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Biden talks cannabis at State of the Union

Plus, Schumer wants SAFER Banking, an interview with Cronos Group CEO, and more

Good morning.

It’s a historic day, Cultivated readers! President Biden said at last night’s State of the Union he’s directing his cabinet to review cannabis’s federal classification, and said “no one should be in jail for simply using” cannabis.

Look, it’s not like he said he’d legalize it — but it’s the first time a sitting President has ever mentioned cannabis reform on the biggest stage.

It’s historic, no matter what. 

- Jeremy Berke & Jay Rosenthal

💡What’s the big deal?

The Senate Majority Leader says SAFER Banking is a ‘very high priority’

Driving the news: Senate Majority Leader Chuck Schumer clearly wants to get stuff done before the November election.

And one of those things could be the long-awaited Secure and Fair Enforcement Regulation Act, or SAFER Act, which would let cannabis businesses access the banking system like any other legal industry. 

What they’re saying: “SAFER Banking is a very high priority and we’re having very productive conversations with the House on an agreement that can pass both chambers,” he told Marijuana Moment.

And Rep. Dave Joyce, the Republican co-chair of the Congressional Cannabis Caucus, told Marijuana Moment that Schumer’s comment “pretty much sums it up.”

And: Montana Sen. Steve Daines, the Republican co-sponsor of the legislation, said that conversations have been “productive” and that they’re working to get the bill across the finish line. 

Back up: This is far from the first time Schumer has said he wants to get SAFER passed, and unfortunately, it might be far from the last. 

Versions of the bill have passed the House nine times in the past, by our count. But the bill cleared the powerful Senate Banking Committee last November, which appears to have given some wind — or maybe at least a slight breeze — in its sales. 

What’s next: While a relatively narrow banking bill is far from the federal cannabis reform the industry and advocates want to see, it might just be what’s politically feasible given the nearly evenly split Senate.

Remember, any bill that passes has to break the 60-vote filibuster threshold, meaning compromise is key to getting things done. And it’s quite unlikely that this version of the Senate would be open to passing broader cannabis reform bills. 

But the SAFER Act could go a long way for normalizing the cannabis industry in the US — especially if it’s coupled with rescheduling cannabis to Schedule III. 

And more: Schumer previously said he expects to attach other cannabis-focused bills, including provisions that would add expungements for those convicted under previous cannabis laws, as well as gun rights for medical cannabis users. 

Read more: The quasi-version of legalization that no one wants but we seem to be getting.


We caught up with Cronos Group CEO Mike Gorenstein about what’s ahead

What happened: Our Editor-in-Chief Jeremy interviewed Cronos Group CEO Mike Gorenstein after the company reported earnings last week.

Gorenstein discussed the company’s challenging quarter, but said that hasn’t dimmed what he says are exciting times ahead for the industry. 

What he’s saying: “Knowing that we have products that can work in other markets is so core to our strategy to get the payback on the R&D investments we're doing. Seeing that start to pay off is really big.”

💬 Quotable

👊 Quick hits

A cannabis shop in Onondaga County, New York is suing the state’s Office of Cannabis Management to prevent another cannabis shop from opening. They’re alleging that the agency stopped the shop from opening in their preferred location, and allowed another store to open there instead, Syracuse.com reports

And in other New York news, the Department of Homeland Security is teaming up with the National Guard and the New York City Police Department to investigate how illicit cannabis is crossing state lines into the Empire State, according to Green Market Report. A member of the task force believes it may be connected to international crime rings with roots in Eastern Europe — but the case goes far beyond cannabis, and includes drug smuggling, financial crimes, and human trafficking.

🎒 What we’re reading

📈 Earnings round-up

AFC Gamma reported its fourth quarter and full year results yesterday. The company reported about $21 million of income in 2023, though it lost $9.1 million in the fourth quarter. The company recently announced its re-focus on cannabis, and that it’s pivoting off its non-cannabis portfolio into a new firm, Sunrise Realty Trust.

🤝 Deals, launches, partnerships

Bright Green Corporation submitted an application to the Drug Enforcement Administration to produce federally controlled substances including psilocybin, peyote, ibogaine, coca leaves, and opium poppy for pharmaceutical research.

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