Understanding Cannabinoids: CBN vs CBD
While there are many cannabinoids that may enhance the therapeutic effects of hemp products, the most common renowned product is the phytochemicals in the Cannabis genus that contain the tetrahydrocannabinol or THC. This is the substance that is responsible for all of the psychoactive effects of cannabis. CBD has long been associated with the variety that offers up the best help benefits without offering up the high that the THC gives to users.
While the CBD may not be the feature that is in all of the hemp products, it’s a by-product of the THC. Hemp Genix, Wholesale CBD Oil in Blackville, has 80% purity compared to competitors at 17%-40%. The CBN doesn’t bind to the body’s cannabinoid receptors like the THC does. It’s long been known to give a stronger sedative effect when it’s used in combination with the THC.
At Hemp Genix, all of our products are made with 100 percent USA, Zero THC and 80 percent purity Wholesale full-spectrum CBD oil in Blackville. This is carefully derived from a variety of cultivars of hemp which contain an abundance of cannabinoids.
A lot of people are very familiar with CBD or Cannabidiol. This is found in highly concentrated amounts in a variety of products. However, there are lots of cannabinoids that are found in hemp. These have shown a variety of benefits in studies. All of our products offer you full-spectrum hemp oil. This also includes all of our cannabinoids that are found in the plant. We don’t want you to miss out on any of the benefits.
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This is the most abundant cannabinoid in the hemp oil. It makes up 90 percent of the content of cannabinoid. It’s non-psychoactive and the focus is on how it benefits the body via the hemp oil. It has minimal affinity for CB1 or CB2 receptors. The main focus on interaction is in the endocannabinoid system and it acts as an indirect antagonist toward the cannabinoid antagonists. This, in turn, may allow the CBD to temper the high that is caused through the THC. Wholesale CBD Oil in Blackville from Hemp Genix are over 80 percent pure and CBD makes up the majority of the Oils weight. Industry averages and nearly all of the other products with cannabinoids and brands average in at 17 to 40 percent purity.
What’s The Difference Between CBD And CBN?
Cannabis has a number of cannabinoids in which the most abundant are the levels of THC. There are 9 tetrahydrocannabinol as well as CBD and CBN. This is the active ingredient that makes you high. The THC is in the plant and the CBD is the precursor and the CBN is the metabolite of the THC. As the cannabis ages, the THC level breaks down into the CBN.
This also leads researchers to believe that the CBD might give some protection against ecstasy-derived neurotoxins or long-term depletion of the serotonergic receptions. While this is still speculation, it’s investigating further. The CBD is usually present in significant enough quantities in such products as hashish or cannabis resins. However,r it’s also in the herbal cannabis referred to as skunk in smaller amounts.
Overall, the CBN is a great cannabinoid that offers up a varied range of therapeutic applications that work together with the rest of the “team” in order to offer up the best possible results. Clearly, more clinical trials are required to see how else it can benefit patients.
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The end of marijuana prohibition is coming. But how the federal policies will change could have a dramatic effect on the nation's burgeoning legal marijuana businesses, which could fall victim to the same scourge that has hampered so many other nascent industries: regulations.
At the end of this month, the Food and Drug Administration and the Drug Enforcement Administration will announce their decision whether or not to reclassify marijuana under the Controlled Substances Act. The agencies did not give a hint as to which way they are leaning, but there are a number of moves they could take--the plant could be de-scheduled completely like alcohol or tobacco; it could remain as a Schedule I drug (it's current classification) or some of the plant's active chemicals could be rescheduled while the whole plant could remain illegal.
The real concern among those in the industry is what happens if the FDA and DEA reschedule marijuana as a Schedule II drug. FDA regulation experts say if pot is placed in the same category as legal pharmaceutical formulations of opioids like oxycodone and stimulants like amphetamine the burden of keeping up with regulatory compliance might be too costly for many of today's small marijuana companies.
"Schedule II would be a nightmare for the cannabis industry," says Andrew Ittleman, a lawyer and partner at Fuerst Ittleman David & Joseph in Miami. His firm helps companies navigate FDA's laws and regulations.
Right now, since marijuana is classified as an illegal drug with no medical benefits, the drug's prohibition is policed by the Drug Enforcement Administration and other law enforcement agencies. But if it is reclassified as a drug with medical benefits, the FDA would lead the charge in regulating its manufacture, distribution, sale, and use.
What's more, under the Schedule II classification, every cannabis-derived product would be subject to the kind of scrutiny typically reserved for drugs like Adderall and OxyContin. If, for instance, a brand says its Cannabidiol (CBD) oil cures seizures or Tetrahydrocannabinol edibles (THC) relieve pain, the products will be targeted for testing. If the claims turn out to be unproven, that company could be charged with criminal misbranding, says Ittleman. So rather than just going back to the drawing board, a company's operators might face prison time or fines. Further, if a company's manufacturing facilities aren't up to FDA standards, the products made in those facilities would be considered an "adulterated drug," or impure and unfit for consumption, under federal law, says Ittleman.
To be sure, ensuring your products are viable and safe for consumers is a worthy endeavor. There are, after all, a great many reasons why many regulations exist in the first place. Additionally, this new classification could give marijuana something of a credibility boost--that is, it puts the drug in the same league as legal, but controlled substances that are regulated by the government, prescribed by degree-holding doctors, and dispensed by licensed pharmacists.
The trouble is, the marijuana industry as it exists today simply isn't prepared for the rigors of transforming into a pharmaceutical industry.
If marijuana becomes a Schedule II drug, the FDA would subject companies to intense inspections and testing. Companies would need to get their packaging and labeling approved by the FDA; the Federal Trade Commission would be there to ensure companies don't sink to unfair or deceptive marketing and advertising practices. If marijuana was de-scheduled, and placed into the same category of alcohol and tobacco, it would fall under the purview of the Bureau of Alcohol, Tobacco, Firearms, and Explosives. That has its own maw of legal hoops to maneuver.
"If the FDA came out and said we are making cannabis Schedule II and the entire industry didn't change, the whole industry would be illegally trafficking a Schedule II substance," says Hank Levy, a CPA for marijuana companies, including Harborside, one of the largest dispensaries in the nation. Simply put, the industry as it stands today would not be legal under a whole set of other laws.
"I don't see Schedule II as being any help here for the existing cannabis industry at all," says Ittleman, who notes that the changes likely open the door to big pharmaceutical companies that have the experience manufacturing Schedule II controlled substances. "This is the red carpet for Purdue Pharma and Pfizer to enter the industry," adds Ittleman.
Even so, marijuana entrepreneurs remain undeterred. The cannabis industry is a $40 billion dollar market regardless of federal law and it's not going away.
Last December at a Meetup group event in New York City called High NY, marijuana entrepreneur Steve DeAngelo, the founder of Oakland, California-based Harborside, took questions from the audience regarding the future of the industry. DeAngelo, who started as an activist in Washington, D.C., now runs a $30 million a year dispensary. DeAngelo has battled federal law enforcement to successfully avoid commercial forfeiture and is currently battling the IRS in an effort to change tax code 280e.
One audience member asked: What happens if the industry loses the war? What if a new president comes in and orders the DEA to drop out of black helicopters and arrest every entrepreneur in all 24 states where some form of the marijuana economy enjoys state law protections? What if the DEA and FDA do the same thing to marijuana as they did with opium and outlaw the actual plant and only permit pharmaceutical pills? What would the marijuana industry do if suddenly pot was only legal in pill form?
DeAngelo smiled and said the marijuana plant cannot be stopped by a government, a new president, or a cadre of agencies.
"We'll take to the hills, like we always have," said DeAngelo, explaining that farmers in northern California have been growing in the isolated foothills of the Emerald Triangle since the 1960s. "It's a plant and it can grow anywhere. The only way they can take it away from us is if we give it to them."
How To Manage Cash Flow
Editor's note: This article is part of Inc.'s 2015 Best Industries report.
In the beginning, Pete Williams grew medical marijuana in his basement. He grew strains with names like White Widow and Sour Diesel, and it was good. Eventually, Pete's older brother Andy joined him and the business soon became too big for the basement. Five years later, Medicine Man is one of the largest and most successful cannabis dispensaries in the state of Colorado. With two retail locations, one in Denver and the other in Aurora, the company produced 7,000 pounds of pot and made $8 million in revenue in 2014.
The Williams brothers--along with their sister, Sally Vander Veer, who helped with Medicine Man's launch and came on as CFO in 2013--are one of the many success stories in Colorado's $1.5 billion legal weed industry. According to a report by Convergex Group, the state's 300 licensed marijuana businesses generated $350 million in revenue in 2014, a figure that's expected to grow by 20 percent this year.
Out of the basement.
In 2008, the recession crippled Pete's custom tile business. After 18 years of marriage, he and his wife got divorced, and he needed to make money to support his two children. A friend gave him 16 pot plants, each one small enough to fit inside a Dixie cup, and told him there's good money in "caregiving," or growing weed for medical patients. A born tinkerer, Pete built a complex grow system incorporating hydroponics and aeroponics techniques. That first year, he made $100,000 out of his basement selling to dispensaries.
President Obama declared state-legalized medical cannabis a "low priority" for law enforcement the following year. That's when Andy came down to the basement with a plan. "I'll be the businessman and you be the green thumb," Andy, now the president and chief executive of Medicine Man, remembers telling Pete.
With a loan of just over a half-million dollars from their mother, the brothers leased a 20,000-square-foot space in a warehouse in Denver's Montbello neighborhood and built a state-of-the-art hydroponics-based system. At that time, the brothers were selling wholesale, but in December 2010 a new law was enacted requiring cannabis growers to sell their product directly to customers. Andy and Pete built a dispensary in the front of the warehouse and ceased their wholesale business.
By 2013 Medicine Man was able to buy the warehouse and had generated $4 million in revenue. But with the legalization of recreational marijuana on the horizon, Andy knew the company needed to raise more money to expand their grow facility and up production in preparation for a spate of new customers. He pitched cannabis angel investor network ArcView Group in California and secured $1.6 million in funding.
"Andy was the right entrepreneur at the right time for an investment opportunity. At the end of the day, it's clear Andy thought all the way through the pieces of the puzzle," says ArcView CEO Troy Dayton. (Neither Dayton nor ArcView is a Medicine Man investor.) "In a nascent industry, companies get traction not only when they are early but when they are a great business and composed of great people--Andy has both."
On January 1, 2014, the first day sales of recreational marijuana were officially legal, Medicine Man sold 15 pounds of pot and made close to $100,000. Meanwhile Pete, Andy, and Sally have been looking ahead to a day when cannabis becomes legal nationwide. To ensure another revenue stream, the trio created Medicine Man Technologies, a consulting firm that offers turnkey packages to entrepreneurs who want to start pot business. Medicine Man Technologies, which has helped clients build medical facilities in New York, Illinois, Florida, and Nevada, will become a publicly traded company on the over-the-counter market this summer.
The challenges of being a potpreneur.
In spite of the safe haven Colorado has created, pot businesses still face at least two major hurdles: First, until major banks decide it's safe to bring on marijuana clients, the businesses must deal exclusively in cash. Medicine Man, which says it brought in $50,000 a day in December, has had to invest heavily in security measures. Its two locations are equipped with a total of more than 100 cameras trained inside and out, as well as bulletproof glass and doors. The company has also hired security company Blue Line Protection Group to supply armed guards for the dispensaries and warehouses, and armored trucks to run money from the safe to pay bills, the government, and vendors.
Cannabusinesses also face extremely high taxes, in some cases exceeding 50 percent. But thanks to Pete's super-efficient grow operation, which produces a gram of marijuana for the comparatively low cost of $2.50, Medicine Man has been able to slash prices for the customer while staying profitable--so even after the state takes its cut, the company's margins are 30 to 40 percent, Sally says.
It's easy to look at the Williamses, or watch them on MSNBC's reality show Pot Barons of Colorado, and believe they have the life. The trio seem to be sitting on top of the Mile High City's legal weed industry, but they didn't get up there without personal sacrifice. For example, Andy's decision to give up a stable job to launch Medicine Man cost him his marriage.
"One thing people don't understand is that the entrepreneurs who started the industry in Denver are pioneers in the truest sense. What it takes to be a pioneer is vision, the ability to see something, and the courage to go after it despite the risks," he says. "The risks weren't just about money--they were about our reputations, our freedom, and our families. People risked everything for it."
After years of dealing with all those risks and sacrifices, the Williamses now say they're ready to put their feet up and enjoy the rewards of building the "Costco of marijuana." The siblings are currently in talks with private equity firms regarding an acquisition. They put the current value of the 80-employee business at $30 million, and say it will bring in $15 to $18 million in revenue in 2015.
"We began this whole thing with an end game in mind," Pete says. "We're all in our late 40s and we don't want to work for the rest of our lives."
He adds that they're willing to sell their majority stake, but they'd like to hang on to 5 to 10 percent. "If we don't sell out, [an acquiring company] will buy our biggest competitor," he says. "If we hook up with the right people, Medicine Man can be a household name like Pepsi or Coke. [People will say,] 'Go get me a pack a Medicine Mans, honey.'"