually in my mind is a huge positive, because it shows that this management team is actually serious. They’re actually walking the talk essentially. So then that actually then lets it have a higher multiple, if the revenue [00:14:00] stream is truly clean in that respect. And it also forestalls that the investigation.

[00:14:06] Mike Regan: But the subpoena from, uh, you know, the, the DOJ, um, if they’re actually saying like, you know, the thesis is we’re a partner to the industry in terms of, or a partner to the regulators in terms of only having licensed stores. So then taking that risk away, then you’re just left with two-sided market, you know, high barriers to entry on that.

[00:14:22] Mike Regan: And There are markets where they dominate, you know, generating 25% margins where the pricing story that they’re both increasing the value and showing that their products are deliver more value to their customers and raising the prices on them. Which is a huge benefit for margin expansion. And then also the upsell on software as a service, the adjacent software technology that dispensary’s need.

[00:14:44] Mike Regan: So you combine that and then, uh, it’s also, you know, trades on the NASDAQ. Doesn’t actually touch the plant. Doesn’t pay 280E taxes today. You know, if I’m a big mutual fund that just wants to own a tech company that happens to sell to the cannabis industry, but it’s not a cannabis company specifically.

[00:14:59] Mike Regan: I can actually [00:15:00] buy it. You know, that all sets up for what I think is a pretty interesting long case. With a good business model that generates cash that is actually earnings positive after taxes. And, you know, Yeah. Still then benefits from, you know, uh, like the overall canvas long thesis of increasing penetration across the U S so the guide said, in a nutshell, we’ll go into sort of where I think the stock will go.

[00:15:22] Mike Regan: We, you know, I think you have something for the premium clients in terms of our actual upsides and downsides and the risks and the such, but that’s, that’s in a nutshell that, uh, I think that’s a pretty compelling case in cannabis right now in the cannabis sector. Although too.

[00:15:37] Bryan Fields: Long-winded no, I think that’s really strong.

[00:15:39] Bryan Fields: And I think you did a really good job of teasing at the end. If you want to see, you know, the other information sign up and we can plug the link right there in that moment. So I think you did a really good job there. So let’s kind of get into some of the trends that you’re seeing from a macro standpoint, obviously like you were saying, Mike, the cannabis injury has got a variety of different issues with Intuity, the state by state issue.

[00:15:58] Bryan Fields: So what macro trends are [00:16:00] you using to kind of overall guide the industry and kind of shed some light on that?

[00:16:06] Mike Regan: I just in terms of overall macro trends, I mean, it’s more understanding digital markets and, you know, sort of the individual margin structures of those on a macro basis. And this is more longer term that, you know, the trend has picked up recently, but I don’t think it ever really went away.

[00:16:23] Mike Regan: It’s just was dormant for awhile will be consolidation. Right. There’s you know, in 10 years there’s probably going to be fewer larger operators, at least in the public side versus. Yeah, the ones that we have today, uh, you’ve already seen, you know, truly is acquiring hardware. Um, and so instead of like, oh, this is, yeah, this means mega mergers are bad.

[00:16:42] Mike Regan: Cause like, I don’t think they ever really went away. It’s just the, the industry will consolidate over time. This one just happened to have happen. Now we have our own reasons why we suspect it happens, you know, on May 10th, specifically, you know, versus in a year or two years ago, uh, related to harvest capital [00:17:00] structure and voting structure.

[00:17:01] Mike Regan: But know that that’s just an overall trend of, you know, who is gaining increasing scale at this point. Has a benefit for access to capital in terms of the, you know, the large players typically have sort of better access to capital and at lower costs of capital. That probably won’t always be the case though.

[00:17:20] Mike Regan: Uh, you know, if we have increasingly realization or safe banking, you know, that’s more of a macro trend of, um, what levers within the companies actually start to change. Uh, and actually we just wrote this up about inflation and Canada. Cannabis generally has sort of, uh, the, the cottage industry nature of it and the nascent, goodness of it leads to opportunities long-term to improve with scale and new processes and automation, you know, a lot of, um, you know, they can probably cut costs a lot more.

[00:17:50] Mike Regan: And that’s more, a longer term trend that we’ve been looking at actually column. You’re probably better to speak about the, uh, you know, the, um, you know, the scalability questions, but, you know, we’re sort of looking at who [00:18:00] can operate efficiently. And that doesn’t necessarily mean who has the highest margins today because I could have a hundred percent margins tomorrow.

[00:18:07] Mike Regan: If I fired everybody. And June would be a great month, but then July would fall off a cliff. Right? You can’t operate a business that way. So it just because you have high margins today is, I mean that you’re necessarily going to be able to maintain those margins as your business gets bigger or as, you know, as the time changes.

[00:18:22] Mike Regan: So I don’t know if you want to reflect on some of those concepts.

[00:18:25] Colin Ferrain: Yeah, I’ll start with the macro trends that we’ve been looking into. I can note are the scalability and then supply demand. And so the scalability side is just that, I mean, you guys know as well as anyone that MSOE is at this point are much closer to startups than they are to establish public companies, um, like incumbents and industrials.

[00:18:44] Colin Ferrain: Right? So when you look under the hood at these companies, it’s just mayhem, you know, like they’re scaling quickly, they’re hiring quickly there. They’re acquiring companies and, you know, it’s just like from the outside, it looks really neat. And when CEO’s go and tell you, like we’ve got plans, [00:19:00] a, B, and C, but when you look at the inside and like, you know, going into the offices, it’s like people are flying all over the place, not enough desks for people type of structure.

[00:19:09] Colin Ferrain: And so you look at the scalability, it’s often that how disciplined are they being about making sure that their business grows because often. Dynamic, you have counter issue of making sure the business can, Gail is going to hurt your near term margins. And that puts this, you know, this like temporary bare thesis in front of investors, or they’re like, well, their margins are not nearly as good as X, Y, and Z, but in reality, they’re prepping for the next five years.

[00:19:31] Colin Ferrain: Whereas companies, X, Y, and Z are only prepping for today. And I think that’s really. Piece, they have to look at when evaluating these companies because you want to hold them for five to 10 years. There’s plenty of upside, um, as the industry continues to grow. Um, and so that’s one of the macro trends we’re looking at it’s everything from like, do they connect their ERP?

[00:19:49] Colin Ferrain: To, uh, their POS in the retailers, right? Like is the POS and the retailer connected to alive. Many of this got real integrations or are they basically selling inventory on their live menu that they [00:20:00] don’t have that there’s dispensary that picks off customers when they go to the store because the product isn’t actually there, right?

[00:20:05] Colin Ferrain: This stuff happens all the time. Then the other item is high demand where, you know, the companies that have the best gross margins right now are usually in states that have limited licenses. Flower prices. And so we’ve been digging into looking at the central supply in any given market, relative to the demand today, and then the demand five years from now.

[00:20:24] Colin Ferrain: So just assuming that the entire per capita population of an individual market say like Colorado, you know, scales to maturity and wherever that maturity is, Colorado continues to grow. So it’s kind of interesting to see that move on. But if you look at states like California, where we’re doing a deep dive on right now, The potential capacity of California, they could plant more cannabis than the entire state would need multiple times over.

[00:20:49] Colin Ferrain: Now it doesn’t necessarily equate it to low prices because not everyone’s putting plants in the ground and not everyone’s actually using their licenses, but if they wanted to, and as more legislation comes on to allow [00:21:00] more outdoor grows and greenhouses, and these perfect agricultural markets like, or sub markets like counties, Santa Barbara.

[00:21:07] Colin Ferrain: Uh, then sure. Uh, Monterrey, uh, Sonoma, um, that will change the entire direction of the pricing. And eventually there’ll be spine to the entire country, but for now it puts risk on the near-term pricing. I

[00:21:18] Bryan Fields: think that’s perfectly said, and I want to dive into Callan because I know we’ve been to some operators that are one of the largest in the space and been overwhelmingly surprised by the way they handled their business.

[00:21:28] Bryan Fields: And we kind of were blown away to think that like, these guys are doing tremendous numbers, we got in there and it’s like you were saying, colonnades, it’s chaotic. And we kind of looked at each other. And it’s one of those where we just kind of got like an inside look and just couldn’t believe how that was going through Kaelin.

[00:21:44] Bryan Fields: You want to shed some light on that experience and kind of piggyback off what Carl was saying. Yeah.

[00:21:48] Kellan Finney: That’s funny that you brought that up because that’s exactly where my head was at. And I was also debating, I was like, probably shouldn’t say the name of the company or anything like that.

[00:21:58] Bryan Fields: It’s

[00:21:58] Kellan Finney: completely, [00:22:00] it’s completely accurate.

[00:22:00] Kellan Finney: Right? Like we went into their facility and check it out and I was just like, What are you guys doing? I was like, this is a total dumpster fire. This is one thing you guys are not doing that. And I was like, all of this other stuff you guys already bought. No one unboxed it. It’s just sitting here in a corner and you’re outsourcing that.

[00:22:17] Kellan Finney: It’s like, what are you guys doing? It’s it’s, it’s absolutely insane. And just like you said, people are running around. They’re like, we don’t have enough boxes for the cartridges, like the throng cartridges, like this order was supposed to go out yesterday and they’re just all like, what do we do? And it’s, it’s just insane.

[00:22:34] Kellan Finney: And they need high quality people and the training and all these things are just so under appreciated and like in a, an established vendor industry where they have this system. Onboarding people and getting them trained and having them all check all these boxes and having them competent. Like all those systems are aren’t in place yet.

[00:22:54] Kellan Finney: And they’re all so fluid within these companies because they’re all still trying to figure it out because it’s not like there’s a, [00:23:00] a rubric for how you run, uh, a company that has. Operations and every different state, that’s a micro market. You know what I mean? So they’re, they’re having to figure this all out on the fly, which is clearly has been, uh, a challenge.

[00:23:16] Kellan Finney: You know what I mean?

[00:23:17] Colin Ferrain: Funny. Cause like, if you didn’t know them, you would have trouble imagining that they were multi-billion dollar

[00:23:24] Mike Regan: industry later.

[00:23:26] Bryan Fields: We kind of assume. That, that they’d be so much more put together and that none of these issues would arise. And then we kind of like took a step back and we thought about it.

[00:23:34] Bryan Fields: It’s like they’re scaling so fast that they’re not even able to consider it. Right. They bought us equipment because someone made that decision. And then it’s Callum said, he’s like, they’ve got a million dollar paperweight in the corner, just collecting dust. And they need that piece of equipment that they’re outsourcing because likely the person that made that decision got hired and moved on to the next role.

[00:23:53] Bryan Fields: And then the person that came in was like, I didn’t buy that. I don’t know where that goes. I mean, this is the part of the industry that kind of excites me the most [00:24:00] because unless you’ve been there and you don’t realize that, like that’s all easy money that they’re going to, once they get like in a rhythm and start optimizing,

[00:24:08] Mike Regan: I guess two other trends we see in the first is, you know, cannabis industry is not just, you know, people growing the plants and science dispensers, it’s the entire supply chain that will need to grow up along with this.

[00:24:20] Mike Regan: Like part of the reason that it might be so chaotic is that there isn’t the, go-to a normal company. Yeah, the go-to outsource or like, Hey, we need this to be done. Just do it. Okay, fine. They do it. There there’s a whole supply chain that hasn’t been built yet that needs to be built. So it will be all these other companies that, yeah, we don’t actually touch the plant.

[00:24:37] Mike Regan: We don’t actually, you know, we serve as the cannabis industry and help them better organize it. And then also just sort of how the margin structure changes. And this is more for investors that we try to think a lot about, you know, is, um, the margins you see today will probably change versus. In the future in terms of first it’s how many, how much you have to scale up that [00:25:00] infrastructure as you grow second is also what happens as, especially with too many.

[00:25:05] Mike Regan: I wonder if that is at least for the U S operators that are propping up some of the margins. Implicitly any margin has to sort of cover the taxes, right? So all of a sudden you take two 80 to way, you know, then it’s not like all that money just flows to investors and investors has get all that know the managing teams are going to look at it and think, well, okay, well now we’re not writing that check to the government.

[00:25:27] Mike Regan: What can we do with that? Instead, we can reinvest it in marketing re-invest and hire more people. Maybe even reinvested in, you know, either lower prices or, you know, eats in a competitive consumer industries. They quote, invest in price. The grocery stores do that all the time. And that basically it’s just a price cap.

[00:25:44] Mike Regan: So you know that if you take out that enormous cost to them right now, and then no one has. You know what I’ve seen in other industries like this happened in 2017 with the tax cut and jobs act. When, you know, the government is universally lower, the [00:26:00] corporate tax rate for everybody from like 35 to 21% businesses that had strong, you know, that weren’t very competitive and it bought back stock with companies that were in competitive consumer businesses and industrial businesses.

[00:26:11] Mike Regan: A lot of them just spent more money on the things they were already doing. Like they celebrate. Uh, strategic growth plans or they were forced to give people raises because like, well, you know, we’re, we’re reinvesting back in our employees where we are investing in price, we’re reinvesting in, you know, product quality.

[00:26:28] Mike Regan: And you know, it’s not like that money was just kept by it by investors, but since EBITDA, which is what the industry is usually valued at is a pre-tax measure. You know, you have this scenario. EBITDA margins go down net income margins or the after-tax margins actually go up. And it’s a question of our investors looking closely enough at that dynamic, because if you just need to kind of give a dumb margins, you’ll freak out.

[00:26:51] Mike Regan: They’re like, oh, this is terrible. Your margins are going down. I don’t want this. It’s like, well, they’re going down, but you’re making more money. So that’s actually a good thing. And our cost of capital is lower because. You [00:27:00] know, uh, tax cuts, the cheapest form of capital possible. Right? I don’t have to, the government is just not taking as much money.

[00:27:05] Mike Regan: Great. You know, I don’t have to like go, you know, pay interest to debt holders or dilute the equity holders with more shares. Right. So it’s actually all good, but not in the simplistic. Oh, you know, 21% of gross profit goes into my pocket, says the investor, that one. Yeah, nothing

[00:27:20] Bryan Fields: in cannabis is simple like that.

[00:27:22] Bryan Fields: So I want to ask a different question. Vertical integration. Does that help the operators you think, because we were talking about all the challenges with scaling, so vertical integration as a whole, are we in favor of it? And from an investment side, do you think it’s beneficial to be investors understand the challenges and the complications of being vertically integrated and having to have all these efforts and all these resources, and then the inability to kind of perfect a certain area of the supply chain.

[00:27:48] Bryan Fields: Colin, do you.

[00:27:49] Colin Ferrain: All, um, I might tease and then hand off to my ex. I think that there’s, there’s a bit of nuance that vertical integration is good for, from an investment standpoint and for operators right now [00:28:00] in the future. Won’t be. So at this point, you’ve got relatively wide margins across the supply chain.

[00:28:05] Colin Ferrain: You move from cultivation to processing, uh, cultivation, manufacturing to processing, to dispensary’s even. But eventually that gets more competitive. So there’s limited license, let’s back up. And these limited license, Stacey of vertical integration, you can sell from your cultivation to your retail or even doing in your cultivation to wholesale and make plenty of money.

[00:28:24] Colin Ferrain: Now you see margin compression. When you look at a competitive market like California or Oklahoma, even Colorado with the exception of this year where margins have gotten better back to a better place, but take California, for example. When the prices go down, you see margins get squeezed across the supply chain is generally starts further downstream and then works its way back up.

[00:28:45] Colin Ferrain: And you have a shakeout of operators, which is not obviously great for investors, but if you’re in Pennsylvania, you basically make money, hand over fist. Florida’s a better example, um, because you’re vertically integrated and because everyone else is locked out. And I think in the [00:29:00] future, as it gets more competitive, more players come into this space, more people are specialized, like.

[00:29:05] Colin Ferrain: A very low probability that someone that has operations in 12 different states. And has vertical integrations is going to be able to compete with a herbal in California. Right? It’s a super well run a business run by people that have former experience in food distribution. The idea that like someone will be able to compete for a core competency when that’s all they do every single day seems farfetched.

[00:29:30] Colin Ferrain: Um, so that’s my general take. Good for now.

[00:29:33] Mike Regan: Mike, the general concept is exactly it’s it’s, you know, thinking fourth dimensionally, if you will. It’s when, you know, when in the industry growth cycle is attractive right now, the lack of a reliable supply chain across the whole sector is what we were talking about before that there’s going to be this whole ancillary supply chain that needs to get built as well.

[00:29:52] Mike Regan: You kind of have to be vertically integrated because you know the one, one thing, that’s your bottlenecks, your products. If you can’t get it and you got to do it yourself, You know, [00:30:00] writing up that know Ford for model T’s during, after world war one needed to be vertically integrated. They owned forests and iron mines and railroads and glassware.

[00:30:09] Mike Regan: Yeah, because they were sick of supply chain disruptions, and there just wasn’t a reliable supply chain, but four, it doesn’t do any of that today because there’s an entire mature supply chain. Uh, we’re nowhere near that yet. So today, you know, having the, the benefit is having the greater ax, you know, guaranteed supply of product control over your quality, you know, and things like that.

[00:30:31] Mike Regan: Is more important than, you know, shaving an extra 5% off of the supply contract, but if fast forward and all of a sudden, if there’s robust wholesale markets or companies that specialize in each part of the supply chain, You know, when you have that specialization, they’ll probably be able to do it better and more efficiently because they’re, you know, like concept they’re really good at that one thing that it makes more sense to, you know, it’s cheaper and better just to hire the outsource this to the person who knows that, who knows how to do it [00:31:00] perfectly, but we’re not there yet.

[00:31:01] Mike Regan: And then, yeah, it’s also a lot of laws for us. And you can kind of get away with it because it is still micro markets, but you know, if all of a sudden you took away those micro markets, you’re going to see, I think a lot more specialization over the longer term. It says that’s a general answer, but it’s that’s I think where we’re going.

[00:31:18] Mike Regan: Over the long-term you only want to touch on that as far as vertical

[00:31:21] Kellan Finney: integration goes. I think the one area I look at it as more of a optimistic perspective. I think that vertical integration is really good for all these companies to approach right now because all of these different management teams are have strengths and they all have weaknesses.

[00:31:38] Kellan Finney: And I think in 10 years, They’re going to figure out that, Hey, our team is really, really good at this section of the supply chain. Right. And then they’re going to cut the fat and then that’s going to help establish. That robust ancillary wholesale market and that supply chain for outsourcing. Right. And you’re going to see all these companies kind of just go [00:32:00] and fit into what they’re really good at.

[00:32:02] Kellan Finney: Right. And so if they’re doing everything and they find out, Hey, we have employees that are absolutely phenomenal at understanding purity of water and all these things, right. From a cultivation perspective. And then they double down on that and then they start outsourcing the other things. I think that that’s going to be really, really strong for the whole industry as a whole.

[00:32:21] Kellan Finney: Right. And so I think that you’re going to see more and more companies start to. Put resources into the areas that they’re really skilled at, right? Whether that’s retail production or extraction, or if it, or cultivation, or even some of the ancillary services like Weedmaps and other companies like that.

[00:32:39] Kellan Finney: Right. And so I think it’s really good for the industry. I think it. It’s tough now, though, because these companies are forced to do things on their own and it’s going to significantly affect the margins because they aren’t as good at it as say another operator or a company down the line in 10 years.

[00:32:56] Kellan Finney: Right. And it also makes it really, really bad. Well, what are your [00:33:00] thoughts on vertical integration? Brian? I

[00:33:01] Mike Regan: think

[00:33:02] Bryan Fields: everyone said it perfectly here. I just don’t think people outside the industry realize actually how challenging that is in Collin. You lightly touched on that when you have all different states with all different regulations and you’re trying to be vertically scaled the challenge and the complexity of being good at everything is really, really, really hard at the end of the day.

[00:33:20] Bryan Fields: Right? Supply chain disruption. If you don’t have flour, And you are not controlling spiking, you’re not selling fire products. So at the end of the day, you kind of have to, and we all agree. And I think that’s part of the excitement that I personally have is that once some of these challenges are lifted off these operators and they can really double down on what you were saying on, on what they’re good at, you’re going to see kind of the best of the best kind of move to the forefront.

[00:33:42] Bryan Fields: And then at the end of the day, you’ll see those numbers kind of follow suit. But right now we’re all in agreement kind of has to be the way it has. Good now bad later. Well,

[00:33:50] Mike Regan: I guess the interesting part of that trend we’ve noticed recently is the larger operators are trying to invest more in cultivation.

[00:33:58] Mike Regan: Surely just. [00:34:00] Uh, whether they’re in the process of buying Los Suenos, which is the largest cannabis grower in Colorado is a giant outdoor farm in Pueblo. And that was interesting to me. You know, if you look back a year ago, you had clearly fought blue kudu, which was a little edibles, kitchen and processing.

[00:34:18] Mike Regan: It wasn’t a, by the blue kudu, random guessing it was just buying the assets and the distribution that they had in 200 stores at the time. It’s probably more now to basically convert that, to select a block of this library. But like if someone in that company has decided we need to have a better the supply and they bought the largest supplier that, you know, I think to date has been mostly wholesale.

[00:34:39] Mike Regan: You know, they sold most of their goods wholesale to other growers. You know what happens when clearly, you know, then bye. That largest supplier are they, are they looking to basically sell wholesale in Colorado or are they looking to guarantee supply? You know, H how much of that supply is just going to go into select, uh, he basically goes into the blue [00:35:00] kudu kitchen and then just pump out select products for the Colorado market.

[00:35:04] Mike Regan: I’m not sure, but it’s know it’s interesting in that we’re, we’re seeing this trend of additional people investing in additional larger scale cultivation stuff, Columbia care, uh, by that giant greenhouse in long island, uh, you know, in glass house, coming public by the stack. That’s, uh, you know, they’re going to have a giant.

[00:35:24] Mike Regan: I think they’re basically a converted giant greenhouse in California. It’s then blow out that more in a retail wholesale, you know, joints, a joint thing. And that goes back to the whole over time. You’re probably going to see greater scale. And the question is the larger operators that have probably better access to capital right now consolidating a bunch of smaller growers.

[00:35:45] Mike Regan: Then you’ll have, you know, that that can be the step function. In sort of margin and capital availability near term and the longer term, how much cultivation do they want or need. Um, but that’s a far longer term question. There’s plenty of [00:36:00] cultivation to consolidate in the near term better

[00:36:03] Bryan Fields: to have and not need the need and not have, and kind of when you relate it back to the pandemic, when you’d go to the food store and there’d be nothing left, but a couple like leftover pieces of bread and people are like, well, I guess this will do.

[00:36:13] Bryan Fields: Sometimes it feels like when people go to dispensary and they’re out of products and there’s like a couple of random pieces left. People are like, well, that’s perfect. Like I w I came here, I waited in line for two hours, like, and this is all that’s left. Perfect. I’ll take that in right now. Like, we don’t really know what the demand of cannabis is.

[00:36:27] Bryan Fields: We just know it’s more and more, but let’s go into another trends. We talked about the trends that you’re seeing. Let’s talk about trends that you’re not seeing, that you’d like to see what type of trends are out there that you think we’ll see. Fine. I guess

[00:36:42] Colin Ferrain: it’s an easy segue, like trends that we’d like to see soon would be more operators focusing on their core competencies.

[00:36:49] Colin Ferrain: So as Kelly mentioned, like that’s a great point that a lot of these folks that you’re starting to see who wants to be good at what. Sometimes we’re even seen who’s good at what, [00:37:00] but it’s not always the same. And so when you look at me, like, excuse me, securely, right? Does anybody really want to own a outdoor farm instead Colorado now?

[00:37:10] Colin Ferrain: Probably not, but if you can sell your products at a price competitive rate to go and get market share and get more distribution doors because you want to build a bridge. And it’s super, super valuable. And that’s exactly why clearly if it’s going out there. So yeah, at this point in time, it’s kind of like a necessary evil to go out and find these certain types of assets, because at the end of the day, like there’s a ton of variables you guys know, as well as anyone given exposure to Colorado, that like, it’s, we’ve got really tough weather to forecast and it’s like the growing season is long, but like the idea that, you know, the chance of you having a snow storm in September is not low and you’re literally out there hand picking.

[00:37:50] Colin Ferrain: Far at that point, like the day before the snow storm comes, cause you only had a day of warning coming back to the point though, seeing folks that go into focusing on their key [00:38:00] competencies, um, which you’ve seen, I think he’s like Cresco with wholesale. Um, they’ve shown that they really want to focus.

[00:38:06] Colin Ferrain: Pushing wholesale and getting distribution doors. Um, and that’s fine. And that’s great. There’s a place in the market for that. I think you’ve historically seen like juicy focused on retail. That’s starting to turn a little bit because they want to build margins. And so they start to get more cultivations, but I’d like to see more focus on core competency going forward.

[00:38:24] Colin Ferrain: And I realized that it’s not especially rational at this point because you have to own across the supply chain, but it will be interesting to see how that pans out.

[00:38:33] Mike Regan: Mike. I basically think of two of them, the first one. And we’re starting to say this, but, um, I mentioned before is just the complexity of the capital structures with so many warrants and options and converts that I think the overall industry will benefit when those capital structures are simpler and the share counts are simpler from just higher multiples as, uh, you know, at this point that I guess mostly investors.

[00:38:58] Mike Regan: I don’t know, or [00:39:00] they’re close enough to that. They’ve already done all the math, but as this industry courts, more and more institutional investors, it’s a question of whether they’ll be able to sort of Wade through these very complex. And it’s more of the dynamism of the share account, right? The share count changes as the stock price changes, right.

[00:39:16] Mike Regan: That’s based on what the warrants do. So, you know, if you’re doing evaluation on a company, you know, you think there’s a hundred million shares. We have, there’s a hundred million shares at $10. When the stock doubles the $20, all of a sudden there’s 15 million shares. And all of a sudden it’s not $20 anymore.

[00:39:32] Mike Regan: It’s, you know, it’s $15, something like that. Right? The industrial benefit overall, it takes them. They can use less and less issue, less and less warrants on future, a capital raises. And again, that’s been impacted. The capital constraint nature of the sector. So it’s slowly happening, but that, I don’t think it will benefit the industry.

[00:39:52] Mike Regan: I think, you know, more traditional companies in their supply chain aspects, you know, we’ll start to see more traditional companies start to look at [00:40:00] supplying this space as just another customer. You know, I guess the, the, the money laundering laws and the banking laws that can complicate things and you know, or the insurance, you know, you may be perfectly legal to decide, but you call up your insurance agent and they’re like, Well, if you supply this cannabis company, all of a sudden your insurance rates are going to quintuple because you know, this is crazy risky for us.

[00:40:20] Mike Regan: We’re not going to let you do it. So it’s effectively, you know, effectively can’t service them. I think that’s a trend I like to see. Change is just the industry gets more, you know, you have more normalized, just like it’s just a standard consumer pharma product. It’s going to have a whole agricultural industrial supply chain, just like any other business.

[00:40:40] Mike Regan: And it needs to be supplied by, you know, you do the exact same thing for soft drink company. Why can’t you do it for, you know, this cannabis company, right. I think that’s coming. And that’s the trend of like, it’s I like to see more of that. And I think you’ll, I think you’ll see more traditional companies start to get involved in the space.

[00:40:57] Mike Regan: Can I

[00:40:57] Colin Ferrain: add one more? [00:41:00] This is not investment based, but lower THC product. We don’t all need to have 25% THC flower or a hundred milligram THC drinks. This is gotta be a thing of the past. And as we get more people that are new to the industry and it becomes a liability more than anything, right? Like a 10 milligram piece of chocolate, just breaking down.

[00:41:24] Colin Ferrain: But less THC in it, more companies will have more log cans shown that that, that, that can happen. I realized there’s barriers to the idea, but, uh, it’s gotta be something that happens in the near future for the CPG companies.

[00:41:35] Bryan Fields: It’s another conversation for another time, because in some people’s mind more is always better.

[00:41:40] Bryan Fields: Right. And when you are first time into a dispensary and you’re not really sure. The higher, the number, the more attractive it is. And sometimes the budtender is more likely to recommend it. And then you’ve just got yourself with circle of issues because whose role is what, and that’s a whole another conversation for another time, but I want to kind of quickly switch gears and go back to the margins conversation.

[00:41:59] Bryan Fields: We talked about kind of [00:42:00] comparing operators. And margins is, uh, an easy way to likely do that, but sometimes it’s very misleading. So in your opinions, can you compare operators in the cannabis space solely by margins? And if not, you know, what sort of other initiatives, if you’re new to this space, would you use to kind of compare operators to make.

[00:42:19] Bryan Fields: And investment into that space. I

[00:42:21] Mike Regan: think you start with margins, but then it’s understanding the stories behind why those margins are the way they are, because you have a low margin for two reasons, you can have a low margin because you’re investing for the future. So if you sort of break it into, well, my, you know, my sustainable margin is, you know, I haven’t been make up numbers here that, you know, 30, but I’m investing 10% of sales for this infrastructure in the future.

[00:42:45] Mike Regan: That’s why it’s 20. That’s a very different story than. Yeah, our product just doesn’t have very good branding power and we just have to keep cutting prices. Because our product sucks and that’s how we compete. You know, that that’s a [00:43:00] very different reason of why are you at 20% margin instead of 30 just to make up around numbers, right?

[00:43:04] Mike Regan: Yeah. That would require us like billing in and understanding, you know, what is the largest structure? Why is it that way? Uh, and then con I’ve talked with this also just properly adjusting for them because, and this may also be a trend for the overall industry. They would all benefit if they, you know, try to show their.

[00:43:21] Mike Regan: Yeah, try to report their financials and, you know, sort of as clean a way as possible. And more information is always good to make. Let investors make more adjustments. As they see fit. Um, but sometimes, you know, the headline, you know, adjusted EBITDA might include things that investors would be like, well, is that really one time should really be excluding that, you know, are you just, that’s sort of a trick and it’s not just cannabis.

[00:43:43] Mike Regan: A lot of companies will do that. They’ll throw recurring things into the one timeline it’s like, wow, your one-time expenses are always. Something big, the individual thing, maybe one time, but like, you always have a big one-time expense. I’m just going to keep that recurring. Right. So that’s, it comes down to understanding [00:44:00] why they are the way they are.

[00:44:01] Mike Regan: And then I think monitor charm, you know, comparing it to what similar industries do that aren’t even in your same space, right? If you know, most consumer companies earning more, only 20% margins. How sustainable is a 40% margin. Well, you know, that’s the question and then saying, okay, well it’s different because of this, this and this.

[00:44:20] Mike Regan: Okay. Well, this probably goes away. This may change and this actually may be permanent. So maybe it’s, you know, 30, I mean, I’m just throw around round numbers, but that concept of what’s the story behind them. I mean, you do ultimately have to compare them both on the level, but also the sustainability.

[00:44:36] Mike Regan: Right. That’s what I think is most important from like an investment standpoint is it’s great what they are, but what are they going to do?

[00:44:42] Colin Ferrain: Yeah, I think that’s, that’s a pretty inclusive answer. Um, you know, we would add that, like we, we were, we do checks. Behind the margins of the more qualitative items, you know, like who are employees turning over?

[00:44:55] Colin Ferrain: Are they, uh, recruiting other employees from competing MSOE? How is [00:45:00] talent acquired basically or lost? Um, where are they investing on their infrastructure side, whether it’s capital equipment or they’re investing in technology platforms to make, as we talked about before the scalability, everything more efficient, and then generally, how do they make decisions, which is a tough one to gauge because he kind of.

[00:45:16] Colin Ferrain: The speaking with the, the core operating team, because generally from the executive team, you get like a pretty templated answer about stuff like that, but you can kind of parse a lot of the takeaways out of looking how historically they’ve made investments in the past. Um, yeah. Then even how they shape those investments in the public view, because obviously there’s always a deeper read than what’s in the press release.

[00:45:39] Bryan Fields: Yeah. I think those are both really well said. And I think that’s exactly the value that, you know, your team brings to the space. So I would encourage anyone. Who’s kind of interested in learning about the industry to kind of dive into MJ research platform and to kind of get involved. Right. Because the only way to really know is to work with experts like yourself to kind of go there.

[00:45:55] Bryan Fields: So before we go into prediction time, we ask our guests a couple of different questions. We’ll start with [00:46:00] you. Biggest misconception in the cannabis space. Other

[00:46:04] Colin Ferrain: some is quite a bit in the podcast. It’s, uh, that these billion dollar industry leaders are all buttoned up and smooth sailing and it operates like apple or, you know, some other big industry incumbent.

[00:46:18] Colin Ferrain: Um, I think that is misunderstood to say the least.

[00:46:23] Mike Regan: I guess from an investor perspective, I guess maybe see sometimes this more on the, some of the companies themselves, but you know, that the cannabis industry is its own unique thing, has its own special valuation metrics and special things. As I see it, it’s, you know, it’s a rapidly growing growth industry, but it’s still, you know, a consumer products with, you know, like capital intensive supply chain that needs to be built out, uh, in a capital intensive business.

[00:46:49] Mike Regan: And. You should view it within the lens of whatever that, of the consumer or industrial or cultural portion that, you know, you have to figure out which individual [00:47:00] company is actually what it has more or less of each of those things, but it’s not like cannabis is really special because of this. This is one of the business standpoint, um, to be clear, you know, it’s, it’s a consumer product it’s rapidly growing, but if you’re going to do evaluations, you should look out to when the growth slows down.

[00:47:17] Mike Regan: So look out five or 10 years, and then. Yeah, but normal consumer multiples on that five or 10 years out and then discounted back, but it’s not like, oh, you know, this should trade it 50 times revenue because it’s cannabis. It’s like, no, that’s no one should do that analysis of like, oh, I think I’m going to go to 55 times revenue.

[00:47:35] Mike Regan: The reason you do that is because. Yeah, we’re putting a normal consumer multiple on the far out growth and discounting it back implies 50 times a day, but it’s really just, you know, three, four or five times revenue or, you know, a more reasonable net income PE of 20 times PE on my 2013. Estimate, right.

[00:47:56] Mike Regan: That’s how it should be viewed. And that’s how we try to view it as, you know, whether [00:48:00] you actually do okay, you cultivate a product and then you process it and then you sell it in a retail establishment. You know, how has that compared to other companies that do something similar,

[00:48:11] Bryan Fields: some of your experience into a main takeaway or lesson learned to pass onto the next generation?

[00:48:20] Bryan Fields: Or would that be all experience? Yeah. Like any experience, something that you’ve learned in the cannabis industry, that for the next generation you wanted to pass on a lesson, something that a wide-eyed freshman walking into a college, who’s eager to get into the cannabis industry and they’re ready to start their career when they graduate.

[00:48:36] Bryan Fields: What lesson have you learned or main takeaway that you’d want to pass on to them? Something that you could share as like a guidance lesson. I’ve

[00:48:44] Mike Regan: got two sons. They’re not quite college age, they’re nine and 11, but I try to do that every day in terms of like, how am I, what am I trying to teach these kids to prepare them for the next 30 years?

[00:48:54] Mike Regan: And it’s, I don’t know. My general concept is to think critically for yourself. [00:49:00] Study history to see what has happened before, because human behavior tends to, I think, repeat itself or, you know, people tend to operate and pattern. So we get good at pattern recognition, but also think critically for, you know, don’t just be stuck with certain analogs of the past.

[00:49:14] Mike Regan: Like, oh, this Amazon was like, oh, alcohol is prohibited and then went legal. It’s going to look exactly like that. You know, that can be a model to help you to think about will happen in the future, but you still have to think critically. Yeah. And I guess the other key lesson is just to always try to disprove yourself, right?

[00:49:30] Mike Regan: It’s the logical concept of like the, what the black Swan example, you know, the thousandth white Swan doesn’t prove that all swans are white. It’s that the one black Swan disproves that all swans are white. So try to find the thing. If this is my hypothesis, what would this prove it? And then look for that.

[00:49:48] Mike Regan: But those are the general lessons I think, apply in sort of any environment and helps you react quickly to the macro hand that the world, these deals. Well,

[00:49:59] Colin Ferrain: I [00:50:00] don’t think I’m going to top a, seem to lab analogy, life experience. I’ll go higher level. Uh, just cause I don’t want to compete, but I think it’s, you know, it tends to be like that stereotypical phrase of like, you know, building your network is I think network is net worth.

[00:50:16] Colin Ferrain: Right. Um, but what I’ve learned, especially through like coming through equity research and then getting into the cannabis industry is always that there’s always someone that’s smarter than you. That’s going to be able to provide you. A ton of information that will shortcut your ability to get to where you want to go, whether it’s in a career or a life decision or whatever it is.

[00:50:35] Colin Ferrain: And if you are proactive on reaching out to those folks more often than not surprisingly, they’re willing to share their advice. Then, you know, I think he realized that as you get older and older, but like being able to find those folks that were, are willing to just help, despite even like, not necessarily having a full relationship with you first off, it builds a relationship, but then second off it gets you to where you need to be much faster than if you were to [00:51:00] go out and try and do all of the digging on your own.

[00:51:03] Colin Ferrain: Um, so I found that valuable both in cannabis, but then also just, um, having like Cheryl mentors from my past roles at all their companies. And it’s been super.

[00:51:13] Mike Regan: Those are two of my favorite answers that

[00:51:14] Bryan Fields: I’ve heard so far since we’ve done that last time, either of you have consumed any cannabinoids. Um,

[00:51:20] Colin Ferrain: last weekend I tried the cookies pancakes.

[00:51:27] Colin Ferrain: Uh, pancakes. I actually have it right here. It’s sitting across my desk, but yeah, it’s called cookies, pancakes. Um, I’ve never tried cookies before, so I just wanted to see what it’s all about. That is relatively new to Colorado, I think like last year. Um, and I know the farm that’s been growing the strains.

[00:51:43] Colin Ferrain: Um, so. Tastes sweet. Um, maybe like pancakes maybe might be a self-fulfilled taste, but otherwise good.

[00:51:54] Mike Regan: Let’s say you think about a week ago. I, uh, I had an edible, uh, like a little gummy, [00:52:00] uh, you know, it was, it was fine. And then went to sleep soon as afterwards and had a nice, nice sleep. So nothing crazy. The sleep edibles are the hypothetical smoking up with Trane associates, which yeah, from the beginning of that, we’ll say it better becomes a reality, the full circle experience.

[00:52:21] Mike Regan: All

[00:52:21] Bryan Fields: right. It’s prediction time, 2030, which big operator outside of the cannabis space has now entered the cannabis space and taken a big.

[00:52:32] Colin Ferrain: Are we talking operators to

[00:52:34] Bryan Fields: ancillary? Yeah. So it can be anyone that’s outside currently outside the cannabis space that has aggressively moved in to try to claim some market share in any of the verticals or any of the revenue opportunities in cannabis.

[00:52:47] Colin Ferrain: I’ll go first. I’ll do a, maybe a sleeper and then. Obvious sleeper. I think Mike and I have gone back and forth on this, but we’re going to see packaging companies live in this oligopoly of like five [00:53:00] that own the entire market share. And the idea that someone’s going to innovate something completely new and special when these guys have been doing it.

[00:53:10] Colin Ferrain: Decades or even longer, um, seems like it’d be really, really tough. And so I expect, I fully expect that, um, you know, the balls of the world will be going in and taking a run on all things, packaging, especially given that you’ve right now, you have. Just so much just like wasteless plastic. And it’s really hard to build a packaging company in the first place because molds costs a ton of money and you can’t really raise startup capital for it because it’s a relatively low margin business.

[00:53:37] Colin Ferrain: So I like that one from the outside. And I would say like the, I’m not sure the CPG company just seems like a, like too, too easy. So maybe I’ll hand off to Mike I’ll, you know, I’ll come back. I think of a better one.

[00:53:51] Mike Regan: Big alcohol and probably big pharma with the caveat that this all depends on what future regulations,

[00:53:58] Bryan Fields: 2030, no.

[00:53:59] Bryan Fields: Which [00:54:00] one w if you had to take eight company

[00:54:02] Mike Regan: is soon by 2030, you know, there’s general legalization and interstate commerce. Then you will look for someone with large distribution capability. Uh, the obvious one, there is Amazon. I’m not saying that Amazon is a cannabis stock by any means at all.

[00:54:23] Bryan Fields: Um, we’re going to remove them.

[00:54:27] Mike Regan: I’ll say like, you know, go by Amazon for the, you know, the cannabis long-term option opportunity. That’s insane. Testing their

[00:54:35] Colin Ferrain: employees though.

[00:54:37] Mike Regan: Well, that’s the thing, right? But here’s the thing, that’s my point. Exactly. That is actually significant in that like, look, they see what is Amazon. Amazon is basically a distribution platform of stuff to your house and they just want to get more stuff.

[00:54:53] Mike Regan: Through their pipes to your house. So. That actually makes [00:55:00] perfect sense. Assuming the laws go that way and you know, they’re already set up for it. It’s just, it’s just another brown box to them. Right. So yeah, the larger companies moving back side of these on GM also is not going to, you know, test for cannabis anymore, which I think is a positive that’s part of the whole normalization angle.

[00:55:17] Mike Regan: But so that, you know, that, that comes a little bit again. I also assume. It makes a million assumptions between now and nine years out of how long has actually happened. Right. But that’s probably one. And then I think this is one of the supply chain aspect. You’ll see, more sort of just traditional, you know, traditional companies having like, oh, when we have a lot of the cannabis division, it’s just even just an agricultural division that, you know, we here’s our five.

[00:55:41] Mike Regan: Divisions. We’ve got our oil and gas division and we’ve got our aerospace division and now we’ve got our plant division, right. Like, which encompasses everything. You’ll see stuff like that. But I guess that’s less sort of like the one company I’ll get into it, but there I’ll throw in Amazon because.

[00:55:56] Mike Regan: They’re already, they are involved in everything. Now, why wouldn’t they be in the [00:56:00] future? Right.

[00:56:01] Bryan Fields: Amazon was the one

[00:56:02] Kellan Finney: I was going to say, so, but I had a backup one just cause like, you know, they’re going after the healthcare industry, like Amazon’s goal is to conquer the whole world and you cannabis is part of the world.

[00:56:12] Kellan Finney: So like, um, I think Uber, Uber or Lyft, um, I know that delivery has high margins and I think it’s a really, really attractive. Business in the cannabis space, right. Um, from a startup perspective and Uber already has the platform and the software and the drivers. And just like Mike was saying, it’s just another brown box to Amazon.

[00:56:35] Kellan Finney: I think that to Uber drivers, it’s just another trip that they can make some money on is same with the food delivery that they launched a couple of years ago. So I think Uber is, is going to be a mainstay in the delivery space of cannabis. Um, by 2020.

[00:56:51] Bryan Fields: I’ve other my third choice, uh, obviously Amazon and Uber are my go tos.

[00:56:55] Bryan Fields: And for the reasons you’ve said, obviously it makes a ton of sense for both of them to be in this space. [00:57:00] And it’s just another addition into whatever they’re doing well. And obviously the theme of this podcast has been understanding what your unique selling point is in both those companies, understanding nextly, what they do well, and you can provide a NASA of added value to the industry and kind of take off the burden to the operators because it’s just an additional headache for them at this moment.

[00:57:18] Bryan Fields: So. If I were going to choose a company, I would choose Johnson and Johnson. I can likely for the sleep aspect of it, obviously people that need to relax, go to some sort of products. Sometimes alcohol. And from a sleeping standpoint, if, if there can be some advancements with the CVN and some sort of compassion to help people go to sleep, then obviously these, these large scale companies are best positioned with their assets now to take advantage of that.

[00:57:43] Bryan Fields: And I think that’ll be the easiest way to adopt, I think from a mass consumption standpoint by 2030, I don’t think it will be heavy THC personally. I think it will be one of these other minor cannabinoids that it just becomes a mass adopted and is looked at as like. Vitamin into the asset, into the body.

[00:57:59] Bryan Fields: [00:58:00] So that’s my standpoint, gentlemen, before we wrap, tell our listeners where they can learn more, where they can get involved and get some of this information from MTV.

[00:58:09] Mike Regan: Uh, well then you can go to our website, which is M J research co.com. Uh, so MJ research, CEO, uh, dot Tom, and Matt has, uh, all of our research is up there, uh, where you can sign up to be a free member where it gets some free stuff.

[00:58:27] Mike Regan: And then, uh, also the premium sign-ups, uh, for the real media analysis that we provide. If, you know, if you’re, uh, an actual institution, we also offer an outsourced analysts, you know, higher fee bespoke research service as well. That’s that can all be found there and free members could sign up for our, uh, our regular email lists as well as sort of a newsletter type thing that we, we publish for everyone

[00:58:52] Bryan Fields: for free.

[00:58:53] Bryan Fields: Yeah. It’s one of the few ones that I consume on a regular basis. So I appreciate all your guys’ hard work and look forward to connecting soon. We’ll link [00:59:00] all the links. Thanks for your time. Thanks

[00:59:03] Colin Ferrain: so much. Appreciate it.

[00:59:05] Mike Regan: Okay.


Thanks so much for listening to The Dime . Subscribe or follow us on Seeking Alpha, Libsyn, Apple Podcast, Spotify, Google Play or Stitcher. And we’d really appreciate it if you could leave us a review on Apple Podcasts. It helps others find our show.

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What Is The Real Cost Of Converting Your CBD To Delta-8- THC?

Often derivative products are taken at face value when being compared. Currently, this is the case when we speak with operators about CBD and Delta-8 THC. The decision-making process always centers around comparing the price of 1 kg of CBD isolate (~$533.00 / kg) to the price of 1 kg of CBG isolate (~$1,150.00 / kg), which at the surface shows the potential to double the gross revenue.

Once you dive into the hard costs of converting your CBD inventory to Delta-8, the story changes dramatically. Below, we go through a calculation that takes into consideration a variety of variables when calculating the costs of converting CBD. The fixed costs in this calculation are based on conversations we had with an R&D research chemist working at a licensed facility in Colorado.

What Is The Real Cost Of Converting Your CBD To Delta-8?

What Is The Real Cost Of Converting Your CBD To Delta-8?

Based on our calculations, there’s still room for Delta-8’s price per kilogram to drop before the conversion becomes unprofitable. Our model suggests that, on this scale, the breakeven price per kilogram is around ~$923.00. Based on our forecast published in last month’s report, this could happen as early as May of this year. We advise our clients not to keep large inventories of Delta-8 in house due to the current Delta-8 pricing volatility.

Input Categories Assumptions
CBD quantity (kg) 10
Market value of CBD isolate $ 533.00
Total cost of CBD $ 5,330.00
Solvent quantity (Liters) 15
Total estimated solvent cost $ 1,400.00
Catalyst quantity (grams) 50
Total estimated catalyst cost $ 50.00
Total estimated labor cost* $ 500.00
Total analytical testing cost   (QA / QC) $ 300.00

NoteS:
*Labor cost is estimated based on 20 hours
of labor @ $25.00/hr
**Conversion yield is calculated after conversion,
work up, and purification to final product.

OUTPUT Categories Assumptions
Conversion yield* 85%
Delta-8 THC quantity (kg) 8.5
Market value of Delta-8 THC /   kg $1,150.00
Potential Revenue
Estimated Profit
$ 9,775.00
$ 2,195.00

Total Input Cost = ( Cost of CBD + Cost of Solvent + Cost of Catalyst + Labor + Analytical Testing )
Potential Revenue=( (Percent Yield from Reaction * Input Quantity of CBD) * Delta-8 Market Value )
Estimated Profit = Revenue – Input Cost

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Editors’ Note: This is the transcript version of the podcast. Please note that due to time and audio constraints, transcription may not be perfect. We encourage you to listen to the podcast, embedded below if you need any clarification. We hope you enjoy!

In this episode, Bryan Fields (Twitter: @bryanfields24) and Kellan Finney (Twitter: @Kellan_Finney) sit down with Dr. John Abrams, The Chairman, and CSO at The Clinical Endocannabinoid System Consortium (CESC), to discuss:

  • What and who is The CESC?
  • What is the endocannabinoid system?
  • Receptors in the human body
  • Research that’s currently underway to illuminate how to properly use cannabinoid products
  • Introduction to The Dosing Project
  • Understanding how cannabis interacts with the human body
  • Future studies that The CESC will dive into

About The CESC: The CESC is an experienced committee of scientists who hold the passionate belief that the pursuit of knowledge involves the collaboration of diverse communities.

Website: thecesc.org

Twitter: @TheCESCorg

Facebook: @TheCESCorg

LinkedIn: The Clinical Endocannabinoid System Consortium (CESC)


The Dime Episode 57 Transcript: The Leading Non-Profit of Cannabis Science Research ft. Dr. John Abrams Chairman of The CESC

Dr_Abrams edited

[00:00:00] Bryan Fields: This is the dime, dive into the cannabis and hemp industry through trends, insights, predictions, and tangent.

[00:00:10] Bryan Fields: What’s up guys. Welcome back to another episode of the dime as always. I’ve got my right hand, man. Tell him Finney here with me. And this week we’ve got a very special guest, Dr. John Abrams, chairman and founder of C E S C.

[00:00:22] Bryan Fields: John. Thanks for taking the time. How are you doing today?

[00:00:25] Dr. Abrams: Oh, I’m great. Thank you for providing the opportunity. I’m looking forward to this discussion.

[00:00:30] Kellan Finney: How are you doing? Just enjoying another sunny day out here in Colorado. Cool.

[00:00:35] Bryan Fields: Ready to dive in. So John, before we get started, Tell our listeners a little bit about yourself and how you got into the cannabinoid space.

[00:00:44] Dr. Abrams: I have been interested in this field for over 50 years. I’ve come from the bay area. I grew up in Palo Alto and this was starting to become common cannabis use. As I was in late high school. It was one of the experiences that we add [00:01:00] and it has been part of my life ever since I’m a biochemist and I’ve been in biotech and pharma for a good part of my career, the major part of my career.

[00:01:11] Dr. Abrams: And this has been an under a theme or a, you know, in the background until perhaps the last decade, when I decided I would really try and understand. The bases of cannabis science, the cannabinoid industry, and most importantly, how cannabis can unlock the human potential and understand the cannabis mind.

[00:01:38] Bryan Fields: Let’s kind of dive into that and you’ve accomplished many, many things in your career here. So the CSC, what is it?

[00:01:46] Dr. Abrams: Can you start that? So the CSC is an acronym for the clinical endocannabinoid system consortium. It’s a nonprofit, a 5 0 1 C3 type of [00:02:00] corporation that we started about five years ago. My illustrious clinical colleague, Dr.

[00:02:05] Dr. Abrams: Joel tolerant, whom will also be on this podcast at a future point. And I started recognizing that to be in. Healthcare space to be able to get grants donations and all it’s felt best. And the best structure was to be in a non profit format. In choosing the name. We decided that we were focusing on the endocannabinoid system.

[00:02:34] Dr. Abrams: We were taking a medical approach, thereby clinical endocannabinoid system. And because we’re intensely focused on the need for collaboration. And partnership and sharing. We looked at this as a consortium. And so our name says it

[00:02:51] Bryan Fields: all. I know cannabinoid system, for those who are maybe on familiar, can you kind of shed some light on exactly what that is?

[00:02:57] Bryan Fields: It’s a,

[00:02:58] Dr. Abrams: another system, [00:03:00] another physiological system that has been. Recently described and discovered as we, first of all, came to understand the structural and chemical basis of the prime active ingredient in cannabis, namely tetrahydrocannabinol or THC. As, and this discovery was pioneered by race.

[00:03:22] Dr. Abrams: Mushu long back in the seventies. I believe along with that, then a couple years later came in understanding of what receptors that is. If the THC is a key, then the receptor is the lock that, that key fits into to unlock. Physiological signaling. These are components then of a larger system, which has become to be called the endocannabinoid system.

[00:03:51] Dr. Abrams: It has also evolved our understanding to include the natural ligature, the natural compounds that our own [00:04:00] bodies. Right. That trigger and function in this system. The endocannabinoid system is like any other system we might learn in biology, the circulatory system, muscular skeletal system reproductive system.

[00:04:15] Dr. Abrams: It’s a, another collection of ligands Keys and receptors lock and binding entities, binding protein. It’s a whole system that we need to understand and discover, and it is majorly influenced by phytocannabinoids as opposed to our own indogenous logins. Endocannabinoids phytocannabinoids are produced. By the plant, the cannabis plant.

[00:04:43] Dr. Abrams: And that was the entry

[00:04:47] Bryan Fields: from the endocannabinoid system. The majority of people understand those areas. Is this like, can you kind of shed some light on that? Because I feel like we have conversations with some people in the space, and they’re surprised to hear some of this

[00:04:58] Kellan Finney: information [00:05:00] and more people are becoming aware of the endocannabinoid system.

[00:05:03] Kellan Finney: The entourage effect is really prevalent now within kind of the. Popular culture of cannabis, right? People are realizing that if they ingest just the THC molecule, they have a different experience than if they ingest the THC molecule with some of the other phytocannabinoids like turpines and, and other ubiquitous molecules within the cannabis plant.

[00:05:27] Kellan Finney: I would say probably the most well-known aspect of the endocannabinoid system comes in terms of how CBD and THC differ in how they interact with the human body. There’s this CB one receptor and CB two receptor that kind of the general public has grouped into two categories that the CBD molecule interacts with.

[00:05:47] Kellan Finney: Your CB two receptors. And the THC molecule interacts with your CB one receptor and one’s in your brain and one’s not, that’s why one gets you high. And the other doesn’t, I think that’s kind of like the general understanding right now, [00:06:00] which is there is so many more receptors and variables to consider when truly trying to understand how those molecules are interacting with your endocannabinoid system as well.

[00:06:12] Dr. Abrams: And so one of the issues is that perhaps some of the popular knowledge that’s out there. Is maybe not. Absolutely correct. And so I’m not sure I’m comfortable with a dichotomy the way you just described with THC affecting CB one and say CBD affecting CD two, if you will. I think that’s probably not born out by the gamut or scientific literature that’s being created in this.

[00:06:45] Dr. Abrams: It’s probably better to understand that there are multiple different classes of receptors a lot on, in, beyond CB one and CB two. And these important entities are affecting other [00:07:00] classes of receptors. And my own view is that one of the principal roles that CB two is triggering on a, another class of receptors.

[00:07:10] Dr. Abrams: Called the trip channels, TRP channels transient receptor protein channels. And this then fits in with many of the defined effects that these lie Gans that these phytocannabinoids are creating. But I think it’s overly simplistic to simply divide it as well. One hits one kind of receptors. the other login hit CB two.

[00:07:36] Dr. Abrams: I would encourage us not to be going down that pathway. However, it is useful if we looked at how the endocannabinoid system interacts. Other systems in the body. And you mentioned that CB one, the receptor may be predominantly brain or nervous system oriented or localized CB two, [00:08:00] probably a little more general, but it has a much more prevalent localization in cells of the immune system.

[00:08:06] Dr. Abrams: And it makes sense rather to look at the result in biology as effective. Are you turn hearing through CB one or are you triggering through but of course, CAC triggers both CB one and CB two. So it reacts, it works in both. The system is nuanced and then it goes on, there are other receptors in the class that.

[00:08:31] Dr. Abrams: And CB two are in, they all have complicated names and complicated biochemistry associated with it, but the devil’s in the details. And our mission is to deconvolute and explain this as clearly as possible to both the scientific and the light community. So let’s go

[00:08:52] Bryan Fields: back to one of the first things you were saying about different with the way Ellen approach that right.

[00:08:57] Bryan Fields: It seems like we’ve got to understand and laid the groundwork for [00:09:00] understanding exactly how it works. We

[00:09:02] Dr. Abrams: even began well, again, the biochemistry and physiology of this is not novel. Many of the other systems that we study or understand in biochemistry utilize similar mechanisms or similar pathways.

[00:09:20] Dr. Abrams: It’s just an essence, expanding the vocabulary list of what is in the human or what, what is in the organism. To understand how this works. It’s not reinventing, it’s just reapplying or fine tuning or expanding the vocabulary. We add new receptor classes. We have new. Well, again, new keys that interact with that.

[00:09:48] Dr. Abrams: I hope that that’s kind of clear. It’s not, we have to do a lot of heavy lifting for novelty. It’s more, how do you, what we learned in pursuing studies [00:10:00] in the end of cannabinoid system fit into our existing. Understanding of how it works in the first

[00:10:06] Bryan Fields: place is the endocannabinoid system commonly taught in school.

[00:10:11] Dr. Abrams: I think, you know, the answer to that, but unfortunately not. And it has been said that many med students are not even reached in that yet. You know, it’s only a couple of decades old and med school curriculum can often. B you know, going back centuries or so, you know, there’s a large historical record here.

[00:10:31] Dr. Abrams: So a little bit, we’re the victim of novelty in trying to place this into our overarching hierarchy. Like I was just saying. And so part of our mission, I think, is to explain and understand. In the context of what we already know about existing system, but at the end of the day, we do our programs, right.

[00:10:53] Dr. Abrams: And we need our goals. Then the endocannabinoid system will be core curricula in med schools [00:11:00] going forward. What are those goals? Well, there’s trying to develop programs. That can allow us to understand the deconvolute some of the problems or, or puzzles that we’re seeing in this. I mean, and this sounds a little kind of, not so clear, but one of the main issues that we’ve been facing in this is what we call a many to many problems.

[00:11:28] Dr. Abrams: That is the plant. The botanical source, the plant has a lot of different components. That interact is Kellen was referring to entourage effect or synergy or whatever. And we have many different receptors, many different locks that these fit into. And there are many different situations or doses or times of day or whatever.

[00:11:53] Dr. Abrams: So it’s this huge many to many problems. And our job is to try to deconvolute [00:12:00] this and find system systems or systematic taxonomy descriptors that will help us understand and simplify this. So we can clearly understand this has this effect in this context. Another agent or another phytocannabinoid has a second effect in this system together.

[00:12:21] Dr. Abrams: They synergize that is they add the effects together or they compete. They block each other’s effect. All this has to be worked out so that we can understand how optimally to use this product and enjoy it. Whether it’s for lifestyle or for medicinal purposes,

[00:12:41] Bryan Fields: they will sit. And I want to tell them to kind of dive in here from undertaking of what John described.

[00:12:46] Bryan Fields: I mean, the complexity of that challenge is, is, sounds like an uphill battle. Is that the way you hear it? Yeah, I

[00:12:51] Kellan Finney: mean, but anything in the scientific world is an uphill battle and I think that. The CSC, how John described it is the only [00:13:00] way that the human race really tackles these kinds of daunting obstacles, if you will.

[00:13:04] Kellan Finney: Right? These kinds of projects of understanding the physical world around us. Right. It’s not going to be one group that’s, it’s going to be collaborative effort individuals across the globe. Right. And you can even see that we’ve just, we’re on the precipice of kind of a logarithmic curve, in my opinion, associated with scientific research, directed at understanding how this cannabis plant and the chemicals, it produces changes.

[00:13:31] Kellan Finney: Human’s perception on the world, around them, right. In terms of the psychological and the psychedelic experience that people have when they consume the plant. And I mean, the amount of literature that’s published daily now is, is pretty phenomenal, right? If you look at it from even 10, 20 years ago, and it’s only increasing every day, and I think that that’s really what it boils down to.

[00:13:53] Kellan Finney: Is it haunting task to try to understand all how five or 600 different chemicals in one plant. [00:14:00] Affect the human mind. Right. And it’s not going to be accomplished by 5, 6, 10 scientists with some pipe hats and some Erlenmeyer flasks. Right. And the, in a lab, like it’s definitely going to take a collaborative effort and a consortium to be able to push the scientific knowledge associated with this forward.

[00:14:21] Kellan Finney: And the other thing is it’s, you could throw a giant army of people at it, but it’s going to take time. These things aren’t just. Checking the box, achieving the goal. Like it’s, you’re working with the real world it’s messy and you never really know what what’s going to come out of. A lot of the experiments you do.

[00:14:35] Kellan Finney: It’s, it’s going to be guessing and going out into the real world and seeing what happens and then reporting on it. And then a lot of other really, really smart individuals look at what you did, kind of provide them your critiques. And then they’re going to go out and try to build on what you do. You did and that’s science, right?

[00:14:51] Kellan Finney: It’s it’s the only way to kind of move these kinds of projects forward is. Taking that scientific approach, if you will.

[00:14:58] Dr. Abrams: And if I could just follow up [00:15:00] on that, because that’s an excellent narrative there. I think fundamentally our approach in this is to provide some kind of overarching systematics or systematic approach.

[00:15:14] Dr. Abrams: And I would outline that is understanding on the one hand. The chemo type thing, the understanding as well as we can, the list of products that are in this complex, mechanical and making that list understanding what is there that we’re talking about. And then on the other side, being able to quantify effect that we’re studying in a reputable manner, whether it’s physiological effects, mental effects biomarkers, we use that term.

[00:15:48] Dr. Abrams: That’s where a biomarker is a key indicator of a state change. In a biology or in a physiological response. But you have to [00:16:00] approach this systematically. So if you can get your content lexicon established and you can get a series of reputable affects or outcomes on to fight or measure. You just start putting it together and become ballooning as you go and drawing your conclusions.

[00:16:19] Dr. Abrams: And I think fundamentally this is the basis of the CSC approach. We’re trying to develop and bring. That kind of systematic into this

[00:16:31] Kellan Finney: field circle back on one thing you did say and tracking. So you mentioned tracking the effects that individuals have from different chemovars and this is something that the CSC has already embarked upon in terms of the ghosting project.

[00:16:46] Kellan Finney: You want to kind of elaborate a little more about the dosing project and how that has been pivotal in humanity’s effort to try to understand how these different chemovars.

[00:16:58] Dr. Abrams: No, certainly thank you for that [00:17:00] prompt show. The flagship program of the CFC is in fact, the dosing product that Kellen was just alluding to.

[00:17:08] Dr. Abrams: This was a program that grew out of a challenge that my colleague Joel tolerant. Back in 2016, when as a cannabis clinician, he was being challenged by his patients, recommend to them, what should I use? How much should I use? What is best for this indication? And sadly, there was no basis of this. And we came up with the idea that folks that are using these products, this medication.

[00:17:43] Dr. Abrams: Preparations might actually be able to report on their responses and guide these kinds of ads or provide answers and help guide our knowledge in the space. John tolerant is a bit of a rebel, and I really salute [00:18:00] him for his view that rather than clinicians necessarily dictating patients, his approach is let the patient explain to you what is working for them.

[00:18:11] Dr. Abrams: And you keep track and correlate that. So in essence, that was the heart of what we were putting together here. And we decided we, we would likely be able to do this where they crowdsource web based query platforms. And so back in 2016, we put together a proof of concept version of this, where we would be asking folks.

[00:18:34] Dr. Abrams: How much flour. And this was initially limited in scope because we knew this program, this project, or this problem is broad again in systematics. If you need to get started, define your scope, narrow it to the point where you could draw some conclusions. So we concentrated on asking folks about flour, not other processed cannabis products.[00:19:00]

[00:19:00] Dr. Abrams: Because they’re just so complex and asking them simply how much they were using by route of administration of inhalation, thereby smoking combusting, blazing cannabis or vaping it, but it was restricted to that mode. It was restricted to flower and it was restricted to the two top indications. That was tolerant.

[00:19:24] Dr. Abrams: We’re seeing in his clinical practice, namely pain and disordered sleep. And so we put out a web-based platform for this, and we were trying to ascertain, could we, based on this kind of crowdsourced. Come up with dosing guidelines for pain and disordered sleep for what people were using. And the answer was a resounding yes, and proof of concept.

[00:19:52] Dr. Abrams: And we’ve presented on this at Amarillo conference in 2018. We’ve written up reports, some of that can be seen [00:20:00] on our website. So it is a very useful and fruitful approach. And now our goals. Is to produce version 2.0, which will be much more, which will be expanded beyond that. It will now include multiple modes of administration.

[00:20:17] Dr. Abrams: It will be expanded to not just flour, but various process forms of cannabis. Well useful for oral and ingested motive administration or topical, the indications will be expanded out and the clinical survey platforms are expanding as well. And the proof of concept phase we simply ask what kind of response on a four category scale, no response, partial response, almost complete or complete response.

[00:20:50] Dr. Abrams: And we coded and analyzed the data that way. Now we’re inserting other survey modules into that, including [00:21:00] mood assessment, psychedelic altered state assessments. These are all standard surveys that are being used in the medical fields or psychology fields. We’ve asked about adverse events, side effects in proof of concept dosing products.

[00:21:18] Dr. Abrams: That will be slightly expanded and modified so that we can come up with what. Negative effects or what bad events may be occurring, but basically this work in proof of concept. And so we’re very excited to be able to expand this. And it is one of our key flagship initiatives under the clinical correlates program with the CSC that we plan to pursue in the near term

[00:21:46] Bryan Fields: for individuals.

[00:21:47] Bryan Fields: Did you need to feel comfortable with that study? And then I have a

[00:21:50] Dr. Abrams: follow-up question. So it’s a great question, Brian. And let me just say that what we’re basically doing is what’s called a [00:22:00] phase. Clinical study, if you will. Clinical drug development typically follows a three phase development program phase one where you’re looking for toxicity in the preparations that you’re administering to people.

[00:22:18] Dr. Abrams: Phase two is looking to try and ascertain what that dose should be. And phase three is looking for efficacy. Am I getting the desired effect? This is a classical paradigm that EU FDA, China, PRC, China, FDA uses. This is very useful drug develop. Once your drug is approved. You do post-marketing surveys and these are typically referred to as phase or where you’re actually looking for what kind of responses beyond what the drug may have been identified for?

[00:22:58] Dr. Abrams: What about [00:23:00] side effects that were not part of the initial studies? So they tend to be broader in our case because of the way. Our models work. We were looking for statistical significance in our models and we could just keep going. Accruing respondents until we hit significance. So it’s not like we had to go in and negotiate with any agency up front that we will put 50 or 60 or a hundred to get those kind of answers.

[00:23:33] Dr. Abrams: But it’s fair to say that for the THC responses that we were trying to measure in smoke flower, as we hit about a hundred respondents, it became real. And so that answers your question it’s at that level. But of course, if you’re trying to find nuances, you’re trying to find what interacts with that. THC, what turkeys or other components [00:24:00] that are present.

[00:24:01] Dr. Abrams: You need more respondents in order to tease out that complexity in order to deconvolute that many to many problems. So I think, I mean, I’m answering your question simply it’s on the order of a hundred or so to get started, but of course our goal is to do much larger data. So that we can begin to deconvolute and understand what either minor cannabinoids or terpenoids or other components, files, esters that are present in.

[00:24:32] Dr. Abrams: In this botanical, how they affect the response,

[00:24:36] Bryan Fields: the reason how many is because obviously everyone handles flour differently may on women, time of day. Wait. And for me personally, every time I consume flower, I’m hungry. And then Sleepy’s. I might not be the best for that, but others might have a different experience.

[00:24:51] Bryan Fields: So I was wondering how you could feel comfortable in, in kind of segmenting all of those data variables and then feeling comfortable with the output you have and understanding that. Okay. Because [00:25:00] we’ve seen enough significant enough difference to go forward with the next

[00:25:03] Dr. Abrams: one. I mean, that’s a great question, Brian, but if your survey methodology specifically is asking about fast and in essence, we are, we’re talking about mood survey.

[00:25:17] Dr. Abrams: And mood surveys specifically can address or do address questions of fatigue, calmness, tension, et cetera, that comes out of the analysis. Doesn’t it? Because you can tell if the bulk of your respondents are reporting that way, then you know, that’s what the response is. If it’s. And I believe it will, or it does.

[00:25:39] Dr. Abrams: You begin to understand how that subsetting occurs and you begin to look at well, what is behind that sub setting? Is it gender? Maybe, maybe, probably not. Is it genotype you might be able to you know, you’re marrying these kind of work with genetic screening that is [00:26:00] increasingly popular. And so you’ve got that parameter.

[00:26:03] Dr. Abrams: You can ask questions or we know about when did you dose How much did you smoke? And most importantly, what did you take it with? And that is another aspect of this that we’re seriously thinking about how to incorporate into this next version or the one after the interaction term with other agents. We know we don’t live in a world where all we’re doing is consuming cannabis in isolation.

[00:26:31] Dr. Abrams: What about with that beer you had? What about those with tobacco? What about other dietary supplements or sleep aids or something like that? And we think that this crowdsourcing approach can help be convolute or understand that, but we just have to ask the questions right. And have it in a form where the data will speak for itself.

[00:26:54] Dr. Abrams: When

[00:26:55] Bryan Fields: you said that I had so many friends that came to mind of just wanting to just sit there and consume [00:27:00] canvas all day for a research study. So that’s what you’re looking for. I’m sure we can put up an announcement. I’m sure we can love the number of applicants for you

[00:27:07] Kellan Finney: do count, huh? No, I’m too. I get bored.

[00:27:11] Kellan Finney: You know what I mean? I’m not a big fan of video games. Like I don’t need to need to find something to keep myself busy while I consumed that kind of cannabis. You know, you started from

[00:27:19] Bryan Fields: a popularity standpoint, I’m sure you can find a couple of people that come to mind that would be interested in participating in such a study.

[00:27:25] Kellan Finney: Oh, we could totally make brochures. It would be sold out. I mean, we could really get a big bonus.

[00:27:31] Dr. Abrams: Well, interestingly for proof of concept phase, we were recruiting through Google ad words because as a nonprofit. We got access to free Google ads or Google supported onwards capability. And so we were experimenting with, can we change the recruitment profiles who are our Google searches or directed Google searches?

[00:27:57] Dr. Abrams: And there’s a whole story [00:28:00] about that concept, how we were able to, for example, channel more respondents into our system. Indication arm when we saw that most respondents. Checking the pain box, but not checking the sleep box. And we wanted to boost that number. And in fact, that’s how you go. If you get significance in your model for pain, because you have enough respondents and you go, oh, well, I don’t have quite enough for sleep.

[00:28:27] Dr. Abrams: I can’t draw any conclusions yet. You try to recruit in sleep and then you start to see, oh, I’m at the same number that we’re responding in pain. And I. Significance in my, my models and I don’t have it and sleep, therefore, either something is not working right. Or it is not so efficacious for sleep, which of course we know is not necessarily the case.

[00:28:52] Dr. Abrams: I’m just kind of quoting an example here. But the point is this approach is dynamic. It’s ongoing. [00:29:00] You don’t have to upfront postulate what your study size is going to be. And then open it and close it. I can keep going. I think that’s one of the advantages of this crowd source web-based phase four approach.

[00:29:14] Dr. Abrams: I hope that’s

[00:29:15] Bryan Fields: clear. Yeah. Yeah, it definitely is. And I can only wonder if you use Google ad words to try and attract people to your study. If I would’ve seen a Google ad that said consumed cannabis for sleep study, I would have assumed immediately it was a lie or a trick or some ception technique, because that seems way too good to be true.

[00:29:31] Bryan Fields: And I’m curious in order for them click that. Good for those guys. It was

[00:29:34] Dr. Abrams: more nuanced than that because in those days, Google had inhibitions on what you could use and we were not able to. Those kinds of terms in, so we had the slalom around the Google restrictions, which we did successfully, but there are, you know, of course there’s always ways, I guess, of getting these announcements out, but it worked, it worked, you know, we could, [00:30:00] we could show.

[00:30:00] Dr. Abrams: Increases in responding cohorts, just based on the terminology that we’re using. But now, Brian, it was not quite as blatant as yet smoked cannabis and respond to this study. I don’t think it would have cleared Google back in 26 and 2017.

[00:30:16] Bryan Fields: That would’ve shut down your site because Google would have been like, there’s a lot of clicking going on here.

[00:30:21] Kellan Finney: I want to just elaborate a little bit or they’re on the dosing study. So the survey is one portion of it. Is there any scientific techniques or technology that’s currently utilized to kind of understand what’s going on in the brain? And is that something that the CSC is looking to. To embark on or already has, is you want to kind of elaborate on, on some of the techniques that are used to look inside the skull to see how this is really interacting with you from a biochemical perspective.

[00:30:51] Kellan Finney: No,

[00:30:51] Dr. Abrams: that’s a great, great question. And we are extremely active in this space through a very fruitful collaboration [00:31:00] that started a number of years ago when I was director of Emerald science the Emerald county. And received across the desk. A very interesting abstract from Dr. Jeff Karen clinical psychologist, out of Eugene, Oregon who had proposed and executed a study of smoked cannabis, runnings, and Q E G quantitative EEG measurements.

[00:31:26] Dr. Abrams: So what that is in essence is putting electrodes on the surface of the brain of the surface of the, of the sky. It’s done very routinely. Medical sleep assessments. Cetera. It’s been a part of neurology for many, many years. That’s not invasive, it’s not a problem. And so he approached us at Emerald at the Emerald conference with this great abstract that really piqued my interest, but he had chosen a couple of strains.

[00:31:56] Dr. Abrams: For the study. And my sense was that was [00:32:00] fine, but he was not really surveying the whole kind of versus it will, as it were. And I was interested in seeing if he would be receptive to expanding that initial study, to include strains on the other side. And for those of you who are listeners who understand sprain, he had not included initially was the sour diesel, or what we call the fuel aroma.

[00:32:26] Dr. Abrams: Chemo type side. And so even as receptive, we added that in and produced the study with these three strains reported on it at Emerald 2019. And that presentation is available on Emerald website. It’s also available through CSC website, but the results have been very interesting to deconvolute and study.

[00:32:49] Dr. Abrams: And out of that, we do see a pattern. Of response in cannabis users with these different strains that we can begin to [00:33:00] understand maybe what some of the underlying fundamentals are. So this gives you. A bone, a feed, a biomarker, if you will, on beyond simple survey responses, it’s almost akin to being able to do blood work or something like that.

[00:33:17] Dr. Abrams: It’s a bone of feed, a bio marker. In addition, in this study, he included surveys, which I referred to earlier regarding mood, the standard Bruno mood assessment, and an altered state, such a delicate questionnaire, which is also part of. That field and we’ve been calling correlating and co-leading the responses.

[00:33:39] Dr. Abrams: And trying to map them to brainwave patterns and we are making good progress. So going into the future, one of the clinical correlates initiatives of CSC is to expand that clinical, the clinical trial work, if you will, based on quantitative EEG. [00:34:00] Ingested smoked or ingested cannabinoids or cannabis product.

[00:34:06] Dr. Abrams: We’re going

[00:34:06] Bryan Fields: to dive into prediction students. Before we do that, we ask all of our guests a few final questions. John, if you could sum up your experience into a main takeaway or lesson learned to pass onto the next generation. Oh, would that be?

[00:34:20] Dr. Abrams: Wow. Follow your heart and your interests. It took me many, many decades to get to the point where I could say I am completely involved in kind of the science and understand standing the cannabinoid industry and the underpinnings of the cannabis.

[00:34:40] Dr. Abrams: Mine. It was a process to get there, to throw in. Wholeheartedly in this space I am exceedingly happy and content at the progress we’re making. And so my advice, I guess, to those that come now or afterwards is try to recognize as early as possible what your goals and dreams are [00:35:00] and go do it. I think that’s

[00:35:01] Bryan Fields: perfectly said your personal experience with cannabinoids.

[00:35:05] Dr. Abrams: Well, I don’t think it’s a, you know, it’s a secret that Been a fan of, of the plant, particularly smoked cannabis for over 50 years. I find it very beneficial for numerous reasons. Certainly the calm, calming, and relaxation component, but for me, I find it at least what I hang on the THC component, age, strong associative ability and ability to kind of lay.

[00:35:35] Dr. Abrams: Concepts and disparate ideas to come up with valid hypotheses that can be tested. It’s almost for me like a brain booster. And I guess I might put myself in the realm of what you might and I mean, this is. Not self-aggrandizing but successful stoner. And I think I probably have been, in addition, [00:36:00] I’ve been trying to understand the best way to consume and use CBD or CBDA because of course there’s so much interest in that.

[00:36:08] Dr. Abrams: And one of the approaches that. Pioneer, not pioneer. That’s an old approach. It’s decoction that is boiling botanicals and creating a tea out of it. But in contradistinction to a tea, which is perfusion or infusion here, you’re actively boiling it. And so not only are you extracting components, but you may be changing them advantageous.

[00:36:34] Dr. Abrams: In the case of cannabis, we know that there’s a decarboxylation chemistry. That’s important. That is you have to take off one of me, functional groups, part of the molecule in order to have a certain range of activities. And I’m being a bleak here because we’re a big proponent of non decarboxylated cannabinoids for biological effects.

[00:36:57] Dr. Abrams: But the point is, is that kids a. [00:37:00] Approachable way to get CBD and or CBDA medication in a cheap. And what I believe is an effective way, simply boil hemp or CBD bud and drink it. And I find that that works. Quite well. So we’ve presented on the approach and the content that comes from this at the 2019 ACS American chemical society, Canada subgroup.

[00:37:31] Dr. Abrams: Meeting here that was in San Diego then. And again, details can be seen on presentations that are on our website. Interesting approach on how to acquire CBD or ingest CBD meditation. So I guess I would say between THC cannabis inhalation, and I’m a big vape user at this point and CBD decoction that’s all I get through my day.

[00:37:57] Dr. Abrams: I love the

[00:37:58] Bryan Fields: brain booster technique. That was, [00:38:00] oh, that was one of my favorite ones are likely going to steal that. So let’s go onto prediction time. 10 years from now 2031, John, will we have enough data and research to have personalized cannabis menu?

[00:38:14] Dr. Abrams: Well, I’m going to just answer that by saying, I’m going to drop off the word cannabis medicine and say 10 years from now, what will the stage of personalized medicine be?

[00:38:26] Dr. Abrams: Because we have to move that forward as well, right? I mean, we’re not going to have personalized cannabis medicine without personalized medicine. I’m an optimist. I think we will get there. And I think it is the key. There’s some paradigm changes. Of course. First of all, we have to be able to generate what is the person or generate information on who or what is that person?

[00:38:55] Dr. Abrams: And that’s a heavy lift because it’s expensive to get that. I mean 10 years from [00:39:00] now. I hope we have the resources that more people, not just wealthy elite have access to that kind of personalized diagnostics along side or on the second truck, you have the evolution in cannabis or cannabis science can adenoid industry and cannabinoid medicine.

[00:39:20] Dr. Abrams: And so yeah, there probably will be a marriage sometime in the future for this to be the best. But it’s, it’s still a heavy lift. Brian, I mean, 10 years is that it’s coming fast. I’d like to

[00:39:35] Kellan Finney: believe that it’s there. You know, I mean, 20 years ago we were still in the middle of the human genome project, right.

[00:39:43] Kellan Finney: In 2001. I could be mistaken on my dates, but it costs SWAT $13 billion to analyze the first full human genome. And now. I can go to 21 and me right as a 21 of me and they 50 bucks, they [00:40:00] send me a, a Q-tip. I swab my mouth, put it in there, send it back. And they’re going to give me a pretty decent understanding of my genetics from, for a significantly lower costs.

[00:40:12] Kellan Finney: So I think that. As we continue to improve the techniques associated with understanding biomarkers inside the human body, as well as genetics, that that cost will continue to fall. And as that costs continues to fall more and more of the population will be able to afford that kind of testing. And as more of the population.

[00:40:39] Kellan Finney: Gets tested for their genetics. You created larger data sets and efforts. Like what the CSC is embarking on with the dosing project. It’ll be easy to kind of look at interdisciplinary data to be able to pull these correlations. Right. And so I think in 10 years it may not be like, What you would see in Hollywood as far [00:41:00] as like personalized medicine.

[00:41:01] Kellan Finney: But I think that someone with enough motivation will be able to pull their 21 and me genetics data and put it into probably some sort of free software too. Pull correlations between say the cannabis, they consume their genetics and how they feel about it. And I think that that would be a form of personalized medicine associated with cannabis.

[00:41:23] Kellan Finney: So I know that’s a long-winded answer, but that is my thoughts on it. I mean, Brian coming from a less traditional scientific background. What are your thoughts on cannabis being a personalized medicine in the future? I mean, kind of walk us through that optimistic.

[00:41:40] Bryan Fields: Brian wants to say yes and wants to agree with you guys.

[00:41:43] Bryan Fields: But the other side, Brian, here’s our friend, Dr. Matt Morton says groundbreaking science is expensive and takes time. And I think 10 years is just not going to be enough time to learn everything. We need to learn, to understand all the datasets. There’s a ton of variables and [00:42:00] teams like the CSE. They’re doing incredible, incredible efforts, right?

[00:42:03] Bryan Fields: They need help from outside parties. Like you were saying, John, like your team can do as much as they can, but need participants from outside studies. And I think that involves more people getting involved in contributing to the cause. So while I’d love for that to happen, I think the only way that happens is if more organizations kind of align with the CSC and people like you, and I tell him, continue to contribute toward the car to help raise awareness and to get people out there to contribute whether it’s information or that donate their funds.

[00:42:33] Bryan Fields: I don’t know, I’m going to have to say no, but I think that’s the next line where Don, if people want to get involved with the CSC, Where can they do that?

[00:42:42] Dr. Abrams: Well, I would start by looking at the website and then thinking about what your level of interest in participation might be. We have donation programs, we have sponsorship programs and we have partnership programs depending on.

[00:42:58] Dr. Abrams: What your level [00:43:00] of interest in this is. And I think that’s where, where I would start. We are interested in collaboration. We are interested in consortium building. We are interested in working with top tier folks who really do want to move this forward. This is a huge effort and, you know it takes a lot more than a village.

[00:43:20] Dr. Abrams: And so we have to be open to that. We have to kind of make sure our egos don’t get in the way we have to make sure. While intellectual property protections are very important and that we’re aware of them that they too don’t get in the way to inhibit this. It has to all be pulling in the same direction, nuanced as it is.

[00:43:43] Dr. Abrams: I’m optimistic that we can move this forward 10 years and it’ll be, it’ll be a challenge, but if you don’t start, you don’t get it.

[00:43:53] Bryan Fields: Perfect. Well, I appreciate your time, John. We’ll link everything up in the show notes so that people want to get involved in and find the link and [00:44:00] look forward to kind of keeping up to date on what’s going on with CSC and having you back soon.

[00:44:04] Dr. Abrams: But thank you so much for the opportunity. It was a very enjoyable discussion.


Thanks so much for listening to The Dime . Subscribe or follow us on Seeking Alpha, Libsyn, Apple Podcast, Spotify, Google Play or Stitcher. And we’d really appreciate it if you could leave us a review on Apple Podcasts. It helps others find our show.

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