Managers Of New York Cannabis Social Equity Fund Earned $1.7 Million Despite Accusations Of Predatory Lending And Mission Failure

They haven’t come close to fulfilling Gov. Kathy Hochul’s (D) goal of helping 150 people victimized by the state’s old, racially biased drug laws enter the legal cannabis business—and some they have assisted fear their dispensary dreams are collapsing.

But the three managers of a public–private loan fund established to carry out the primary social mission of New York’s sweeping cannabis legalization program are doing just fine.

Records obtained by THE CITY show that they earned $1.7 million over the most recently tallied 12-month period and stand to make millions more in years to come, even though the New York Cannabis Social Equity Investment Fund has faced charges of predatory lending, secrecy and mission failure. By a conservative estimate computed by THE CITY, the managers’ longterm haul could easily come to $15 million over a decade.

The state selected the three managers, who operate under the almost identical name of Social Equity Impact Ventures, after a bidding process in June 2022: Bill Thompson, a former New York City comptroller and mayoral candidate; the former NBA star Chris Webber; and Lavetta Willis, a former sneaker entrepreneur based in Los Angeles.

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Addicted To Drug — Statistics

I have long told you that when drug companies produce statistics, for the consumption of regulatory agencies or the public, their products look better than the same statistics produced by others, or on trials when the drugs are in the wild.

Partly this is because of the greater care pharmaceuticals take in running their clinical trials. It’s true. They are forced into this vigilance by regulatory agencies. I do not mean the results are therefore more likely to be correct. I mean trials proceed in a more orderly manner, including the writing of the statistics at the end, that the process is better controlled for them than in teams of researchers laboring away in the hope of papers.

Drug companies know how to get wee Ps better than anybody, since it is their business. Regulatory agencies require wee Ps, you see. Alas, wee Ps are proof of nothing. Nothing having to do with whether a drug works, or it causes harm, or is useless, or anything like that. I know I am almost alone in saying this. For now. Maybe after reading this, you will join me.

In the speech I gave to the at Hillsdale (blog/Substack), which included many nervous scientists who met beforehand to plan a strategy of reaction, I remarked, “The British Medical Journal 2017 review of New & Improved cancer drugs found that for only about 35% of new drugs was there an important effect, and that ‘The magnitude of the benefit on overall survival ranged from 1.0 to 5.8 months.’ That’s it. An average of three months.”

In other words, two-thirds of new drugs that waved their wee Ps in the faces of regulators failed when released into the wild. And the ones that succeeded provided a barely there effect.

This is only one of many similar stories of what happens when drugs are out of the hands of manufacturers and put into the hands of the people who you ask if the drugs are right for you. The well known John Ioannidis examined forty nine top medical papers and found: “…7 (16%) were contradicted by subsequent studies, 7 others (16%) had found effects that were stronger than those of subsequent studies, 20 (44%) were replicated, and 11 (24%) remained largely unchallenged.”

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SCOTUS Case Involving Cannabis Fraud Highlights the Illogic of Federal Drug Testing Mandates

The U.S. Supreme Court last week considered a case involving a trucker, Douglas Horn, who lost his job because he tested positive for THC after consuming a CBD tincture that was advertised as completely free of that psychoactive compound. Horn sued the companies that made and marketed the tincture under the Racketeer Influenced and Corruption Organizations (RICO) Act, arguing that he was “injured in his business or property by reason of” the defendants’ mail and wire fraud.

The issue in Medical Marijuana Inc. v. Horn is whether the economic losses that Horn suffered fit that statutory language, as the U.S. Court of Appeals for the 2nd Circuit held last year. But the case also highlights the weak scientific basis for the federally mandated drug test that Horn failed, which reflects the ongoing conflict between state and federal marijuana laws.

In 2012, Horn bought Dixie X CBD Dew Drops 500 mg Tincture to treat the pain and inflammation caused by hip and shoulder injuries he had suffered in a truck accident. Since he was well aware that testing positive for marijuana would endanger his job, he investigated the product to make sure it did not contain any federally illegal substances. He says he was reassured by Dixie’s claim that its CBD extract was made from hemp containing less than 0.3 percent THC (the federal limit) and that, after processing, it contained “0.00 THC.”

According to a High Times article that Horn cited in his 2015 RICO lawsuit, the tincture was produced via “a proprietary extraction process” from “a strain of high-CBD hemp grown in a secret, foreign location.” The article said the resulting tincture “contains 0% THC and up to 500 mg of CBD.” Tripp Keber, Dixie’s managing director, averred that “we are importing industrial hemp” that is “below federal guidelines for THC, which is 0.3%,” and “extracting the CBD.” Keber said Dixie had “meticulously reviewed state and federal statutes,” and “we do not believe we are operating in conflict with any federal law as it’s related to the Dixie X (hemp-derived) products.”

Keber offered similar assurances in several YouTube videos, saying those products were “THC free” and contained “no THC.” Just to make sure, Horn says in a Supreme Court  brief, he contacted a customer service representative, who “confirmed that Dixie X contained ‘zero percent THC.'”

Based on those assurances, Horn’s brief says, he “purchased and consumed Dixie X in
September 2012.” A few weeks later, he was dismayed to learn that he had tested positive for marijuana in “a routine random drug screening.” As a result, “his employer immediately fired him.” He “lost his career and income,” which meant “financial ruin” for his family.

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Votes On Arkansas Medical Marijuana Expansion Measure Won’t Be Counted, State Supreme Court Rules

Arkansas voters will get to decide on a medical marijuana expansion initiative at the ballot next month—but those votes will no longer count following a new state Supreme Court ruling.

Prohibitionists who challenged the cannabis measure from Arkansans for Patient Access (APA) successfully convinced the court that the ballot title was affirmatively misleading, and justices ruled on Monday that votes will not be processed after Election Day.

The state’s highest court said it was siding the anti-marijuana group Protect Arkansas Kids (PAK), agreeing that the measure’s title is misleading because it fails to adequately explain that—beyond expanding the state’s medical marijuana program—it would also more broadly legalize possession of cannabis if a federal policy change is made and would also restrict the legislature from revising the voter-approved law if enacted.

“For these reasons, we hold that the proposed amendment is misleading,” Justice Shawn Womack wrote in the majoity opinion. “Accordingly, we grant the Intervenors’ request for relief and order that the Secretary be enjoined from canvassing or certifying any ballots cast for the proposed amendment at the November 5, 2024, general election.”

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Legalizing Marijuana Does Not Jeopardize Mental Health, Studies Show, Contrary To Opponents’ Alarmist Claims 

Opponents of marijuana legalization often allege that jurisdictions that have legalized adult-use marijuana sales experience subsequent rises in incidences of cannabis-induced psychosis and other adverse mental health consequences. But nearly a decade worth of scientific data from Canada and the United States refutes this contention.

For instance, a study published last year in an imprint of the Journal of the American Medical Association evaluated the relationship between U.S. legalization laws and psychosis rates in more than 63 million privately insured individuals. Researchers described it as the “largest [study] to quantify the association of medical and recreational cannabis policies with rates of psychosis-related health care claims across US states.”

Investigators concluded: “State medical and recreational cannabis policies were not associated with a statistically significant increase in rates of psychosis-related health outcomes.”

They’re not alone in this determination. A just-published consensus study compiled by the National Academies of Sciences, Engineering and Medicine concluded, “There is insufficient evidence of an association between cannabis policy and changes in mental and behavioral health.”

And new data from Canada, published this month in the journal Social Psychiatry and Psychiatric Epidemiology determined that cannabis-related emergency department visits declined among schizophrenia patients following Canada’s adoption of adult-use marijuana legalization.

“Our findings suggest that regulatory measures accompanying legalization could enhance the quality and safety of cannabis products, potentially leading to fewer adverse health outcomes in vulnerable patient populations,” the study’s authors wrote. “Furthermore, our study indicates that legalization and cannabis regulation, in certain contexts, may help reduce acute care utilization in vulnerable patient groups.”

Their findings are particularly relevant because it is well established that those suffering from schizophrenia, psychosis and similar conditions tend to consume cannabis, tobacco and other controlled substances at rates higher than those in the general population. Data also suggests that, in some cases, cannabis use may exacerbate symptoms of psychosis or even trigger a psychotic episode in those predisposed to it. Therefore, regulatory strategies that better educate, target and protect this vulnerable population is critically important.

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DeSantis Stirs Pot Again With More Anti-Marijuana Ads Funded By Taxpayers, Including One Linking Cannabis To Domestic Violence

Florida Gov. Ron DeSantis (R) is facing new allegations of weaponizing state agencies with taxpayer-funded ads to support his campaign to defeat a marijuana legalization initiative that voters will decide on at the ballot next month.

In an ad from the Department of Transportation (DOT), three sheriffs make various claims about the harms of cannabis—including one who suggests that marijuana use is associated with a greater risk of domestic violence, contrary to research on the topic.

“When we make home visits for domestic violence calls, they’re often associated with marijuana use,” Polk County Sheriff Grady Judd said.

Duval County Sheriff T.K. Waters said in the PSA, first reported by Seeking Rents, that there are “too many kids going to the ER because of weed gummies and joints laced with fentanyl.”

In one of the only statements from the sheriffs that seems directly relevant to DOT, Brevard County Sheriff Wayne Ivey said “we see more traffic collisions and fatalities because of driving high.”

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Federal Court Upholds Order Requiring Alaska Airlines To Rehire Worker Who Was Fired Over Positive Marijuana Test

A federal judge in Seattle has rejected an effort by Alaska Airlines to overturn an arbitration order reinstating the employment of an aircraft maintenance technician whom the company fired over a positive test for THC.

The worker insisted that he did not knowingly use cannabis and was unaware of how the drug entered his system, speculating he may have accidentally eaten an infused edible at a neighborhood block party.

The employee, Gregory Chappell, was given a random drug test in July 2022. The level of THC metabolites came back above a minimum threshold, and he was immediately fired given the safety-sensitive nature of his lead aircraft maintenance technician (AMT) role.

Chappell denied using marijuana and said it was possible he’d unwittingly consumed an edible at the neighborhood party, where none of the potluck foods were labeled. The airline did not investigate that claim, instead relying on the company’s policy against drug use by safety sensitive employees.

Chappell’s union challenged the firing, and in October of last year, an arbitration panel reversed his termination.

Alaska Airlines promptly filed a lawsuit in federal court seeking to undo the arbitration board’s decision, arguing that it was undisputed Chappell failed the marijuana test. The company said the employee’s claim “that he may have unknowingly and accidentally ingested a marijuana edible at a block party simply” amounted to “a fantastical story” and “bizarre speculation,” according to the arbitration panel’s account of the case.

But in a federal court order on Tuesday, U.S. District Judge John H. Chun rejected the company’s challenge, ruling that the arbitration board “did not exceed its jurisdiction” in ordering Chappell be rehired.

“To vacate an adjustment board’s award, a court must conclude that the board’s reasoning was ‘wholly without foundation in…fact,’” the court wrote.

“And insofar as Alaska Airlines contests the Board’s reinstatement of Chappell,” the decision continues, “Alaska Airlines cites no authority suggesting that the board’s remedy was unfair, much less warranting judicial intrusion in an area over which the Board has special expertise.”

The judge further awarded the union attorneys fees and costs for the case, though it remanded the matter to the arbitration board to determine how to handle backpay and benefits for the past year.

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Army Updates Drug Policy To Explicitly Ban Delta-8 THC Hemp Products And Warn Soldiers Against Eating Poppyseed Bagels

The U.S. Army has updated its drug policy to clarify that soldiers are prohibited from using intoxicating hemp cannabinoid products like delta-8 THC. It is further cautioning servicemembers against eating foods containing poppyseeds, which can produce false positives when testing for opioids.

The update to the Army’s substance misuse guidance took effect on October 4. And with respect to the delta-8 THC components, it represents one of the latest examples of how government and private institutions are attempting to navigate the legal grey area that’s emerged since hemp and its derivatives were legalized under the 2018 Farm Bill.

The military branch’s prior policy enacted in 2020 made clear that the “use of products made or derived from hemp,” even if it’s legal for civilians, is prohibited for soldiers. But that guidance came before delta-8 and other intoxicating cannabinoids became a mainstream feature of the largely unregulated cannabis market.

Instead, the Army at the time focused on non-intoxicating CBD, which servicemembers are also barred from using. It remains the rule that prohibited cannabis products include those that are “injected, inhaled, or otherwise introduced into the human body; food products; transdermal patches, topical lotions and oils; soaps and shampoos; and other cosmetic products that are applied directly to the skin.”

“This provision is punitive, and violations may be subject to punishment,” it says.

Congress and state legislatures have been paying closer attention to the intoxicating cannabinoid market in recent years, with various proposals to regulate or outright ban such products. The language of the earlier Army guidance would seem to apply to delta-8, even if it’s not explicitly mentioned, but now the branch is putting the policy more clearly into writing.

The new regulations, first reported by Task & Purpose, specify that soldiers are banned from using controlled substance analogues, which include “synthetic cannabis and other tetrahydrocannabinol (THC) substitutes that have no known application other than mimicking the effects of THC in the human body.”

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Millions Of Americans With Depression Could Be Eligible For Psilocybin Therapy If Approved By FDA, Study Shows

As many as 6 in 10 people currently receiving treatment for depression in the U.S. could qualify for psilocybin-assisted therapy if the treatment were approved by the Food and Drug Administration. That’s according to a recent study in the journal Psychedelics that highlights the broad impact that could result from wider clinical availability of the entheogen.

“Our findings suggest that if the FDA gives the green light, psilocybin-assisted therapy has the potential to help millions of Americans who suffer from depression,” Syed Fayzan Rab, an MD candidate at Emory University, and the study’s lead author, said in statement about the report. “This underscores the importance of understanding the practical realities of rolling out this novel treatment on a large scale.”

The study, authored by a three-person team from Emory, the University of Wisconsin and UC Berkeley and published last month, sought to estimate the upper, midrange and lower boundaries of current depression patients—including both major depressive disorder (MDD) and treatment-resistant depression (TRD)—who would likely be eligible for the psychedelic treatment. Its low-end figure is 24 percent, the midrange estimate is 56 percent and the upper boundary is 62 percent of current patients.

Overall, the report gives a range of estimates on the number of depression patients who’d qualify for psilocybin therapy, with between 4.7 million and 6.6 million MDD patients and between 1.4 million and 1.9 million TRD patients potentially eligible.

“These ranges highlight the potential variability in our estimates based on changes in the assumptions underlying comorbidity prevalence, emphasizing both the robustness and the uncertainty inherent in our projections,” the paper says.

Behind the wide range of estimates are open questions about who would be eligible for psilocybin-assisted therapy (PSIL-AT). For example, authors said the variance was “largely influenced by the removal of alcohol and substance use disorders as exclusion criteria” as well as analysis of other comorbidities that may or may not affect patient eligibility.

Other issues involve the degree to which healthcare providers would dispense psilocybin for off-label use (meaning for conditions other than depression), whether treatment is covered by insurance and whether other psychedelics—for example LSD—become available as alternatives to psilocybin.

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