The Week In Cannabis: The New Tilray, Jazz-GW Pharma, Earnings, M&A, And More

This was an eventful week for the cannabis industry.

On Monday, Tilray, Inc. TLRY and Aphria, Inc. APHA closed their merger after months of negotiations, creating a company with a combined market cap of $3.3 billion. Benzinga spoke with Irwin Simon, CEO of the new combined company.

Check out the video below:

Following the merger, Jefferies upgraded the rating for Tilray from Underperform to Buy, while raising the price target from $4.77 to $23.

Jazz Pharmaceuticals JAZZ finalized its acquisition of GW Pharmaceuticals plc. GWPH, the producer of the FDA‑approved prescription cannabidiol drug Epidiolex, for $7.2 billion or $6.7 billion net of GW Pharma's cash.

Meanwhile, Ascend Wellness Holdings AAWH started trading on the Canadian Securities exchange following a raise of approximately $80 million through an initial public offering of roughly 10 million shares of its Class A common stock at $8 per share.

Benzinga Cannabis’ content is now available in Spanish on El Planteo.

After two weeks of consolidating below resistance at the $1 level, shares of Reddit favorite Sundial Growers Inc. SNDL have resumed their downtrend.

Credit Suisse Group AG CS reportedly stopped handling transactions in shares of cannabis companies with U.S. operations and plans to refrain from holding cannabis stocks on behalf of its clients.

The Swiss-based lender, which declined to give a statement, was among a handful of banks willing to buy and sell marijuana-related stocks and hold the shares as a custodian for clients in the United States. While it's not yet clear what impact this decision will have, Reuters reported the move has affected the sale of marijuana stocks in recent weeks.

In fact, all major ETFs were down. Over the five trading days of this week:

The ETFMG Alternative Harvest ETF MJ: lost 0.2%.
The AdvisorShares Pure Cannabis ETF YOLO: tumbled 1.8%.
The AdvisorShares Pure US Cannabis ETF MSOS: shed 0.2% of its value.
The Cannabis ETF THCX: dropped 3.4%.
The Amplify Seymour Cannabis ETF CNBS: was down 3.5%.
The SPDR S&P 500 ETF Trust SPY closed the week up 1.21%.

Policy, Science And Data

In New York, people gathered to celebrate cannabis legalization.

“Last weekend's annual New York City cannabis parade brought out a who's who in politicians jockeying for position to be the one who was always supportive of legalizing cannabis. Ah-hem. Water under the bridge shall we say,” commented Debra Borchardt, CEO of Green Market Report. “With adult use cannabis sales likely to be legal by next year's parade, the people who attended were clearly in a celebratory mood. The New York market is expected to be the largest in the country and there were many small businesses working the crowd. There should be a Tinder app for social equity applicants to hook up with investors as there was a lot of talk about social equity applicants, but most have no money or very little.”

In Colorado Gov. Jared Polis signed a bill that would expand access to medical cannabis for school children in need by removing obstacles to its administration.

Financings And M&A

Jushi Holdings Inc. JUSH JUSHF finalized its purchase of a 93,000 sq. ft. facility operated by its subsidiary, Dalitso LLC, for around $22 million. The deal also includes nearly nine acres of surrounding land in Prince William County, Virginia.

High Tide Inc. HITI HITIF 2LY will acquire 80% of Fab Nutrition, LLC. (operating as FABCBD) for $20.64 million in stock and cash.

MassRoots, Inc. MSRT is looking to acquire Empire Services, Inc. for $14 million in a primarily stock-based transaction.

Trulieve Cannabis Corp. TRUL TCNNF purchased West Virginia-based Mountaineer Holding LLC for $6 million.

Cansortium Inc. TIUM, CNTMF, doing business under the Fluent brand, exercised its right to regain up to the maximum of $5 million of convertible promissory notes, originally issued in the amount of $10 million in 2019.

Green Thumb Industries Inc. GTII GTBIF will reach the Virginia market via its acquisition of Dharma Pharmaceuticals LLC.

Earnings Reports

Kiaro Holdings Corp. KO reported record revenues of CA$17.1 million in 2021, representing a year-over-year increase of 230%. Same-store sales spiked 58% over the same period.

Cansortium Inc. TIUM CNTMF, which operates under the Fluent brand, announced its fourth-quarter and full-year 2020 financial results, with consolidated revenue of $14.7 million for the three months ending Dec. 31, up 54% year-over-year.

Scotts Miracle-Gro SMG reported that company-wide sales grew by 32% year-over-year reaching $1.83 billion in the second quarter. For the first half of fiscal 2021, the company reported sales of $2.58 billion, up by 47% from $1.75 billion in sales posted a year ago.

Sales for the cannabis-focused Hawthorne segment climbed up to $363.8 million, representing a 66% year-over-year increase.

Lowell Farms Inc. LOWL LOWLF generated $11 million in revenue during the first quarter of the 2021 fiscal year, representing an increase of 17% year-over-year.

Cannabis REIT Innovative Industrial Properties, Inc. IIPR announced its total revenue increased by 103% year-over-year to $42.9 million in the first quarter of 2021. Net income for the same period was roughly $25.6 million, or $1.05 per diluted share, representing an annual growth of 122%.

POSaBIT Systems Corporation PBIT POSAF reported its total revenue increased by 327% year-over-year, hitting roughly $3.06 million in the fourth quarter of 2020. Total revenue amounted to $7.82 million in 2020, representing an annual increase of 127%.

Related content: Benzinga's Full Earnings Calendar

Cronos Group Inc (NASDAQ: CRON) reported a Q1 adjusted EBITDA loss of $37.07 million, marginally up from $37.05 million reported a year ago. This slight increase in losses was primarily driven by the rise in sales and marketing costs due to brand development in the U.S. segment and an increase in R&D costs.

Hemp cultivation and processing brand HempFlax posted its full-year 2020 earnings report, with revenues of €14.5 million ($17.4 million), up 43% from 2019's $10.1 million. EBITDA increased 63% from 2019, totaling €1.8 million, marking the company's second profitable year. EBITDA margins increased to 12.7% from the previous year's 11.1%.

Planet 13 Holdings Inc. PLTH PLNHF generated record sales in April of $10.7 million — almost as much as last year’s total second-quarter revenue of $10.8 million.

Find all the details on these and other earnings reports on Benzinga Cannabis’ Earnings Center.

Other News

Canadian hospital Sunnybrook Health Sciences Centre and Avicana Inc AVCNF announced a partnership to provide medical cannabis products on-site through the Odette Cancer Centre Pharmacy.

Orchid Ventures Inc ORVRD entered an exclusive licensing agreement with Gold Flora. Per the agreement, Gold Flora will be assuming all production, sales, and distribution of Orchid Essentials products throughout the state of California, and purchasing all hardware, packaging, and terpenes through PurTecDelivery Systems, a wholly-owned subsidiary of Orchid Ventures.

“As one of the highest growth operators in the state, we are confident that Gold Flora's leadership and quality of their operations will accelerate Orchid's growth potential, further establishing the brand as a leader in the largest recreational cannabis market in the world, California,” Corey Mangold, CEO and chairman of Orchid Ventures, told Benzinga.

Applied DNA Sciences, Inc. APDN signed a new contract with the Defense Logistics Agency’s (DLA) Land and Maritime’s Product Test Center (PTC) with a maximal value of $1.04 million.

MedMen Enterprises Inc MMEN MMNFF announced the opening of its first Miami Beach, Florida location.

Tamerlane Trading launched an online quality-verified marketplace for wholesale and bulk cannabis, calling the move the first and only cannabis marketplace of its kind in the world.

“Our overall goal with the new online marketplace is to establish trust and transparency in the cannabis industry. By including quality verification and grading of cannabis product, wholesale buyers and suppliers will benefit,” said Jhavid Mohseni, CEO of Tamerlane Trading.

Acreage Holdings, Inc. ACRG ACRGF and Medterra CBD, LLC are joining forces to develop a CBD-based collection of products.

Sitka Hash House has launched its handmade hashish-based products into the California market with manufacturing partner, Garden Society. Founded in 2012, Sitka claims 9 out of the top 10 hashish SKUs in Washington state.

Sitka CEO Jeff Graham told Benzinga, “Interstate expansion offers us the opportunity to provide our original cannabis concentrates to new audiences. We are proud to enter California with the Garden Society as our manufacturer and HERBL as our distributor.”

The Aster Farms team tracked their energy consumption, CO2e emissions, water use, solid waste as well as their hiring practices over the last year. The company now released its first annual Sustainability Report.

“Sustainability is part of our company's DNA,” shared Aster Farms CEO and co-founder Julia Jacbonson. “From regenerative agriculture and recyclable packaging to inclusive hiring practices, we understand that sustainable farming is only part of the story.”

“The cannabis industry is in a unique position to change the paradigm of what a successful company looks and feels like and what is considered most important,” she added.

Newly released podcast Highly Unlikely, hosted by standup comedian Alex Gettlin and produced by Wikileaf, dives into the absurdity of the world we live in. Each episode features famed comedian guests losing their minds over some very real and strange facts while trying various new cannabis products.

Canadian licensed cannabis producers and global markets will have access to time-tested, feminized, organic-certified cannabis seeds. This is thanks to a new partnership between Humboldt Seed Company and Nymera, which will allow not only the production and sale of the seeds in Canada, but also the export of these genetics to other countries with legal cannabis markets around the world.

This is the first time a cannabis seed is certified as organic.

Calyxt announced advancements in technology that will make it easier for scientists to bring advanced breeding into hemp. The company, an expert at improving crops like soybeans and wheat to produce more heart-healthy oil or higher fiber, announced its scientists have transformed hemp – an important step as the company can now engineer the hemp genome, unlocking capabilities to selectively breed and deliver improvements in hemp traits through advanced plant breeding like gene editing or even GM level engineering.

“We were able to change the plants DNA and regenerate plants through tissue culture, thus accomplishing something that has been fairly elusive in hemp to date," said Travis Frey, Ph.D., chief technology officer of Calyxt. “By modernizing the hemp crop, we can now deliver traits that benefits both growers and consumers who are increasingly looking for plant-based and sustainable foods, materials, cosmeceuticals, nutraceuticals and more."

Zelira Therapeutics Ltd ZLD ZLDAF launched its HOPE line of cannabis products in Washington DC. The product line, especially formulated for autism spectrum disorder (ASD) patients of all ages, is also available in Pennsylvania, Louisiana and Australia.

“Since we first launched HOPE in the US, our long-term goal has been to make it accessible to ASD patients everywhere, and Washington DC's reciprocity allows us to take a huge step in that direction here in the US,” Dr. Oludare Odumosu, CEO of Zelira Therapeutics, told Benzinga. “The nation's capital is one of the most popular travel destinations, so we are thrilled to be able to offer HOPE there as a treatment option for ASD patients from around the country who travel to DC.”

Cannabics Pharmaceuticals Inc. CNBX, received a “Notice of Allowance” from the Mexican Patent and Trademark Office (IMPI) for a patent on a “System and method for high throughput screening of cancer cells.”

Executive Moves

CBD products distributor, Khode LLC., announced Tuesday it formed its first board of directors consisting of music artists, executives and CBD industry veterans, including Grammy award-winning artists and entrepreneur DJ Khaled, music executive Lenny S, CEO of Endexx Corporation EDXC Todd Davis, and Stephen Herron and Ron Cotting of CBD Unlimited, Inc.

Find out all about the latest executive moves at:

Phyto, HERBL, Treez, Fyllo, Auxly, AgraFlora, Viridis

Fire & Flower, Acreage, cbdMD, Greenlane & KushCo, Digital Venture

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