Nov 5, 2019

Cannabis companies could be facing cash crisis

Illustration: Sarah Grillo/Axios

Marijuana companies may be in serious trouble, as their declining stock prices are putting the cash-reliant businesses in a bind.

Why it matters: "Dealmaking is already slowing, while debt is becoming scarce and more expensive," writes the Wall Street Journal.

  • "Large banks won’t lend to them while the drug remains federally illegal in the U.S., so pot businesses rely heavily on issuing new shares to fund their deals and expansion plans."

The big picture: Those expansion plans are being put on hold these days, as capital is drying up quickly.

  • "The amount of capital raised in the cannabis industry during the week ending October 25 plummeted to $27 million from $708 million in the same period of 2018, data from Viridian Capital Advisors shows," per the Wall Street Journal.
  • "And deals are beginning to fall through: MedMen Enterprises pulled plans for an all-stock purchase of PharmaCann in October," notes the Journal.

Go deeper: Welcome to Marijuana 2.0

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House committee passes marijuana bill to federally legalize the drug

A pro-cannabis activist holds up a marijuana cigarette during a rally on Capitol Hill on April 24, 2017 in Washington, DC. / AFP PHOTO / MANDEL NGAN (Photo credit should read MANDEL NGAN/AFP via Getty Images)

The House Judiciary Committee approved a bill 24-10 Wednesday that would decriminalize marijuana at a federal level.

Go deeperArrowNov 21, 2019

Biden: There's no proof marijuana isn't a gateway drug

Joe Biden speaks in Cedar Rapids, Iowa, Nov. 2. Photo: Joshua Lott/Getty Images

2020 candidate Joe Biden said Saturday there would need to be more research into marijuana's effects before he'd ever federally legalize the drug as president, in order to rule out whether it's a "gateway drug."

The big picture: Several 2020 candidates have proposed to end the war on drugs and legalize marijuana. When Biden was vice president, he supported decriminalization rather than legalization.

Go deeperArrowNov 18, 2019

Debate night: Booker, Biden butt heads over marijuana

Former Vice President Joe Biden and Sen. Cory Booker went head-to-head Wednesday over legalizing marijuana, with the senator joking that Biden "might have been high" when he recently said he opposes federal legalization.

Go deeperArrowNov 21, 2019