Econo-style value brands are beginning to dominate REC sales--and in response, REC stores have begun seriously cutting prices.
MJ Biz Daily

• Last week, a Toronto Tokyo Smoke franchise offered Pure Sun Farm value ounces for $65, and Hexo's value ounces at $77--dramatically lower than illicit market prices, and also lower than wholesale costs (which some provincial regulators don't allow).
  Twitter--@WhatsMyPot, @UnityMarguerite
• MED prices are also falling, even before compassionate pricing discounts for patients with limited incomes. BC micro-umbrella LP Shelter is offering MED at $3.21 per gram, while James Wagner is offering MED at $4.33 per gram.
  Twitter--@askcannaqueen, @ashleighshecann

BC LP Tantalus Labs CEO Dan Sutton warned lower price products will favour bigger companies able to produce cheap product. He suggested expecting to pay $10/gram to keep micro-cultivators and small LPs functioning, while "$7/g buys a small market with large players."
Twitter--@DSutton1986

• Sutton posted a chart breaking down of all different costs that make up a $7 gram of cannabis in a helpful chart.
  Twitter--@DSutton1986

As for ultra-premium product, not everyone's a fan.
Twitter--@WhatsMyPot

This week's most talked about product is Redecan's "Redees": boxes of small pre-rolls designed as enough for one person (sometimes known as "Dogwalkers" after a U.S. brand).
Global News

• Twitter users praised Redees as "the greatest thing since sliced bread," "COVID-19 friendly," "pretty cool to [...] take a pack to a potluck (one day)," and reported Redees were sold out in Windsor.
  Twitter--@gill_pollard, @JacquiChilds, @drowbb, @Dan_Adelman1, @Andreadobbs2

This Week in 2.0 Product News:

AlbertaCannabis.org, the crown online REC retailer, announced it will stop selling REC chocolates until September 7 due to the products melting.
MJ Biz Daily

Aurora's new "THC Citrus Shots" may resemble 5-Hour Energy products, but they're classified as ingestible extracts-- not drinks -- meaning they skirt Health Canada's bizarre equivalency scale limiting beverage purchases by weight rather than potency. (This hasn't helped Canadians' confusion about what THC numbers listed on packaging indicate about potency.)
Twitter--@jefflagerquist, @_DeepakAnand, Drug and Alcohol Dependency

• Canopy CEO David Klein called federal beverage equivalence regs "a flawed concept," while lobbyists representing Fluent and Truss have appealed to Ottawa to relax some REC beverage rules.
  Yahoo Finance

Unity Marguerite, buyer for Vancouver REC store Village Bloomery, reported so many vape-cart producers have "issues" (production, ethical, etc.) that 510-thread cartridges are getting hard to source.
Twitter--@UnityMarguerite

Quick Hits

1. Canada continues to stymie cannabis researchers with strict research regulations and long delays in granting research permits.
   GrowthOp
2. Border busts keep getting bigger: US Customs and Border Patrol intercepted 9,500 pounds of flower on the Peace Arch bridge between BC and Washington and charged one.
   WHAM-13

Former federal cabinet minister Tony Clement, longtime aggressive opponent of harm reduction, took a position as senior advisor to Red Light Holland, a company that produces and sells "a premium brand of magic truffles" to Netherlands' REC market.
CBC Montreal, CMAJ, CBC Technology, the Star, The Tyee, iPolitics, Globe NewsWire

• Other high-profile names have joined Red Light Holland, including comedian Russell Peters (chief creative officer), Peace Naturals founder Ann Barnes (director),  and ousted Canopy co-CEO Bruce Linton (chair of the advisory board).
• As health minister under prime minister Stephen Harper, Clement announced "the party is over" for illicit drug users, launching the National Anti-Drug Strategy in 2007, which introduced mandatory minimum sentences for drug offences but offered zero funding for harm reduction or alcohol policies, while ignoring researchers who claimed previous Conservative anti-drug initiatives had failed.
  CBC News/Web Archive, Stop the Drug War, Centre for Addiction and Mental Health, CBC News
• In 2018, Clement resigned from parliament after he was extorted in a sexting scandal. He sent sexually explicit images to two West African men posing as a woman online.
  National Post

Predictably, many people accused Tony Clement of being a hypocrite whose actions left people to die.
Twitter--@infosecivy, @jerallingham, @danalarsen, @garthmullins, @gilliankolla

• Disclosure: I have volunteered with homeless people and IV drug users for over a decade, and thus I don't have a kind word to say about Tony Clement, other than that he has blocked me on Twitter.

Aurora announced its founder and ex-CEO Terry Booth retired from his position on the board of directors, effective last Friday. Booth left the chief executive position in February.
Newswire, MJ Biz Daily, BNN Bloomberg

• Booth's resignation follows the retirement of board president Steve Dobler, announced two weeks ago and effective yesterday.
  MJ Biz Daily
• Katie Dobler, his daughter, also reportedly left her position as Aurora's product education coordinator. She faced accusations of nepotism in response to Instagram posts suggesting a lavish lifestyle.
  Twitter--@BettingBruiser, Equity Guru

CanniMed Therapeutics founder Brent Zettl suggested Aurora will likely leave the MED field to focus on REC products alone.
Global News

Canopy redesigned the terms of its conditional deal to buy U.S. REC player Acreage Holdings, and will now pay roughly US$843M instead of its previously promised $3.4B.
New Cannabis Ventures, Financial Post

• The companies blamed the volatility of the markets that led to Acreage losing 60% of its share value year to date, while Canopy shares have lost 13% of their value.
  Yahoo Financial
• The transaction will occur as soon as legally possible in the U.S., possibly before federal legalization. The cost is calculated according to ratios of each company's share prices, so the amount Canopy will pay remains to be determined.
  BNN Bloomberg
• Beyond the calculation of cost, the deal gets even more complicated (and includes a $37.5M cash payment).
  Canadian Lawyer, MJ Biz Daily

Quick Hits

1. If, like me, you've never heard of a cannabis germplasm repository (CGR) and don't know why Canada might need one, this article explains how such a thing would protect the genetics at the core of the sector.
   Greenhouse Canada
2. Responding to pressure from MED advocates, Health Canada extended the expiry date of registrations for licensed home MED growers by six months.
   Twitter--@MedCannCA, Health Canada, StratCann

When licensed edibles producer Dynaleo opens its factor near Edmonton, AB, it will be the largest REC gummy factory in Canada.
Edmonton Journal

• CEO Brandon Wright, founder of grey-market company Baked Edibles, turned to the legal market with Dynaleo, which received $2M in funding from Canopy Growth's investment arm Canopy Rivers, and got final licensing approval from Health Canada last week.
  Food Quality & Safety, Newswire
  
• Dynaleo signed a letter of intent with Los Angeles edibles shop Pantry to license their products for the Canadian market.
  NewsWire

In Other Sector News:

The REC industry has grown 231% since legalization, and last week Health Canada issued eight more licenses, for a total 417 federally licensed parties. Former Health Canada cannabis team member David Brown crunched annual licensing numbers and found the regulator has licensed more LPs this year than in the four previous years put together.
Twitter--@Drowbb

• There are so many LPs, New Cannabis Ventures revised the rules for including a company among its Canadian Cannabis LP Index.
  New Cannabis Ventures

Auxly joined other LPs in retracting its overseas commitments, halting planting for the 2020-2021 growing season at Uruguayan subsidiary.
MJ Biz Daily

The bright side of low stock prices is distressed assets are priced to move.
Bloomberg

The BC Liquor Distribution Branch, which operates BC Cannabis Stores, rejected claims by private REC store operators that the province pays less for wholesale product.

• Grower Aaron W Anderson suggested the BC LDB was being evasive and not disclosing where its real margins actually are.
  Twitter--@AaronWAnderson

A BC LDB spokesperson said "I think the private retailers had a bit of an advantage" because many operated in the grey market before being licensed.
Castanet, Kelowna Daily Courier, StratCann

• REC retailers expressed outrage at the comment. Industry consultant Natasha Raey responded the province didn't "actually use any of their own money like the rest of us did."
  Twitter--@CalyxTrichomes, @LakeCityCanna, @NatashaRaey

Rumour has it BC will open private delivery and online sales before 2021, and farm-gate sales next year.
Twitter--@drowbb

• BC consumers still prefer the legacy market, buying $1.24B worth of unlicensed cannabis in 2019. Some see potential in getting talented unlicensed producers to enter the licensed sector.
  Global News, GrowthOp

Ontario celebrated its 100th authorized retail store last week, as provincial regulator AGCO has ramped up its approvals to grant 24 Retail Store Authorizations in 26 days. We've come a long way from last year's REC retail lottery chaos.
Twitter--@ONCannabisStore, @MattPMaurer

• There are now so many licensed REC stores in Ottawa's touristy ByWard Market area that community leaders are asking to slow new store approvals to avoid "a monoculture."
  CBC Ottawa
• The province also extended its temporary emergency orders allowing private REC retail delivery and pick-up until July 10.
  Press Release

Hot after a booming first year, REC chain Fire & Flower paid off $27.17M worth of unsecured convertible debentures. The company was also spotted advertising on Pornhub.com (an age-gated site, one presumes). Jason Spatafora, owner of MarijaunaStocks.com, said ads on the site were "surprisingly cheap" and offered "great" return on investment.
NewsWire, Twitter--@BettingBruiser, @WolfOfWeedSt

• Hopefully the spate of new stores will help with brand differentiation: at present consumers aren't familiar with either LPs nor REC retail brands.
  BNN Bloomberg

The first Indigenous owner of a licensed Ontario REC store opened his doors in Nipissing First Nation, west of North Bay. Many first nations have non-licensed dispensaries within their territories, but Nipissing FN's Northern Zen Cannabis is the only one licensed by the Ontario government.
Bay Today

• Del Riley, Former Chief of the National Indian Brotherhood (now the Assembly of First Nations), helped write sections 25 and 35 of the Constitution. Riley has long argued unlicensed dispensaries on reserve are protected under those sections of the constitution, which protect treaty rights.
  Soo Today
• Iqaluit began public consultations on its first REC store.
  Nunatsiaq News

Campaign for Cannabis Amnesty (CCA) director Annamaria Enenajor called the federal government's cannabis record-suspension program an "abject failure," arguing the program's high rejection rates result from unclear eligibility criteria.

Only 436 of the estimated half-million Canadians with possession records have received pardons since the pardon system was launched last year.
Huffington Post, Law & Style, Twitter--@Nick_Pateras

• Enenajor said the onus should be on Ottawa to suspend records, not on those convicted under prohibition. The CCA continues to push for expungement of cannabis possession convictions from all databases.
• David Brown, Health Canada cannabis team member turned founder of StratCann, called expungement a "myth" that is "not logistically possible."
  Twitter--@drowbb

The Campaign for Cannabis Amnesty stresses prohibition disproportionately affected Black and Indigenous Canadians. As the U.S. sector faces the challenge of confronting the racism of prohibition, Filipina-Canadian cannabis educator Abi Sampson called for the Canadian sector to build equity programs to address that disparity.
Medium, Twitter--@HiHeidiHigh

• Superette founder and CCA advocate Mimi Lam spoke about being a person of colour in the sector and called for companies to "look in the mirror" to address the absence of Black and Indigenous people and POCs at all levels.
  Green Entrepreneur
• Editor Dustin Parkes appears to have quit the National Post over parent company Postmedia's decision last week to take down an opinon piece critical of a Tokyo Smoke franchise. In the censored piece, GrowthOp editor Katie Robertson apparently criticised the store for displaying anti-capitalist art by Banksy during ongoing uprisings against racism.
  Twitter-- @DustinParkes, @CosmicBlend, Yahoo Finance
  
• The aforementioned Tokyo Smoke took down their Banksy art following public backlash.
  Daily Hive