Vancouver-based cannabis and psychedelic medicine firm Thoughtful Brands has dissolved its German subsidiary Verrian to focus on its core business of direct-to-consumer brands, e-commerce, and the vertical integration of its supply chain.
Verrian had established a foothold in the emerging field of psychedelics to treat anxiety, mood, and substance abuse disorders. It operated a pharmaceutical manufacturing facility in Radebeul, a suburb of Dresden, which was involved in clinical studies using psychedelic compounds for the treatment of opiate addiction. It has now sought creditor protection in Germany.
Thoughtful Brands said Verrian lacked sufficient working capital to sustain current operations and satisfy creditor demands, and had therefore been compelled to institute insolvency proceedings. It has suspended all operations and is awaiting the appointment of a court-appointed preliminary administrator to oversee its affairs in the interests of its creditors.
This follows Thoughtful Brands’ acquisition of Kentucky-based hemp grower and processor American CBD Extraction Corp in September in a deal estimated to be worth $9m.
The acquisition enables the firm to become fully vertically integrated, controlling each aspect of the supply chain including production, logistics, and value chain. The firm plans to launch new “superior quality” CBD brands, offering products made from hemp it has extracted and produced itself, as well as products formulated for future brand clients.
The closure of Verrian comes at a time when the use of psychedelics is becoming increasingly acceptable and commercial interest in “magic mushrooms” is growing.
Oregon recently became the first US state to legalize psilocybin, the main active ingredient in magic mushrooms. Oregon’s Measure 109 will give legal access to psilocybin for mental health treatment in supervised settings.
Meanwhile, citizens in the District of Columbia voted to decriminalize the use of magic mushrooms and other psychedelic substances, including the active ingredients in ayahuasca and peyote, with the passage of Initiative 81, the Entheogenic Plant and Fungus Policy Act of 2020.
The measure does not legalize the drugs but makes possession of them among the lowest enforcement priorities for DC police, according to the initiative, which still faces some hurdles before it becomes law. The DC Council needs to approve the measure before sending it to Congress for review. Congress then has 30 legislative days to block it or allow it to become law.
Congress has continually attempted to stop DC legislators from passing drug liberalization efforts. Republican Andy Harris, a representative for a nearby Maryland district, has already said he would work to oppose such measures.
Also recently, in California, state Senator Scott Wiener called for the decriminalization of psychedelic drugs for therapeutic benefits:
“When the legislature reconvenes, I’ll introduce legislation to decriminalize psychedelic drugs. These drugs have been shown to have medicinal value treating depression, PTSD, and other conditions. We need to stop criminalizing drug use and addiction.”
“I’ll be working with Assembly members Evan Low and Sydney Kamlager-Dove on this important step toward a more rational, science-based, and public health-focused approach to drugs.”
Still, it’s important to note that, despite the continued interest and the growing number of legislative victories for psychedelics, they remain a niche product with very few current opportunities for profitable business.
Thoughtful Brands clearly thought the likely time remaining until it would see a sufficient return from Verrian to justify the current expense was too great. As investors continue to look for new opportunities in the psychedelics area, that wariness should be remembered.
Original article: https://www.cbd-intel.com/thoughtful-brands-pulls-out-of-german-psychedelics-to-focus-on-american-cbd/
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