Another year, more legal cannabis! 2018 saw a ton of changes in the cannabis industry and support for legalization is at an all-time high.

These were some of the biggest cannabis stories of 2018:

California Adult-Use Sales

On January 1, recreational marijuana sales officially began in California. The state is home to nearly 40 million people, and the potential cannabis revenue is in the billions. Changing regulations, licensing delays, high taxes, local cannabis bans, and testing snafus caused a less than smooth roll-out of adult-use sales in the state. California’s Bureau of Cannabis Control (BCC), charged with issuing licenses to retailers and distributors, initially issued businesses licenses to eighty-eight stores in 34 cities. As of December, the BCC has issued 547 temporary licenses to recreational marijuana dispensaries, still on the low end to supply the market adequately. Only 70 of California’s 482 cities allows recreational cannabis retail stores, but recent changes in regulations will allow cannabis deliveries throughout the state.

Massachusetts also began adult-use sales this year, with the first recreational dispensaries opening in November.

FDA Approves Cannabis Epilepsy Medication, Pushes to Deschedule CBD

The U.S. Food and Drug Administration (FDA) approved Epidiolex, a cannabis-derived medication used to treat certain forms of epilepsy, in June. Epidiolex, developed by UK-based GW Pharmaceuticals, is made from CBD and contains no THC.

In October, the FDA released a memo advising the U.S. Drug Enforcement Agency (DEA) that CBD has “negligible potential for abuse,” “currently accepted medical use in treatment,” and that any abuse “may lead to limited physical dependence.” As a result, the FDA recommended that the DEA reschedule CBD under its least restrictive category, Schedule 5.

Canada Legalizes Marijuana Nationwide

On October 17, Canada became the second country in the world to legalize adult-use cannabis. Uruguay was the first country to legalize cannabis in 2013. In June, the Senate and House of Commons passed the Cannabis Act, making it legal for adults 18 years-and-older to purchase, possess, and grow cannabis. Canadians will be able to cultivate up to four plants and possess up to 30 grams of cannabis in public. There’s no limit to the amount of cannabis residents can possess in their homes.

State Legalization

November’s mid-term elections resulted in huge wins for adult-use and medical marijuana legalization. Michigan was the first state in the Midwest and the 10th in the country to approve recreational marijuana. The first recreational dispensaries are expected to open in 2019 or 2020.

In Missouri and Utah voters were in favor of medical marijuana, a watershed moment in states that have traditionally opposed marijuana use. Missouri had three medical marijuana initiatives on the ballot, but Amendment 2 was the only one to pass with 65 percent approval. In Utah, Proposition 2 met voter approval, despite opposition from the Mormon Church.

Farm Bill Legalizes Hemp

The 2018 Farm Bill removed industrial hemp from the federal government’s list of controlled substances, legalizing its use as an agricultural product. While the bill didn’t deschedule CBD, it did legalize CBD extraction from hemp. The bill will enable farmers to grow, sell, and export industrial hemp, and opens the door for researchers studying CBD and other cannabinoids. Moving hemp to legal status will make banking and advertising in the industry more accessible, and this could be another step closer to nationwide cannabis legalization.

After months of tweaks, regulators have finalized rules for California’s recreational marijuana industry. The regulations were drafted by the Bureau of Cannabis Control (BCC) and must receive approval from the Office of Administrative Law (OAL) before becoming permanent.

Here are some of the key regulations:

Cannabis delivery statewide
One of the most debated regulations involved cannabis delivery in the state. The California League of Cities and law enforcement groups were opposed to statewide deliveries, arguing that it would undermine local government control and increase crime. However, the BCC decided that the language of Proposition 64 permits statewide deliveries, even if the local municipality bans cannabis.

Packaging and exit bags
Packaging headaches seem part and parcel of the cannabis industry, and California cannabis manufacturers should expect more “regulatory whiplash.” Cannabis manufacturers and growers have until 2020 to ensure their packaging is child-resistant. Until then, dispensaries and retailers will need to place cannabis products in resealable exit packaging.
 
Revised testing requirements
As of July 1, mandatory testing of all cannabis products, including flower and edibles, were required to undergo testing for pesticides, pathogens, and potency. In the first two months of testing, there was a 20-percent failure rate, which has since dropped to 14 percent. Of the 23,864 products tested between July and November, 2,100 products didn’t make it to shelves because the label overestimated the amount of THC.

Sequoia Analytical Labs surrendered its testing license after state regulators discovered that the company was falsifying test results and not testing for pesticides and other contaminants.

Josh Drayton of the California Cannabis Industry Association said that it’s an “open secret” that some cannabis manufacturers have paid testing companies for favorable results.

“We don’t want to create a pay-to-play system with our testing labs,” said Drayton. “We do need to make sure we get standard operating procedures.”

California was the first state to legalize medical marijuana in 1996, and voters approved Proposition 64 legalizing recreational cannabis in 2016. Adult-use sales began Jan. 1, 2018. Cannabis research firms ArcView Market Research and BDS Analytics estimate that California will generate $4.7 billion in recreational cannabis sales and $300 million in medical marijuana sales in 2019.

The Senate passed the 2018 Farm Bill 87-13 on Tuesday, a huge step towards legalizing hemp cultivation. The bill would remove industrial hemp from the federal government’s list of controlled substances and categorize it as an agricultural product. The bill would also allow CBD and other cannabinoid extraction.

The Hemp Farming Act was originally introduced by Oregon Sens. Jeff Merkley and Ron Wyden before being included in the 2018 Farm Bill by Senator Majority Leader Mitch McConnell.

Not only will farmers be able to grow, sell and export industrial hemp, it will also make it easier for researchers who want to study hemp oil products, CBD, and other cannabinoids. The U.S. Department of Agriculture (USDA) will oversee hemp production, but states will be in charge of regulating and testing industrial hemp.

Any CBD extracted from hemp must be below 0.3 percent THC. Hemp producers whose plants exceed the THC threshold will not be subject to drug charges, but they must submit a plan to correct the “hot” hemp.

Legalizing hemp will open the door for banking, advertising, and insurance, access to which has long been a hurdle in the cannabis industry.

Other key elements of the bill include:

The bill will need to pass in the House and be signed by President Trump before it becomes law.

Researchers at the University of Toronto have completed mapping the cannabis sativa genome and have discovered how CBD and THC evolved in hemp and marijuana.

Hemp and cannabis are both species of the Cannabis sativa family, but while they share 85% of the same proteins, the two strains evolved distinct chemical properties. Hemp produces an abundance of the cannabidiol CBD while cannabis contains more of the psychoactive cannabidiol THC.

By mapping the cannabis genome, researchers discovered that marijuana and hemp evolved into separate species of the same plant through the action of virus-like DNA segments called retroelements. About ten million years ago, one of these virus-like infections spread through the Cannabis sativa species, changing the DNA of the plant and replicating itself into what scientists call “junk DNA.” The mutation changed the chemical compounds the plants created, and selective breeding by humans reinforced these characteristics.

“The researchers believe that gene duplication of the ancestral synthase gene and expanding retroelements drove ancient cannabis to split into chemically distinct types. Humans subsequently selected for plants containing desirable chemistry such as high THC,” according to U of T News.

Other findings in the study included the discovery of the gene responsible for producing a cannabinoid called cannabichromene (CBC), which may also have some psychoactive properties. There are hundreds of cannabinoids, many of which are still unknown. Mapping the cannabis genome means that more cannabinoids can be discovered and studied, leading to “new strains with desired medical properties as well as varieties that can be grown more sustainably, or with increased resistance to diseases and pests.”

Until now, producing cannabis plants that do not produce any THC has been unsuccessful. However the chromosome map “should make it possible to separate them during breeding to grow plants without THC.”

Tim Hughes and researchers at the University of Toronto, Jonathan Page of Aurora Cannabis and the University of British Columbia, and Harm van Bakel of the Icahn School of Medicine at Mount Sinai collaborated on the research. The study was published in the Journal of Genome Research.

A first draft of the study was originally released in 2011; however, it was still incomplete, something the researchers blame on restrictions in cannabis research.

“Mainstream science has still not done enough because of research restrictions,” says Page. “Legalization and looming ease of research regulation really provide for opportunities for more research to be done. And Canada is leading the way.”