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US Department of Justice tells Supreme Court to pass on medical cannabis case

One cannabis law expert says the federal government’s “hands-off” approach to cannabis needs to end. 



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The Department of Justice has urged the Supreme Court to deny two workers’ bids for medical cannabis reimbursement. One patient has called for the Supreme Court to reject the “unusually weak arguments”.

Two workers in the US state of Minnesota have been seeking reimbursement from their respective employers for the costs of medical cannabis which was prescribed to them after sustaining injuries at work.

Minnesota’s Supreme Court ruled that employers are not required to reimburse injured workers for medical cannabis as it would result in the organisation breaking federal law. This is the fourth case of its kind in the United States.

Last month, the US Supreme Court asked the Department of Justice (DOJ) to weigh in on the case but the DOJ responded by urging it to steer clear due to the novelty of the issues, while showing support for Minnesota’s verdict.

In an amicus brief filed last month, the DOJ stated: “The judgments […] are correct for the straightforward reason that when a federal law such as the [Controlled Substances Act] prohibits possession of a particular item, it preempts a state law requiring a private party to subsidise the purchase of that item.”

The DOJ also argued that the workers’ compensation order is preempted by federal law because it “stands as an obstacle to the accomplishment and execution of the full purpose and objectives of Congress”.

Justin Brandt – a founding partner of the cannabis law firm Bianchi & Brandt – is not convinced by the DOJ’s response.

“The [Department of Justice] conveniently ignores the government’s own policy of non-enforcement, which inherently poses an obstacle to the accomplishment of Congress’s objectives,” Brandt told Cannabis Wealth.

“In other words, the DOJ is speaking out of both sides of its mouth. The government doesn’t want to be in a position where it must explain why it may rely on the Controlled Substances Act to impede state law while at the same time failing to enforce the Controlled Substances Act against those acting in compliance with state cannabis laws.”

One of the patients fighting the case, Susan Musta has a similar opinion, urging the Supreme Court to reject the DOJ’s “unusually weak arguments”.  As reported by Law360, Musta hit back at the Biden administration. “The government acknowledges that there is a 2-2 split on a question of national importance,” Musta wrote. “Yet it nonetheless recommends denying certiorari — based on unusually weak arguments that one would never ordinarily see in a government brief.”

While the Department of Justice asserted that it would not be appropriate for the Supreme Court to review the cases due to the nuances of the issues, Brandt believes the DOJ is “dragging its feet” on the issue and its “hands-off approach to cannabis needs to end”.

“The DOJ doesn’t want this case heard by the Supreme Court because it will force the government to address its incoherent approach to cannabis policy. Because of that, the government is forced to make arguments lacking common sense,” Brandt said.

“The petitions in these cases, which present a novel question in a rapidly evolving area of law, do not warrant this Court’s review,” the DOJ stated in last month’s brief. “The judgments below are correct for the straightforward reason that when a federal law such as the [Controlled Substances Act] prohibits possession of a particular item, it preempts a state law requiring a private party to subsidise the purchase of that item.”

Similar cases have been seen in three other states; Maine, New Hampshire and New Jersey. Maine’s top court reached a similar conclusion to Minnesota, ruling that federal law preempts reimbursement for medical cannabis. While New Hampshire and New Jersey found that the Controlled Substances Act did not preempt state law.

“The Minnesota and Maine Supreme Courts relied on “impossibility preemption” in finding that the Controlled Substances Act preempted state law,” Brandt explained. “The courts concluded that the workers’ compensation order was preempted because it would force the employer and insurer to participate in conduct that would violate the Controlled Substances Act.”

The New Hampshire Supreme Court, meanwhile, found that the Controlled Substances Act did not criminalise insurance reimbursement for medical cannabis as employers were compelled to do so by state law. This means it would lack the criminal intent for aiding a federal offence, the court ruled.

The New Jersey Supreme Court also found that the Controlled Substances Act did not preempt state law but the reasoning was slightly different. “It relied on the annual appropriations riders that Congress has enacted since 2014,” Brandt added. “Those riders prohibit the DOJ from using funds to prevent states from implementing medical cannabis laws. The New Jersey Supreme Court concluded that the Controlled Substances Act cannot coexist with the enacted appropriation and thus is effectively suspended.”

Markets and industry

Panaxia to expand its Malta production plant with $6m investment

Panaxia’s investment in the country is a “milestone” for Malta’s medical cannabis industry, says Minister for the Environment, Energy and Enterprise.



Panaxia to expand its Malta production plant with $6m investment
Home » News » Politics & policy » US Department of Justice tells Supreme Court to pass on medical cannabis case

Israel-based Panaxia is set to expand its medical cannabis production facility in Malta and will export its first products to Germany in the coming weeks.

Panaxia is set to deepen its connection with Malta as it plans a further expansion to its local production plant now the company has obtained its EU-GMP licence. 

The company received an official license from the health authorities in Malta to manufacture finished medical cannabis products in May, 2022.

The news of Panaxia’s $6m (~£4.95m) investment was announced during a visit to Panaxia’s Ħal Far plant by Malta’s Minister for the Environment, Energy and Enterprise Miriam Dalli. 

Read more: Panaxia to exit cannabis activities in Israel and focus on Europe

Panaxia aims to enrich the Maltese production portfolio with products aimed for both Europe and Latin American markets. To do this, its Malta facility will diversify into an array of products ranging from the production of tablets, oil and extracts, as well as carrying out clinical trials, stability experiments and research and development.

Minister Miriam Dalli described Panaxia as an early success story for one of Malta’s newest economic niches.

Read more: Panaxia to begin medical cannabis production in Malta

Minister Dalli commented: “Malta Enterprise has been in discussions with Panaxia since the early days after the enacted legislation in 2018. Today, Panaxia is only marking the start of its actual production, but it is already planning an expansion in its facilities. 

“This is another milestone reached for our medical cannabis industry – an industry which further enriches our wider pharmaceutical sector. Malta is the ideal location for such operations, whereby specialised products are developed for the global healthcare supply chain.”

CEO of Panaxia, Dadi Segal, commented: “I am impressed with the role of Malta Enterprise in their support to our Malta team at Panaxia on various levels, not just the financial assistance but also the constant communication and facilitation. 

“We had to build this facility from scratch and the process was long but soothed through Malta Enterprise’s constant guidance.”

Panaxia also operates from locations within the United States, Canada and South Africa, and is currently in the process of registering products in Portugal, Greece, Poland and Brazil amongst others. Its range of pharmaceutical products, over 60 in all, are mainly based on cannabis plant extracts and treat a variety of ailments including nausea, anxiety and depression.

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Groundbreaking agreement to supply Czech patients with cannabis extracts

The agreement will enable Czech pharmacies to prepare personalised medicines for patients.



Groundbreaking agreement to supply Czech patients with cannabis extracts
Home » News » Politics & policy » US Department of Justice tells Supreme Court to pass on medical cannabis case

Prague-based pharmaceutical company, Motagon, will be the first company in the Czech Republic to supply medical cannabis extracts to patients.

Motagon has secured the agreement with Europe’s biggest indoor cannabis producer and one of the first cannabis extracts and formulations producers Phcann International. 

Phcann International is an EU-GMP vertically integrated, multinational pharmaceutical cannabis company headquartered in Warsaw, Poland with an established footprint portfolio of countries like UK, Germany, Poland, Italy, Israel, Portugal, Australia and Brazil.

Read more: Cannabis extract registered in Poland by Curaleaf International

Through the agreement, Czech cannabis patients will now be able to access Motagon’s dried cannabis flowers and extracts to treat a number of health conditions including neuropathic pain, spasticity in multiple sclerosis, chronic pain, vomiting and nausea in the context of conventional cancer treatment, complex palliative care, or treatment of symptoms in neurological diseases such as Parkinson’s.

Additionally, Czech doctors are extended the option to work with an effective form of cannabis medicines, namely standardised extracts with more precise doses of CBD and THC cannabinoids. 

Read more: GROW expands into Germany with launch of medical cannabis extracts

With the extracts, pharmacies will be able to prepare personalised medicines for specific patients, including creams and gels for topical application, oils and capsules for oral consumption and rectal and vaginal suppositories.

Motagon’s chairman and executive director of Heaton, Motagon’s parent company, Jaromír Frič, commented: “We are extremely pleased that in a relatively short period of time we have managed to commence the import, sale and distribution of high-quality medical cannabis to pharmacies in the form of dried flowers, but our aim from the start was to offer more effective forms such as extracts to Czech patients as soon as possible.

“I believe that doctors and especially patients will appreciate this fundamental change, as well as the fact that there will be a broad extracts portfolio with a wide array of THC-CBD formulations, targeting a wider range of patients. 

“I would also like to express my great appreciation to our team at Motagon who have successfully managed to comply with all the legislative requirements of the regulatory authorities.”

Motagon CEO Jan Mehner, has stated that the range of extracts on offer should cover the needs of the vast majority of cannabis patients in the Czech Republic:.

Mehner commented: “We plan to immediately introduce extracts with high THC content and a group of balanced THC-CBD extracts, allowing us to target patient populations that aren’t responding to treatments from existing traditional medicines. 

“We’ll then broaden our portfolio (and patient base) to include high CBD and balanced products with a slight predominance of THC or, conversely, CBD.”

Phcann International CEO, Zlatko Keskovski, commented: “The agreement with Motagon will provide both companies with the first mover advantage in the Czech market where we will be able to set and implement the highest standards of quality and consistency that will meet expectations of the Czech patients.”

The first cannabis extracts are expected to be available in Czech pharmacies as early as September 2022.

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Swiss CBD investment company secures £26.23m funding

Pharma Tech Holding has obtained a capital commitment agreement from LDA Capital.



Swiss CBD investment company secures £26.23m funding
Home » News » Politics & policy » US Department of Justice tells Supreme Court to pass on medical cannabis case

Pharma Tech Holding SA has secured a CHf30m (£26.23m) investment from global investment group LDA Capital Ltd – with expertise in cross-border transactions including the agriculture, Agri-tech, and CBD industries – which will support its portfolio investments.

Pharma Tech Holding SA invests in innovative businesses with high technological value and scalability potential, mainly in Switzerland and Europe, with a focus on the health-tech, agri-tech, and functional food.

The CHf30m investment from LDA Capital will allow the company to invest and support its portfolio company Blue Sky Swisse SA, which focuses on the extraction of natural active principles from vegetable matrices, vegetable waste, and renewable sources to deliver B2B products under the form of CBD oil, terpenes and waxes. 

Read more: New cannabis-themed ETF launches

The factory, located in Biasca, will be built with state of art of extraction technology using supercritical CO2, and will be self-sufficient through the use of solar photovoltaic panels and district heating. 

CEO at Pharma Tech Holding, Sabina Del Nigro, commented: “We’re thrilled with this partnership and are so glad that LDA Capital recognises the value of Pharma Tech Holding and its portfolio company, with the aim of creating one of the most innovative hubs for health-tech, agri-tech and functional food.”

Blue Sky Swisse will make high-quality CBD due to a proprietary extraction process, starting from the farming, performed under strict control and culminating with the immediate freezing of the flowers after harvest. 

It will also sell “all natural” formulations to increase bioavailability and will invest in the agricultural raw material chain, as well as creating an aeroponic greenhouse in Ticino, to deliver a high-quality GMP pharmaceutical CBD oil.

LDA Capital agreed to commit an amount of up to CHf30m in cash within a maximum of three years. This Capital Commitment will be released based on drawdowns by Pharma Tech Holding, which Pharma Tech Holding has the right to exercise at its sole discretion.

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