From the vaping crisis to an editorial rebuttal, there’s a lot to discuss this week…
Last week, I talked about how I disagreed with the New York Times editorial piece, “Do We Really Want a Microsoft of Marijuana?”
My answer is yes. We absolutely want a Microsoft of Marijuana!
In the article, the author – Christopher Caldwell – states that he thinks the SAFE Banking Act would disproportionately help giant operators at the expense of smaller companies. That, in turn, would usher in a dystopian future in which multinational businesses develop new flavors and products to turn America’s children into a nation of potheads.
I think he’s wrong, but I want to know what you think.
That’s why, at the end of this article, I’ve created a Twitter poll.
Your opinion matters, and I want to hear yours!
The Vaping Crisis
As you saw earlier this week, I sent out an updated report about the vaping crisis, which has turned into an epidemic. Over 400 people may have been affected, and several people have unfortunately died.
Of course, I know a lot of our readers have a lot of questions about this issue.
Keith D. asks: “Greg, what do you think the near term effect will be for the companies in our portfolios that concentrate their business in the vaping market and vaping supplies?”
Thanks for your question.
I’m concerned in the short term.
The publicity surrounding this illness may sweep up many legitimate vape manufacturers into a panic caused by overzealous policymakers and an uninformed press.
I’ve recommended two companies before all of this happened that make all or most of their revenue from vaping products.
One of the model portfolio members in the Cannabis Investor’s Report was already on “HOLD” because of other issues at the company.
The other one – in the Cannabis IPO Insider – I have moved to HOLD for the time being. You can access that report here.
Why not just sell?
In the intermediate to longer term, this issue may turn out to be a huge positive for legitimate vape manufacturers. Consumers and regulators will learn that legal, regulated providers are the best way to prevent bad effects from happening to the public.
Former FDA Commissioner Scott Gottlieb has already spoken out on this issue, and others are starting to follow. The vape industry is starting to react, too.
KushCo Holdings Inc. (OTC: KSHB) CEO Nick Kovacevich, recently talked to Yahoo Finance about the issue. Other vape makers and other press outlets will follow.
While many of the illicit vape consumers will have no options available to them because cannabis is not legal in their states, many others will stop buying on the illicit market and pay up for clean, tested, and safe products.
They’ll have to pay up – the illicit operators don’t pay taxes on their products, and of course, they save a lot of money using untested ingredients.
But when they do, they’ll find that in addition to safety, they get a better product.
Another member had a question concerning threats to CBD investments…
Biosynthesis: Threat or Opportunity?
Clinton J. asks: “Is biosynthesis a threat to our existing investments in CBD?”
It’s not, Clinton. In fact, it could be an opportunity.
Other companies are similar.
So, synthetic cannabinoids might turn out to be a huge headache for farmers, but farming only makes up a tiny fraction of our CBD investments.
The producers of branded products that we’re focused on may be able to buy synthetic cannabinoids for less than they can acquire the cannabinoids from farmers, or they may be able to buy custom cannabinoid combinations, which would be impossible without synthetically produced cannabinoids.
So, one of our companies could sell a face cream with extra CBN, CBA, or whatever turns out to be the most effective cannabinoid for treating facial skin.
Thanks again for the question.
There’s a lot of pharmaceutical companies and wellness companies out there vying for your attention, and there will be a few that have revolutionary breakthroughs.
That’s why one of the sub-sector categories in our NICILytics stock rating system is “Pharmaceutical.” We’re closing in on 200 ratings for different companies, and you’re free to learn more about our system here.
Share Your Thoughts
Before you enjoy the rest of your weekend, I promised that I would share a poll to get your input.
Do you think the industry needs a Microsoft of cannabis stocks?
Let me know below.
— National Institute for Cannabis Investors (@NICINetwork) September 12, 2019
Executive Director, National Institute for Cannabis Investors
6 responses to “The Industry Does Need the Microsoft of Cannabis”
September 14 2019