Great movies have great lines. charlie wilson's warThere, Charlie Wilson (played with distinction by the incomparable Tom Hanks) explains the relatively covert and successful involvement of the US government in the Soviet-Afghan war: They were amazing and changed the world…and we just ruined Endgame. ”
With the next Farm Bill on the horizon, I believe a similar period is near for the future of hemp. I believe the future of hemp is bright and can change the world. What will you do until the end?
This is an analysis of the current state of hemp and whether it will revolutionize the world before governments relegate it to the ash heap of history. That happens to coincide with my personal experience representing clients in connection with hemp businesses.
Introduction…
Back in the “stone age” (circa 2017) when I decided I wanted to be a cannabis lawyer and started focusing on cannabis. [As a brief aside, telling people in Alabama you practice cannabis law in 2017 must have been what Noah felt like when he was telling people it was about to start raining.]
The 2014 Farm Bill legalized “industrial hemp” for the first time, as distinct from marijuana, under the Controlled Substances Act, allowed state farm departments and universities to license hemp production, and set initial limits. has opened the door to an established cannabis market. This was a great opportunity to advise new cannabis operators and investors on how to make the most of this opportunity within the framework of the law.
At the same time, we were regularly receiving calls from existing customers, business colleagues, and strangers asking how non-cannabis companies should act if approached by cannabis companies they wanted to do business with. The latter category includes banks, insurance companies, real estate companies, and countless other companies that had questions about how employee hemp use would interact with their companies' existing drug testing policies. I did. For the most part, companies were reluctant to get involved with hemp, but the conversations were interesting and it was clear that most companies recognize that things are changing. It was the Wild West and I was having a ball.
rocket fuel
Consider the 2018 Farm Bill and the explosion of the hemp industry. The 2018 Farm Bill removed the word “industry” and defined “hemp” as:
The plant Cannabis sativa L. and any part of that plant, including its seeds, and all its derivatives, extracts, cannabinoids, isomers, acids, salts, and salts of isomers, whether growing or not; Delta-9 Tetrahydrocannabinol concentration greater than or equal to 0.3 percent on a dry weight basis.
In addition to removing restrictions from licenses in the 2014 Farm Bill, the 2018 Farm Bill also transferred oversight authority from the Department of Justice and DEA to the USDA and FDA.
The 2018 Farm Bill was a seismic shift, and we recognized the potential for a new regime almost immediately and predicted what was to come.
- More “smart” money and research. Because hemp has been a Schedule I substance along with marijuana for decades, many sophisticated financial sources have refrained from funding the industry. This puts hemp at a competitive disadvantage against other products and prevents it from reaching its full potential. Now that you can produce and sell hemp without incurring substantial legal risks, ensure that money flows to this underserved sector. Publicly traded companies, private equity firms, venture capitalists, and other investment groups will all have significant interests in both the production and distribution of hemp and hemp-derived products. In addition to traditional commercial development efforts, much of this cash will be used to hire top researchers to develop proprietary hemp yarns for a variety of product applications and to take steps to protect the resulting intellectual property. likely to be spent on taking measures.
- The explosion of hemp and hemp-derived products. Driven in large part by an infusion of capital from sophisticated investors, hemp uses are likely to explode. Hemp already has hundreds, if not thousands, of known uses, and that number should increase significantly as the industry is exposed to the market forces of smart money and increased research. The biggest winner may be a hemp-derived CBD business. Hemp-derived CBD is a compound that is thought to have significant therapeutic effects, even without significant psychoactive components. washington post “In dozens of studies, [CBD] In addition to epilepsy, it can also treat a variety of illnesses such as anxiety, schizophrenia, heart disease, and cancer. ” One industry analysis predicts that the hemp-CBD market alone could reach $22 billion by 2022. The health and wellness space should see particularly hemp-related activity and growth in the coming years.
- Increase in ancillary services provided to hemp-related businesses. Because cannabis has been included in the definition of marijuana under federal law for decades, most banks, law firms, and other service providers have no legal liability for money laundering or violating state and federal drug laws. It has avoided providing services to cannabis businesses to avoid the risk of conspiracy charges. . The absence of such service providers has fostered tremendous uncertainty in an area that desperately needs certainty and clarity. With hemp's new legal status, look for professional service providers to enter the market in 2019 and beyond. Of course, companies seeking to provide services to cannabis-related businesses must take sufficient precautions to ensure that those companies are only producing federally legal cannabis.
- Integration and integration. An interesting phenomenon in states where marijuana is “legal” is the rapid consolidation and consolidation of marijuana growers, processors, and dispensaries. Some states require vertical integration (e.g., producer-seller) through regulation. And many cannabis companies have acquired cultivation operations or multi-unit dispensaries rather than establishing a cannabis presence in the state from scratch. The hemp industry is likely to follow a similar path, as large companies will likely seek to obtain sufficient quantities of hemp through government regulation and through consolidation and vertical integration. Therefore, lawyers and investors should expect significant merger and acquisition activity in the coming years.
- Federal regulations and state systems. The 2018 Farm Bill does not create a completely unregulated playing field for hemp. Over the coming months, the U.S. Department of Agriculture and the Food and Drug Administration will issue regulations implementing the 2018 Farm Bill. The state government will also announce plans to control the testing, labeling, and marketing of hemp-related products, as well as the licensing and oversight of hemp-related businesses.
We're proud to have almost profited from these predictions, with countless studies and data proving hemp is a viable product with countless form factors that will help shape the global economy. It has been confirmed that this is possible.
That's when I realized I might be able to make a career out of it as a cannabis lawyer.
good and bad
Of course, the development of the hemp industry was not without controversy. In fact, controversy may have spurred much of its development.
I would be lying if I said that all hemp or hemp-derived products are designed with the best intentions or include appropriate mechanisms to ensure consumer safety. There are certainly cannabis-derived products on the market that have not undergone sufficient product development or testing and are being sold in ways that policymakers and the public should rightly be concerned about. Novel psychoactive cannabinoids that fall within the terms, if not the spirit, of the Farm Bill are filling store shelves across the country with little or no enforcement mechanisms. This situation should change, and Americans should have confidence that the products available to them are safe and effective.
In response to this proliferation, many states have enacted rules and regulations restricting the production and sale of certain hemp-derived cannabinoids. Many of these rules (e.g., age and purity limits for psychoactive cannabinoids) appear to be well-intentioned, and unless the federal government takes further action, more rules are likely to apply. It is expected.
But in some cases, policymakers' motives may not seem so pure. It is no secret in cannabis industry circles that cannabis licensees in states that have legalized cannabis do not support an unregulated cannabis-based psychoactive drug industry. After all, marijuana companies are taxed and endure astronomical regulatory costs compared to products that could offer somewhat similar “high prices” without the organizational overhead and headwinds. This makes it much more difficult to make a profit. Florida may be the clearest and most recent example. Adult-use marijuana is widely expected to become law in Florida soon, with the state legislature recently passing legislation that largely bans Delta-8 and Delta-10.
On the other hand, it would be naive, even wrong, to think that the development of hemp-based products does not provide substantial benefits to society as a whole. Entrepreneurs are developing hemp-based alternatives to all the most common products used around the world. This means that the target market for hemp is not just the planet, but everyone around the world.
In my youth, I once compared the remarkable market for marijuana to the market for cannabis, writing:
Hemp, on the other hand, has the potential to dwarf marijuana in the global market. Unlike its sister plants, hemp has the ability to replace the products we use every day without us even realizing it. For example, hemp can provide substitutes for concrete, plastics, fuel, auto parts, clothing, and more. These are products that almost every consumer needs, but they don't realize or care what the product is made of, as long as it works. Thus, while the marijuana market is limited to consumers looking to purchase marijuana, the hemp market includes anyone who purchases products that can be made with hemp. Partly for these reasons, experts predict that the industrial hemp market will grow four to five times more in the next five years.
I stand by that statement. I believe hemp can change the world.
But I believe that local, state, and federal governments, without proper consideration of hemp's benefits, could return the hemp plant to its Prohibition-era status and deny the world its many benefits. I am confident that Policy choices made by state governments, and perhaps most importantly by the federal government in the upcoming Farm Bill, could fundamentally change the future of hemp. Will it become a quickly forgotten shooting star that captivated the world for a decade and then burned out, or will we look back on the past decade as the rebirth of one of civilization's oldest and most versatile plants?
conclusion
Philip Seymour Hoffman's work is universally respected, so I'll end where I started. emerging trends Because the film's eerie ending is a message for those who want to see the hemp industry flourish in the coming years.
As Hanks' character celebrates the Soviet Union's defeat in Afghanistan, Hoffman's hard-nosed CIA analyst offers this analogy:
On his 16th birthday, the boy receives a horse as a present. Everyone in the village says, “That's amazing!”
The Zen master says, “Let's take a look.''
One day, while riding a horse, the boy falls off the horse and injures his leg. He can no longer walk, and all the villagers say, “This is terrible!''
The Zen master says, “Let's take a look.''
Time passes and the village enters a war. All the other young men are sent into battle, but this boy is unable to fight because his leg is damaged. The villagers all say, “How wonderful!”
The Zen master says, “Let's take a look.''
The message behind this story is very clear. We tend to jump to conclusions about whether something is “good” or “bad.” We're especially quick to label something as “bad.” In reality, things can be good, bad, good, bad, or neither. As for whether Congress and the states recognize the huge potential of hemp, I think we'll see.
