By Ciara Linnane, MarketWatch
John Oram, president and chief executive of Oakland, Calif.-based NUG, agreed and called on industry insiders to coalesce around that message. The illness “is a big setback for legal cannabis,” he said, with tobacco companies pointing the finger at cannabis, because most of those sickened have said they used THC products.
Cannabis companies, meanwhile, are pointing the finger at big tobacco, “and it’s not productive,” said Oram. “This is an opportunity to show that it’s not our products that are causing the problem, but the illicit market, it’s an opportunity to call for stronger regulations, stronger enforcement and a different approach to how the legal business is rolling out,” he told MarketWatch.
On the regulatory side, more needs to be done to get licensing approvals and expand the number of dispensaries, so the legal market has the chance to grow. In California, the black market remains a major force, he said. The sector also needs enforcement action to shut down black-market players, but in a political environment that is focused on attaining social justice for those who suffered disproportionately during prohibition, district attorneys and attorneys general are reluctant to take any action that might be construed as re-establishing the war on drugs, he said.
“Now there’s a public health crisis that people are listening to is the time to get the message out there that people really need to go to regulated stores,” he said.
One challenge for the legal sector is the proliferation of counterfeit products, which are becoming increasingly sophisticated, said Oram. “There are products that look exactly like real brands and have packaging that makes them look completely compliant,” he said.
A recent NBC News report found that 15 THC products purchased on the black market contained pesticides and myclobutanil, a fungicide that can turn into hydrogen cyanide when burned. Three cartridges purchased in legal dispensaries were clean, the test found.
Shares of Greenlane Holdings /zigman2/quotes/211319667/composite GNLN -4.64% were down 3%, Canopy Growth’s stock /zigman2/quotes/200603886/composite CGC -0.14% /zigman2/quotes/202205609/delayed CA:WEED -0.98% was down 2.7% and Cronos Group /zigman2/quotes/206842762/composite CRON -1.93% /zigman2/quotes/202715342/delayed CA:CRON -2.48% was down 3.1%.
Tilray’s shares /zigman2/quotes/209129655/composite TLRY -5.18% were down 1.1%, stock of Aurora Cannabis /zigman2/quotes/210559470/composite ACB -3.11% /zigman2/quotes/203734337/delayed CA:ACB -3.74% was down 1% and Hexo /zigman2/quotes/206508254/composite HEXO -7.69% was up 2.9%.
Sundial Growers /zigman2/quotes/213489825/composite SNDL -14.13% was down another 3.7%, a day after it became the subject of a class-action lawsuit in the U.S. for allegedly failing to disclose that a customer returned half a ton of cannabis because it contained mold and bits of rubber gloves.
The allegations were first reported by MarketWatch’s Max A. Cherney on Aug. 20, and MarketWatch’s reporting is cited in the suit.