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MJ News for 07/31/2014


Jul 25, 2008
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The federal government’s incredibly poor, misleading argument for marijuana prohibition

The New York Times editorial board is making news with a week-long series advocating for the full legalization of marijuana in the United States. In response, the White House's Office of National Drug Control Policy (ONDCP) published a blog post Monday purporting to lay out the federal government's case against marijuana reform.

That case, as it turns out, it surprisingly weak. It's built on half-truths and radically decontextualized facts, curated from social science research that is otherwise quite solid. I've gone through the ONDCP's arguments, and the research behind them, below.

The irony here is that with the coming wave of deregulation and legalization, we really do need a sane national discussion of the costs and benefits of widespread marijuana use. But the ONDCP's ideological insistence on prohibition prevents them from taking part in that conversation.

Here's what they have to say:

Marijuana use affects the developing brain. A recent study in Brain reveals impairment of the development of structures in some regions of the brain following prolonged marijuana use that began in adolescence or young adulthood.

The same is true for alcohol and tobacco. This is a great argument for restricting young peoples' access to the drugs (as Washington and Colorado have done with marijuana), but a poor one for banning it completely.

Moreover, the study cited was of a group of 59 individuals who had been heavy marijuana smokers for 16 years, and who had smoked an average of 4.5 joints every single day over that period.

This is far outside the realm of normal, moderate use. A recent Colorado Department of Revenue report found, for instance, that the majority of users in that state smoked five or fewer times per month. Again, what we have is not an argument against marijuana use, but an argument against overdoing it.

The same is true for alcohol and tobacco. The study cited by the ONDCP looked at changes in IQ among heavy marijuana users, defined in this case as those who smoked marijuana at least four times a week. In general, the authors found a "small" IQ effect for people who had used marijuana heavily at some point in their lives, with the exception of those who showed consistent heavy use over a period of 20 years, for whom the negative effect was "medium." Again, a solid argument for a minimum age and moderate use.

Substance use in school age children has a detrimental effect on their academic achievement. Students who earned D’s or F’s were more likely to be current users of marijuana than those who earned A’s (45% vs. 10%).

This comes from a CDC fact sheet. ONDCP doesn't report that students who earned D's or F's are also more likely to be current drinkers of alcohol than those who earned A's (62 percent vs. 32 percent). Setting aside that there's zero causality implied in these findings, the only argument here is, again, for keeping marijuana and alcohol out of the hands of minors.

Marijuana is addictive. Estimates from research suggest that about 9 percent of users become addicted to marijuana. This number increases to about 17 percent among those who start young and to 25-50 percent among people who use marijuana daily.

This is from a 20-year-old paper on the addictiveness of various substances. Taking these findings at face value, the important thing to note is that the 9 percent addiction rate for marijuana users is substantially lower than the 15 percent addiction rate for alcohol drinkers and the 33 percent addiction rate for tobacco users. This comports with more recent research showing that marijuana is a relatively non-addictive substance.

Or, to put it another way, marijuana is about as addictive as video gaming.

Drugged driving is a threat to our roadways. Marijuana significantly impairs coordination and reaction time and is the illicit drug most frequently found to be involved in automobile accidents, including fatal ones.

Undoubtedly true, and a strong argument for legalization and regulation to keep stoned drivers off the road. One important point in the study: Marijuana was a factor in about 12 percent of the fatal crashes studied in 2010. Alcohol was a factor in nearly 40 percent of fatal crashes throughout the study period. Distracted driving was the cause of 18 percent of all fatal crashes, on the other hand.

There are plenty of things that it is stupid to do behind the wheel, from being tired to texting. But that's a case for not doing stupid things when you drive — not a case for outlawing those things altogether.

Addictive substances like alcohol and tobacco, which are legal and taxed, already result in much higher social costs than the revenue they generate. The cost to society of alcohol alone is estimated to be more than 15 times the revenue gained by its taxation.

This is a weak argument for alcohol prohibition, and a terrible one for marijuana prohibition. The study ONDCP cites estimates the total societal cost of excessive drinking to be $223.5 billion. On the other hand, the alcoholic beverage industry estimates it generates about $400 billion in economic activity. And since marijuana is widely regarded to be a less harmful substance than alcohol, the economic cost of marijuana legalization would be even lower than for alcohol.

Reports from the nonpartisan RAND Institute found that the potential economic benefits from legalization had been overstated, citing that:

Marijuana legalization would not eliminate the black market for marijuana.
Dramatically lowered prices could mean substantially lower potential tax revenue for states.

For starters, these two statements are at odds with each other — if marijuana legalization results in dramatically lowered prices, how would there be an incentive for black market trade?

The RAND black market study looks at the effect that legalization in Calfornia, and California only, would have on drug trafficking organizations in Mexico. Not surprisingly the effect they find is small — the study assumes continued black market demand in all 49 other states, and notes that marijuana trafficking makes up a small proportion of Mexican cartels' overall export revenue.

But the study says absolutely nothing — literally nothing! — about the effects of national legalization, nor about the impact that legalization would have on domestic black markets. The study never even purports to make those types of conclusions. It's hard to see how the ONDCP's citation of this study to claim that "marijuana legalization would not eliminate the black market for marijuana" is anything other than a deliberate attempt to mislead.

The revenue picture is less clear. Colorado's marijuana revenues are coming in below forecasts, partly because existing medical marijuana patients are continuing to patronize the medical marijuana dispensaries, where prices are lower.

Any discussion on the issue should be guided by science and evidence, not ideology and wishful thinking.

Indeed, ONDCP. Indeed.


Jul 25, 2008
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What Science Says About Marijuana

For Michele Leonhart, the administrator of the Drug Enforcement Administration, there is no difference between the health effects of marijuana and those of any other illegal drug. “All illegal drugs are bad for people,” she told Congress in 2012, refusing to say whether crack, methamphetamines or prescription painkillers are more addictive or physically harmful than marijuana.

Her testimony neatly illustrates the vast gap between antiquated federal law enforcement policies and the clear consensus of science that marijuana is far less harmful to human health than most other banned drugs and is less dangerous than the highly addictive but perfectly legal substances known as alcohol and tobacco. Marijuana cannot lead to a fatal overdose. There is little evidence that it causes cancer. Its addictive properties, while present, are low, and the myth that it leads users to more powerful drugs has long since been disproved.

That doesn’t mean marijuana is harmless; in fact, the potency of current strains may shock those who haven’t tried it for decades, particularly when ingested as food. It can produce a serious dependency, and constant use would interfere with job and school performance. It needs to be kept out of the hands of minors. But, on balance, its downsides are not reasons to impose criminal penalties on its possession, particularly not in a society that permits nicotine use and celebrates drinking.

Marijuana’s negative health effects are arguments for the same strong regulation that has been effective in curbing abuse of legal substances. Science and government have learned a great deal, for example, about how to keep alcohol out of the hands of minors. Mandatory underage drinking laws and effective marketing campaigns have reduced underage alcohol use to 24.8 percent in 2011, compared with 33.4 percent in 1991. Cigarette use among high school students is at its lowest point ever, largely thanks to tobacco taxes and growing municipal smoking limits. There is already some early evidence that regulation would also help combat teen marijuana use, which fell after Colorado began broadly regulating medical marijuana in 2010.

Comparing the Dangers
As with other recreational substances, marijuana’s health effects depend on the frequency of use, the potency and amount of marijuana consumed, and the age of the consumer. Casual use by adults poses little or no risk for healthy people. Its effects are mostly euphoric and mild, whereas alcohol turns some drinkers into barroom brawlers, domestic abusers or maniacs behind the wheel.

An independent scientific committee in Britain compared 20 drugs in 2010 for the harms they caused to individual users and to society as a whole through crime, family breakdown, absenteeism, and other social ills. Adding up all the damage, the panel estimated that alcohol was the most harmful drug, followed by heroin and crack cocaine. Marijuana ranked eighth, having slightly more than one-fourth the harm of alcohol.

Federal scientists say that the damage caused by alcohol and tobacco is higher because they are legally available; if marijuana were legally and easily obtainable, they say, the number of people suffering harm would rise. However, a 1995 study for the World Health Organization concluded that even if usage of marijuana increased to the levels of alcohol and tobacco, it would be unlikely to produce public health effects approaching those of alcohol and tobacco in Western societies.

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Most of the risks of marijuana use are “small to moderate in size,” the study said. “In aggregate, they are unlikely to produce public health problems comparable in scale to those currently produced by alcohol and tobacco.”

While tobacco causes cancer, and alcohol abuse can lead to cirrhosis, no clear causal connection between marijuana and a deadly disease has been made. Experts at the National Institute on Drug Abuse, the scientific arm of the federal anti-drug campaign, published a review of the adverse health effects of marijuana in June that pointed to a few disease risks but was remarkably frank in acknowledging widespread uncertainties. Though the authors believed that legalization would expose more people to health hazards, they said the link to lung cancer is “unclear,” and that it is lower than the risk of smoking tobacco.

The very heaviest users can experience symptoms of bronchitis, such as wheezing and coughing, but moderate smoking poses little risk. A 2012 study found that smoking a joint a day for seven years was not associated with adverse effects on pulmonary function. Experts say that marijuana increases the heart rate and the volume of blood pumped by the heart, but that poses a risk mostly to older users who already have cardiac or other health problems.

How Addictive Is Marijuana?
Marijuana isn’t addictive in the same sense as heroin, from which withdrawal is an agonizing, physical ordeal. But it can interact with pleasure centers in the brain and can create a strong sense of psychological dependence that addiction experts say can be very difficult to break. Heavy users may find they need to take larger and larger doses to get the effects they want. When they try to stop, some get withdrawal symptoms such as irritability, sleeping difficulties and anxiety that are usually described as relatively mild.

The American Society of Addiction Medicine, the largest association of physicians specializing in addiction, issued a white paper in 2012 opposing legalization because “marijuana is not a safe and harmless substance” and marijuana addiction “is a significant health problem.”

Nonetheless, that health problem is far less significant than for other substances, legal and illegal. The Institute of Medicine, the health arm of the National Academy of Sciences, said in a 1999 study that 32 percent of tobacco users become dependent, as do 23 percent of heroin users, 17 percent of cocaine users, and 15 percent of alcohol drinkers. But only 9 percent of marijuana users develop a dependence.

“Although few marijuana users develop dependence, some do,” according to the study. “But they appear to be less likely to do so than users of other drugs (including alcohol and nicotine), and marijuana dependence appears to be less severe than dependence on other drugs.”

There’s no need to ban a substance that has less than a third of the addictive potential of cigarettes, but state governments can discourage heavy use through taxes and education campaigns and help provide treatment for those who wish to quit.

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Impact on Young People
One of the favorite arguments of legalization opponents is that marijuana is the pathway to more dangerous drugs. But a wide variety of researchers have found no causal factor pushing users up the ladder of harm. While 111 million Americans have tried marijuana, only a third of that number have tried cocaine, and only 4 percent heroin. People who try marijuana are more likely than the general population to try other drugs, but that doesn’t mean marijuana prompted them to do so.

Marijuana “does not appear to be a gateway drug to the extent that it is the cause or even that it is the most significant predictor of serious drug abuse,” the Institute of Medicine study said. The real gateway drugs are tobacco and alcohol, which young people turn to first before trying marijuana.

It’s clear, though, that marijuana is now far too easy for minors to obtain, which remains a significant problem. The brain undergoes active development until about age 21, and there is evidence that young people are more vulnerable to the adverse effects of marijuana.

A long-term study based in New Zealand, published in 2012, found that people who began smoking heavily in their teens and continued into adulthood lost an average of eight I.Q. points by age 38 that could not be fully restored. A Canadian study published in 2002 also found an I.Q. loss among heavy school-age users who smoked at least five joints a week.

The case is not completely settled. The New Zealand study was challenged by a Norwegian researcher who said socio-economic factors may have played a role in the I.Q. loss. But the recent review by experts at the National Institute on Drug Abuse concluded that adults who smoked heavily in adolescence had impaired neural connections that interfered with the functioning of their brains. Early and frequent marijuana use has also been associated with poor grades, apathy and dropping out of school, but it is unclear whether consumption triggered the poor grades.

Restricting marijuana to adults is more important now that Colorado merchants are selling THC, the drug’s active ingredient, in candy bars, cookies and other edible forms likely to appeal to minors. Experience in Colorado has shown that people can quickly ingest large amounts of THC that way, which can produce frightening hallucinations.

Although marijuana use had been declining among high school students for more than a decade, in recent years it has started to climb, in contrast to continuing declines in cigarette smoking and alcohol use. Emergency room visits listing marijuana as the principal cause of admission soared above 455,000 in 2011, up 52 percent from 2004. Nearly 70 percent of the teenagers in residential substance-abuse programs run by Phoenix House, which operates drug and alcohol treatment centers in 10 states, listed marijuana as their primary problem.

Those are challenges for regulators in any state that chooses to legalize marijuana. But they are familiar challenges, and they will become easier for governments to deal with once more of them bring legal marijuana under tight regulation.


Jul 25, 2008
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Seattle Cop Who Issued 80 Percent Of Marijuana Tickets Reassigned

SEATTLE, July 30 (Reuters) - The Seattle Police Department has reassigned an officer who single-handedly issued about 80 percent of the marijuana tickets handed out in the city during the first half of this year, authorities said on Wednesday.

Seattle Police Chief Kathleen O'Toole said staff reviewing data to prepare the department's first biannual report on marijuana enforcement found that 66 of 83 citations for public pot use were given out by just one officer.

"In some instances, the officer added notes to the tickets," O'Toole said in a statement, adding that some of the notes requested the attention of City Attorney Peter Holmes and were addressed to "Petey Holmes."

In one case, she said, "the officer indicated he flipped a coin when contemplating which subject to cite."

In another, O'Toole added, he referred to Washington's voter-approved changes to marijuana laws as "silly."

Washington state voted in 2012 to legalize the sale of cannabis to adults for recreational use but does not allow it to be used in public places.

She said the officer's actions were reported to the police's Office of Professional Accountability, and that he will not perform patrol duties while an investigation takes place.

The six-month report, which was released last week, found African Americans in Seattle were ticketed disproportionately to their population for using pot in public.

The police department said 36 percent of the tickets were issued to African-Americans, who make up just eight percent of the city's population.

A spokesman said the SPD recognized the numbers were disproportionate, and O'Toole reiterated on Wednesday that the study was designed to provide more oversight and to flag "anomalies or outliers" in Seattle's marijuana enforcement.


Jul 25, 2008
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Children's Deaths Prompt New York Governor's Bold Medical Marijuana Move

New York Gov. Andrew Cuomo (D) on Wednesday called for faster implementation of the state's medical marijuana law, which passed last month but won't take effect for another year and a half.

In a letter to the state Health Department, Cuomo cited the deaths of two children from complications of seizure disorders who could have been treated with medical cannabis. The Huffington Post reported last week that the death of 9-year-old Anna Conte prompted drug reform advocates to demand that Cuomo find a way to speed access to medical marijuana for patients with chronic conditions.

"The deaths ... were tragic reminders of the urgent help children with epilepsy desperately need," Cuomo wrote. "The children struggling with this condition deserve every consideration we can make that will potentially ease their pain and suffering."

Conte's mother, Wendy Conte, applauded the governor's effort in a statement Wednesday, saying she hopes he will continue to focus on the issue. "We know that this medicine is readily available," Conte said. "There is simply no reason, or excuse for why another child, like Anna, must die."

Conte, who repeatedly lobbied state legislators on behalf of her daughter, is widely credited for New York's medical marijuana law. The measure faced years of resistance from both Cuomo and conservative state lawmakers, and the legislation is one of the strictest medical marijuana laws in the U.S. The law allows patients to ingest cannabis in the form of edibles, tinctures or vapor, but they can't smoke it -- a restriction drug reformers argued will alienate lower-income patients.

Strains of medical marijuana that are high in cannabidiol, a non-psychoactive ingredient that doesn't cause users to feel high, have proven extremely effective in treating rare conditions like Anna Conte's. Children in states that allow the treatment, including Colorado and California, ingest the drug in pills or as a liquid tincture and in some cases have seen remarkable results. A 10-year-old boy HuffPost profiled in January used to suffer from thousands of debilitating seizures every day. He's been seizure-free since beginning his medical marijuana regimen more than a year ago.

But cannabis remains illegal under federal law, with classifies the drug alongside heroin and LSD as having no medicinal value. As a result, states are adopting laws similar to New York's that specifically target children with seizure disorders and other crippling ailments that may be helped by marijuana. Action has included even conservative states like Georgia, which is exploring using medical marijuana in clinical trials, and Florida, which passed a limited-access cannabis law earlier this month.

As Capital New York noted Wednesday, despite Cuomo's efforts, there may not be much the governor can do to speed implementation of the law. Cultivating the marijuana plants for patients may take up to 10 months.

Some may not have that much time. "We have a moral obligation to ensure that this medicine is available to those who are critically ill now," Kate Hintz, whose child suffers from a severe seizure disorder, said in a statement. "We cannot sit and wait for more deaths to occur before this is made a priority."


Jul 25, 2008
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Major Oregon marijuana critic lays out his case against legalization

Clatsop County District Attorney Josh Marquis says he and other law enforcement officials won't have much money to battle the marijuana legalization measure on the November ballot.

But he hopes that Oregon voters will once again vote against liberalizing the state's marijuana laws and he has some reason to hope for a win: His side has prevailed in the last three statewide initiative fights against pro-marijuana forces.

Oregon voters in 2012 rejected an initiative to legalize marijuana and in 2004 and 2010 voted down measures to liberalize medical marijuana laws. Of course, none of those measures had the national firepower being brought to bear in favor of this year's marijuana initiative. So far sponsors have raised more than $1.1 million and pitch their initiative as carefully written to sensibly regulate possession and sale of the drug.

Marquis, perhaps the state's most high-profile marijuana opponent, disagrees. He met with The Oregonian's Editorial Board Wednesday to lay out some of the arguments he expects to make during the fall campaign.

Here's a look at his major points:

USE BY MINORS: Marquis said that legalization will inevitably lead to more pot smoking by kids.

"There's going to be a huge trickle down to youth" from adults, he argued. As the drug is seen as more acceptable, it will also become more popular with those under 21 – just as repeated surveys show that alcohol is more widely used by minors than any illegal drug.
Regardless of your feelings about adult use of marijuana, he said, "would you want your kids...while they are learning, to be affected by a powerful drug?"

Peter Zuckerman, a spokesman for New Approach Oregon, sponsor of the marijuana initiative, said the lower rates of teen smoking in recent decades show what can be accomplished with strict regulation.

He also noted that a new study did not find that youth rates increased more in states that legalized medical marijuana than in other states.

DRIVING WHILE INTOXICATED: Increased use and acceptance of marijuana will also inevitably lead to more intoxicated driving, Marquis argued.

That doesn't mean that pot-impaired drivers are more dangerous than drunken drivers, he said. But he said it's harder to measure intoxication among marijuana users because traces of the drug remain in people's bodies for a much longer time.

Zuckerman said overall DUI fatalities declined in Colorado in 2014 after voters legalized marijuana in 2012. In Washington, which passed a similar law the same year, statistics from the Washington Traffic Safety Commission show fewer fatalities from drivers testing positive for marijuana in 2013 than in 2012.

OREGON'S CURRENT LAWS: Marquis said Oregon already has a reasonable system of regulating marijuana that allows adults to safely partake in the privacy of their homes.

"Marijuana," he said, "is already functionally available to almost any adult that wants it in Oregon."

Oregon allows medical marijuana users to possess up to a pound and a half of pot, he said. And Oregon was the first state, in 1973, to decriminalize possession of small amounts of marijuana, making it subject to a citation.

Even now, he said, many of those cited don't wind up paying the maximum $650 fine. For the most part, he said, law enforcement doesn't pursue marijuana offenses unless someone is selling to minors.

Marquis said marijuana advocates are correct to say that laws are too harsh in some states where people can be jailed for simple possession.

Zuckerman countered that some 99,000 people were cited or arrested for marijuana offenses in Oregon over the last decade – and he said legalizing the drug would free up law enforcement in many of those cases to focus on more pressing priorities.

PROHIBITION'S EXAMPLE: Supporters of legalizing marijuana often point to the nation's failed experiment with alcohol prohibition.

"It took 13 years for the United States to come to its senses and end Prohibition, 13 years in which people kept drinking, otherwise law-abiding citizens became criminals and crime syndicates arose and flourished," The New York Times wrote in a widely circulated editorial on Sunday. "It has been more than 40 years since Congress passed the current ban on marijuana, inflicting great harm on society just to prohibit a substance far less dangerous than alcohol."

Marquis accepts that Prohibition was a failure but said it's not a useful example.

Alcohol had deep roots in American society by the time prohibition rolled around in 1919. "Marijuana has not been accepted in America," said Marquis. "It has been gradually more tolerated."

In other words, he said, he'd rather keep marijuana where it is now – in a kind of gray area. He said he'd happily eliminate alcohol and tobacco if he could, but he said that's not practical. But he argued there is no reason to bring "a really powerful psychoactive drug" further into the mainstream.


Jul 25, 2008
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(UK) North-east's first major pro cannabis rally to take place in Redcar this weekend

A pro cannabis rally is taking place in Redcar on Saturday.

Supporters are to campaign for a change in the law, as well as those wanting to find out more about their efforts.

As part of their campaign organisers Teesside Cannabis Club - which has joined with Tyne & Wear Cannabis Club to host the event - seeks to see the drug legalised for medicinal use.

It is the first major cannabis-based event to be held in the North-east and will take place from 12pm - with further details available on the Facebook event page.

It will feature a number of speakers and the opportunity to meet other campaigners.

John Holiday, 30, is the founder of Teesside Cannabis Club which he says has around 1000 members.

John says he used cannabis to help with a chronic stomach complaint that doctors were unable to diagnose.

However he is keen to stress that as a figurehead for the club he no longer uses the drug.

John, a mechanic from central Middlesbrough, says that after much research online he turned to cannabis oil six years ago which he says helped him dramatically - and claims he was able to come off six prescribed drugs entirely.

He said: “It completely resolved the problem.

“If it wasn’t for running this campaign I would still be using it every day.”

He added: “We are trying to promote the medicinal use, the industrial use and the recreational use - we want to tackle it on all three points.

“we are trying to get as much attention as possible. However we are not condoning anyone behaving in a illegal way.

“It’s a meeting of like-minded people.

“People will come from all over to find out the facts and speak to people.”

Currently it remains illegal for UK residents to possess cannabis in any form. It is illegal to possess, grow, distribute or sell in the UK without the appropriate licences.

It is a Class B drug, with penalties for unlicensed dealing, unlicensed production and unlicensed trafficking of up to 14 years in prison, an unlimited fine, or both.

A spokeswoman for Cleveland Police said they would be monitoring the event and dealing robustly with anyone engaging in antisocial or criminal behaviour.

Alcohol is banned at the event.


Jul 25, 2008
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If Big Pharma Isn't Nervous, It Should Be; Early Stage Cannabis Technologies...Potentially the Next GW Pharma

VANCOUVER, British Columbia, Jul 31, 2014 (GLOBE NEWSWIRE via COMTEX) --

Deep in the brain, buried within the central nervous system as well as lymphatic tissues and organs throughout the body are cannabinoid receptors; patiently waiting to help address a myriad of diseases. With the advent of cannabis research and therapy development many patients will likely trigger them very soon.

Two known receptors in the Endocannabinoid system are CB1 and CB2. There is mounting evidence that there are many more. Simply put, this system of receptors is involved in dealing with a variety of physiological processes including appetite, pain-sensation, mood and memory.

Activating these receptors by introducing the appropriate drug based on a specific formula of cannabis, primarily utilizing Cannabidiol (CBD) and Tetrahydrocannabinol (THC) has already shown remarkable potential efficacy, albeit somewhat anecdotal, in the treatment of a host of afflictions ranging from cancer to epilepsy, glaucoma, MS, Tourette's and even eczema.

To date there have been approximately 100 cannabinoids identified; each with the potential to be an integral component of a lower cost treatment; countering the expensive and frequently toxic Big Pharma drugs and therapies.

The current level of research and development of cannabis therapies is analogous to where the Internet was in the mid 1990's. What is known is that the introduction of targeted phytocannabinoid formulations, such as those with CBD and THC, signal the body to make more endocannabinoids and open more cannabinoid receptors enhancing the body's ability to fight pain and disease.

"At this point, we don't actually know how many therapies are possible utilizing phytocompounds, but we suspect hundreds, if not thousands," stated Craig Schneider, President and CEO of Cannabis Technologies (can:CSE)(canlf:OTCQB). "To that end, CAN has developed a proprietary Cannabinoid Drug Design Platform (CDP) to identify new bioactive compounds within the cannabis plant that interact with certain genes responsible for specific diseases."

The poster stock in this Life Sciences sector is GW Pharmaceutical. The Company IPO'd at $8.90 in May 2013 and traded as high as $107 in 2014. When investors compare the metrics of peers GWPH and CAN, the case for the latter appears compelling.

While it would be easy to draw the usual David and Goliath analogy, in this case the participants, while competitors are really more peers, working toward the same therapeutic goals. And, as a result of the focused CDP development process, cannabis therapies can be on the market in 4-6 years versus 10-15 years as is the norm through the Big Pharma pathway.

GW currently trades at $87 has a market cap of $1.5 billion and had trailing twelve-month (ttm) revenues of $50 million, is virtually debt free and has approximately $163 million in cash. Cannabis Technologies trades at $0.37 is pre-revenue and has a market cap of $12 million with roughly $600k in cash. CAN shares have a 2014 high of $0.71 and low of $0.33.

GWPH market cap is 30 times revenue. Translating that multiple to eventual revenues to early stage CAN evidences compelling growth potential.

GWPH, as CAN, decided early on to dedicate R&D to therapy development and plant their respective flags firmly in Life Science space instead of the class of 'Medical Marijuana' companies with all the different connotations.

These companies are involved in serious and life saving science. There are others as well, including AbbVie, which makes the FDA approved chemotherapy nausea treatment Marinol, which is a synthetic formulation of THC. Valeant Pharmaceuticals produces Cesamet, which is a like treatment. The best known to investors is likely GW's vapor delivered Sativex, used currently in 25 countries outside the US for treatment of the spasticity associated with MS. Sativex is currently in clinical trials for approval as a treatment of cancer pain.

CAN's Schneider notes: "The media has categorized CAN as an early-stage GW Pharma, a comparison we welcome. We are currently entering Phase 1 trials for our glaucoma treatment CTI-085, which showed great therapeutic promise in pre-clinical trials relieving the ocular pressure associated. This initial therapy is much more, being a proof of concept of the ability of our CDP to identify specifically engineered treatments to deal with many debilitating and deadly diseases."

For context, the $12 billion ocular disease market includes $5.7 billion for glaucoma.

Other drugs in development include GW's Epidolex for the treatment of rare diseases as well as other compounds in clinical trials for treatment of autoimmune, diabetes and schizophrenia.

The key to therapy going forward is this specific engineering and the ability to replicate the compound for quality and consistency. Sativex is basically 50% CBD and 50% THC. The CBD component has the dual task of being the active ingredient as well as damping down the psychotropic effects of the THC. CBD comes from the hemp plant and has only trace THC.

As new cannabis drugs develop, individual formulations will be more therapy specific, have non-cannabis ingredients added and undergo stringent quality and consistency controls.

Big Pharma has a right to be nervous. Side effects from cannabis therapies are virtually non-existent, development costs are extremely low by comparison--$5 billion on average per Big Pharma drug—and companies like CAN are confident that as it progresses it can develop therapies in a period of 60-90 days instead of decades.

Part of the strategic engineering is not just how much of this and that goes into a compound. The key is to develop plants that produce the right material for each formulation. It is not inconceivable that if there were 500 cannabis therapies, there would be 500 different strains of cannabis plant as 'feed stock'.

The label of Medical Marijuana companies, when referring to enterprises such as GW, CAN, AbbVie and Valeant, are the exception to what appears to be a wild west show at times. These are serious life science companies. To include them with the plethora of Medical Marijuana initiatives, whether junior mining companies looking for a new direction or those that feel simply growing generic marijuana is a sound business plan, many will likely fail or be swallowed.

Like the Internet of old where there are few survivors today from that era, the cannabis space will eventually be littered with casualties as it builds out. What is not in dispute, is that the efficacy of cannabis appears undeniable and therapy development will continue and likely speed up, building on early successes. GW and CAN will likely be among those to grow and prosper; a good thing for both shareholders and, more importantly, those millions of patients suffering from particularly nasty diseases and conditions.

Innovative science requires scientists. Rounding out CEO Craig Schneider's 20 years of capital market and biopharmaceutical experience CAN has two world-class scientists. Dr. Sazzad Hossain Ph.D, M.Sc., Chief Science Officer, brings two decades of experience in new drug discovery and natural health product development. His practical experience includes senior scientist at the NRCC bringing and has generated over $500 million in revenue from therapies he has been involved in developing from the discovery to commercialization.

Key as well is the Company's breeding, genetics and cultivation division led by Dr. Hyder Khoja, Ph.D., M.Sc., A.Ag. who brings 17 years of extensive research and business provenance in life sciences and business services.

Management has spoken frequently about addressing larger therapy markets including cancer, metabolic diseases and pain and inflammation. On par with GW, CAN has plans to produce medicines in-house initiated by its CDP technology, breeding and cultivation division and proprietary formula engineering. Even at this early stage, the Company is keenly aware of the need for not just the development of therapies but the ability to replicate each with strict quality and consistency.

Further adding to shareholder value is a patent pending for CAN's CDP and a plan to protect IP by filing patents as therapies are developed.

If you are considering investing in the cannabis space, buy the science. Hype has a very short shelf life.


Jul 25, 2008
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San Diego student's near-death in DEA custody avoidable: report

Simple measures, such as a white board listing names of prisoners, might have prevented the near-death of a San Diego college student inadvertently left in a holding cell for nearly five days without food or water, a federal report showed on Wednesday.

The student, Daniel Chong, says he survived the 2012 incident by drinking his urine while in the custody of the Drug Enforcement Administration. His lawyers said he reached a $4.1 million settlement with the DEA last year.

The Department of Justice report slams the DEA for not keeping track of prisoners and for assigning the same federal agents who left Chong in the cell to conduct the investigation, violating policy.

"This policy is particularly important when an incident involves conduct that could be subject to criminal prosecution, as this incident was, because an investigation by management could be construed as compelling employees' cooperation ...," the report said.

Chong, then a University of California San Diego student who is now 26, was arrested in April 2012 during a raid on a home where DEA agents suspected an ecstasy drug ring was operating.

Agents quickly determined Chong was not part of a trafficking gang and placed him in a holding cell, saying he would be released soon. He spent five days handcuffed there before he was found and rushed to the hospital with kidney failure.

The report concluded that at least four agents saw or heard Chong in the cell, and said three members of a task force that arrested him as well as a supervisor bore responsibility for his welfare.

According to the report, none of the agents admitted handcuffing Chong or placing him in the cell, and none of 25 employees nearby could remember hearing him shout or pound on the cell walls, though investigators determined they should have.

The U.S. Attorney's office declined to file a criminal case because of insufficient evidence, the report said. The DEA said it remained troubled by the incident but could not comment on disciplinary action.

The report also says the Special Agent in Charge of the San Diego office had obtained price quotes for cameras with audio feed for the holding cell area, but had not ordered them. Cameras have since been installed, along with a whiteboard, the DEA has said.

Chong's attorney welcomed the report but expressed disappointment no action was taken against the agents.

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