บทถอดความฉบับเต็มของ #154 - Rescheduling, Global Politics, & Executive Action w/ Jason Adelstone of Harris Sliwoski

before a repeal vote, which has been widely covered. 00:05:23.680 --> 00:05:33.360 People know that there is a ballot initiative right now in front of voters to end adult use cannabis um in Massachusetts. 00:05:33.600 --> 00:05:35.759 Um, and while that's happening, yeah. 00:05:36.000 --> 00:05:36.319 Boo. 00:05:36.879 --> 00:05:37.360 Boo Sam. 00:05:37.920 --> 00:05:41.120 Like they're just out there straight lying. 00:05:41.199 --> 00:05:51.759 They've been talking about how uh teen consumption has increased over the last years, where there's even a federal government study that has shown that just not to be true. 00:05:52.000 --> 00:05:56.079 So apparently you can just go out and lie to people to get them to vote. 00:05:56.399 --> 00:05:57.199 Say whatever you want. 00:05:57.279 --> 00:05:59.040 The liars, they'd be lying. 00:05:59.279 --> 00:06:22.639 Um but yeah, so the cannabis control commission just laid out like a huge sweeping regulatory package that would change an enormous amount of um kind of systems and structures uh that include things like standalone medical dispensary license, new testing framework, being able to sell seeds, um, and possibly creating new license caps. 00:06:22.720 --> 00:06:25.439 Uh, but what's interesting is is the timing of it all. 00:06:25.519 --> 00:06:35.519 Um in the face of the repeal vote, uh, the this new regulatory package won't get um voted on internally until December. 00:06:35.680 --> 00:06:42.160 So it is a month after the voters will ultimately decide on question eight the repeal measure. 00:06:42.319 --> 00:06:57.519 Uh but to me, it seems like a signal that the regulators are pretty confident that the repeal is not going to move forward since they are seemingly business as usual and trying to do the work of regulators. 00:06:58.319 --> 00:06:58.639 Yeah. 00:06:59.600 --> 00:07:04.079 So do we think these regulations will improve the Massachusetts market? 00:07:05.519 --> 00:07:13.199 You know, I haven't done a deep dive of what's been proposed, but I think that that is what is being said. 00:07:13.600 --> 00:07:18.079 That is the narrative around them, in particular in relation to the license caps. 00:07:18.160 --> 00:07:24.079 Um, Massachusetts has a really high concentration of dispensaries as a proportion of their population. 00:07:24.639 --> 00:07:30.639 And um, there are a lot, a lot of businesses um that exist there. 00:07:30.959 --> 00:07:42.160 And probably creating some amount of license cap or not issuing new licenses is considered a way to create more success for the existing companies. 00:07:42.319 --> 00:07:44.000 But um, yeah, more on that. 00:07:44.160 --> 00:07:47.040 If it moves forward, I I promise to come back with an opinion. 00:07:47.680 --> 00:07:52.160 You know, some businesses operate off of supply and demand, just throwing it out. 00:07:52.480 --> 00:07:55.439 As opposed to regulatory capture, I don't know. 00:07:57.279 --> 00:07:58.000 So all right. 00:07:58.560 --> 00:08:01.120 It should be a decision when you're starting a business. 00:08:01.439 --> 00:08:18.639 Um the state would I which I would argue maybe has the deepest regulatory capture, Florida, um, has finally issued 22 more vertically integrated MMTC licenses, which are are Florida's medical marijuana um licenses. 00:08:18.959 --> 00:08:35.759 And the the issue the licenses were issued on September 11, 11th, um after many years of delays um due to administrative legal kind of friction in the process. 00:08:36.080 --> 00:08:53.759 And um ultimately the licenses were issued to the original people that were supposed to get them from November 2024, even though um it was considered that the applications need to be re-scored and that there was corruption in the scoring process. 00:08:53.919 --> 00:09:12.639 Uh, but these 22 businesses applicants now have the licenses and they have 10 days to place a$5 million bond with the state that shows that they are serious, and then they've got 180 days to get cultivation authorization. 00:09:12.720 --> 00:09:19.600 And this is a big deal because Florida is so intensely vertically integrated, it's forced vertical integration. 00:09:19.759 --> 00:09:27.279 So every retailer can only sell product that they cultivate, manufacture, and distribute directly to themselves. 00:09:27.440 --> 00:09:29.919 There is no commerce between licensees. 00:09:30.240 --> 00:09:44.559 So it creates a situation where there needs to be enough retail owned by a licensee that makes it financially viable for them to build cultivation and manufacturing infrastructure. 00:09:44.720 --> 00:09:49.919 So scale is sort of a prerequisite for coming to play in Florida. 00:09:50.240 --> 00:10:06.080 And that just kind of begs the question of is there really enough opportunity left in Florida that these 22 new licensees are going to take the risk to make the massive investment that it takes to really compete in the state? 00:10:06.240 --> 00:10:21.519 And and I would, I would be um, I would, I think I will I would be very careful of going into a state that has TrueLeave and CuraLeaf and and Cresco and others with such strong, big existing footprints already. 00:10:21.840 --> 00:10:26.559 Yeah, because all those companies have like upwards of like what 75. 00:10:26.720 --> 00:10:30.799 Doesn't TrueLeave have like 120 uh license stores? 00:10:31.120 --> 00:10:31.840 Yeah, exactly. 00:10:32.000 --> 00:10:39.279 That TrueLeave has well over a hundred stores, a lot of other players have over 50 or 75 stores. 00:10:39.600 --> 00:10:42.080 Yeah, so they they get the benefit of the economies of scale. 00:10:42.159 --> 00:10:45.519 And like, how are you even going to compete with that when it comes to pricing? 00:10:45.600 --> 00:10:53.919 I I I guess I guess the strategy is doing craft cannabis and and creating the anti-brand to to these large chains. 00:10:54.240 --> 00:10:56.320 Uh I don't know if that's the strategy. 00:10:56.480 --> 00:11:06.399 I think

that in the end, you still have to reach some level of scale to pay for the cost of building these cultivation manufacturing assets, which are extraordinarily expensive to build. 00:11:06.480 --> 00:11:16.960 And so you're likely gonna have to have at least 10 stores just to be able to sell enough product to pay for and support the the cultivation infrastructure. 00:11:17.120 --> 00:11:20.320 And the challenge in Florida is kind of right sizing everything. 00:11:20.480 --> 00:11:31.120 It it's about growing enough to support the stores, but not too much that you have that you have, you know, aging product that that isn't high quality. 00:11:31.279 --> 00:11:36.559 And then if you want to open more stores, you need to be expanding your production at the same time. 00:11:36.799 --> 00:11:42.639 And it just takes it takes a lot to manage a healthy business in Florida. 00:11:42.720 --> 00:11:49.360 And there's a lot of folks that are so deeply entrenched that I'm gonna be watching who decides to actually make this investment. 00:11:49.519 --> 00:11:54.799 I will heavily doubt that these 22 licenses are all gonna commercialize. 00:11:54.960 --> 00:12:01.600 There will be five or so, is my prediction, that decide to take the leap and and make an investment in the state. 00:12:02.480 --> 00:12:02.720 Yeah. 00:12:02.960 --> 00:12:08.799 Wow, it's a it's it's 22 is such a small number compared to the total number of dispensaries in Florida. 00:12:09.039 --> 00:12:19.679 And in thinking about that compared to other states, like I mean, you have that many dispensaries churn in a year, probably, at least here in California. 00:12:20.240 --> 00:12:21.120 For sure. 00:12:21.440 --> 00:12:24.559 Um, well, so let's um let's bring Jason on. 00:12:24.639 --> 00:12:27.440 Um, our guest today is Jason Attlestone. 00:12:27.519 --> 00:12:35.600 He's an attorney at Harris Witkowski, uh tackling cannabis policy at the intersection of federal and international law. 00:12:35.840 --> 00:12:44.559 His practice spans corporate formation, market entry, regulatory compliance, um, and works with operators navigating U.S. 00:12:44.639 --> 00:12:46.720 rescheduling in cross-border markets. 00:12:46.960 --> 00:13:01.279 Jason is also the co-founder of Project for 2029, an organization built around the premise that reform is likely to arrive through executive action rather than lobbying, which is really interesting. 00:13:01.440 --> 00:13:06.879 Um, he's been one of the most consistent trackers of the Schedule III litigation since it began. 00:13:07.120 --> 00:13:19.759 And he wrote a really interesting blog about um global right-wing politics that caused me to reach out and say, Jason, let's have a conversation on the podcast. 00:13:19.919 --> 00:13:20.799 So that's why he's here. 00:13:20.960 --> 00:13:22.000 Super excited to have him. 00:13:22.159 --> 00:13:23.679 Jason, welcome. 00:13:24.720 --> 00:13:26.080 Hey, yeah, thank you so much. 00:13:26.240 --> 00:13:28.399 Uh, Ben Anore, thank you for having me. 00:13:28.480 --> 00:13:30.399 And uh I'll just say it's Slawaski. 00:13:30.799 --> 00:13:33.440 It does not roll off the tongue super easy. 00:13:33.679 --> 00:13:36.320 Um, but I've had a lot of practice. 00:13:36.799 --> 00:13:37.840 Slawasky. 00:13:38.399 --> 00:13:38.879 Yeah. 00:13:39.120 --> 00:13:40.879 Names are a hard one, man. 00:13:41.039 --> 00:13:42.080 They really are. 00:13:42.399 --> 00:13:42.639 Yeah. 00:13:42.960 --> 00:13:47.919 Well, we kind of mentioned we got to hang out with you in person last week, which was great. 00:13:48.080 --> 00:13:52.639 Uh, you've you've got great style and and great intellect. 00:13:52.799 --> 00:13:59.120 So I I respect when those both things both show up at the table together, especially with for lawyers. 00:13:59.279 --> 00:13:59.600 Yeah. 00:14:00.000 --> 00:14:00.799 Thank you so much. 00:14:00.960 --> 00:14:04.320 That is probably the best way I could start uh this podcast. 00:14:04.480 --> 00:14:06.559 I can't think of a better to start it. 00:14:06.639 --> 00:14:07.440 So I appreciate that. 00:14:07.519 --> 00:14:13.440 Yeah, it was so great to meet you both in person um and actually get to sit down and have a conversation. 00:14:13.600 --> 00:14:23.759 Um, it seems like while we're well past COVID, like there's still that just how many people you talk to that uh that you've known for years and then you finally get to meet. 00:14:23.840 --> 00:14:29.840 So it was great to kind of have just met you both uh in person and really kind of through email. 00:14:30.240 --> 00:14:31.440 Yeah, absolutely. 00:14:31.840 --> 00:14:49.279 Jason, it's uh I I think it do you justice to kind of just describe your background and how this journey has gone just really quickly, because um you kind of have grown up with the who's who of of cannabis attorneys in in the space. 00:14:49.519 --> 00:14:56.080 And um yeah, give the audience just kind of your lens through through the journey that you've gone through in cannabis. 00:14:56.399 --> 00:14:59.120 Yeah, so my journey started about 10 years ago. 00:14:59.200 --> 00:15:00.879 Um, law is my second career. 00:15:00.960 --> 00:15:02.240 I went to law school late in life. 00:15:02.320 --> 00:15:06.080 I was 34 when I went to law school and was in restaurants for 20 years before that. 00:15:06.240 --> 00:15:13.279 But when I went to law school, I knew I wanted to go specifically into cannabis, also restaurants, but at the time was mainly focused on cannabis. 00:15:13.440 --> 00:15:15.360 So I was incredibly fortunate. 00:15:15.440 --> 00:15:20.879 Um, before I decided to go to law school, I applied to be uh a dispensary manager at Ian Sieb. 00:15:20.960 --> 00:15:23.759 He's uh the the governor of Colorado's cannabis guy. 00:15:23.840 --> 00:15:26.159 He owned a dispensary before uh that position. 00:15:26.320 --> 00:15:28.399 I applied to He was also at the event. 00:15:28.720 --> 00:15:29.519 He was, he was. 00:15:29.759 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00:15:31.440 Um, love Ian, great guy. 00:15:31.600 --> 00:15:36.639 Uh thankfully he did not hire me, um, which ended up leading me to law school. 00:15:36.799 --> 00:15:39.840 But when I went there, I asked him, I was like, who should I work for? 00:15:40.000 --> 00:15:42.080 Um, because I knew I was coming back to Colorado. 00:15:42.159 --> 00:15:45.120 I went to law school in Syracuse, so I knew I was gonna come back here. 00:15:45.279 --> 00:15:47.600 And he said, you you Vicente Cedarberg. 00:15:47.759 --> 00:15:49.679 Like at the time it was Vicente Cedarberg. 00:15:49.840 --> 00:15:53.440 He introduced me to Jordan Wellington, had my interview and got the job there. 00:15:53.519 --> 00:16:02.879 And so I started my career working uh for Christian, Brian, uh Charlie Sean, um, and then a whole bunch of others who were a part of it. 00:16:02.960 --> 00:16:06.559 But those were kind of the main four uh partners when I was there. 00:16:06.720 --> 00:16:20.480 Um, and and then I for part of that time I got to work directly in a in a practice group where it was Christian Cederberg as the partner, Shane Pennington as the senior, and I was the junior, which was one of the best experiences I've ever had. 00:16:20.639 --> 00:16:22.159 And I mean, continues. 00:16:22.399 --> 00:16:25.039 Uh Shane and Christian are both mentors to me. 00:16:25.200 --> 00:16:33.840 I'm lucky that Christian, uh, when it became Vicente, um, and a few years after that, Christian joined me over here at uh Harris Lewowski. 00:16:34.159 --> 00:16:36.720 Um so I get to work with him directly a lot more. 00:16:36.799 --> 00:16:41.200 And uh Shane, though, I'm I'm in constant in touch with him all the time. 00:16:41.360 --> 00:16:44.799 I mean, he is by far one of the best mentors I've had. 00:16:44.879 --> 00:16:45.840 The guy's a genius. 00:16:46.000 --> 00:16:49.840 So I couldn't have asked for two better mentors to have than them. 00:16:50.080 --> 00:16:58.480 Um and yeah, and now I'm I'm over at Harris Lewowski where Vince Lewaski's been doing this for uh pretty much since the beginning of Oregon as well. 00:16:58.639 --> 00:17:11.359 And so I've just been extremely lucky to be surrounded by so many people who kind of led the way and have really kind of pushed policy forward and have helped me really advance my education in a way now. 00:17:11.440 --> 00:17:14.160 I'm trying to stand out on the international side with them. 00:17:14.400 --> 00:17:16.960 So uh yeah, it's it's just been really great. 00:17:17.279 --> 00:17:22.880 Well, and so it's no wonder why when you put out a thought piece, smart people like Anna Ray listen. 00:17:24.079 --> 00:17:27.440 I'm I'm lucky that that smart people like Anna Ray listen. 00:17:27.680 --> 00:17:29.200 Wow, thanks, guys. 00:17:29.759 --> 00:17:31.839 Well, so let's talk about that. 00:17:32.000 --> 00:17:36.799 I mean, I think you you just talked about some of these guys that have been mentors to you that are total legends. 00:17:36.960 --> 00:17:41.920 Um, but I think that you are sharing some really cool and exciting and interesting new perspectives. 00:17:42.079 --> 00:17:57.519 And you just wrote this piece about how so often people that are following international cannabis are tracking policy, but it's actually the politics that are driving as a leading indicator what we could be predicting about some of these governments. 00:17:57.680 --> 00:18:16.960 And and you highlighted how there is a movement towards right-leaning governments that have taken hold across a number of countries, like Germany and much of Latin America, and that it's kind of a reversal of some of the center left that drove some of the reform that we saw over the past decade. 00:18:17.200 --> 00:18:29.839 And um, I'd love for you to to give our audience a peek into what you shared in that article, and then we'll dive into the details of what this means ultimately for cannabis globally. 00:18:30.400 --> 00:18:31.519 Yeah, absolutely. 00:18:31.680 --> 00:18:45.920 Um, and I think that was a great way to phrase it just very succinctly, is that so many people do advise on policies, cannabis policy in particular, but they ignore the politics of each country that those policies are operating within. 00:18:46.160 --> 00:18:58.720 And as we've seen, especially in the US, um if laws are more difficult to change, but when policies are built on regulations and decrees, those can be kind of brought back. 00:18:58.799 --> 00:19:02.160 There can be changes that a lot of people don't really pay attention to. 00:19:02.319 --> 00:19:16.640 And I think that is one of the most important things that especially operators that are either currently operating in foreign foreign jurisdictions or especially now with rescheduling, those that are looking at operating in foreign jurisdictions, they really need to pay attention to. 00:19:16.960 --> 00:19:24.240 Because, for example, we have elections coming up in Brazil in about two weeks, and everyone is super excited about Brazil. 00:19:24.400 --> 00:19:30.559 I I mean, that is the one country that every single person asks me about is like what's going to happen in Brazil. 00:19:30.720 --> 00:19:35.039 And that's because the current president, president, he's called President Lula fondly. 00:19:35.119 --> 00:19:46.160 It's a nickname based on his last name, but he advanced cannabis policy allowing domestic cultivation, manufacturing, and just kind of is working on advancing the domestic market. 00:19:46.319 --> 00:19:53.359 There's a lot of uh people saying he's not doing enough, but the prior president, Bolsonaro, just prohibited it. 00:19:53.440 --> 00:19:55.039 He just wouldn't allow it to happen. 00:19:55.200 --> 00:20:11.200 So Brazil is moving forward, so they're they're gonna have a domestic market, at least as it currently stands, a domestic market as well as their robust import market that patients are allowed to access, uh, where you get an approval from Ant

Visa, the regulatory agency, and you can get imports. 00:20:11.440 --> 00:20:18.880 The problem is we're seeing a huge right shift in South and Central and South America, especially. 00:20:19.039 --> 00:20:26.799 We just saw it in Colombia, um, where the the left-leaning president got ousted by a very right conservative uh president. 00:20:27.519 --> 00:20:31.759 And the concern is that the same thing could happen in Brazil. 00:20:32.079 --> 00:20:38.480 And a lot of South American countries, Brazil being one of them, you need to have at least 50% of the vote to win. 00:20:38.640 --> 00:20:41.839 And so if you don't get that, then you go to a runoff. 00:20:42.079 --> 00:20:49.200 And runoffs do not favor the incumbent because it shows that more than 50% of the population wanted change. 00:20:49.359 --> 00:20:57.839 And so when you go into a runoff, the challenger does tend to have the benefit in that next election. 00:20:58.079 --> 00:21:05.920 In this case, the challenger is the prior president Bolsonaro's son, Flavio Bolsonaro, who it's actually interesting. 00:21:06.000 --> 00:21:20.240 Since my article came out, um, some things have changed a little bit, but we expect him to have a similar policy to his father, where he's not going to be super psyched on expanding medical, definitely not adult use is even in the conversation. 00:21:20.480 --> 00:21:32.160 Um, but an article came out last week where he actually is he he named his health minister, or who would be his health minister, who is actually entrenched in the cannabis industry. 00:21:32.400 --> 00:21:34.720 And this is a good news, bad news thing. 00:21:34.880 --> 00:21:43.920 It's good news that there's someone who actually understands cannabis policy, but the bad news is he's a pharmaceutical focused uh cannabis operator. 00:21:44.079 --> 00:21:58.559 So you're looking at like SatovX, Abidialx type of program that he's gonna want to implement that does not really coincide with the current program in Brazil, which allows oils, tinctures, uh flour, things like that. 00:22:01.200 --> 00:22:03.839 I I was just I was just looking it up. 00:22:03.920 --> 00:22:06.720 I I didn't realize Brazil was as large as it was. 00:22:06.799 --> 00:22:08.079 And I don't think a lot of people do. 00:22:08.240 --> 00:22:13.519 Everyone's so focused on unlocking Germany and the 80 to 90 million people there. 00:22:13.759 --> 00:22:17.680 But Brazil is 214 million people. 00:22:17.839 --> 00:22:19.680 Like that's a massive market. 00:22:20.240 --> 00:22:22.720 Would probably be the largest market, yeah. 00:22:23.200 --> 00:22:36.319 Yeah, I'm I'm curious as to how many people from your perspective have been watching this and and banking on Brazil unlocking, or has it largely kind of gone under the radar? 00:22:37.119 --> 00:22:38.799 I would say it's a little bit of both. 00:22:38.960 --> 00:22:51.279 It's interesting because Brazil right now, um, I know of people exporting out of the US to Brazil through in visa authorizations, Delta 8, Delta 9, and hemp derived Delta 8 and Delta 9 into the medical program. 00:22:51.680 --> 00:23:00.720 Um, I don't advise on Brazil law, so I can't say if the sourcing matters on that end uh legally wise, but it is allowed to get into the system. 00:23:00.799 --> 00:23:03.200 They do have import authority to do that. 00:23:03.279 --> 00:23:13.440 And so there is a lot of opportunity already occurring in Brazil, which has led a lot of marijuana operators to be very gung-ho about Brazil and very excited about it. 00:23:13.680 --> 00:23:25.279 The one thing that has surprised me about Brazil, and it may be because of the stigma you see with a lot of uh Central South American countries where a lot of people are hesitant to go there because just there's a stigma about it. 00:23:25.440 --> 00:23:32.960 Um they have been more hesitant to actually make the advances and start to invest in being able to get to Brazil. 00:23:33.200 --> 00:23:45.680 So I do think there is a lot of excitement, but any, I mean, anytime I advise anyone, I bring up this political question mark that that will hopefully get answered next month, or we we will get answered next month. 00:23:45.759 --> 00:24:01.680 Um, and after that, if especially if Lula wins again, I think you'll possibly see far more investment going into Brazil because they have actually started to work on the cultivation and the manufacturing uh regulations, processes that will then allow more certainty moving forward. 00:24:01.920 --> 00:24:04.559 So um, yeah, there's a ton of excitement. 00:24:04.720 --> 00:24:08.400 So I expect after October, we'll probably start to actually see some more investment. 00:24:08.559 --> 00:24:11.920 But also US investment is just going to depend on rescheduling. 00:24:12.079 --> 00:24:14.640 Um, but you'll see a lot of, I'm sure, Canadian. 00:24:15.359 --> 00:24:31.519 It's it's really wild to hear that there's hemp derived Delta VII being exported into a medical program in Brazil, and to think of how that is impacted by the current hemp conversation happening this year. 00:24:31.759 --> 00:25:00.880 Um, I don't I I didn't intend to dive down that that rabbit hole like on this conversation, but um yeah, that that seems like a a a glaring kind of conflict with like what's I mean I think I think the conflict can be sums up pretty well in that the US is incredibly unique and that we've for some reason decided to bifurcate hemp and cannabis, even with with not it's not intoxication versus non-intoxication or industrial and everything else. 00:25:00.960 --> 00:25:05.759 It's just like intoxicating hemp, intoxicating marijuana, and then you have uh industrial. 00:25:05.920 --> 00:25:08.160 We're really the only country that does that. 00:25:08.319 --> 00:25:17.839 And so my guess is that at least on the Brazil side, the legal justification is that it's cannabis, which is what the world kind of just bases it on. 00:25:18.000 --> 00:25:24.880 I mean, the

treaties use the term cannabis, they don't use marijuana and hemp, and most of the countries do as well. 00:25:25.039 --> 00:25:30.799 And so I assume it's just they're seeing cannabis at these levels and they're like, yeah, that aligns. 00:25:31.200 --> 00:25:36.160 Um, and it's not necessarily like the source, I don't think is really cared about there. 00:25:36.240 --> 00:25:47.039 Um, because it's not really cared about anywhere else, because you really can't export intoxicating anything um into most countries, even if it's sourced by uh source from hemp. 00:25:47.279 --> 00:25:52.240 Um most countries just won't allow it because it'll have to fall into their medical marijuana framework. 00:25:52.319 --> 00:26:04.400 And most other countries have a higher barrier, like EU GMP, no hemp operator here, as far as I know, would satisfy those requirements to get into the EU medical market with a hemp product. 00:26:05.839 --> 00:26:07.680 Well, there's a lot to untangle there. 00:26:08.000 --> 00:26:11.039 Um I'm like wondering how far I should take it. 00:26:11.759 --> 00:26:34.960 Um but you know, I I think it's this this whole premise about right-leaning politics creating obstacles for cannabis policy feels like, in some ways, like an old narrative that the progressives want cannabis policy reform or opening up access, and that the conservative people are prohibitionists. 00:26:35.200 --> 00:26:47.279 And and I if there's one thing that I will say about the Trump administration, over the past two years, we're actually seeing more action for policy change in the US than we have seen in a very long time. 00:26:47.440 --> 00:26:48.400 Things are happening. 00:26:48.559 --> 00:26:58.559 And so I think that we no longer can make the assumption that that right-leaning political ideology means that you don't support cannabis. 00:26:58.720 --> 00:27:02.720 This starts to be almost like a bipartisan issue in some ways. 00:27:02.799 --> 00:27:05.680 And you see detractors on both sides as well. 00:27:05.920 --> 00:27:11.119 And I'd I'd like for you to kind of help us understand that from the global perspective. 00:27:11.359 --> 00:27:19.279 You talked about Brazil, but maybe choose another one of the countries that that you're looking at and help us help us understand how this is playing out. 00:27:19.599 --> 00:27:20.240 Yeah, absolutely. 00:27:20.559 --> 00:27:28.160 I think another way to look at that as well is that left-leaning uh governments are also maybe not the best for cannabis policy either. 00:27:28.400 --> 00:27:35.920 I mean, in Colombia, Petro, the former president, came into office, and I believe there was only one vote left uh in their Congress. 00:27:36.000 --> 00:27:38.960 I think they had to do it's either seven or eight votes in the Colombian Congress. 00:27:39.119 --> 00:27:43.359 We have to read the legislation, and then we could have gotten full adult use legalization. 00:27:43.599 --> 00:27:45.759 On the final reading, it failed. 00:27:45.920 --> 00:27:49.920 And my sources were telling me that the reason why it did is because Petro wanted his own bill. 00:27:50.000 --> 00:27:54.160 He didn't want to come in on someone else's bill and have that be the one that passed. 00:27:54.319 --> 00:28:00.160 And so he the left-leaning governments tend to have the perfect be the enemy of the good. 00:28:00.400 --> 00:28:03.599 And that failed, and we're definitely not going to get it now. 00:28:03.680 --> 00:28:05.039 They just started that all over again. 00:28:05.119 --> 00:28:07.599 It has to go through two legislative sessions. 00:28:07.680 --> 00:28:09.839 And I mean, it takes a really long time. 00:28:10.079 --> 00:28:16.400 So that was a huge problem um in Colombia was the left-leaning government had nothing to do with the right. 00:28:16.559 --> 00:28:20.240 Um, because we should have full legalization in Colombia right now. 00:28:20.480 --> 00:28:27.920 Um, and also you see that, I mean, to go to the right-leaning governments that aren't necessarily bad for cannabis policy either. 00:28:28.079 --> 00:28:30.000 Um, you have the Netherlands. 00:28:30.319 --> 00:28:32.799 They were uh pretty far right. 00:28:32.880 --> 00:28:36.880 They had, I think the guy was called like uh Mini Trump or something. 00:28:36.960 --> 00:28:40.160 I forget, I forget his name, but he would dress up like Donald Trump. 00:28:40.240 --> 00:28:42.559 He was really tall, kind of tried to look like him. 00:28:42.720 --> 00:28:48.319 Um, they didn't cancel the pilot programs or stop the pilot programs from occurring in the Netherlands. 00:28:48.400 --> 00:28:50.319 They let that continue to move forward. 00:28:50.480 --> 00:28:53.119 Um, they have now, there was a snap election about a year ago. 00:28:53.200 --> 00:28:54.720 They've moved a little more center. 00:28:54.799 --> 00:28:57.519 So still, we think those pilot programs are going to go forward. 00:28:57.759 --> 00:28:59.440 Switzerland went a bit right. 00:28:59.599 --> 00:29:05.680 Those pilot programs are moving forward and expanding, and there's even talk about full legalization in Switzerland. 00:29:05.839 --> 00:29:10.079 So I think that's a perfect example of the right not necessarily being um. 00:29:11.359 --> 00:29:12.079 Double-click on that. 00:29:12.160 --> 00:29:18.160 So then do you see a difference between the governments that are more right-leaning and the type of programs? 00:29:18.319 --> 00:29:32.000 Like, is it more pro-business when it's a right government and more social equity focused when it's a left-leaning government, sort of the way that we've seen the debate in the US, or does it is it playing out differently in these in these other countries? 00:29:32.319 --> 00:29:40.400 I mean, when you talk about social equity, you're really just talking about, I think, the US and then Canada also has that with the Native American tribes there. 00:29:40.640 --> 00:29:43.680 Um, but it's it's interesting. 00:29:44.079 -->

00:29:49.920 Switzerland, for example, they're very science-based and they're very evidence-based, either the right or the left. 00:29:50.160 --> 00:29:58.400 And so the right is seeing the evidence coming out of these scientific pilot programs, and it's showing just pretty much unanimous success. 00:29:58.480 --> 00:30:00.559 There's very little problems that are occurring. 00:30:00.640 --> 00:30:03.599 Like all the data that's coming out, it's reducing the black market. 00:30:03.839 --> 00:30:09.519 There's no uh young uh kids aren't getting greater access to it. 00:30:09.680 --> 00:30:13.039 Um, it's it's helping with the quality of product. 00:30:13.200 --> 00:30:17.200 Um, and so they're they're basing a lot of it on just the science and data. 00:30:17.279 --> 00:30:21.119 And that's really a lot of how a lot of your novel concept. 00:30:21.839 --> 00:30:22.640 I know, right? 00:30:22.799 --> 00:30:23.039 I know. 00:30:24.160 --> 00:30:25.200 I'm moving to Switzerland. 00:30:25.279 --> 00:30:26.240 Screw this. 00:30:26.720 --> 00:30:27.839 I wish, I wish. 00:30:28.000 --> 00:30:30.079 Switzerland's an amazing country. 00:30:30.240 --> 00:30:33.920 Um, but yeah, so I mean, there's a lot of that. 00:30:34.160 --> 00:30:45.680 What I think is also really unique or not unique, or I guess it's unique in the US, is that we're having this medical conversation now, and there's still this the right is still largely against medical. 00:30:45.759 --> 00:30:55.359 I mean, we see the president, his administration's for it, but you can't get any really common consensus in Congress uh to pass anything, which would obviously need a lot of Republicans. 00:30:55.440 --> 00:30:59.680 You still have tons of Republicans trying to ban this move to Schedule Three. 00:30:59.839 --> 00:31:03.519 Um, in the rest of the world, medical is pretty accepted. 00:31:03.599 --> 00:31:25.119 I mean, when you have conversations, let's say in Germany with the right wing party taking over, when they took over, they wanted the the the CSU and the CDU, the the Christian conservatives, they wanted to roll back the adult use that had happened there, which isn't a commercial program, um, is more of just like personal possession, home cultivation, uh, and collectives. 00:31:25.359 --> 00:31:29.920 They wanted to roll that back, but they they didn't want to eliminate the medical market. 00:31:30.079 --> 00:31:34.559 They just wanted to eliminate the part of the medical market that's kind of a de facto adult use. 00:31:34.880 --> 00:31:38.799 So they wanted to kind of roll back the telehealth. 00:31:39.039 --> 00:31:52.480 That was a big one for them, but the EU law creates a huge problem with that because they could they they can prohibit German pharmacists and uh or uh uh doctors from doing telehealth visits. 00:31:52.720 --> 00:31:56.559 But if you're a doctor anywhere else in the EU, under EU law, you have to allow that. 00:31:56.640 --> 00:32:03.599 So it basically would have just

been a problem for only German doctors, where other countries would have still benefited from being able to do it. 00:32:03.759 --> 00:32:13.920 They want to eliminate like delivery, um, which allows people in farther or people who can't actually go to the pharmacy to get delivery. 00:32:14.000 --> 00:32:18.960 And both those things have turned into more of a de facto adult use, which is why they were going after them. 00:32:19.119 --> 00:32:22.240 Um, but they didn't want to eliminate the medical market entirely. 00:32:22.319 --> 00:32:24.640 And you're not seeing that in France. 00:32:24.799 --> 00:32:30.559 Um, I don't believe that they would want to eliminate the whole market if the if Le Pen's party takes over in France. 00:32:30.720 --> 00:32:32.319 I think they would just scale it back. 00:32:32.480 --> 00:32:43.839 It's already a pretty scaled-back pharmaceutical uh kind of it's between a full pharmaceutical uh uh program and like a Germany, like they allow more products. 00:32:44.000 --> 00:32:49.440 It doesn't have to be like a Satovax um or epidielex, but it's not allowing flour. 00:32:49.599 --> 00:32:54.480 Um, they may scale that back to be a more pharmaceutical focus than it currently is. 00:32:54.640 --> 00:32:58.640 Um, Brazil, I don't think they'd get rid of it if Bolsonar wins. 00:32:58.720 --> 00:33:03.440 I just think, again, especially with this health minister, they would kind of scale it back to a more pharmaceutical. 00:33:03.839 --> 00:33:09.599 So the conversation of the rest of the world isn't like they've accepted medical efficacy or at least therapeutic use. 00:33:09.759 --> 00:33:16.000 Like that conversation, and in countries that have uh implemented medical programs, they've they've accepted that. 00:33:16.079 --> 00:33:18.000 And the right and left pretty much agree with it. 00:33:18.079 --> 00:33:23.759 It's just what type of program is really the conversation, not whether the program should exist at all. 00:33:25.359 --> 00:33:35.119 So I do want to try to start working us back towards the US uh as we kind of get into the latter half of the show here, but just to kind of like wrap this up, you you said it really well. 00:33:35.279 --> 00:33:38.480 People watch the policy and and not so much the politics. 00:33:38.640 --> 00:33:40.799 And uh I think I'm guilty of that. 00:33:40.880 --> 00:33:51.839 Um, you know, over the last 10 years, I've seen this kind of what looked like this slow, methodical uh global um rollout of cannabis, right? 00:33:52.079 --> 00:34:02.640 And it seemed like, oh, it's like, oh, we just keep our eyes on these markets as as they slowly evolve, and at some point it's gonna become interesting enough for us to expend those resources to expand there. 00:34:03.680 --> 00:34:08.960 And now now that's like maybe my foundation's being shaken a little bit. 00:34:09.360 --> 00:34:22.880 Um and I'm curious from your lens, like understanding what's happening in these different markets, do you see this as the kind of natural push and pull as we continue to expand global acceptance? 00:34:23.199 --> 00:34:35.599 Or do you uh now anticipate maybe some of those critical markets rolling backwards in the other direction because maybe they've seen too much, maybe uh maybe the hypothesis was wrong. 00:34:37.840 --> 00:34:40.639 It's kind of tough to say. 00:34:40.880 --> 00:34:56.880 I do think if we do see this right movement, I do think there's gonna be some, like if this continues, especially in Europe, I think we're gonna see some restriction and decline in demand just based on regulations that are implemented. 00:34:57.039 --> 00:35:00.960 For example, getting rid of telehealth, um, that would reduce demand. 00:35:01.119 --> 00:35:03.199 Getting rid of delivery is gonna reduce demand. 00:35:03.280 --> 00:35:09.280 And in the German market, that um is is pretty saturated right now. 00:35:09.760 --> 00:35:15.280 And that I think is just the reality of political shifts. 00:35:15.360 --> 00:35:24.320 I mean, then if it swings the other direction, we could get legalization in Germany with the subsequent uh party after that. 00:35:24.400 --> 00:35:27.599 And so I don't think it's gonna go anywhere. 00:35:27.760 --> 00:35:35.679 So I think if you're a solid company who has the ability to operate in these foreign jurisdictions, there's certainly opportunity. 00:35:35.920 --> 00:35:45.679 I'm just not sure, especially looking at US uh um US operators and their optimism on the global market. 00:35:45.920 --> 00:35:49.679 I I think it's gonna be restricted to only a few. 00:35:50.000 --> 00:35:58.880 And those few are are probably gonna have to deal with some hard times as really I mean, US operators should be used to that by now. 00:35:59.199 --> 00:36:03.679 But it's not, I don't think it's gonna be as gung-ho as a lot think. 00:36:03.840 --> 00:36:07.760 But I think you're gonna see like what CuraLeaf is doing with Aurora. 00:36:07.920 --> 00:36:13.840 I mean, that is, I think, a very smart move if they can pull this off, because that just gains you immediate access. 00:36:14.000 --> 00:36:29.119 I mean, being able to get existing access, I think is gonna be far more valuable because you're not actually kind of what Anna Ray was saying at the beginning of the show with like Florida, you're not having to spend all this money in a country that is already very well developed. 00:36:29.280 --> 00:36:33.840 You're just able to jump into that development and adjust as you need to there. 00:36:33.920 --> 00:36:39.440 And I think that's gonna be probably the winning move uh for for most. 00:36:39.679 --> 00:36:50.159 I mean, there will be some that will be able to jump in fresh, but I do think it is gonna be a bit more difficult, especially if these countries do move to the right um in the next year or so. 00:36:50.480 --> 00:37:29.440 I love that you brought up Cure Leaf and Aurora because it's actually the perfect segue to talk about the US, um, but

within the global lens, I I saw like a social post that was referring to um CEO of Aurora, Miguel Martin, basically starting to now in his kind of defensive posture to try to ensure that this hostile takeover fails, um, making the argument that Cure Relief is over-indexed in the US and for Aurora to be tying its future to a business that has so much of its assets based in the US. 00:37:29.519 --> 00:37:36.559 And the the US is basically this terrible flat environment for cannabis business, is just not smart. 00:37:36.719 --> 00:37:45.920 Whereas the opportunity to be able to participate in the global market that Aurora has is um is is much bigger greenfield opportunity. 00:37:46.159 --> 00:37:58.320 And uh it it takes us kind of into this now like American-Canadian trade war politics that are happening uh between between Mark Carney and and Donald Trump. 00:37:58.400 --> 00:38:06.239 And and it's like, oh my gosh, now now Aurora and and Kira Leaf are participating on both sides of this argument in some ways. 00:38:06.559 --> 00:38:15.760 But so much of the lack of opportunity that is afforded to US companies remains because of of Schedule One. 00:38:16.000 --> 00:38:21.280 And um and and we're we're deep in this process of looking at schedule three. 00:38:21.440 --> 00:38:24.880 And so I think it makes sense for us to talk about schedule three for a little while. 00:38:25.039 --> 00:38:29.519 I mean, we could we could go deep into cure relief as well, but but maybe maybe we don't. 00:38:29.679 --> 00:38:46.000 And and I'd love to I'd love to start talking about where we are with schedule three, because I think that you have a unique lens to help our audience understand the difference between the executive order and the ALJ process that has been unwinding. 00:38:46.079 --> 00:38:49.280 And in talking to you, I now have a better understanding of it. 00:38:49.519 --> 00:39:05.119 So if you could bring us to where we are today on September 22nd, um, with these two parallel schedule three processes, I promise that we'll bring it into a larger international conversation as we process it. 00:39:05.519 --> 00:39:06.559 Yeah, absolutely. 00:39:06.719 --> 00:39:14.480 Um, so right now we are in a situation where state legal medical marijuana is currently in schedule three. 00:39:14.639 --> 00:39:18.639 And that was based on the attorney general's final order issued in April. 00:39:18.880 --> 00:39:34.480 We also have a separate um ALJ uh hearing at the DEA that's continuing the rescheduling process that started under the Biden administration and then was paused uh the first year of the Trump administration and then picked up with an ALJ hearing a few months ago. 00:39:34.639 --> 00:39:42.000 And that is for to reschedule the term marijuana that is listed in Schedule One of the Controlled Substances Act. 00:39:42.159 --> 00:39:45.199 And so I'll start with that one because that one's probably the easiest one to explain. 00:39:45.440 --> 00:39:59.599 Um, so

marijuana has been a Schedule I substance since the 60s and 70s when the uh US kind of forced the world to add cannabis to the single convention, and then we incorporated that into our Controlled Substances Act. 00:39:59.760 --> 00:40:02.639 And so today a lot of people are talking about it as adult use. 00:40:02.719 --> 00:40:05.360 That adult use rescheduling went through the ALJ. 00:40:05.519 --> 00:40:06.639 Well, that's sort of true. 00:40:06.800 --> 00:40:10.800 It doesn't really account for everything because this is for the entire term. 00:40:10.880 --> 00:40:16.559 So all of marijuana, as it's defined under the Controlled Substances Act, could move into Schedule III. 00:40:16.719 --> 00:40:21.440 DDA has recommended it, HHS has recommended it in their health evaluation. 00:40:21.599 --> 00:40:23.440 There were 43,000 comments. 00:40:23.599 --> 00:40:26.000 I think like 90% of those recommended it. 00:40:26.159 --> 00:40:34.800 And now the ALJ had a hearing with all prohibitionists and is about to recommend whether he thinks it should be in one, two, or three. 00:40:35.119 --> 00:40:48.079 If he recommends three, um, well, hold off, before that, I think DEA, we we've heard a lot of stories about the industry, and there's been a lot of publications about the industry paying, I think, about$13 million for the Schedule three to happen. 00:40:48.239 --> 00:40:54.480 So I do think DEA, no matter what ALJ says, is going to come out with a recommendation for schedule three. 00:40:54.639 --> 00:41:01.360 But the ALJ recommendation is incredibly important in this process, especially for the litigation that will certainly ensue. 00:41:01.599 --> 00:41:21.360 Um, because if the ALJ comes out with anything but three, if he recommends one, which I doubt, because I think medical efficacy was at least um argued well enough in in the hearing that I think two, which is the lowest possible scheduling that acknowledges medical efficacy, I think two is the only real other option. 00:41:21.760 --> 00:41:38.400 If the ALJ recommends two, then Sam, Kevin Sabet, and their Arsenal and War Chest are gonna have a good argument at the DC circuit that it shouldn't have gone to three if the DEA actually does issue a final rule moving to three. 00:41:38.719 --> 00:41:45.440 If the ALJ recommends three, then I think Schedule Three is done deal for the term marijuana. 00:41:45.760 --> 00:41:51.920 This would not, this is different than the medical marijuana framework that was implemented in April. 00:41:52.079 --> 00:42:03.920 All this would do, just taking it as a silo, would really eliminate 280e from all state or actually all operators, because 280E applies to only Schedule One and two substances. 00:42:04.000 --> 00:42:09.599 So if it moves to three, the no operators will be subject to 280E, which is a huge benefit. 00:42:09.840 --> 00:42:16.159 But would not there would not be this uh medical framework where state licensees are registering. 00:42:16.239 --> 00:42:19.119 Um adult use is definitely not going to happen. 00:42:19.199 --> 00:42:21.760 That you cannot have adult use in a medical framework. 00:42:21.840 --> 00:42:40.079 So anyone who's thinking that that by moving it into three, if they if it ends up there, um, will then allow adult use to participate the way medical marijuana operators are participating in this kind of regulated DEA registration system, like that's certainly not going to happen. 00:42:40.320 --> 00:42:42.480 Um, and so that's really all it does. 00:42:42.559 --> 00:42:49.519 It just sits there in three, and then everything that currently applies in the Controlled Substances Act would apply to marijuana. 00:42:49.599 --> 00:42:59.840 So all state legal operators, again, siloing this from the medical marijuana framework, um, all operators would still be operating illegally under federal law. 00:43:00.079 --> 00:43:09.679 Um can we can we pause really quick just because I I there were conversations happening in Colorado, a lot of people pontificating on the direction they thought things were going. 00:43:09.840 --> 00:43:16.639 So you're saying that everything marijuana cannabis would be schedule three. 00:43:17.199 --> 00:43:17.599 Yeah. 00:43:17.840 --> 00:43:31.119 If you're in the medical marketplace, then you can engage with the DEA and potentially get the benefits of whatever is to follow, be it interstate commerce or or or what have you, um, but be a federally sanctioned business. 00:43:31.280 --> 00:43:43.519 If you're in adult use, you might be schedule three, but you're still in conflict with the federal government, um, and therefore not working with the DEA, not benefiting from interstate commerce. 00:43:43.599 --> 00:43:54.000 And and I think that's an important clarification because I do think I heard some people talking about oh, we'll have uh dual DEA license applications and all this kind of stuff. 00:43:54.079 --> 00:43:56.480 And so you're saying no to that. 00:43:57.360 --> 00:43:58.960 I think, yeah, that's correct. 00:43:59.119 --> 00:44:10.719 But I also think I think that so the medical being able to participate with DEA will only apply if the medical marijuana final order that was issued in April, if that survives. 00:44:10.960 --> 00:44:31.920 If the medical marijuana final order does not survive, then the ALJ moving or the DEA moving um all of marijuana into Schedule Three, you would not be able to participate with DEA unless you got a DEA registration, which you would have to go through the Controlled Substances Act procedures to get a registration. 00:44:33.280 --> 00:44:42.719 That rescheduling would not allow for the state license to basically grant you DEA registration the way the medical marijuana framework did. 00:44:43.440 --> 00:45:06.079 Having said that, though, what I do think will happen, and I'll get into the medical marijuana framework in a sec, but I think if that survives, if it survives the DC circuit and you have medical marijuana

legal in the US that made it through that litigation, I think what you have now, which let's, I'm just gonna make up numbers, but let's say 90% of the US is adult use, 10% is actually medical in states that have both. 00:45:06.320 --> 00:45:07.840 I think that'll flip. 00:45:08.000 --> 00:45:15.519 I think you'll end up with 90% medical, 10% adult use or less, because everyone, I mean, you're gonna want to be federally legal. 00:45:15.679 --> 00:45:17.679 States are gonna want to be federally legal. 00:45:17.760 --> 00:45:25.440 And so that's going to just create these new robust medical programs that'll be very different depending on the state. 00:45:25.599 --> 00:45:30.320 But I you know, and they'll just be de facto adult use as well, just called medical. 00:45:30.480 --> 00:45:32.239 Um, so I think that'll switch. 00:45:32.320 --> 00:45:45.679 But yeah, adult use, you cannot, it was kind of the difficult part about this ALJ hearing is that medical marijuana was removed out of the definition of marijuana and the Controlled Substances Act and put into three. 00:45:45.840 --> 00:45:52.480 So the only thing that was left was non-medical marijuana, which by definition has no medical efficacy. 00:45:52.559 --> 00:45:55.119 It's a it's not medical because medical was already removed. 00:45:55.280 --> 00:46:00.079 So it technically needs to stay in one because all you have left is non-medical. 00:46:00.239 --> 00:46:04.000 But what they were arguing is the therapeutic use of it and to move it into three. 00:46:04.159 --> 00:46:08.800 And so it's to be moved into three, it has to have medical use, and it cannot just be adult use. 00:46:08.960 --> 00:46:14.000 So you can't have like an adult use system in a medical framework. 00:46:14.159 --> 00:46:16.159 Like that just doesn't make sense. 00:46:16.320 --> 00:46:19.199 You need to pull it out like you do alcohol and tobacco. 00:46:19.440 --> 00:46:26.800 And so that's why adult use licenses will not just be added into it, um, into this medical framework. 00:46:27.039 --> 00:46:30.480 And now to go, maybe I should have started with the medical framework first. 00:46:30.559 --> 00:46:32.480 I thought it'd be easier going the other way around. 00:46:32.719 --> 00:46:44.239 But um, this medical marijuana framework um was based off of a statute, the attorney general rescheduled state legal medical marijuana under statute 21 USC 811 D1. 00:46:44.559 --> 00:46:50.079 I've been writing about this for a while, and one of my specialties is international treaty obligations. 00:46:50.320 --> 00:47:07.280 And 811D1 says that if international treaty obligations or in order for the US to maintain compliance under treaty requirements obligations, um, the attorney general can unilaterally reschedule or schedule a substance, and the keyword is substance to ensure the U.S. 00:47:07.360 --> 00:47:08.800 maintains compliance. 00:47:09.199 --> 00:47:14.239 I wrote a ton of the stuff that DEA that educated DEA on this whole

process. 00:47:14.320 --> 00:47:21.679 I mean, we submitted tons of uh documents to them about the process, what's legal or what's allowed under the treaty system. 00:47:22.000 --> 00:47:39.440 Um, and the the problem that I have, well, before I get into that, so um so when you reschedule it, it moved all state legal marijuana, uh, medical marijuana from one to three, which immediately got rid of 280e uh for all state legal and medical marijuana. 00:47:39.519 --> 00:47:42.800 There's a lot of misinformation about that, but the order is extremely clear. 00:47:43.039 --> 00:47:47.440 Whether you register with DEA or not, 280E does not apply. 00:47:47.599 --> 00:47:52.239 The time frame of when it doesn't apply, that is more up to IRS. 00:47:52.559 --> 00:48:02.400 But as soon as they moved it, the attorney general is extremely clear that it is now in three, which means that 280E by definition and by statute just does not apply. 00:48:02.800 --> 00:48:04.639 And so that was a huge benefit. 00:48:04.800 --> 00:48:12.800 And then they did this whole thing where like to ensure treaty compliance, we're going to move, we're gonna basically accept all the state licensing. 00:48:12.880 --> 00:48:17.679 You're not gonna have to go through the federal framework because none of the state licensees would be able to pass that anyway. 00:48:17.840 --> 00:48:20.559 Um, so we're just gonna kind of allow that to happen. 00:48:20.719 --> 00:48:28.639 And then we're also gonna do this like I reread this yesterday um in preparation for this, just to make sure I wasn't missing anything. 00:48:28.719 --> 00:48:48.320 But there's a really interesting ambiguity in the order where it both says that state legal medical marijuana operators need to participate in this buy-sell where DEA comes, they basically put their hands on the product, you pay them a nominal fee, and then they take their hands off the product, and now it's been bought and sold by DEA. 00:48:48.480 --> 00:48:51.679 Um, there are two places in in the order. 00:48:51.840 --> 00:48:55.119 One says that that does apply, and one says that that doesn't apply. 00:48:55.440 --> 00:48:58.159 So um there is some confusion on that. 00:48:58.239 --> 00:49:06.880 But there it is very there is a very clear statement saying that uh the buy-sell and the monopoly that DEA is supposed to have is not gonna apply. 00:49:07.119 --> 00:49:09.199 Um, which goes into oh, go ahead. 00:49:09.440 --> 00:49:11.760 Yeah, I wanna I wanna dive into this a little. 00:49:11.920 --> 00:49:25.199 It's it's so confusing this idea that the executive order created this immediacy, but then there is this DEA framework that followed that also has operators feeling like they have to wait. 00:49:25.440 --> 00:49:42.320 Is and so if there's an immediacy in that medical cannabis immediately became schedule three, how much is the benefits, how much are the benefits of schedule three locked up behind the DEA framework? 00:49:42.559 --> 00:49:50.880 Or

if businesses that are allowed currently today that are in schedule three to transact across state lines with each other, can people do that? 00:49:51.119 --> 00:49:55.599 Or are they stuck waiting for the DEA to tell them that they can? 00:49:56.079 --> 00:49:58.639 Um so right now they're stuck. 00:49:58.800 --> 00:50:12.400 And I think there's a lot of companies that'll be surprised to hear that because technically, DEA for every buy sell um that you that any company has that's registered, DEA is gonna have to issue a quota for that buy sell. 00:50:13.199 --> 00:50:17.199 And until you get that quota, you're not allowed to sell. 00:50:17.440 --> 00:50:21.280 And that's just under current DEA regulations and laws. 00:50:21.440 --> 00:50:33.360 And so assuming that that stays, DEA will be issuing quotas and it'll either be, we don't know exactly what it's gonna be, it could be for the state, it could be for the whole program, it could be for individual operators. 00:50:33.599 --> 00:50:41.599 Um, and and whether or not they're gonna have to apply for each purchase and sale to DEA to get approval, that's also unknown. 00:50:41.840 --> 00:50:49.039 Um, so a lot of operators right now have said that they're operating as if they are a DEA registrant. 00:50:49.119 --> 00:50:50.239 And that is not true. 00:50:50.480 --> 00:50:58.960 The order says that they're operating federally legally, they're not, they're not an illegal operation as long as you submitted in that early application window. 00:50:59.119 --> 00:51:10.960 So that's all that means is that you're not violating federal law at the moment if you're operating under your state license, which operating under your state license means that you cannot interstate commerce. 00:51:11.199 --> 00:51:18.639 And so as of right now, because no state license has made it possible to do that, because all of their existing frameworks. 00:51:18.880 --> 00:51:22.960 And so that that's an interesting complexity to add to this. 00:51:23.199 --> 00:51:33.440 We've had conversations with regulators, and I don't want to call them out by name, but who have been very open with the fact that the DEA is not communicating with the states about how to do this. 00:51:33.679 --> 00:52:01.119 Because I would say that the cannabis regulators that I have talked to are kind of ready and willing to update policies in order to help the operators in their state and have been pretty optimistic about look, we're gonna do whatever it takes so that people aren't locked out from participating, but they don't want to make it so that you can, you know, change metric to do a transaction between Oregon and Missouri until until that's allowed or that they're that's clear. 00:52:01.360 --> 00:52:11.440 Uh but but it is very confusing how what what we're waiting for and what we can do today versus confused too. 00:52:11.519 --> 00:52:17.039 It's not like they elected to be in this situation, and they were just like, here, this is now yours.

00:52:17.119 --> 00:52:18.880 And and they're like, Oh, what do we do with this? 00:52:18.960 --> 00:52:21.760 So they're equally confused as as the state operators. 00:52:21.840 --> 00:52:26.719 And yeah, and there's not a whole lot of communication coming from home office to the field offices. 00:52:26.800 --> 00:52:38.639 They're kind of operating on their own at the moment from from the sound of it, and they're trying to work through processes that they've had that don't apply to this current system, and they don't seem to be getting guidance. 00:52:38.719 --> 00:52:41.280 And the interstate transport, I think, is just one of those. 00:52:41.440 --> 00:52:46.639 I know, I know many regulators are trying to find out about the quotas and how that's gonna work. 00:52:46.719 --> 00:52:52.400 And and I mean, just really how regulation, how this buy-sell is gonna work, because is that gonna have to go through metric? 00:52:52.719 --> 00:53:01.280 Um, and or I mean, like states like Arizona that don't have any of those, uh, any metric or anything, like those will probably be the easier ones. 00:53:01.440 --> 00:53:10.639 Um, but yeah, there's just so much confusion, both on whether or not, like I personally don't think this is gonna survive the DC circuits litigation. 00:53:10.800 --> 00:53:22.719 Um, so I'm not sure we're gonna have to worry about it, but it's going because the stay was denied, this process is gonna take months to get through, and licenses could start being issued as early as next month. 00:53:22.880 --> 00:53:29.199 I mean, that six-month window, a lot of people are calling it fact, like the order says you have to do it within six months. 00:53:29.280 --> 00:53:31.119 But there are three different places in the order. 00:53:31.280 --> 00:53:35.280 One of them says it has to, one of them says it may, and one of them says best efforts. 00:53:35.360 --> 00:53:40.559 So, whichever one that they want to take on that, like I don't think the six month is at all mandatory. 00:53:40.719 --> 00:53:49.920 But if they do start issuing those registrations before the litigation plays out, then you're really gonna have to start worrying about like how do you operate under these systems? 00:53:50.000 --> 00:53:57.760 And if DEA is not really communicating, I think you're still gonna have states that are saying, no, you can't export this out of state, whether it's international or domestic. 00:53:57.920 --> 00:54:02.400 And then you get dormant commerce clause litigation, which that takes time to play out. 00:54:02.480 --> 00:54:10.400 And I mean, that this is gonna be both for the litigation and at if it survives, is gonna be a a lot to deal with. 00:54:11.119 --> 00:54:22.079 So, Jason, you and we're getting close to the end, but I want to touch on this because one of the things that was so amazing when the executive order happened is like, whoa, that's all it takes. 00:54:22.320 --> 00:54:28.480 We've been, we've been having like cannabis policy fails, like safe banking. 00:54:28.559 --> 00:54:38.960 I think eight times it's been introduced in the house for so long that it's like somebody can just wave a wand or the president can wave a wand with an executive order and make policy change. 00:54:39.199 --> 00:54:47.760 Um I know that you are interested in this conceptually, uh, based on the organization that you founded, Project for 2029. 00:54:48.239 --> 00:55:02.159 Um I'd love it if you could just give us some ideas of what else could be done via executive order for cannabis policy and progress that um that the industry should be rallying behind. 00:55:02.559 --> 00:55:11.440 Yeah, so I've I, along with Shane Pennington again, have been screaming about 811 D1 for years, and all of the cannabis organizations pretty much told us to shut up. 00:55:11.760 --> 00:55:15.599 And so um happy that they actually used it. 00:55:15.840 --> 00:55:25.119 But now we're living in a world where executive action is basically like president the Trump administration has changed what's called the unitary executive theory. 00:55:25.199 --> 00:55:34.960 They've expanded it substantially, and what that means is that the president can dictate what his agencies do, can hire and fire based on them listening to him or not. 00:55:35.039 --> 00:55:40.639 Um, obviously hiring us to go through Congress, but firing is obviously a big way to make sure that people do what you want. 00:55:40.800 --> 00:55:45.119 And you can specifically say, I want you to do this policy and you need to do it. 00:55:45.280 --> 00:55:48.400 And that is fundamentally changed under this administration. 00:55:48.559 --> 00:55:58.320 And so using that and using current legislation and regulations, we can pretty much legalize anything having to do with cannabis in several ways. 00:55:58.480 --> 00:56:12.559 There's one way to do it under scientific pilot programs, and this is where I think DEA really messed up in their final order is if DEA had worked with FDA, then they could have set up scientific pilot programs in partnership with states. 00:56:12.719 --> 00:56:23.119 And so being in Colorado, you have Governor Polis uh working with the DEA and the FDA to create investigational new drug applications for the state programs. 00:56:23.360 --> 00:56:32.320 The FDA has authority to waive a lot of these requirements so that what was prohibitive before for cannabis could be permitted under these waivers. 00:56:32.480 --> 00:56:36.559 And so you can do that for anything from medical marijuana, adult use marijuana. 00:56:36.719 --> 00:56:42.639 If you want to do hemp versus marijuana, intoxicants, non-intoxicants, you can even do it with like the DoD. 00:56:42.800 --> 00:56:53.599 If the Department of Defense wants to give half a billion dollars to the hemp industry to help make hemp plastics uh for the military, that that can be a way to do it to expand cannabis policy. 00:56:53.840 --> 00:57:05.840 There's also descheduling that I think is

on the table using the same process that the uh Biden administration used for Schedule Three, where you tell HHS to do uh you to study cannabis. 00:57:05.920 --> 00:57:07.599 Um, you do it just intoxicants. 00:57:07.679 --> 00:57:10.000 I'm kind of sick of this whole marijuana hemp thing. 00:57:10.079 --> 00:57:16.000 Um, but you you have it study it against alcohol and tobacco, find out which one's safer. 00:57:16.159 --> 00:57:24.960 And if HHS finds that cannabis is a more safer alternative for uh adults to consume, then they recommend that it's descheduled. 00:57:25.199 --> 00:57:31.039 And under statute, if HHS recommends descheduling, DEA must reschedule. 00:57:31.199 --> 00:57:32.880 The language is extremely clear. 00:57:33.039 --> 00:57:36.000 So if you get that done, you require it to be done within a year. 00:57:36.159 --> 00:57:39.760 You can get full descheduling, which needs regulation. 00:57:39.840 --> 00:57:42.559 There's huge problems if you deschedule without regulation. 00:57:42.800 --> 00:57:46.400 But I think that would force Congress to actually move forward. 00:57:46.480 --> 00:57:51.519 And that's what Project 42029 is intended to promote, is to educate presidential candidates. 00:57:51.599 --> 00:57:55.119 Because instead of lobbying all of Congress, you just need to lobby one person. 00:57:55.280 --> 00:57:59.840 Whoever the next president is is the only person you have to lobby to to get this done. 00:58:00.000 --> 00:58:10.719 And so I think it is much, much easier, especially this day and age, to get common sense cannabis policy through executive action that will ultimately force Congress to act. 00:58:11.920 --> 00:58:14.960 So it did come up in Colorado quite a bit. 00:58:15.039 --> 00:58:22.159 There was a panel that that you were going to be on about the one plant solution and this whole descheduling talk. 00:58:22.239 --> 00:58:28.719 I think for some of us that have been in the industry as long as we have, it's like we're just now getting progress after so long. 00:58:28.960 --> 00:58:32.239 Like, are we ready to have that conversation? 00:58:32.400 --> 00:58:37.679 And and maybe that's not maybe that's not the right way to approach the concept. 00:58:37.840 --> 00:58:41.119 It's maybe maybe it's independent of that because of the mechanisms. 00:58:41.360 --> 00:58:46.719 But like we don't even know what's going to happen with schedule three. 00:58:46.960 --> 00:58:51.280 Can we immediately start engaging in this descheduling conversation? 00:58:51.519 --> 00:58:58.320 And maybe this is a good opportunity to just talk about the strategy with project 2029 or for 2029. 00:58:58.880 --> 00:58:59.519 Yeah. 00:58:59.760 --> 00:59:08.960 Um, I I mean, I think it is the perfect time to do this because we are having a conversation where hemp beverages are probably getting the easiest coverage right now. 00:59:09.039 --> 00:59:12.159 And that seems to be if we're gonna get a path forward, it's gonna be beverages. 00:59:12.320 --> 00:59:19.920 There's also some talks about like other kind of changing the milligram dose or the milliligram requirement on the hemp ban. 00:59:20.320 --> 00:59:33.119 Um, but I think that right now it is the perfect time to be talking about this because right now, basing intoxicant legalization on hemp versus marijuana makes no sense whatsoever. 00:59:33.360 --> 00:59:46.559 And so I think we were talking about this in Colorado, is we have hemp included in these beverage bills when all I think if you just replace that with cannabis sativa L. 00:59:46.719 --> 00:59:55.440 So in the hemp beverage bill, if you take out the word hemp and you just replace it with cannabis sativa L, then that allows it becomes kind of a one plan. 00:59:55.519 --> 00:59:56.800 It's source agnostic. 00:59:56.880 --> 01:00:00.159 It just has to do with the intoxicant that is the end product. 01:00:00.400 --> 01:00:08.880 And that basically is legalization of marijuana that's, I think, more palatable than actually including the word marijuana. 01:00:09.039 --> 01:00:14.639 And we are having this discussion where people seem to accept that intoxicating cannabis should be legal. 01:00:14.800 --> 01:00:20.960 Like that seems to be, at least politically wise, something that seems to be gaining steam. 01:00:21.039 --> 01:00:25.599 And the fact that we're separating it in hemp and marijuana is just going to confuse everything. 01:00:25.840 --> 01:00:33.679 And I don't know if we get a hemp bill that's allowed, then that may just stall legalization at that point. 01:00:33.840 --> 01:00:39.840 Like there is an argument, I know Anna Ray has brought this up, that that may normalize it and help the conversation move forward. 01:00:40.000 --> 01:00:52.960 But I also think that there's a possibility that a lot of the people or a lot of the industries that are behind us, like the beverage industry, um, restaurant industries, I think they may be like, okay, we got this. 01:00:53.360 --> 01:00:55.679 Now, I mean, I think we're good now, right? 01:00:55.840 --> 01:00:57.920 Like a lot of people don't understand that there's a difference. 01:00:58.079 --> 01:01:03.440 So a lot of people that we would need to support us may just be like, all right, so we've we have kind of legalized. 01:01:03.519 --> 01:01:05.280 Like, what else do we need to do here? 01:01:05.519 --> 01:01:08.880 And so I think there just may be this kind of what's happening in Colorado. 01:01:09.039 --> 01:01:18.880 Like, we revised our regulations many years after we legalized, and now trying to even fix things, our legislators, like, we don't want to deal with it. 01:01:18.960 --> 01:01:21.039 Like, we just really don't want to deal with it anymore. 01:01:21.119 --> 01:01:22.880 And I could see that possibly happening. 01:01:23.039 --> 01:01:34.480 So I think it is a good time to have this conversation, especially in a world where the executive has so much authority that Congress isn't gonna agree as we

we see now. 01:01:34.639 --> 01:01:39.280 Congress doesn't agree, they don't do anything, but they don't agree with what the president's doing in a lot of ways. 01:01:39.440 --> 01:01:53.840 Um, but if you have a Congress that wants to act, and I think marijuana policy is a place where you'll get a lot of consensus on acting, that if the president makes these bold steps, Congress is gonna be like, okay, okay, we're gonna do something to kind of rein this in in a way that we want it. 01:01:54.000 --> 01:01:56.559 How that happens is gonna be difficult, though. 01:01:58.000 --> 01:01:59.519 I can't help myself. 01:01:59.760 --> 01:02:14.480 Um there is so uh threading the needle with politics and what we're talking about, it seems like we've got Gavin Newsome from uh California's governor as like a real potential front runner in the next presidential election. 01:02:14.639 --> 01:02:34.079 And I would call Gavin Newsome like a hemp hater to the 10th nth degree, if possible, based on kind of the the way that he has supported adult use legalization through Prop 64 in California and how he has really like prohibited all hemp products from um being in the market here here in the state. 01:02:34.559 --> 01:02:43.840 And so how much do these executive orders have the ability to just change um with the times? 01:02:44.079 --> 01:02:53.679 Because if what while I like what you've suggested about this cannabis sativa L in the hemp language, I don't actually see that happening. 01:02:53.920 --> 01:02:59.519 And I think that if anything happens, it's with language that is already being discussed today. 01:02:59.679 --> 01:03:26.719 So if that was to move forward and um a hemp beverage bill was to pass, and then we get a massive political shift, and we've got Governor Newsom as President Newsom, and he hates hemp, um, how much can an executive order undo or shift existing legal precedent and laws that have already been passed by Congress? 01:03:27.119 --> 01:03:28.960 So it can't contradict laws. 01:03:29.119 --> 01:03:31.519 So it couldn't, yeah, it can't contradict laws. 01:03:31.599 --> 01:03:37.599 Like everything I'm talking about is using current statutes, current regulations to push this policy forward. 01:03:37.840 --> 01:03:47.840 So that in that case, if we're living in a world where the hemp beverage bill passes and he comes into office, it's not like he could sign an executive order that says this no longer applies. 01:03:48.000 --> 01:03:50.559 Like that's not an authority the president has. 01:03:50.800 --> 01:04:02.159 What he could do is just basically give registrations and give uh the marijuana industry the ability to participate in pretty much the identical market without any of the barriers that the statute requires. 01:04:02.400 --> 01:04:04.559 So that is something that he could do. 01:04:04.719 --> 01:04:14.400 So there that's again just there are ways to work around the laws that we're learning under this administration that they're just like the Supreme Court is blessing. 01:04:14.480 --> 01:04:21.519 Whether Supreme Court would bless the same uh under a president newsome, um, I think is an open question. 01:04:21.599 --> 01:04:27.760 And I would be surprised if they they kind of gave his carte blanche of authority to a president newsome. 01:04:28.079 --> 01:04:29.760 But that's pretty much how it would be. 01:04:30.000 --> 01:04:39.760 They couldn't just contradict the statute, but he could work around it to make it pretty worthless to the people who actually are abiding by the statute. 01:04:40.320 --> 01:04:47.119 That's gonna be a very interesting end of the year, especially with the the midterms uh happening in early November. 01:04:47.280 --> 01:04:53.840 So we'll see just how much uh Congress can get done this year and what they're willing to get done in in the years to come. 01:04:54.159 --> 01:04:56.159 Yeah, I don't have I don't have much hope. 01:04:56.320 --> 01:05:07.920 I I just I'm betting on the another extension to March on the funding bill and whether or not Mitch McConnell is actually alive or he's uh weakened up burning it. 01:05:08.000 --> 01:05:08.719 I don't know. 01:05:09.039 --> 01:05:18.719 But if if he can get it stripped out or if it gets extended again till March and then they deal with it later, like that's I there just isn't enough time, it seems. 01:05:18.880 --> 01:05:31.199 They already are they've gone uh to recess till after the election, and then you just have a very small amount of time to get something going, and presumably there's gonna be a huge shift in who's in Congress. 01:05:31.440 --> 01:05:35.679 So um, yeah, I think it's just incredibly un uncertain right now. 01:05:35.840 --> 01:05:47.039 Um, and even if Democrats take over and get a huge win in both houses, like we saw Schumer hold up safe banking because he wanted CAOA um because there wasn't enough social equity in it. 01:05:47.119 --> 01:05:53.119 And so are we gonna see the same thing if we have Schumer as the majority leader in the Senate when you have a hemp bill up there? 01:05:53.360 --> 01:05:55.920 Um, so yeah, I I I don't know. 01:05:56.400 --> 01:05:58.159 Yeah, very confusing and designed. 01:05:58.639 --> 01:05:59.599 So much that's unknown. 01:05:59.840 --> 01:06:10.480 And yeah, and this whole thing with the extension, the extension after extension, and it's like this inevitable, just it's I've I talk about it often of the lobbyist industrial complex. 01:06:10.559 --> 01:06:20.079 It's like the lobbyists know they're just keeping themselves at the table with everything and and keeping the industry in this place of uncertainty, job security in some ways. 01:06:20.320 --> 01:06:22.320 Um, but we could talk about this forever. 01:06:22.559 --> 01:06:25.440 Unfortunately, we can't today, actually. 01:06:25.599 --> 01:06:27.760 So it is time for our last call. 01:06:27.920 --> 01:06:32.239 Um, Jason, uh, why don't you give us a final message for our listeners?

01:06:32.400 --> 01:06:34.079 Advice, call to action, closing thought. 01:06:34.159 --> 01:06:35.039 What do you got? 01:06:35.440 --> 01:06:41.760 Yeah, for me, it would just be for anyone moving forward, whether it's hemp or marijuana, just do so, I think responsively. 01:06:41.920 --> 01:06:45.920 Like don't jump over your skis, don't get way too ahead of yourself on this. 01:06:46.159 --> 01:06:59.440 Prepare for either a medical marijuana future where it's schedule three in the state system we have, or that hemp is going to survive in some way, but also prepare for it not happening and make sure that you're getting responsible guidance. 01:06:59.599 --> 01:07:08.159 I mean, one of the things I I try to do is just provide honest uh feedback on what I'm seeing and the law behind it. 01:07:08.400 --> 01:07:22.960 And so I think if you're looking for just kind of a uh a non uh uh or a non like one-sided focus on what's going on, if you don't want just the shiny news or the bad news, um, definitely reach out to me. 01:07:23.039 --> 01:07:36.559 I'm always happy to talk and advise clients just on what's going on, what I see um in both the US and international market, because education is going to be the biggest thing to help you be able to move forward in this ever-changing landscape. 01:07:36.719 --> 01:07:39.519 And that's what I try to do is just educate. 01:07:40.400 --> 01:07:41.360 Amazing. 01:07:42.000 --> 01:07:47.920 Stay informed, uh, stay prepared and stay responsible, people. 01:07:48.719 --> 01:07:52.400 Um Jason Attlestone, Harris Slawowski. 01:07:52.960 --> 01:07:53.599 Nailed it. 01:07:53.679 --> 01:07:58.800 Uh thank you for spending the last hour plus uh with us. 01:07:58.960 --> 01:07:59.920 Incredibly informative. 01:08:00.000 --> 01:08:01.519 We could absolutely do a part two. 01:08:01.679 --> 01:08:07.280 Maybe we should, as we get a little deeper into the decision making around schedule three and and hemp and everything. 01:08:07.599 --> 01:08:09.760 Yeah, thank you both so much for having me. 01:08:09.840 --> 01:08:10.320 This was great. 01:08:10.400 --> 01:08:12.159 And uh yeah, happy to join whenever. 01:08:12.400 --> 01:08:15.440 I love having conversations with people that understand this stuff. 01:08:15.599 --> 01:08:17.439 Um, because not many people do. 01:08:18.399 --> 01:08:19.279 It's a lot. 01:08:19.520 --> 01:08:19.920 But thank you. 01:08:20.239 --> 01:08:20.640 Thank you so much. 01:08:20.880 --> 01:08:21.840 A little bit clearer. 01:08:22.239 --> 01:08:23.840 Yeah, it was really fun. 01:08:24.800 --> 01:08:32.000 All right, and thank you uh for watching and engaging and leaving comments in our live recordings on LinkedIn. 01:08:32.159 --> 01:08:39.520 Uh, please go over to YouTube or wherever you listen to your podcast and subscribe, like, share, do all the things. 01:08:39.760 --> 01:08:45.119 Thank you to our teams at Virtosa and Wolfmeyer, and of course, our producer, Eric Rossetti. 01:08:45.840 --> 01:08:52.079 As always, folks, stay curious, stay informed, and most importantly, keep your spirits high. 01:08:52.319 --> 01:08:54.640 Until next time, that's the show.