Clean Sweep for Cannabis: 2020 Elections Open Five New Markets for Cannabis Technology

Rhea-AI Summary

Akerna (Nasdaq: KERN) announced a significant victory for the cannabis industry following the 2020 Elections, where all five states voted on cannabis reform passed their initiatives. New Jersey, Arizona, Montana, South Dakota, and Mississippi will establish new adult-use and medical cannabis markets. This growth is expected to boost the North American cannabis retail sales to $40.3 billion by 2025. Additionally, the cannabis seed-to-sale software market is projected to increase from $330.3 million to $630.4 million in the same timeframe, highlighting Akerna's opportunity for expansion.

Positive

• All five states voting on cannabis reform passed their initiatives, opening new adult-use and medical markets.
• North American cannabis retail sales projected to reach $40.3 billion by 2025.
• Cannabis seed-to-sale software market expected to grow from $330.3 million to $630.4 million by 2025.
• Bipartisan support for cannabis reform seen as a catalyst for potential federal legalization.

Negative

• None.

DENVER, Nov. 5, 2020 /PRNewswire/ -- Akerna (Nasdaq: KERN) ("Akerna" or the "Company"), an enterprise software company, leading compliance technology provider, and developer of the cannabis industry's first seed-to-sale enterprise resource planning (ERP) software technology (MJ Platform®), is pleased to announce that the cannabis industry is the clear winner of the 2020 Elections.  

Of the five states voting on cannabis reform this election, all five passed their respective ballot initiatives, adding four new adult-use markets and two medical markets. Those states were New Jersey, Arizona, Montana, South Dakota, and Mississippi. 

New Jersey 

New Jersey Public Question 1 – 67% in favor, 33% opposed 

New Jersey Public Question 1 alters the state's constitution to legalize the cultivation, processing, and sale of cannabis for adults over 21. The New Jersey Cannabis Regulatory Commission will oversee the adult-use programs, though the scope of its regulatory authority has yet to be determined by the legislature. 

Arizona 

Proposition 207 – 60% in favor, 40% opposed. 

Proposition 207 will legalize adult-use cannabis for individuals over the age of 21 and permit residents to grow up to six cannabis plants per household. The measure also imposes a 16% tax on cannabis sales, allows the state to expunge cannabis-related offenses, and ban smoking cannabis in public. 

Montana 

Initiative 190 – 57% in favor, 43% opposed 

Initiative 190 legalizes the possess and use of cannabis for adults over the age of 21. Cannabis sales will be taxed at 20%, and the Montana Department of Revenue will be responsible for developing industry regulations. 

South Dakota 

Amendment A – 53% in favor, 47% opposed 

Amendment A legalizes adult-use cannabis for adults over the age of 21. Adults may legally possess up to one ounce of cannabis, grow up to three mature plants, and cannabis sales are taxed at 15%. 

Initiated Measure 26 – 69% in favor, 31% opposed 

Initiated Measure 26 legalizes medical cannabis for patients suffering from debilitating conditions, which is loosely defined as chronic conditions causing cachexia or wasting syndrome; severe, debilitating pain; severe nausea; seizures; or severe and persistent muscle spasms. The state Department of Health will be responsible for overseeing and regulating the program.  

Mississippi 

Initiative 65 – 74% in favor, 26% opposed 

Initiative 65 amends the state's constitution to legalize medical cannabis for patients suffering from up to 22 debilitating conditions. Patients may possess up to 2.5 ounces of cannabis, and sales will be taxed at 7%. The Mississippi State Department of Health will oversee the program and pass regulations. 

With a clean electoral sweep, these burgeoning markets will undoubtedly accelerate growth in the cannabis technology sector, as well as the wider industry. By 2025, the North American cannabis retail sales are estimated to grow to $40.3 billion. During that same period, the cannabis seed-to-sale software market is expected to increase from $330.3 million to $630.4 million. 

Further fueling the potential for growth is the increasing pressure on Congress to enact federal cannabis reform. Cannabis has not only proven to be popular with both Republican and Democratic voters, but also the substance is now legal, either for adult-use or medical purposes, in more than half of the country. 

"We are well positioned to capitalize on these new market opportunities.  Cannabis reform once again proves to be a bipartisan issue," said Akerna Chief Executive Officer Jessica Billingsley. "One out of three Americans now live in states with adult-use cannabis, and many more live in states with medical cannabis laws. There has never been a better time for Congress to act on cannabis reform." 

About Akerna 
Akerna (Nasdaq: KERN) is an enterprise software company focused on compliantly serving the cannabis, hemp, and CBD industry. Based in Denver, Colorado, the Company's mission is to create the world's most transparent and accountable supply chain by building a cannabis technology ecosystem connecting data points across the global cannabis supply chain from seed to sale to self. First launched in 2010, Akerna has tracked more than $20 billion in cannabis sales to date and is the first cannabis software company listed on Nasdaq. 

Using connected data and information to propel the cannabis industry forward, Akerna empowers businesses, governments, patients, and consumers to make smart decisions. The Company's cornerstone technology, MJ Platform, the world's leading infrastructure as a service platform powers retailers, manufacturers, brands, distributors, and cultivators.  Akerna also offers a complete suite of professional consulting services and data analytics for businesses as well as solo sciences, MJ Freeway, Leaf Data Systems, Trellis, and Ample Organics. 

For more information, visit https://www.akerna.com/ 

 Forward-Looking Statements:
Certain statements made in this release are "forward-looking statements" within the meaning of the "safe harbor" provisions of the United States Private Securities Litigation Reform Act of 1995. When used in this press release, the words "estimates," "projected," "expects," "anticipates," "forecasts," "plans," "intends," "believes," "seeks," "may," "will," "should," "future," "propose" and variations of these words or similar expressions (or the negative versions of such words or expressions) are intended to identify forward-looking statements. Such forward-looking statements include but are not limited to statements regarding the anticipated growth in the cannabis industry and the cannabis seed to sale software market, the potential for federal cannabis reform and Akerna's positioning to capitalize on new market opportunities. These forward-looking statements are not guarantees of future performance, conditions or results, and involve a number of significant known and unknown risks, uncertainties, assumptions, and other important factors, many of which are outside Akerna's control, that could cause actual results or outcomes to differ materially from those discussed in the forward-looking statements. Important factors, among others that may affect actual results or outcomes, include (i) Akerna's ability to maintain relationships with customers and suppliers and retain its management and key employees, (ii) changes in applicable laws or regulations, (iii) changes in the market place due to the coronavirus pandemic or other market factors, (iv) and other risks and uncertainties disclosed from time to time in Akerna's filings with the U.S. Securities and Exchange Commission, including those under "Risk Factors" therein.  You are cautioned not to place undue reliance on forward-looking statements. All information herein speaks only as of the date hereof, in the case of information about Akerna, or the date of such information, in the case of information from persons other than Akerna. Akerna undertakes no duty to update or revise the information contained herein. Forecasts and estimates regarding Akerna's industry and end markets are based on sources believed to be reliable; however, there can be no assurance these forecasts and estimates will prove accurate in whole or in part.

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SOURCE Akerna

FAQ

What are the cannabis reforms passed in the 2020 Elections related to KERN?

All five states voting on cannabis reform—New Jersey, Arizona, Montana, South Dakota, and Mississippi—passed their initiatives, establishing new adult-use and medical markets.

How will the cannabis industry's growth impact Akerna (KERN)?

The growth in the cannabis industry, projected to reach $40.3 billion in North America by 2025, presents significant opportunities for Akerna in the cannabis technology sector.

What is the projected growth of the cannabis seed-to-sale software market?

The cannabis seed-to-sale software market is expected to grow from $330.3 million to $630.4 million by 2025.

How does bipartisan support affect KERN and the cannabis industry?

Bipartisan support for cannabis reform is seen as a potential catalyst for federal legalization, which could benefit Akerna and the broader cannabis industry.