Here’s What You Missed in Cannabis, Psychedelics This Week

In this week’s “Rising High,” The Fly’s recurring series focused on cannabis and psychedelic stock news, The Fly looks back on a license sale, an FDA clearance and product launches.

PLANET 13 TO SELL MEDICAL MARIJUANA TREATMENT CENTER LICENSE: Planet 13 Holdings (PLNHF) announced Monday that it has entered into a stock purchase agreement to sell all of the issued and outstanding shares of common stock of Planet 13 Florida, which owns a medical marijuana treatment center license issued by the Florida Department of Health, to SGW FL Enterprises. The sale of the MMTC License is a closing condition to the company’s previously announced proposed acquisition of VidaCann. “We’re pleased to be executing on the roadmap we’ve laid out for Florida expansion. The sale of this surplus license was the primary step required for us to move forward with our acquisition of VidaCann and their expansive retail network and cultivation assets,” said Bob Groesbeck, Co-CEO. “The solid, all cash return from this sale will help facilitate closing and integrating VidaCann.” Pursuant to the agreement, the company will sell the shares for a cash payment of $9M due on closing. The proposed transaction is expected to close in 1Q24, subject to customary closing conditions, including the receipt of regulatory approvals and the simultaneous closing of the acquisition of VidaCann. (read more)

Additionally on Tuesday, Planet 13 provided an update on access to certain cash accounts. On June 20, 2021, the company engaged El Capitan Advisors for cash management services. One of the company’s accounts managed by El Capitan was held at BridgeBank, a division of Western Alliance Bank (WAL). Pursuant to a dispute unrelated to the company, Casa Verde Capital obtained a $35M default judgment against El Capitan, which is a portfolio company of Casa Verde. Casa Verde then levied that judgment causing approximately $5.5M of the company’s funds held at WAB and managed by El Capitan to be directed to the Orange County, California Sheriff’s Office on September 21, 2023. On or around October 24, the company became aware of the levy against the WAB funds and thereafter filed a third-party claim of exemption asserting rightful ownership over the WAB funds. The company has secured a partial settlement with Casa Verde for the release of $3.4M of the WAB funds. On January 16, 2024, the court entered an order directing the Sheriff’s Office to release these funds to the company. The remaining approximately $2.1M of the WAB funds are still in the possession of the Sheriff’s Office while litigation is ongoing. A hearing on the ultimate disposition of the remaining funds is scheduled for April 29, 2024. After filing the WAB claim in November, the company also took immediate action to withdraw the remaining approximately $16.5M that the company held in two additional company accounts managed by El Capitan. On November 14, El Capitan informed the company that due to issues in connection with the Casa Verde judgment the wire was not able to be processed. Since November 14, El Capitan has refused to honor the company’s further withdrawal requests with respect to the funds and at this time it is unclear whether the funds will be returned. Based on discussions with El Capitan to secure the withdrawal of the funds and purported bank statements provided by El Capitan, the company has reason to believe that the funds were misappropriated by El Capitan. On January 22, the company initiated a lawsuit in Santa Monica, California against El Capitan seeking approximately $16.5M in compensatory damages and other relief. (read more)

CYBIN RECEIVES FDA CLEARANCE FOR CYB004 STUDY: Cybin (CYBN) announced Tuesday that the U.S. Food and Drug Administration has cleared its investigational new drug application for CYB004, its proprietary deuterated dimethyltryptamine molecule in development for the treatment of Generalized Anxiety Disorder. This clearance allows the company to proceed with its plans to initiate a Phase 2a study of CYB004 in 1Q24. The Phase 2a study will be a randomized, double-blind, active-controlled trial to assess the preliminary clinical efficacy, safety, tolerability, PK and PD of CYB004 in participants with GAD. This trial will be conducted at study sites in the United States. “With the recent positive topline results from two Phase 1 studies of our proprietary deuterated DMT molecules, CYB004 and SPL028, we are well-positioned to initiate a Phase 2a study of CYB004 in GAD this quarter,” said Doug Drysdale, CEO. “From our extensive portfolio of DMT and deuterated DMT datasets across five completed clinical studies, we have gathered important insights on dosing and preliminary efficacy signals in both depression and anxiety that will inform our next steps. Exploratory data from our completed Phase 2a study of SPL026 have shown that SPL026 reduced symptoms of anxiety in patients with major depressive disorder, which further serves to de-risk the development of deuterated DMT in anxiety disorders as we continue to evaluate the efficacy and safety of CYB004.” (read more)

AURORA LAUNCHES THREE CANNABIS-INFUSED BEVERAGES: Aurora Cannabis (ACB) announced Wednesday the launch of three new cannabis-infused beverages, available exclusively at first to veteran patients. The company said, “Designed to deliver on taste, potency and choice, the introduction of beverages is in response to the needs of patients looking for alternative forms of cannabis to support their wellbeing.” Three cannabis-infused products produced by Vacay and Versus, and available in three fruity flavours: Neon Rush, Strawberry Pineapple Tropical Fizz and Pineapple Coconut Fizz can be purchased at Aurora Medical. The new cannabis infused beverages are available in 355ml cans and are crafted with SoRSE emulsion technology for little to no cannabis aroma or taste. Veteran patients can order any mix of flavours up to four cans of each product per order for a total of 12 cans. (read more)

CANOPY UNVEILS NEW PRODUCT OFFERINGS: Canopy Growth Corporation (CGC) announced Wednesday the introduction of new product offerings across the company’s adult use and medical cannabis portfolio, including new Tweed softgels and oils featuring minor cannabinoids, a large format flower offering from Tweed, as well as new medical exclusive pre-roll products from 7ACRES and Spectrum Therapeutics. “In addition to launching new flower products, we’re making it easier to access CBD and minor cannabinoids in convenient oil and softgel formats to support wellness-minded consumers looking to start the year feeling their best,” said Dave Paterson, President, Canada. “For our medical cannabis consumers, we’re proud to continue delivering the variety and convenience that the Spectrum Therapeutics store is synonymous for thanks to new pre-rolls from 7ACRES and the Spectrum Reserve.” (read more)

ORGANIGRAM CLOSES FIRST TRANCHE OF BAT INVESTMENT: Organigram Holdings (OGI) announced Wednesday that it has closed the first of three tranches of the previously announced C$124,559,674 follow-on strategic equity investment by BT DE Investments, a wholly owned subsidiary of British American Tobacco (BTI)). Pursuant to the first tranche closing, the investor acquired 12,893,175 common shares of the company at a price of C$3.2203 per share for gross proceeds of C$41,519,891. The remaining 25,786,350 shares subscribed for shall be issued at the Per Share Price in two further equal tranches on or around August 30, 2024 and February 28, 2025. “With this transformational deal now formally approved by shareholders and with the first tranche funded, we look forward to delivering on our objectives of geographic and technological growth as well as product expansion,” said Paolo De Luca, CEO Organigram. “Since we announced this transaction on November 6, 2023 we have seen tremendous interest from cannabis companies looking for strategic partnership opportunities and growth capital. Organigram, with its strong balance sheet and dedicated Jupiter capital pool, is uniquely positioned to take advantage of a growing set of emerging opportunities.” The majority of the C$124.6M Investment will be used by Organigram to create a strategic investment pool, named Jupiter. Jupiter will target investments in emerging cannabis opportunities that will enable Organigram to apply its capabilities to new markets. Management has identified that geographic expansion is a strategic priority and this opportunity presents the company with the capital to lay global foundations as the legal recreational cannabis market continues to see significant growth. (read more)

CANNABIS/PSYCHEDELIC STOCKS: Publicly-traded companies in the space include Acreage (ACRHF), Audacious (AUSAF), Atai Life Sciences (ATAI), Avant Brands (AVTBF), Ayr Wellness (AYRWF), BZAM (BZAMF), Cannara Biotech (LOVFF), Chicago Atlantic (REFI), Clearmind (CMND), Clever Leaves (CLVR), Cresco Labs (CRLBF), CordovaCann (LVRLF), Cronos (CRON), Columbia Care (CCHWF), Compass Pathways (CMPS), CURE Pharmaceutical (CURR), Curaleaf (CURLF), CV Sciences (CVSI), Delic Holdings (DELCF), Delta 9 (DLTNF), Entourage Health (ETRGF), Enveric Biosciences (ENVB), Fire & Flower (FFLWF), Flora Growth (FLGC), Trees Corporation (CANN), Goodness Growth (GDNSF), Greenlane (GNLN), Green Thumb (GTBIF), GrowGeneration (GRWG), Hemp (HEMP), High Tide (HITI), India Globalization Capital (IGC), Indiva (NDVAF), IM Cannabis (IMCC), Innovative Industrial Properties (IIPR), InterCure (INCR), Wellbeing Digital (KONEF), Khiron Life Sciences (KHRNF), Lotus Ventures (LTTSF), Lowell Farms (LOWLF), Lucy Scientific Discovery (LSDI), MediPharm (MEDIF), MedMen (MMNFF), MindMed (MNMD), NewLake Capital (NLCP), Numinus (NUMIF), Red White & Bloom (RWBYF), Reunion Neuroscience (REUN), Revitalist (RVLWF), RIV Capital (CNPOF), Relmada (RLMD), RYAH Group (RYAHF), Safe Harbor Financial (SHFS), SNDL (SNDL), Sproutly (SRUTF), Skye Biosciences (SKYE), Stem Holdings (STMH), Sunniva (SNNVF), TerrAscend (TRSSF), Tetra Bio-Pharma (TBPMF), Tilray (TLRY), Trulieve (TCNNF), Tryp Therapeutics (TRYPF), Verano (VRNOF), Village Farms (VFF), Wesana Health (WSNAF), Zynerba (ZYNE) and 4Front Ventures (FFNTF).