fbpx

Ep.179: Ari Huffnung, Vireo Health; Introview w/Nial DeMena Manna

Cannabis Economy Podcast
Ep.179: Ari Huffnung, Vireo Health; Introview w/Nial DeMena Manna

Ep.179: Ari Huffnung, Vireo Health; Introview w/Nial DeMena Manna

Ari Hoffnung joins us as our first guest operating in New York. He takes us through where the medical program is in regards to license holders, patients and physicians. He discusses his unique history and how his background became the foreground for his participation in legal cannabis in New York. But first Nial Demena of Manna Molecular joins us to take su through what’s happening in New England from an operators perspective. His reporting suggests that the polling in Massachusetts is simply way too close for comfort. Ari Hoffnung preceded by Nial DeMena

Transcript:

Speaker 2: Ari Hofnog, Vireo Health Ari Hofnog joins us as our first guest operating in New York. He takes us through. We're the medical program is in regards to license holders, patients and physicians. He discusses his unique history and how his background became the foreground for his participation in legal cannabis in New York, but first Nael Domina of Manna molecular joins. Just to take us through what's happening in New England from an operator's perspective is reporting suggests that the polling and Massachusetts is simply way too close for comfort. Welcome to cannabis economy. I'm your host Seth Adler. Check us out on social with the handle can economy. That's two ends of the word economy. If you're into more direct communication, feel free to send an email and engage@Canneseconomy.com. Ari known from New York, proceeded by denial demeanor from New England. Enjoy.

Speaker 1: All right, so, uh, nial demeanor. I think of you as nial demeanor from a man and molecular. But, uh, but it's not called a minute, isn't it?

Speaker 3: Uh, no, it, it is. Now that you said it right the second time,

Speaker 1: the second time, which should be the first time and that's what it will be here too, for uh, thanks for giving us a few minutes. You're up there in Maine and you're an operator and you know, what's going on in New England. And so we wanted to kind of check in with you, um, and, and, and hear what was happening. So, you know, as far as Maine is concerned and legalization, uh, you know, where are we? Let's jump in there. We'll, we'll go around the horn and then find out about what's going on with man. How about that?

Speaker 3: Sure. Um, so the main legally legalization initiative initially had, they had a signature drive get on the ballot, they hit the number of signatures that were required and then the state throughout many of the insurers which brought them below the threshold, but then in court they appealed and got a lot of the signatures back on which allows them to get back on the ballot and time for November. So what we're looking at is a November eight ballot initiatives to initiate a marijuana legalization. And free our creational marijuana market or cannabis market with a 10 percent retail sales tax and if I percent a state sales tax and the first 30 million in tax revenue would be used for school and the first 30 would be allocated to a general fund and it would be handled by the Maine Department of Administrative and Financial Services Bureau of the alcoholic beverages moderately operation. So it's going to be regulated like alcohol and lottery.

Speaker 3: Um, and I think it's a good step for a Maine. Maine's a very progressive state. It's not doing well economically, are not doing as well as it could. I would say that I was born in. So there's a big disparity between, you know, the southern Maine and the rest of the state as far as income distribution and culture. And so I think a legalization would help a lot of those kind of ailing a former manufacturing facilities, paper mills, etc. You know, those municipalities generate some kind of revenue so that they can, uh, you know, repair their schools, uh, you know, and have municipal services increased. So I think it's a good thing for the state of Maine and I sincerelY hope it passes. I have a few friends that are working dispensary's there as cultivators and I know the caregiver market there is very lively and uh, I think for those reasons that this will be a boon to that market.

Speaker 1: Excellent.

Speaker 3: uh, I think it's pulling in favor. I think it's something like 55 and favor. So I think it has a good shot at passing, but I know that the opener, a page, uh, I think he's against it. Yeah. And so, you know, you have kind of a similar story, Massachusetts where you have a political leadership, a more conservative staunchly against it. Um, and you know that this is a reason why it's going on the ballot initiative, you know, that the people are kind of seeing the lack of progress and want to override the decisions that these politically, uh, you know, authoritative figures have. And I think that's appropriate given the circumstance in may and I believe it will pass just like I will believe it'll pass in Massachusetts.

Speaker 2: Ari Hofnog, Vireo Health Ari Hofnog joins us as our first guest operating in New York. He takes us through. We're the medical program is in regards to license holders, patients and physicians. He discusses his unique history and how his background became the foreground for his participation in legal cannabis in New York, but first Nael Domina of Manna molecular joins. Just to take us through what's happening in New England from an operator's perspective is reporting suggests that the polling and Massachusetts is simply way too close for comfort. Welcome to cannabis economy. I'm your host Seth Adler. Check us out on social with the handle can economy. That's two ends of the word economy. If you're into more direct communication, feel free to send an email and engage@Canneseconomy.com. Ari known from New York, proceeded by denial demeanor from New England. Enjoy.

Speaker 1: All right, so, uh, nial demeanor. I think of you as nial demeanor from a man and molecular. But, uh, but it's not called a minute, isn't it?

Speaker 3: Uh, no, it, it is. Now that you said it right the second time,

Speaker 1: the second time, which should be the first time and that's what it will be here too, for uh, thanks for giving us a few minutes. You're up there in Maine and you're an operator and you know, what's going on in New England. And so we wanted to kind of check in with you, um, and, and, and hear what was happening. So, you know, as far as Maine is concerned and legalization, uh, you know, where are we? Let's jump in there. We'll, we'll go around the horn and then find out about what's going on with man. How about that?

Speaker 3: Sure. Um, so the main legally legalization initiative initially had, they had a signature drive get on the ballot, they hit the number of signatures that were required and then the state throughout many of the insurers which brought them below the threshold, but then in court they appealed and got a lot of the signatures back on which allows them to get back on the ballot and time for November. So what we're looking at is a November eight ballot initiatives to initiate a marijuana legalization. And free our creational marijuana market or cannabis market with a 10 percent retail sales tax and if I percent a state sales tax and the first 30 million in tax revenue would be used for school and the first 30 would be allocated to a general fund and it would be handled by the Maine Department of Administrative and Financial Services Bureau of the alcoholic beverages moderately operation. So it's going to be regulated like alcohol and lottery.

Speaker 3: Um, and I think it's a good step for a Maine. Maine's a very progressive state. It's not doing well economically, are not doing as well as it could. I would say that I was born in. So there's a big disparity between, you know, the southern Maine and the rest of the state as far as income distribution and culture. And so I think a legalization would help a lot of those kind of ailing a former manufacturing facilities, paper mills, etc. You know, those municipalities generate some kind of revenue so that they can, uh, you know, repair their schools, uh, you know, and have municipal services increased. So I think it's a good thing for the state of Maine and I sincerelY hope it passes. I have a few friends that are working dispensary's there as cultivators and I know the caregiver market there is very lively and uh, I think for those reasons that this will be a boon to that market.

Speaker 1: Excellent.

Speaker 3: uh, I think it's pulling in favor. I think it's something like 55 and favor. So I think it has a good shot at passing, but I know that the opener, a page, uh, I think he's against it. Yeah. And so, you know, you have kind of a similar story, Massachusetts where you have a political leadership, a more conservative staunchly against it. Um, and you know that this is a reason why it's going on the ballot initiative, you know, that the people are kind of seeing the lack of progress and want to override the decisions that these politically, uh, you know, authoritative figures have. And I think that's appropriate given the circumstance in may and I believe it will pass just like I will believe it'll pass in Massachusetts.

Speaker 1: Well, how is it pulling in in Massachusetts currently?

Speaker 3: Um, so there are some new external poles and put it within basically worth more within one standard deviation or was it, were, were tied within the plus and minus. So it's about 50 slash 50 right now. external tooling, uh, I have some privilege access, the criminal polling that suggests that it's actually slightly in favor of legalization and basically we have a really top caliber team leading criminal. Uh, right now, um, you know, some of the people that bringing the playbook from a Oregon, Washington, Colorado and what they're seeing, you know, we've given generously. They're camping, a lot of people have to. We did that so we can buy ad time before the election and we're basically following the playbook that has said and has won three out of three states recreationally and we know that our funding levels are higher than me and tightrope the prohibitionist. So we're in good shape and I think, you know, they're, they're telling us that this is exactly what they've seen at this stage for every other state that has gotten legalization. So for me, that's very comforting to know that we're in the hands of some very skilled, um, you know, very skilled kind of campaign campaigners that had experience doing this and that they know the playbook, it's worth three times and that the evidence is pointing to a similar outcome here in Massachusetts.

Speaker 1: Still certainly work to be done. Uh, what about, uh, New Hampshire, you know, they have a, a, not a huge state and only four licenses, but a sounds like some good news out of there.

Speaker 3: Hampshire. It's really coming along quite swiftly and it's kind of the intersection of Maine and Massachusetts in my view, and has the kind of regulatory, regulatory complexity of a Massachusetts and that it's all organic grow requires third party lab testing, um, had a strict standards, you know, I know some of the applications were over a thousand pages long, so it's very detailed. It's very highly regulated. Nevertheless, they have a very good relationship with the people at the state running the program. And I think that there is much more in the spirit of collaboration between the government and the operator's at these are skilled operators that they've decided to go with and the state puts a little bit more trust and faith into some of their ability to decide for themselves. Um, so, you know, unlike Massachusetts, which, you know, it's a great state and they certainly come a long way since, you know, since medical marijuana passed, but there's still maintained some arms length relationship even with the people that have made it in Massachusetts with the department of public health.

Speaker 3: And I think in new hampShire we're not, we're not seeIng that kind of arms. I mean we are in the sense that uh, and there's no favoritism going on, but they're in good communication with everybody that they are now operating. So I'm really glad to see that program. The patient counts, continue to grow on a week by week basis. Um, so I think, um, they're going to continue to add, they just, I believe that just added ptsd, a little list of conditions that they're, they're expanding the program. And I think only three of the four operators or operational now, I think time has still yet to come online. So when that happens, the program will be at full capacity for the time being. And I think the operators, you know, we'll continue to push the patient counts up and that the infrastructure, like the doctors, the right certifications and whatnot, that supporting infrastructure will broaden and strengthen and that will help the program expanded from Florida,

Speaker 1: which is the right direction. I know you don't have as much insight in Vermont and Rhode Island, but because we're talking about new england, can you just give us a broad overview of what, you know?

Speaker 3: Uh, yeah. I know rhode island's in the Myths of legalization initiative. I'm not sure about the success level that I, you know, it's progressive state. They've got a robust medIcal program is medicare to remarket. Um, you know, I'm just not sure what the polling is or at what stage they are in preparing a window where it got on the initiative in november or not Vermont, you know, it's something that alive people support. Uh, this is in Rhode Island.

Speaker 1: No, I gotcha.

Speaker 3: Right, right. Um, so switching to Vermont, they are a little different situation. They were one of the first new england states that looked like it was going to go a legal route and there's been kind of pushed back and the legislature against that, they lost the keys, uh, last couple of months for legalization. And so, uh, I think are going to continue to have a strong medical program. I think they're really limiting themselves by going full results. So It's kind of new england right now. Everyone was looking, obviously states are looking at each other looking to see which one is going to implement legalization, become the first east coast state. But I think, you know, what we're really hoping for is that Maine and Massachusetts do it and that way you have to have different approaches to legalization happening. Uh, not so far geographically from each other.

Speaker 3: And I think that would encourage states like Vermont and Rhode Island and New Hampshire, you're going to start considering the possibility that the sky's not gonna fall if legalization happens and that we can really strengthen the economy and that we don't necessarily have to follow up, follow the model of the west coast players that we can make this something at a we envisioned that's different from that. And that's the unique and exciting future for the new england states that when that happened, uh, you know, we're going to have a system that are like a Colorado and whatnot, but I know at least in Massachusetts, we're going to see the legislature step in and are wIlling to rewrite some of the rules that are passed in the criminal bill. And I would expect that to happen probably in Maine as well if it goes through. And that, um, you know, I know in Massachusetts, uh, they've already said that it's going to take till 20, 19 to implement at least if it passes. So even if these things do pass, it's going to be a long road ahead just getting it up and operational. Nevertheless, symbolically, um, culturally I think it's gonna move the needle significantly in terms of people's perception and the kind of cooperative spirit between the dispensary's themselves, um, and what's the dph and with the public and with broader institutions who I think are going to appoint to study this, the economic impact, the medical impact, social impact, etc.

Speaker 1: Which brings us to you. We spoke to you, you know, kind of way back when, uh, certainly early days a lot's gone on. What's the, what's the latest from congratulations on getting to where you are.

Speaker 3: Thank you. Our, our sales are very, very strong in Massachusetts. Were selling it in good health and brockton. Um, they've been very good to us and we're really excited to be partnering with them. We've got our mailbox installed there and we're producing patches and um, you know, we're goIng to continue to add the product line. We started with a 10 milligram and we're expanding into a 35. So we're adding new students all the time in New Hampshire. We debuted in dover where we sold 80 patches from one day. Um, which a small community of patients. That's a very strong sales and I think that this is a great opportunity for a new hampshire's is incredibly earnest we medical program and so a transdermal patch, um, you know, it's really the right fit for that kind of program, especially at the stage that they're just now being able to get in early to get those patients early on and give them the opportunity to use your term from the patch. Um, I think it's been very helpful to a lot of them and we've already gotten a lot of good feedback.

Speaker 1: So as a, uh, as a final, uh, question, um, I hope you know, this is coming. Uh, you've answered the other final questions and you've answered this one too, but we'll get a new one unless it's the same one on the soundtrack of your life named one track one song that's got to be on there today.

Speaker 3: no, it would be o lucky man. I, uh, I'm from the old lucky man soundtrack, the title track. It's a great song. I think it's Alan Price from the animal and she did the soundtrack and uh, you know, that's just how I, that's how I feel right now. I fEel like a new one. I've been waiting for so long for this operation side of Massachusetts. We've got three licenses. The patches are doing well on the market. We got married, robotics coming online, so I just feel really lucky to be alive at this point in time and lucky that, uh, you know, I'm, I'm with the teams that I am in. Lucky. Good. No, I was able to put myself in a position to be where I am.

Speaker 1: Oh, lucky man. Nile demeanor. I appreciate your time and keep doing the work, man.

Speaker 3: Thanks. It's always a pleasure. And uh, you know, I'll uh, I'll keep my eye on the ball. You're out in new england and if, uh, if your listeners need, uh, any, any updates in the future, I'm sure sometime a little bit after november we did a, we can have a post, a legalization initiative, a follow up to see where we're at.

Speaker 1: It's a date, my friend. I'll talk to you then and probably before then. Okay. Thanks sir. All right.

Speaker 2: This episode is supported by the mpg. The marijuana policy group is a denver based economic and policy consulting firm nationally recognized for its role in shaping the Colorado regulated cannabis market. And peg regularly provides actionable research and analysis that empowers businesses, investors, and institutions to make informed decisions within the regulated cannabis industry. The mpg mission is to apply research methods rooted in economic theory and statistical application to inform business in government decisions in the rapidly growing legal, medical, and recreational marijuana markets. Go to mj policy group.com. And so I'm confident in saying that it's red huffman. This is pronounced

Speaker 4: accurate 100 percent. All right. So, um,

Speaker 5: well where is that? Where's the etymology of that last name? We'll start there. Hoffman means hope in german. Okay. And the half nuns have been in this great city of New York for five generations. And I like bragging that I am a fifth generation new yorker and a debt to three, six generation new yorkers. Um, all right, so three kids, that's a lot. That's more than the parents, unless there's a third parent, I guess. Well, there's a bubby grandmother of course, as a mother in law, so she is certainly helpful. Um, but, uh, kids are a handful, but they're a blessing. Okay. There are a real blessing. So explain to folks what bUbby, what above. He is a, bubby Is a super grandmother. She is somebody who loves the children at all times and at all costs and yes, even when it's sometimes really difficult to deal with them. Right. Um, so, uh, bobby's just a super grandmother and uh, we're fortunate to have bumpy living, very close bubbies originally from akron, Ohio and she moved to New York three years ago. Okay. And how old are the kids? Will have a seven year old violet, a five old teddy and a three year old jack. Aha. So it's a very hands on phase of our life right now, but, uh, but it's really terrific. Really terrific.

Speaker 6: My sister has kids about that same age and I call her house the chaos factory. Yes. Yes. We certainly manufacturer chaos everyday consistently. All right, well we're going to get to the fact that you are one of very few folks that are running the cannabis industry here in New York. Um, so you know, you're, you're, you're manufacturIng a little bit of chaos on your own, right.

Speaker 5: Well, we hope we're not manufacturing chaos where manufacturing a pharmaceutical grade medical cannabis according to New York state regulations, but we are in the manufacturing business. Right.

Speaker 6: Well, let, let's jump in because we have not had a guest on a from New York. Um, eh, you know, we haven't had a, the, the best feedback on the New York program because it's so tight fisted as they say. So we'd love your take on exactly what it took to get here today. So you have dispensary's open, correct?

Speaker 5: Yeah, we have three of our four dispensary's. And just to give your listeners, I'm kind of a brief overview of the New York market now. There are five registered organizations, there are five licenses. All the licenses are seed to sale licenses. So with the license comes the opportunity to open a manufacturing facility and for dispensary's, uh, of the 20 dispensary's, they're probably about open right now. Okay. Um, and they're three to go. So we have three of our four open, uh, we have to downstate. One iS in queens in New York cIty. We have one in white plains in westchester county and then one in johnson city which is in the southern tier right outside of binghamton. Okay, great. Uh, our fourth will be in albany, a, the market has been open for a little more than six months now. And directionally we're, we are headed in the right direction.

Speaker 5: There are two data points that we monitor very carefully and there it's a matter of public information. The two data points that we tend to look at are the number of physician who are registered with the program. You must be registered with the program to recommend medical marijuana to your patients. There are now more than 600 physicians throughout the state to a registered excellent. Um, and the other data point that we monitor very closely as the number of patients who have been certified by their physicians today, it stands at nearly 6,000. We are seeing a significant monthly grow growth rates, but we would lIke to, uh, to see more, uh, both on the physician side and on the patient's side and give folks a sense if we're six months in 600 physicians, a 6,000 patients. It's nice alliteration there. Yes. What is that growth though? What kind of a percentage growth are you seeing?

Speaker 5: Well, um, I mean we went from zero to 6,006 months. So there you go. Uh, so there's been, is it getting progressively higher? Is my question. I guess it is directionally heading north. Um, we, so we're heading in the right direction. We would like to see more physicians who are certified to register to recommend medical marijuana. Look there, there are two ways to look at It and um, it's, it's kind of the classic, uh, is, is the glass half full or, or, or, or empty, um, on one hand, 600 physicians who have taken their time to take a four hour course that cost, I think $250. They get cme credit, which physicians like I'm so taken four hours of their time, spent some money on it so they can help their patients. 600 people have done that when there is still a conflict between federal and state law when some of their institutions may not necessarily be supportive of that.

Speaker 5: That's a huge thing that in the state of New York, we have 600 physicians who are, uh, recommend actively recommending medical marijuana to their patients. On the other hand, there are 20 million residents in New York. There are tens of thousands of physicians somewhere I'm told in the area of 70 to $80,000. So 600 you cAn argue is just a drop in the bucket. Literally. Yeah. Um, but we're very excited about the, the New York market. We're very enthusiastic about the New York market. We believe things are heading in the right direction. Are there ways to improve things? There's always ways to improve programs, but directionally we're heading north.

Speaker 6: Well, let's, let's stay on. Physicians have, have you and, uh, you know, uh, your brother in, uh, in the program, reached out to physicians. Is there that kind of outreach? Is there that kind of information sharing or gathering or promotion?

Speaker 5: No. Great question. So, um, one of the things that distinguishes vireo health is that we are physician led company. Um, I am not a physician. I'm, my mother's still proud of me, but I am not a physician, uh, but we have three full time mds who work for our company. And one of the things, one of the primary things that they do is that they reach out to their peers, um, to really educate and to raise awareness about the program. And there's nothing more powerful than a physician speaking to a fellow physician. Right? Um, they understand the language, they understand the culture, they've been through similar schooling and training, and we find that extraordinarily effective. Uh, and, uh, that's soMething that we remain deeply committed to. Um, and I think something unique that New York brings to the table is the emphasis on physician engagement in the program. Pretty much medical cannabis is being treated like any other pharmaceutical that is prescribed by physicians and New York. Yes. And it's very much a medical model and that's something that we're very proud of.

Speaker 6: So you and I came together, um, you know, moving onto patients, uh, you and I came together through my friend who went to your queens location, um, for some cbd medication for his crones, uh, and had a very positive results for the first time in his life based on a medicine. So what kind of, um, uh, outreach, you know, will your physician peers at your organization do um, with the positive case studies that they're receiving from, uh, from patients?

Speaker 5: Yeah, it's, uh, the stories that a patients tell us are extraordinarily to, to our entire team and really make soul the challenges associated with launching a new business in a new industry. I'm really worth it 10 times over. Um, I don't, and we don't regard medical cannabis, medical marijuana as a magical drug that is effective for all conditions and for all people. However, there are many patients with many conditions that seem to benefit for medical marijuana like you're friend with crohn's. Crohn's is a very difficult disease that really impact somebody's quality of life and we have quite a few chrone's patients who are coming back to our dispensary's and reporting, uh, providing very positive feedback to our pharmacists. Um, and that's great, and that's great. And that's why we're here. You know, uh, we are not a nonprofit organization so we're not a 500, one c, three.

Speaker 5: We are a company, we are companies. Responsibilities is to, um, is to their shareholders. Um, but, uh, primarily we are here to serve patients and that primarily we are here to solely serve patients and on the business side of things, what I like to say is you need to be in business to serve those patients. AbsolUtely. The patients are the reason we exist. And, uh, it's not unique to me, but one of the reasons I got into this business is that so many people, I witnessed so many people close to me suffering from diseases where medical marijuana could help some patients in, in, you know, in, in with those medical conditions and to be able to help hundreds and thousands of people improve their quality of life. And we're not even talking about folks who believe that medical marijuana may have some curative properties. I'm not a physician, I'm not a chemist.

Speaker 5: I'm not going to speak about that. But I think we can all agree that medical marijuana for some folks really helps improve their quality of life and to be involved in something like that day in, day out is just a real blessing. Uh, yeah, no, it certainly is. As far as those qualifying conditions in New York state, let's kind of go through what you're hearing from the front lines, what qualifying conditions we mentioned crones, what else you know, is top of mind, top of mind. This cancer cancer is, is it a disease, a condition that I'm spares? Uh, no demographic group. I'm upstate downstate, all

Speaker 7: ethnicities, genders. Uh, it really crosses every single demographic. We have a lot of cancer patients, a lot of people, a lot of folks going through chemo, struggling with the side effects of chemo, uh, struggling with the nausea, struggling with the pain. Um, so we're certainly seeing a lot of cancer patients, tyrol number of cancer patients. There are also quite a few neurological diseases. Um, there are

Speaker 5: pediatric

Speaker 7: neurological conditions that medical marijuana seems for some kids to be extraordinarily effective. We're seeing those kids, um, and their stories just bring tears to your eyes when you listen to their, to their parents. Absolutely. Um, and, uh, but I would say for the most part, um, it is really a cancer and neurological disease.

Speaker 6: [inaudible]. Okay. So, uh, your qualifying conditions, there's the update on physicians. There's kind of the update of a bike by definition on, uh, on the patients as well. Uh, what about the program? You know, uh, all anyone from this show has heard is that they're New York program is very tight fist and uh, it's not so great. Um, what would you say to, to, you know, to the folks in California and portland and uh, Colorado, um, you know, who have different programs, let's with

Speaker 5: say that over time. Yeah, I am confident that New York will assume a leadership position in the cannabis industry and there's no doubt in my mind that when you look at the footprint that New York has in healthcare and pharmaceuticals in marketing, in advertising, that we have a lot to contribute. It takes time for regulations to evolve. It takes time for the state, culturally, socially, politically, and from a regulatory perspective to get comfortable with this new industry. And I think that over time we will assume a leadership position in this industry. And my hope is that New York will be able to contribute to the industry in ways that as we have this conversation, we can't even think of right now. Um, but there's a lot of talents. There's a lot of great human capital in New York. There's certainly a lot of patients who need medical who could benefit from medical marijuana in New York. Um, and I think we have all the ingredients to assume a leadership role in the industry

Speaker 6: and from being inside on a timeline perspective, if we, you know, we were six months in and we've got the numbers that we've got. What's your sense on our timeline of, of reaching some sort of critical mass? Are we talking another six months? Are we talking in another six years? What do you think?

Speaker 5: It's very hard to assign the timeline. I've written about this and I've done research on it and um, I think when you look at, you know, New York was the 23rd state. When you look at other states who have had medical marijuana programs for a much longer periods of time, the mature markets, you're looking at one to two percent of the population being enrolled in the program. One to two percent of the population. People have 20 million people. I mean gives you anywhere from 200 to 400,000 patients. Um, when will we get there? I can't answer that question, but fundamentally there's nothing different from a public health perspective when you compare new york's population to populations in other more mature markets. Um, so it is reasonable to assume that over time that one to two percent threshold will be achieved to the extent that regulations allow for it to be achieved in all markets.

Speaker 6: Um, speaking of benchmarking, you're clearly looking at other markets. Which ones do you look at? You know, what are good, uh, bellwethers for you

Speaker 5: look, uh, w, w, w we look at walmart. Um, there are a lot of different models out there and many of your previous guests have spoken about different models. There are different models on the medical side. There's different models models on the rec side. Um, and one of the great things about this country is that there's this terrific experiment going on now in the cannabis industry on a state level. And I think the exciting thing is we get to learn from each other. And, uh, when we speak to regulators without going into tremendous detail, if we think that there's a model, a regulatory model or a certain aspect of a regulatory model working in another state, we'll share that, uh, and uh, you know, over time it's reasonable to assume that the regulatory models will be more similar than different, but right now where we're really at the beginning, we're at the launch of this new industry, so there's a lot of different interesting models and, and we monitor all of them and we look at all of them. Good, good.

Speaker 6: You speak of, uh, let's, let's get into some history. You speak to your speaking to regulators, uh, you know, how to speak government. You're A, I think, the job before the job. Before this one. Yes. A deputy comptroller of New York cIty. Is that right? That is correct. That's a cool sounding job.

Speaker 5: The great thing about being a deputy comptroller of New York city is people take your calls. Yeah. They're not really sure what it means, but they'll always take your call.

Speaker 6: It's time to answer the call. Yeah, absolutely. It's already the deputy comptroller. I've got a minute, um, I, uh,

Speaker 5: five years working for the city of New York. I spent, uh, about a year in the city council. It took some time off to work on mayor bloomberg's reelection campaign. Uh, I then spent four years working in the New York city comptroller's office, um, and mainly as deputy comptroller for budget and public affairs. We helped oversee the city's 70 plus billion dollar budget, um, and one of a small but interesting parts of my portfolio was running a public policy think tank and I don't know, over four years, probably published two dozen reports on different topics from affordable housing to return on investment on, on early childhood education, kind of bread and butter municipal topics. Uh, and as somebody who aspires to write things that other humans may read at some point, um, when the referendums passed in late 2012 in Washington and Colorado, there was really a growing public conversation here in the big apple about and nationally about aMerica's relationship with marijuana being transformed in ways that were unimaginable just years ago.

Speaker 5: So we thought it would be Interesting to do some research and kind of localize it for New York and that's really how I got on this path. I'm the first report we wrote was looking at other states looking at other markets, and this was before the New York state compassionate care act passed before, well before, well before it, it had been introduced to year after year, but it was not passing. So we looked at how many new yorkers in New York city would benefit from medical marijuana, came up with more than $100,000 and I believe that to be a conservative estimate, extrapolate it to the state. It's double

Speaker 6: right. And that that's based on the qualifying conditions that you kind of wound up with a conservative list of qualifying conditions. Yes. A meeting. Well, not chronic pain for. No. Absolutely. I believe that would include pain. Oh, that would include pain. We can

Speaker 5: talk about chronic pain. I have some interesting updates there. All right. Um, and, uh, there was just so much interest when we published this report that we decided to write to write another one and we then took it a step further and saId, what would the economic and budgetary impacts be if we followed in New York city, worked to follow in the footsteps of Colorado and Washington from an excise tax perspective, from a revenue perspective, from a cost savings on law enforcement and corrections. And it's in the several hundred million dollars a year zone. And I've testified on this issue in albany. Um, and uh, as I became immersed in this really new topic, I thought it was interesting then it was ready to move on. I love exploring new topics. But what quickly began as kind of a academic political policy exercise became very personal when my younger brother who lives in Israel was diagnosed with stage four lymphoma cancer.

Speaker 5: And suddenly it was a cancer patient. My athletic brother who served in the military, who unlike his older brother, takes care of his body and very healthy guy suddenly dealing with cancer. And because the healthcare system in Israel is entirely different, his physician, before they started very aggressive chemo, he said, look, dummy, here are the conventional meds. This is the protocol. Now I'm giving you the conventional meds. If it doesn't work in a week or two, I want you back here and I'm gonna. I'm going to recommend medical cannabis, medical cannabis working for so many of my patients. It turned out that my brother's doing very well now. He didn't need Medical cannabis and he was able to take conventional meds. But what? That was the transformational personal story that happened with me and my family and it it. It led me to become very passionate in advocating for policies that allow physicians to make that decision.

Speaker 5: They're trained to make that decision. Politicians are not trained to make that decision and there's almost a holy relationship between the physician and their patient to collaboratively decide based on the risks, based on preferences, based on social social issues, cultural issues, what's right for that patient. And as somebody who's not a doctor, as much as I love my brother, I can give them empathy. I can give him emotional support, I can't cure cancer, and that really led me to become a passionate advocate for medical marijuana here in neW york. Let's get it out of the hands of politicians and let's put it in the hands of the medical community of physicians were trained to do this. And I was delighted when the New York state compassionate care act passed in 2014 and jumped into it. I feel like the medical marijuana industry in New York represents to unprecedented opportunities. One is economic, it is a business. Sure. And the second is helping folks in mass. Hundreds, thousands of people. How many people in their life get an opportunity to help thousands of people? What a phenomenal opportunity. Human opportunity. Uh, and it's been really great. it's been a blessing.

Speaker 6: One of the, uh, company's fiorello I don't think that you're, i'M still associated. I don't know if they're still going. What, what, uh, that, that was going to be a product company. Is it still, is it still going?

Speaker 5: So, um, I founded fiorella pharmaceuticals, applied for a license here. there were 43 finalists and fiorello came in number seven. Okay. You get it to be top five. He irrele missed it by a half a point on a scale of zero to 100 horseshoes and hand grenades. But, uh, I, I try to be forward looking in life and you never know when one opportunity leads to a next opportunity and uh, soon after the results were announced, some of the companies that were awarded licenses reached out and we weren't dialogue and I joined the because I, uh, I just believe it's an extraordinary company and it's a company that's physician led a and accompany that's a physician led in a medical market is something that's really important and a really helpful.

Speaker 6: Yeah, no, absolutely. Um, so just tying back to it, so a fear, fear, fear, fear, rela, laguardia airport, a former mayor, great mayor. I'm also an a marijuana advocate all the way back when. That's

Speaker 5: right. The, the, the famous laguardia commission, um, which, uh, after the 19, 37 stamp act was passed in congress, a mayor laguardia who was quite a character. He spoke many languages, uh, including italian in yiddish. Um, it's an odd combination. Yes. Um, well, not for the 19 thirties and forties and not in New York. Worked with the New York academy of medicine on a, on the laguardia commission reports to look at some of the myths, um, that were coming out of congress and it was very clear to them back then, 70 plus years ago that a marijuana could be used effectively for medicinal purposes. Right. And in fact, um, you know, if you take a walk downtown today, I'm the same streets that you're walking on where you see duane reades and walgreens and other drugstores. The drug from 100 years ago sold cannabis extracts, right? Uh, we did not invent this in 2014, 15 or 16 California.

Speaker 5: Didn't invent this in the mid nineties. Right? Um, and, uh, this is just something that's been around a, obviously human history, but it's very much part of New York history as well. Uh, so we're not, you know, from a New York historical perspective. We're not creating anything new, but we're really reconnecting with our roots. And I have every reason to believe that my great grandparents on the lower east side, when they visited the pharmacies, have the time for certain conditions, they were offered cannabis extracts. Um, and uh, it's just nice that we're kind of reconnecting, uh, in, in that way with our own historical roots. Yeah.

Speaker 6: You had an interesting perspective when you wrote the paper and then the followup, um, being uh, you know, in finance for New York city, you could literally see what effect a cannabis would have. Um, what opened your financial eyes? Uh, as far as you say, you mentioned excise tax, you mentioned, you know, a tax revenue, um, take us through the balance sheet, shore mind inside of your mind. Yeah, absolutely. They're there too.

Speaker 7: Things that you would want to look at from a pure economic perspective. It, look, they're compelling social justice reasons on that, on the recreational side, and they're compelling public health and almost humanitarian reasons on the medical side. But let's just talk numbers just to put all of that aside. Sure. you need to look at two things. One is you need to look at the revenues, the revenues from excise tax could be very material and in fact are proving to be very material, um, in markets like Colorado where there is a fairly aggressive excise tax, um, and in New York state with a population several times the size of Colorado, we would four to five x their revenues. Now you have to be careful with excise tax if you get too aggressive with excise tax that allows a black markets to continue to thrive. See Washington state, right? We'll come back to. So, um, there needs to be a balance and you can't impose too high of an excise tax. It's a, it's a little bit of an art, a little bit of a science, but there's certainly material revenues to be had on. But that's not it on the cost saving size. When you look at law enforcement, when you look at the cost of incarceration, when you look at the cost to the judicial

Speaker 7: material costs. So whatever people might think about the effectiveness of the so called war on drugs, I hope we can all agree that it's a very expensive war and then the question needs to be in a era of scarce financial resources, how do you prioritize the spending of those resources? Um, and we know where the nation is heading in that direction.

Speaker 6: Absolutely. Uh, so I, I want to keep going backwards in your, uh, on your resume and before you got to, to mayor bloomberg. Um, and by the way, what kind of boss was mayor bloomberg?

Speaker 7: So I just worked on his campaign. I then worked for a controller, john lu under him, John Lewis independently elected. We. Yep. You certainly worked with the bloomberg administration. Uh, I think, uh, mayor bloomberg was, say a, was a great mayor. He did many great things for the city. uh, and sometimes I think, uh, well at least for new yorkers, you appreciate somebody more when they're no longer. Okay.

Speaker 6: Of courSe, absolutely always the case without question.

Speaker 7: But, uh, he certainly made significant contributions to the city of New York.

Speaker 6: Okay. Before you got to him, um, bear stearns, there's a specific company in the, uh, you know, in, in, in our time here,

Speaker 7: uh, one of my earliest jobs in my career was at bear stearns, uh, in the mid nineties, I was an analyst there. I spent the next, uh, more than 10 years working for the firm, working my way up from analyst to managing director and I was there in march of 2008 when the firm imploded. Uh, when we lead the financial crisis, that's not something that you want to lead. Don't want to be a leading indicator there. A, it was a great place to work. They, I still have many friends from the, from, uh, and it was a, it was almost surreal, uh, the days in march when, when things were unfolding so rapidly.

Speaker 6: So I don't know how much you want to get into this, but I know just me as a person, it has to be fascinating to, to think about you at your desk. I'm on thosE days in march. Was it one day? Was it one week? Uh, you know, how far in advance did you realize, oh,

Speaker 7: well we didn't realize. Oh, because if we realized, oh, it wouldn't have happened. Right. So, um, it was, uh, it was, it, it, it unfolded in a few days very quickly and so rapidly that the firm wasn't able to effectively respond to the rapidly evolving circumstances in the markets. I'm jp morgan stepped in. I'm really over a weekend a purchased our firm and then I was jpmorgan employee. I spent nine months for jp morgan, jp morgan. Um, jp morgan's great company. It's a very large company. Sure. I had always been passionate about public service and I was really ready for a career change and that's what led me to New York city.

Speaker 6: Got it. Um, as far as your recollection of those events, that sounds like my recollection, meaning you really didn't have any forewarning those days happen to you, just like they happen to me at bear stearns. Is that fair to say or. Well, it was, it was, it was probably

Speaker 7: different being inside the firm. Sure. Um, but you had no warning at all? Not, no, and certainly I'm not sufficient warning to allow for the firm to take actions that would have prevented its downfall, right. Um, and uh, it was, it was a fascinating place to be. A lot of regular folks lost a lot of money. Um, and you know, it's, it, it's, it, it's easy I think for, for some to look at folks at the most senior level who may have had hundreds of millions of dollars of, of holdings and not be extraordinarily sympathetic to their predicament, but any firm, and certainly bear stearns had many employees at all parts of the salary spectrum and um, was a place where there were middle class and upper middle class jobs and many folks had retirement savings, which in part we're in the form of company stock. um, so a lot of folks lost a lot of money, a lot of personal wealth, a lot of famIlies were hurting after it. Yeah. Um, but at the end of the day, uh, I think it at least taught me a lesson that things can change really fast and just because a company or a firm was around for 75 years doesn't mean it's going to be around for the next five years. It doesn't necessarily mean it's going to be around through the end of the month or the week. That's the economy that we live in. Things rapidly change and you just need to be flexible and open to new opportunities

Speaker 6: one more as far as sitting at your desk. Um, I remember specifically that it felt like a free fall that it felt like everything was. Who knows what's gonna happen that weekend that you speak of with jp morgan chase purchasing bear stearns was actually, it felt like a floor. It felt like, okay, wait a second. It might be okay because there is at least some sense of catching, you know, everything else was falling. And then that weekend there was a catch, you know, there was a floor put in a give us your sense, you know, from, from inside

Speaker 7: a lot of people, uh, who I knew a, I'm a sabbath observer. So, um, I, I don't work on saturday, uh, but many folks, many folks work the weekends were teams of people working with jp morgan. I'm helping them understand, uh, what was going on. Um, but, uh, I'm probably not going to elaborate anymore.

Speaker 6: That's fair. All right. I think we've got enough job but just such a fascinating time and I think you've put it, uh, put it perfectly. Uh, it affected everybody and even the guys, you know, like you sitting at the desks there, you know, it affects,

Speaker 7: it affected people at all levels of the organization. Um, and uh, and certainly the, the economic crisis of 2008 impacted the lives of americans all over this country. Um, and uh, you know, it, it, as I said, it taught me that the things you think are permanent may not be permanent. Uh, but hopefully as a country, as an economy, we've learned from the lessons of 2008. Yeah,

Speaker 6: I'm certainly will. We'll see. We'll see how much we've learned very soon. Um, but let's keep going further back because we mentioned bubby. We mentioned her moving from Ohio. We mentioned your brother in Israel. So where did you grow up?

Speaker 7: I grew up mainly in New York. Oh, you did? Mainly in New York. Um, and uh, I've at different times. I've lived in manhattan. I've lived in queens now I live in the bronx and I just love New York. I love New York city. Um, I love visiting other countries. I love visiting other states, other cities, but New York is home and I feel particularly blessed that I'm able to live in the city. I love and work in an industry that's very meaningful to me. It was never in the cards. I love visiting denver. What a beautiful city. Seattle, what a great place. What a great place to. Terrific cities. Love it. It's so fascinating how the industry is developing in both of those cities. There's never going to move my family to denver, seattle, you know, fifth generation new yorker. Um, can I visit? Sure. Absolutely. But I'm not moving there and it's a wonderful place. And folks who live, they're wonderful people. But uh, I'm very much a new yorker, so to be able to be in this industry, in the city I love is just a blessing is terrific.

Speaker 6: So, uh, you know, nine times out of 10 when I say I'm from New York, people say, oh, great city, love to visit could never live there. So what, what? Say you new yorker. Why? Why do you love New York? What is it about it that makes you live here? You say, I'm never going to move to Colorado. Why not? We can do a whole separate podcast on,

Speaker 7: on, on why New York is New York and how wonderful it is. Fair enough. But I live in a. I'll just share one, one story. I live in a townhouse. There are, I'm the middle of three attached townhouses weren't orthodox jewish family to our right is a wonderful catholic family. To our left is a wonderful muslim family. That's only in New York, that is only in New York, so only in New York and everybody likes hummus and, um, and a diversity here, the culture, the history, I mean, it's just such a special place. Um, it is, is just absolutely terrific and, uh, perhaps it's not for everyone, but it certainly a place that I'm delighted to call home.

Speaker 6: You mentioned your faith a couple times. Uh, how does your faith guide you? I'll just ask you that big, broad question.

Speaker 7: We also need a separate podcast for that. Um, but I think that people of all faiths, it's very important for people of all faiths and it's a fundamental principle, um, to help folks to help folks who are suffering and it's not unique to judaism. It's certainly not unique to christianity, but it's something that's fundamental to both religions and, uh, certainly a guiding principle in my own life. Um, and uh, you know, one of the things that I'm proud of here at vario is we are the first medical cannabis company in the country to become certified kosher by the orthodox union. And we did it for two reasons. One is there's a significant jewish population that has dietary restrictions and we always want to be patient focused and sensitive to the unique needs of our patients. So from that perspective made sense, but from a on a deeper level, we hope that having a prominent group of orthodox rabbis certify our medical cannabis products as kosher sends a message to people of all faiths and backgrounds that they ought not to be ashamed or feel guilty when they, if they need to use medical cannabis, particularly if the physician recommends.

Speaker 7: And we hope that that really, uh, sent that message so that we can help combat stigma. And, uh, that is something that we continue to work on there still. It's in many, many pockets in New York and around the country. Stigma associated with medical marijuana. And you know, you've had guests on your show and it's certainly been a lot of writings about this. What exactly will scheduled to happen? What will be happen yesterday, by the way? Yes, what will, what will its impact be? And that's an interesting conversation. My hope is that if and when it happens, it will help combat the stigma associated with marijuana and perhaps that might actually be one of the most powerful implications of moving it from schedule one and two, not, you know, there's a lot of interesting research opportunities and opportunities with the fda and so on and so forth, but there's still a stigma and for the federal government to move it from one to two, I'm taking it really taking it out of one hopefully, and let's say, tell a little for this podcast, why not right?

Speaker 7: Hopefully will, will really help alleviate this, alleviate the stigma still associated with medical marijuana. Um, and, uh, if, if doctors and rabbis and the federal government to all agree, how could it be so bad? Exactly, exactly. I'm just, while we're on the rabbis, I mean, what was that conversation like when you first approached? Um, we had some interesting conversations without getting into details, but the fact that our products were being solely used for medical purposes, it is actually, there are many complicated theological issues in all religions. This is not a complicated theological issue. This is an issue of a plant whose xt the plant extracts a are scientifically and medically proven to be helpful to people who have certain conditions. It's not a complicated theological issue. Recreational marijuana, that's a more complicated conversation for some people of faith. To have medical is not a theologically complex issue.

Speaker 6: Did you bring up Dr. Michelle Adams, uh, you know, studies and papers with the, with that group specifically, or how did that guy. I never go into great detail in my conversation with regulators or rabbis. It's the same type of person, I guess. Right? Regulating one thing, regulating another thing, but, um, I applaud them. I applaud the orthodox union for um, uh, for certifying our products is kosher. And uh, I believe in Illinois there's a company that will soon be certified kosher perhaps by another organization. and I think that over time I'm just like in the food industry, uh, we will see many, many more products, a certified kosher in this industry. Just finally on the stigma. You know, you come from government, you come from finance, uh, you come from, um, faith, uh, these are three groups who are not certainly not all in just yet. What further information, what further messaging will, what further commentary would you provide to folks that just can't get over it come over a two to cannabis as medicine?

Speaker 7: Well, um, as you know, increasingly folks have come over, um, we are at a point where more than half the states now have medical marijuana programs. Um, it is something that medical is polling in the 80 plus percent zone, um, which means people of all faiths are increasingly supportive of this, but I think like anything else, excuse me, in life, it takes time for people to change they way they think about an issue and it takes time to evolve. But I feel like we are in a period where there's rapid evolution taking place and the changes we'll see in the coming years are just going to be fascinating to observe.

Speaker 6: part of. Yeah. Uh, well we're happy you're in it, right. You've got a good pedigree for, for being, for doing what you're doing. So

Speaker 7: appreciate that. I, I, again, I, I just feel blessed that I could live in New York, the city. I'd love a, I can work in a industry that I'm passionate about, an industry where there's really unprecedented economic opportunity and an opportunity to help folks.

Speaker 6: Alright, it's time for the three final questions. I'll tell you what they are and then ask you them in order, although I think I don't have to tell you what they are, but uh, what has most surprised you in cannabis? What has most surprised you in life and on the soundtrack of your life named one track. One song. First thing's first, what has most surprised you in cannabis?

Speaker 8: The morning.

Speaker 7: More states adopting medical marijuana laws and it's just fascinating to see a case sick. I was jUst gonna say it from Ohio. Yeah. Obviously republican governor. He just ran for president and Ohio. It's going to be wonderful market. Yeah. Uh, so it's a pleasant surprise. It's a pleasant surprise. And, and that was just weeks ago. That's it. Um, what has most surprised you in life? Slightly larger question.

Speaker 6: Donald trump. All right. So it's the beginning of august of 2016. When, when are you saying that? Um, I, I have to ask a followup question. I mean, why does he surprise you specifically?

Speaker 7: I think it's fascinating that he became the republican nominee for president of the United States. Sure.

Speaker 6: Yeah. I also think it's fascinating. And, and here's my, a one take. I, I try not to kind of, you know, uh, share my political beliefs, but I do think that, um, we have a history of the president of the United States of America not asking other nations to spy on us. And I, I like that history. That's all I'll say about that. Do you have anything else to add? And he just shakes his head. No, dave won't even say no. Alright. Uh, so, so then, you know, this is either, you know, the, the toughest or the easiest on the soundtrack of your life. One track, one song that's got to be on their New York, New York, frank sinatra, the chairman of the board. A. Again, thanks for doing what you're doing. It sounds like you're doing exactly what you should be doing. A thank you for your time and keep going. Thank you for this wonderful podcast. The real, real pleasure. Thank you. Great conversation. You got it. And there you have run up none.

Speaker 2: So I hope you understand the nuance of a New York accents. You know that's a specific accent from New York. We have many others that you may be familiar with and if you are not familiar, thanks. Denial domina up at the top. Thank you for listening. Very much appreciated.

Read the full transcript:

Become a member to access to webinars, quarterly reports, contributor columns, shows, excerpts, and complete podcast transcripts

Become a Member

Already a member? Login here.

Subscribe now to get every episode.

Cannabis Economy is a real-time history of legal cannabis. We chronicle how personal and industry histories have combined to provide our current reality.