38 minute read
News
Stok’d Cannabis Expands Retail Presence in Ontario with Opening of First Franchise Location
The founders of Stok’d Cannabis announced the opening of their fourth cannabis store, and their first franchise, located at 2978 Eglinton Avenue East, near Bellamy Road in Scarborough. Expanding on the success of the other Stok’d stores, this third Scarborough store positions Stok’d as the cannabis retail leader in Toronto’s east end. Stok’d Eglinton will be open 9am to 10pm daily, with summer hours extended to 11pm on Friday and Saturday. A grand opening celebration was held this Saturday, August 27th from noon to 5pm, where guests enjoyed free refreshments, a cornhole tournament, draws and giveaways. Additionally, Stok’d Eglinton accepted non-perishable food items to donate to the Scarborough Food Security Initiative (SFSI) on behalf of the community.
Rubicon Organics Announces Resignation of Chief Executive Officer Effective December 31, 2022
Rubicon Organics Inc., a licensed producer focused on cultivating and selling organic certified, premium cannabis, announced that Jesse McConnell, Co-Founder and Chief Executive Officer (CEO) of Rubicon Organics has provided his notice of resignation as CEO of the company. Mr. McConnell is on parental leave and his resignation is anticipated to become effective on December 31, 2022. The Board of Directors of the Company will immediately begin a search for a successor who can lead the company in driving forward its vision to be “the global brand leader in premium organic cannabis”. Mr. McConnell cofounded Rubicon Organics in June 2015 with Peter Doig with a vision to provide leadership in organic cultivation of premium cannabis. Under his leadership, the company has grown to become the industry leader in superpremium organic cannabis products with a robust portfolio of premium cannabis brands and industry-leading quality and yields.
Aurora Cannabis Acquires Controlling Interest in Bevo Farms
Aurora Cannabis Inc., the Canadian company defining the future of cannabinoids worldwide, announced that a wholly owned subsidiary of the company has acquired a controlling interest in Bevo Agtech Inc., the sole parent of Bevo Farms Ltd., one of the largest suppliers of propagated vegetables and ornamental plants in North America (the “Bevo Transaction“). Concurrent with closing of the Bevo Transaction, Bevo entered into an agreement to acquire the company’s Aurora Sky facility in Edmonton, Alberta through the acquisition of one of Aurora’s wholly owned subsidiaries (the “Aurora Sky Transaction” and together with the Bevo Transaction, the “Transaction“). Founded in 1986, Bevo operates 63 acres of greenhouse in British Columbia, Canada; is led by a management team with more than 85 years of agricultural experience, and supplies greenhouses, nurseries, field farms and wholesalers. Bevo has consistently demonstrated growth in revenue and earnings over the past decade through process improvements and facility expansions. For the 12 months ended June 30, 2022, Bevo has achieved revenues of $39 million and Adjusted EBITDA of $9 million (excluding non-recurring rental revenue). Bevo’s business exhibits seasonality driven by agricultural grow cycles, with the strongest financial period being from January to June.
SNDL Announces Agreement to Acquire The Valens Company to Create Leading Vertically Integrated Cannabis Platform
SNDL Inc. and The Valens Company Inc. announce that they have entered into an arrangement agreement to combine their businesses and create a leading vertically integrated cannabis platform. Pursuant to the terms of the agreement, SNDL will acquire all of the issued and outstanding common shares of Valens, other than those owned by SNDL and its subsidiaries, by way of a statutory plan of arrangement (the “Transaction”). All financial information in this press release is reported in Canadian dollars unless otherwise indicated. Under the terms of the agreement, Valens’ shareholders will receive, for each Valens share, 0.3334 of a common share of SNDL (the “Offer Exchange Ratio”). Based on the August 19, 2022 close of the SNDL shares on the Nasdaq Capital Market exchange (the “Nasdaq”), the consideration represents an implied value of $1.26 per Valens share (the “Implied Offer Price”), for total consideration of approximately $138 million. With 555,500 square feet of cultivation and manufacturing space and 185 cannabis stores under the Spiritleaf and Value Buds banners, the combined company will offer a complete portfolio of branded products to consumers in Canada through its own supply and distribution channels. With approximately $314 million in net cash and no debt, SNDL will continue to have one of the strongest balance sheets in the North American regulated cannabis industry. SNDL will also have the highest pro forma Canadian cannabis revenue on a last fiscal quarter annualized basis. The combined company will operate as SNDL Inc., and Valens shareholders will own approximately 9.5% of the pro forma entity.
Pure Sunfarms Extends Partnership with Simon Fraser University to Advance Cannabis Research
Pure Sunfarms is extending its partnership with Simon Fraser University (SFU) to advance cannabis plant health research over the next three years. Since the partnership began in 2018, SFU researchers together with the Pure Sunfarms cultivation team have identified pathogens that affect the cultivation of greenhouse-grown cannabis—findings that have led to the development of cutting- edge biological, cultural, and environmental control strategies in cannabis. As part of the partnership, SFU researchers and students have access to Pure Sunfarms on-site laboratory and 65,000-square-foot state-ofthe-art processing centre to research ways to mitigate threats to cannabis plant health. Teams use a variety of methods to follow the complete life cycle of plants, looking at environmental conditions, strains and production practices to address and promote the quality of post-harvest cannabis.
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CANNABIS FOLLOWS GLOBAL BEST PRACTICES IN SAFETY, SECURITY AND SUSTAINABILITY
By Frank Massong
The global cannabis industry is walking in the same footsteps as all industrial supply chain sectors. Coming soon to an eStore near you is the ISO Secretariat, PRF IWA-37 Safety, Security and Sustainability of Cannabis Facilities and Operations - Part 1: Requirements for the safety of cannabis buildings, equipment and oil extraction operations; Part 2: Requirements for the secure handling of cannabis and cannabis products; and Part 3: Good production practices (GPP): https://tinyurl.com/yu7saew2
Why is this important to the cannabis industry, not only in Canada but also for the future global trade? ISO (International Organization for Standardization) is recognized as the standards development leader by 167 nations. ISO has generated more than 22,000 standards, which are recognized by governments and industries worldwide to support their objectives and leading to orderly trade supporting clearly defined outcomes and methods. Many ISO standards are embedded in national regulations, used in government procurement, or used by other bodies like the World Trade Organization, which directs its member states to use international standards, such as those developed by ISO, as the basis for domestic and international technical regulations. The result is the reduction in technical barriers to trade while still respecting the sovereignty of nations to establish their own level of protection in human, animal and plant health as well as the basis for handling trade disputes.
The Standards Council of Canada (SCC) as Canada’s representative on ISO was authorized to work on a guidance document to the challenges with respect to market requirements for cannabis and fill in any voids. The SCC and the Underwriters Laboratories engaged more than 20 member countries represented by hundreds of global stakeholders to lead them through a series of workshops starting in November 2020 ending in early 2022. Purity-IQ Inc. (PIQ) was a proud contributor. We have been advised that final publication is imminent. It should also be noted that the PRF IWA-37 is a “guidance” document and not a “standard”. However, it will be a precursor to the development of future ISO technical standards or form the basis for the creation of private certification standards.
Of special significance is Part 3: Good production practices (GPP) from propagation, cultivation and manufacturing, which includes cannabis edibles that will consider a science-driven management system approach. This prioritizes controlling potential hazards by identifying hazards, establishing limits and designing validated preventive controls to eliminate or reduce micro-biological, chemical and physical contaminants with feedback mechanisms to track trends and to better deliver the intended outcomes. These need to be flexible and customized to meet challenges, changing technology or to sustainably seize market opportunities faced by users.
We expect the future of management systems for cannabis to parallel the development of private food safety standards, which not only support regulatory obligations but to fill any gaps that may occur in conventional regulatory systems and enforcement technologies. The concept of HACCP, as it became known in the 1970s, became more widely used in the regular food supply as the seven principles of HACCP in the late 1980s. Today, these founding principles are now the basis for hazard analysis and preventive controls in food safety enforcement programs and for measuring global equivalency (e.g., FSMA). The value of their application and proven success also spawned private food safety standards, which go beyond the minimum requirements set in national regulations. Certification is proof of due diligence as determined by competent and independent certification bodies (CB’s) accepted by both seller and buyer.
The Global Food Safety Initiative (GFSI) consulted with retailers, manufacturers and brand owners from across the world to benchmark private food safety standards to foster global acceptance of GFSI-recognized certification programs as “once certified, accepted everywhere”. This utilized CB’s accredited to ISO 17065 and ISO 17021 issuing certificates of conformity subject to the findings reported by competent third-party auditors.
With the passing of the Canadian Cannabis Regulations and following the trajectory and success of GFSI-recognized private food standards, PIQ anticipated that a similar approach could be applied to certify individual producers, manufacturers and if requested, their products. The Cannabis Authenticity and Purity Standard (CAPS) was published in January 2021 as the result of a consultative process with global stakeholders considering best practices supported by the most current science. See https://caps-cert.com/. In our view, CAPS compares well with ISO PRF IWA-37.
CAPS-Basic is a tool that enables producers and manufacturers to be certified as meeting government requirements (e.g., GACP, GMP, CFR 111, CFR 117) and demonstrate due diligence of performance to customer and corporate expectations, as measured by ISO 17065 accredited CB, like GFSI-benchmarked standards. CAPS-Advanced was added using the best genomic and Nuclear Magnetic Resonance (NMR) technology available to register individual canna-bis cultivars and products on a private and secure platform and then certified for the consistency and authenticity of outcomes, when compared with the registry’s reference samples. Not only will this lead to more dependable product performance, it can be the basis to effectively establish intellectual property as well as increase transparency and trust between the buyer and seller.
The ISO PRF IWA-37 safety, security and sustainability of cannabis facilities and operations guidance document provides a clear message that the cannabis industry is maturing. The path to success is clearer and tools are available for companies wishing to adopt best practices based on science, like all other industrial sectors. Unlike the successes of management system certification in food that took decades, the cannabis industry through rapid adoption can now get there much faster with less cost.
Frank Massong is the Regulatory and Technical Advisor to Purity-IQ Inc., operators of the Cannabis Authenticity and Purity Standard (CAPS).
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10 Ways Canada’s New Consumer Privacy Protection Act Will Impact Privacy Practices
By David Fraser & Sarah Anderson Dykema, CIPP/C
In June 2022, the Canadian government introduced a complete overhaul of the private sector privacy law regime that both protects individuals’ personal information and regulates organizations’ privacy practices. The Consumer Privacy Protection Act (CPPA) will replace the Personal Information Protection and Electronic Documents Act (PIPEDA), which has regulated the collection, use and disclosure of personal information in the course of commercial activity in Canada since 2001. Here are 10 ways the CPPA will impact organizations’ Canadian privacy practices.
1. New Obligations. PIPEDA is based on the 10 “fair information” principles of the Canadian Standards Association Model Code for the Protection of Personal Information (including principles of accountability, consent, limiting collection, use, disclosure and retention, and safeguarding of information). The CPPA incorporates the Code’s 10 principles, but implements significant changes that will impose new obligations on private sector organizations. For example, organizations must now:
» Implement and maintain a privacy management program that “includes the policies, practices and procedures the organization has put in place to fulfill its obligations” under the CPPA that must cover particular policies, practices, and procedures and take into account certain factors, and must provide it to the Privacy Commissioner on request. However, organizations can establish a “code” and internal certification programs for CPPA compliance that, once approved by the Commissioner, effectively establish their legal compliance obligations. » Record and document the purposes for which they collect, use or disclose any personal information. The CPPA also details what’s required for valid consent.
2. New Penalties. PIPEDA only authorizes penalties for certain breaches of the Digital Privacy Act (data breach response provisions), with a maximum fine of $100,000 per violation. The CPPA authorizes administrative monetary penalties and fines of up to $10M or 3% of the organization’s gross global revenue in its prior financial year, whichever is higher, for failure to comply with privacy obligations, including failure to implement and maintain the privacy management program or to document the purpose for which personal information is collected, used or disclosed. It also provides for quasi-criminal prosecutions with even greater financial consequences: up to the higher of $25M and 5% of the organization’s gross global revenue for an indictable offence; and up to the higher of $20M and 4% of the organization’s gross global revenue for a summary offence.
3. More Commissioner Powers. Significantly, the CPPA changes the Privacy Commissioner’s focus from ombuds with no order-making power to a much more adversarial regime. Under PIPEDA, the Commissioner has only the power to make recommendations to a breaching organization. Under the CPPA, there are more circumstances where the Commissioner can decline to investigate, more procedural protection if the Commissioner investigates and refers the matter to an inquiry, and the Commissioner has the power to make orders against organizations and recommend penalties to a new Tribunal (in addition to continuing to name and shame violators) after an inquiry.
4. Specialized Tribunal. A new “Personal Information and Data Protection Tribunal”, three members of which must have privacy expertise, will determine whether Commissioner recommendations regarding penalties are appropriate, and levy any such pen-
alties, which have the effect of a court order. Organizations accused of violating the CPPA will have the right to appeal to the Tribunal the Commissioner’s findings and orders, but the Tribunal’s review will be to a stricter standard than under PIPEDA.
5. Global Reach. Reflecting the growing digitization and globalization of the economy, the CPPA expressly applies to all personal information an organization collects, uses or discloses in the course of commercial activity and to employee information of federally-regulated organizations – and also where personal information is collected, used or disclosed interprovincially or internationally. But this expansion beyond Canada isn’t without issues: it’s not expressly limited to commercial activity, raising an argument the law applies to non-commercial or employee personal information generally (otherwise beyond the scope of the law) that crosses borders; and organizations with operations in Canadian provinces with provincial privacy legislation substantially similar to PIPEDA (Quebec, B.C. and Alberta) must comply with the provincial privacy laws of provinces in which it operates and with the CPPA when moving data across provinces. Furthermore, the CPPA fails to fill a PIPEDA gap in not expressly extending to personal information imported into Canada under an adequacy finding under the EU’s General Data Protection Regulation (GDPR).
6. New Privacy Violation Legal Claim. Where the Commissioner decides an organization violated an individual’s privacy under the CPPA, and the Tribunal upholds that decision, the individual can now sue the organization (within two years) for compensation for the violation. And while PIPEDA limits any action to recover compensation for a privacy violation to the Federal Court, the CPPA also allows such actions in the superior court of a province. However, the CPPA’s wording makes it unclear whether a violator is also exposed to class action liability. 7. Data Portability & Deletion. Individuals can require an organization to transfer their personal information to another organization (subject to regulations not yet available), a likely boon to open banking. However, data portability must be connected to a “data mobility framework”. Individuals can also require an organization to delete their personal information, subject to some limitations, in what appears to be a limited “right to erasure”.
8. Algorithmic Transparency. Under the CPPA, individuals have the new right to require an organization to explain how an automated decision-making system made a prediction, recommendation or decision about them that could have a significant impact on them.
9. Consent Exceptions. In what will delight some and enrage others, and could impact, for example, the information an organization must communicate in a privacy policy, the CPPA makes some (potentially broad) exceptions to when an organization must obtain an individual’s consent to the collection, use or disclosure of his/her personal information:
» Collection and use without consent is allowed for certain business activities where it would reasonably be expected to provide the service, or for security purposes, safety or other prescribed activities. But this exception doesn’t apply where the personal information is collected or used to influence the individual’s behaviour or decisions. » A “legitimate interest” exception to consent for collection, use and disclosure requires an organization to document any possible adverse effects on the individual, mitigate them and weigh whether the legitimate interest outweighs any “adverse effects”. However, it’s unclear how “adverse effects” will be measured. » Individuals can withdraw consent subject to similar limitations in PIPEDA. However, an individual can now also require an organization to dispose of his/her information, which includes deleting or anonymizing it.
10. Anonymizing & De-Identifying Data. The CPPA makes new rules around the de-identification of data - including allowing organizations to use an individual’s personal information without his/her consent to de-identify his/ her data - but appears to limit other uses of de-identified data. In certain circumstances, organizations can also disclose de-identified data to public entities for socially beneficial purposes. However, the CPPA takes an interesting approach by creating two distinct categories:
» Anonymizing data means “to irreversibly and permanently modify personal information, in accordance with generally accepted best practices, to ensure that no individual can be identified from the information, whether directly or indirectly, by any means”. The CPPA doesn’t regulate anonymous data because, by definition, there’s no reasonable prospect of re-identification. » De-identifying data means “to modify personal information so that an individual cannot be directly identified from it, though a risk of the individual being identified remains”. The CPPA generally prohibits attempts to re-identify de-identified data, though says in some cases, it can, or even must, be used in place of fully identifiable personal information.
David Fraser and Sarah Anderson Dykema are Privacy & Tech Lawyers at McInnes Cooper. This article is information only; it is not legal advice. McInnes Cooper excludes all liability for anything contained in or any use of this article. © McInnes Cooper, 2022. All rights reserved.
WHAT DO EMPLOYEES REALLY WANT?
By Stephanie Pow
They say the average person will work 90,000+ hours during their lifetime, equating to approximately one-third of their total time. Ask any of the 150,000+ employees who have worked in the legal Canadian cannabis industry since 2018 and they will likely say that their number is getting closer to half since their careers in cannabis began.
It was clear from the beginning that working in the cannabis industry could never follow the typical 9 to 5, especially working to build an entirely new industry from scratch under the watchful eye of regulatory bodies, and during a global pandemic no less. Plants don’t take vacation, and dedicated cannabis employees have been on the ground, day after day, putting in the hours needed to build this industry into what it has become.
Yet as more time passes and cannabis employees continue to gain further experience in their roles, we’re starting to get a clearer vision as to what cannabis employees are looking for from their work and the cannabis companies they work for.
CANNABIS EMPLOYEES WANT TO DO
WHAT THEY LOVE AND THEY WANT TO WORK FOR COMPANIES THAT SUPPORT THEM AS PEOPLE
Most people can share a not-so-great experience from their time working in the cannabis industry. Toxic leadership, unclear vision, lack of company culture, unpaid paychecks, layoffs, and unfulfilled promises, just to name a few. Unfortunately, these are all-too-common stories told at the ground level.
However, it’s a tight-knit industry and (fortunately) as time goes by, a more informed cannabis workforce is emerging across all areas of the supply chain. Employers can no longer bury their heads in the sand if they want to attract the best talent for their cannabis companies.
As we head into 2023 and beyond, what do cannabis employees really want from the companies and leadership they work for?
A DEFINED CORPORATE CULTURE
A company’s culture serves as the organization’s compass. It clearly defines a company’s core values and beliefs: how they convey ideas, how they should act, deal with clients and present themselves at work.
Putting a mission statement and a list of values on the wall just doesn’t cut it anymore. Cannabis employees want to see the values and mission of the company lived out in their day-to-day work environment. They want a leadership team that exemplifies the ethos of the culture and focuses as much on the “internal” corporate brand as the brands they’re selling to the end consumer.
TO FEEL VALUED
Employees want to feel recognized within their teams and acknowledged that their work makes a contribution to the larger company as a whole. They’re giving their time, energy and dedication to the work they do. In exchange, they’re looking for a stable paycheck, to have a voice at the table, and to feel they have a purpose for the work they do.
TO SEE THE PATH FORWARD
For most, working in cannabis isn’t just a job, it’s a career. When cannabis employees are working for a company, they want to know that there’s room to grow and develop their personal careers. Succession planning across the organization lays out a clear path for all to understand where they’re going and how the individual and team will work to get there.
Having the opportunity to learn new skills, manage people, work cross-collaboratively across the organization, and be supported with personal learning and development, all demonstrate a commitment by the organization to employees’ growth.
TO HAVE POSITIVE AND SUPPORTIVE MANAGEMENT
The best leaders are aware that their people play a key part in achieving success and reaching the company’s defined goals. Empowering employees to do their best work, be their best selves and work together for the greater vision of the company is a hallmark of healthy leadership.
Cannabis employees want to work for honest leaders they can trust. Leaders who genuinely care for their people and the work they do; providing clear direction, effective communication, and fostering collaborative environments while following a transparent ‘360’ leadership model.
TO REPRESENT INNOVATIVE, HIGH-QUAL-
ITY, WELL-RESPECTED BRANDS AND PRODUCTS
Cannabis employees are a company’s best marketing tool. They become walking advertisements for a company’s brand and products to their friends, family and wider communities. They have put their time and energy into creating, preparing, processing, testing, packaging and launching these products to the world.
There’s a strong sense of pride in representing leading products and brands. Employees put their trust in the company to ensure quality standards from seed to sale and prioritize bringing innovation to the industry. Company reputation, both within the industry and in the general public, is a key deciding factor for many cannabis employees.
As we look forward to 2023 and beyond, the people of cannabis will remain a critical piece of the larger picture. Creating positive, sustainable and profitable cannabis companies starts with its employees on the ground. These past four years post-legalization have focused heavily on the plants and the profits; it’s time to put the focus back on the people that make the cannabis industry possible.
Employees across all areas of cannabis want to see this industry, and the companies they work for, succeed and thrive. Prioritizing employees and providing them with what they truly want will help create a dedicated, sustainable, thriving workforce that will lead the cannabis industry into all it can and will be.
Stephanie Pow is a recruitment consultant and cannabis career coach who supports the global cannabis industry. Find her on LinkedIn to follow along on her “people-first” mission or connect with her at www.withpow.com.
Canada: An Ever-changing Blueprint for International Cannabis Legislation
By Rick Savone, SVP Global Governments Relations, Aurora Cannabis
Much has changed in Canada’s cannabis industry since 2018. Stores have opened, some have since closed, the industry has pivoted, and most risks have been mitigated. Canadians have grown accustomed to legal cannabis as a part of everyday life. But with constant fluctuations in the regulations and frameworks that govern this nascent industry, the country’s once-booming cannabis sector has remained stagnant.
As the industry braces for the pending Cannabis Act Review – the impacts of which won’t be felt until the mid-2020s – it’s worth revisiting the state of cannabis regulations and asking ourselves what can be learned from Canada’s ascension to global cannabis leader, and what it can do to sustain that position as the slow drip of legalization colours the globe green.
The question of whether the Canadian approach remains a blueprint for international legalization starts with looking at the economic conditions those regulations have played a part in creating. There’s little doubt that since 2018, the industry has been a net positive contributor to the Canadian economy. Deloitte and the Ontario Cannabis Store found that the industry has generated $11 billion in sales, made $29 billion in capital expenditures, and contributed $43.5 billion to the country’s GDP1. Tax revenue has exceeded $15 billion, and the industry sustains nearly 100,000 jobs for Canadians coast-to-coast. These are positive impacts for real families, often in rural Canadian communities with few investment options.
With numbers like this, it’s hard to wonder why any government wouldn’t want to follow the Canadian model step by step. But beyond the raw numbers, the industry’s trajectory tells a different story – one whose latest chapter speaks to the need for governments to be a partner, rather than an oversight body.
A report from EY, commissioned by the Cannabis Council of Canada2 , ponders the industry’s long-term viability if the Canadian government continues to take a wait-and-see approach to evolving the regulations and frameworks that govern it. And the situation with taxes is even more complicated. Since 2019, licensed producers have seen their share of total revenues fall significantly while excise taxes have taken a much bigger chunk from their sales streams. Against the backdrop of stunted retail rollouts, high taxes, red tape, price compression and a smaller-than-expected total addressable market, the market capitalization of the largest licensed producers in 2019 has more than halved since then.
TAXATION AND RED TAPE UNDERMINING STABLE GROWTH
While producers, like Aurora, are dealing with the fallout from an unstable market, governments have continued to reap the benefits of legalization. While government taxes, fees and charges ballooned, many retailers and producers have struggled. At a time when LPs were repeatedly reporting dramatic losses and write-offs, EY argues that excise duties as a percentage of the final price of goods rose by more than 57%, from 23.9% to 37.6%. There’s no doubt that this tax situation is a drag on the industry and a huge barrier for growth.
Countless cannabis companies have course-corrected to reflect the realities of the sector by closing facilities and laying off thousands from well-paying jobs. Those efforts, though, appear to have been made in vain as governments sit idle on pressing issues, including taxation, while companies continue to evolve.
The Canadian approach to cannabis taxation has been heavy-handed. By implementing a regime that looks closer to tobacco than anything else, licensed producers may have needed an infinitely expanding addressable market to drive revenue growth. Instead, they’ve had to make drastic choices to retain any shot at staying competitive – both with each other, but also with the legacy market.
If not the government, the biggest winner from the cannabis tax regime is undoubtedly the illicit market. Even after price compression, illicit market prices with 2.2% less for dried flower – and that’s a small difference compared to a 24.3% price difference on vapes, and 90% price difference on edibles. Illicit market producers don’t pay any taxes and don’t respect the government’s compliance frameworks. If one of the primary goals of legalization is to eliminate the illegal market, taxes levied against companies responsible for shifting that market share should measure up with the task. In this sense, the Canadian framework provides an important lesson to wouldbe legal countries: consumers and producers suffer when governments
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seek to enhance their revenue stream above all other considerations of resilience.
Taxation might be the clearest path forward to building a more sustainable and competitive industry in Canada. But there are plenty of other areas that countries might be able to look at when assessing whether Canada’s framework is one worth following.
Licensed producers are still limited in communicating with potential consumers, creating difficulties in building the brand loyalty that’s critical to preventing those same consumers from returning to purchasing from the illicit market. Educational and promotional material must be viewed more intensely through a legal rather than business lens. Stringent rules around packaging further restricts efforts around product differentiation, while potency and possession limits serve only to sustain the illicit market. Where once these strict rules might have made sense – legal cannabis was, after all, new territory and the risks were not well understood – they now limit the industry’s growth potential and have stalled the needle on movement toward the goals of legalization.
SEPARATING MEDICAL AND RECREATIONAL
Any discussion of what can be learned from Canada’s legalization rollout is incomplete without examining how it has impacted medical patients who had safe, legal access to cannabis before 2018. For those 300,000 Canadians, legalization of the recreational market has taken centre stage while the real needs of medical cannabis patients have been all but subsumed. Today, medical cannabis patients are the only ones who are forced to pay taxes on their medicine. The Task Force on Marijuana Legalization and Regulation reported that patients can pay up to $500 a month for their medical cannabis. The Arthritis Society, meanwhile, reports that sales and excise taxes on medical cannabis cost an average arthritis patient nearly $2,000 per year4. These tax revenues pile up for the government but represent a significant continue to stay focused on the original goals of legalization, the ISED initiative enables industry to work with government on the economic challenges it faces today. For international onlookers, the group doubles as an example of what governments can do from the start to ensure that neither public health nor economic growth come at the expense of one another. Sector resilience involves more than just removing the choke of prohibition only to be cuffed with excessive amounts of taxation.
Many hope these are growing pains and not symptoms of longer term issues. But for those wondering if the Canadian example is one to follow, it’s a lesson in urgency. Governments and industry can work together to quickly respond to emerging issues without nullifying public health objectives. With the right frameworks in place, urgent solutions can help sustain a competitive industry that eliminates the illicit market, serves the needs of patients, creates jobs and sustains innovation.
cost for patients who have reclaimed their access rights for medical cannabis.
As the leading Canadian LP in global medical cannabis revenue, Aurora understands well that medical cannabis patients have distinct needs from recreational consumers. While legalization claims have put public health and safety at the forefront, it may have done so inadvertently by creating unsustainable cost structures for patients.
MOVING THE INDUSTRY FORWARD
With taxes stifling growth opportunities, a refocused illicit market, and patients feeling left behind, it’s fair to question whether the Canadian approach to cannabis legalization is the blueprint for other countries.
To its credit, the government’s position seems to have started to turn as groups like the Cannabis Council of Canada continue to play an active role advocating for the industry. The Ministry of Industry, Science, and Economic Development (ISED) recently established the Cannabis Strategy Table that should be positioned to act as a direct liaison between producers, stakeholders and government. While Health Canada will Rick Savone is a SVP Global Governments Relations for Aurora Cannabis.
1. An industry makes its mark: The economic and social impact of Canada’s cannabis sector. https:// www2.deloitte.com/ca/en/pages/ consumer- business/articles/an-industry-makesits-mark.html. Published 2021. 2. The impact of taxation and regulation on Canada’s cannabis industry. https://assets. ey.com/ content/dam/ey-sites/ey-com/en_ca/ topics/ cannabis-canada/pdf/ey-the-impact-oftaxation- and-regulation-on-canadas-cannabisindustry.pdf 3. Government of Canada. Data on cannabis for medical purposes. Published 2021. https://www. canada.ca/en/health-canada/services/drugs- medication/cannabis/research-data/medical- purpose.html 4. Arthritis Society Position Paper on Medical Cannabis.; 2018.
SOCIAL MEDIA MANAGEMENT FOR CANNABIS BRANDS
By Colin Bambury
Social media has become the primary marketing tool for a wide range of brands in a variety of industries. The cannabis industry is no exception. Although social media platforms, particularly Meta’s Facebook and Instagram, can be hard to deal with for cannabis brands, the benefits of having a social media presence surely outweigh the potential challenges. This article will explore the reasons that social media is important for cannabis companies and will seek to outline best practices for management and content creation.
WHY IS SOCIAL MEDIA IMPORTANT FOR CANNABIS BRANDS?
Social Media is an important method for cannabis marketers to communicate to current and future consumers and retail partners. Millennials and Gen Z use social media as search engines. Many will search your brand name up on Instagram, Twitter, or TikTok to check out your page and learn more about your company – similar to the way that many would “Google” something.
Having a presence on social media solidifies you as a legitimate brand and allows your consumers to reach out to you for customer service-related questions, complaints, and comments. Past that, social media content creation and community engagement allow brands to foster deep and meaningful connections with consumers in a digital environment that they choose to participate in.
WHICH SOCIAL MEDIA PLATFORMS SHOULD I USE AS A CANNABIS BRAND? Depending on your brand values and organizational goals, there are several different social media platforms that cannabis marketers can utilize.
Instagram is still the platform that has arguably the most attention and hype surrounding it. It is primarily an image-based platform so lifestyle photography and well-produced graphics and motion graphics perform well. Instagram is a great customer service platform and allows you to engage with new potential customers via hashtags and discovery tools.
Facebook’s popularity has decreased slightly in recent years but brand pages are still a relevant way to connect with your consumers. Facebook has a large demographic of users in their 30s and 40s, making the average age slightly older than other platforms. An older demographic could
HOW DO I AVOID GETTING MY SOCIAL MEDIA
POSTS AND ACCOUNTS DELETED AS A CANNABIS BRAND?
Although it can be incredibly useful, social media is also a massive pain point for many cannabis industry professionals. Facebook/Instagram’s official content policies around “drugs and drug-related products” are: 1. Ads must not promote the sale or use of illegal, prescription, or recreational drugs (Ex. drug-related paraphernalia, such as bongs, rolling papers and vaporizer devices) 2. Avoid using images of smoking-related accessories (such as bongs and rolling papers) 3. Avoid using images that imply the use of a recreational drug 4. Avoid using images of either recreational or medical marijuana
These rules aren’t necessarily encouraging for marketers looking to increase sales of their cannabis products. However, there are some creative workarounds and compliant content that can still be published to help brands connect with consumers.
For Instagram and Facebook, the most important rule to remember is that you can never make it seem like you are selling a product or promoting a sale. Terms like “now available,” “for sale,” “discount,” and “for purchase” will get your account flagged, regardless of if you’re posting cannabis-related content. The reasoning for this is that Instagram doesn’t want its platform being used for the promotion of sales unless it is getting a cut. It wants users to utilize their in-app shopping feature for all purchases and is quick to remove posts that imply that the purchase of something is available somewhere else.
On Instagram and Facebook, do not use blatant language to refer to the plant or its product formats. Do not use the words “cannabis,” “THC,” “CBD,” “marijuana,” “hemp,” “cannabinoids,” “concentrates,” “blunts,” etc. These words are flagged by the platform and will instantly remove your posts. This will also result in your account receiving a warning that it may be deleted or temporarily disabled in the future.
Do not feature images of cannabis plants or concentrates if possible. Do not feature images of your government-mandated packaging as many believe that the THC “stop sign” symbol is automatically flagged by Instagram’s AI.
So what should you do? Create lifestyle content using clothing and accessories. If you are going to show products or packaging, show beauty packaging that does not feature the government-mandated THC symbol. Show product (bud) sparingly and try not to have it as the main focus of the picture. Use creative static and dynamic motion graphics to advertise new SKUs. Post educational-focused content, not sales-focused. Create interviews and content around people (to the degree that is allowed within the Health Canada regulations), not just products. Build stories through imagery, graphics, and photography. Images of individuals smoking and holding pre-rolled cannabis seem to avoid being flagged for the most part.
mean a more educated audience with more income (but potentially less disposable income). Create a Facebook brand page that your consumers can “like” to stay up-to-date with your brand’s latest announcements and content.
Twitter is surprisingly a very cannabis-friendly platform. Twitter is also an excellent customer service tool, as many happy and disgruntled customers will share their thoughts on the platform. Responding to feedback is a great way to show your brand cares and is engaged with the community. Twitter also allows brands to start and engage in relevant conversations around the products they sell and the services they offer, allowing companies to establish thought leadership through the platform.
LinkedIn is known as more of a B2B, business-focused platform. In recent years, it has moved past just job seekers and job updates to a robust content platform with video, text, image, and blog content. LinkedIn is a great way to reach individuals within the industry (retail partners, budtenders, cultivation partners, etc) and to target higher-wealth, older cannabis consumers.
Snapchat
Although aimed at a younger audience and although the platform’s popularity has waned in recent years, Snapchat allows for cannabis content and even paid advertising. Cannabis companies can target 19+ individuals on the platform and feed them advertisements between their friend’s posts. Snapchat also prioritizes short video content.
TikTok
TikTok is quickly replacing Instagram as the “it” and “cool” platform, especially among the younger generation. TikTok has aged up over the years, now having the vast majority of its user base over the legal age of cannabis consumption in Canada. TikTok is a unique and hard platform to create content for – prioritizing short, flashy, fun, and interesting video content (usually with a musical or theatrical soundtrack in the background).
We suggest monitoring relevant Reddit forums such as /TheOCS and other cannabis reviewing pages. Posting on Reddit requires authenticity. Only post on Reddit if you are posting transparent information about growing methods, lineage, etc, or if you are operating through a personal account.
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Auxly Cannabis Group Inc. introduced a new extension to its Foray brand: Edi’s. While keeping true to Foray’s pedigree of approachability and accessibility, Edi’s is bringing the fun back into snacking with a bold and honest attitude that will speak to consumers looking to enjoy an edible snack while controlling their cannabis experience. Launching this new brand extension into the market is Edi’s Gumdrops, a delightfully chewy, premium gummy that is bursting with familiar flavours of lemon, lime, cherry and orange. With 20 snackable pieces per pack, these low-dosed edibles offer 0.5mg of THC per bite - the first of its kind in Canada - allows consumers to enjoy the snacks they love without concern of overindulging in potent THC cannabis products. Other flavours include two additional familiar Foray consumer favourites, CBD Blood Orange and CBN Blackberry Lavender.
Edi’s Gumdrops by Foray The Original Fraser Valley Weed Co.
The Original Fraser Valley Weed Co.’s initial offering includes ounce packs of popular, potent, BC-grown dried flower strains: D. Burger and MAC 1. D. Burger (Potency: 21-27% THC): Like a backyard BBQ with some extra gas for good measure. D. Burger is deliciously savoury, pungent and gassy — think grilled cheese and dark garlic in a bulk bag. This high-THC indica is a cross of GMO Cookies and Han Solo Burger. An ounce of dense green buds and tufts of orange hairs, our D. Burger’s unmistakable bud is greenhouse grown in BC’s best growing region, the Fraser Valley. MAC 1 (Potency: 18-24% THC): This smooth hybrid is a cross between iconic strains, Alien Cookies F2 and Miracle 15. Bulk ounce bags with round buds covered in frosty trichomes and sugar leaves, MAC 1 is an upbeat and balanced flower with citrussy, earthy, and lightly gassy notes. Each ounce bag is filled with quality bud, greenhouse grown in BC’s best growing region, the Fraser Valley.
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Zyre Full-Spectrum Cured Resin Vapes
B.C. consumers can choose from two vibes, each in one-gram cartridges containing 78-85% THC and minor cannabinoids that can include CBG, CBN, THCA, and THCV. At launch, the two vibes from their 1.0 series will include:
LAUNCH 1.0 - Pineapple Punch: Take your adventure to new highs and launch into your favourite activity. This product complements upbeat vibes and social occasions.
RECLINE 1.0 - Blueberry Pie: Kick back at the end of a busy day with a freshly baked blueberry pie flavoured cartridge. This product is a perfect match with a low-key, dreamy, and chill summer evening.
SPOTLIGHT 1.0 - Wild Strawberry:
Cut through the fog and shine a light on what’s truly important with this wild strawberry-flavoured cartridge, perfectly paired with a focused or creative vibe.
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THC KISS Mango Shot
THC Kiss Mango Shot is a full-spectrum 30ml juice-based cannabis beverage with 10mg of THC. It has a refreshingly sweet mango flavour like summertime in a bottle, available all year long! This innovative pocket-size drink is an enjoyable alternative to smoking cannabis with a fast-acting onset time of as low as 10 minutes. It is gluten-free and made without inessential water and sugar in a nut-free facility. It ranks among Ontario’s best-selling beverages because it contains just as much THC as higher-priced edibles and has no bitter or chemical-like aftertaste! Please visit https://www. thckiss.buzz/ for more information.
Did You Know that...
...Cannabis Prospect Magazine now mails to 2000 cannabis retailers!
Beginning in 2022 Cannabis Prospect Magazine will be mailed to over 2000 cannabis retailers across Canada in hard-copy format as well as offered for free digitally on our website.
www.cannabisproonline.com
