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October 6, 2022 55 mins

Boris Jordan is a fascinating figure. An American of White Russian ancestry, he played a pivotal role in Russia’s roller coaster economic transformation during the 1990s. Today he is best known as the founder, executive chairman and principal shareholder of Curaleaf, which is in many respects the world’s largest cannabis company. We started off by talking about the politics of marijuana reform in Congress but then focused on the future of the cannabis industry. What role will Big Tobacco, Big Pharma, Big Alcohol and the other big consumer good companies eventually play? Which countries, not just in Europe but also in Asia, Africa and the Middle East, are most likely to legalize cannabis in coming years? Why does he think cannabis beverages will account for half of the cannabis market within ten years? What does he think about the future of legal psychedelics? And how and why did he get involved in this industry in the first place?

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Episode Transcript

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Speaker 1 (00:00):
Hi, I'm Ethan Nadelman, and this is Psychoactive, a production
of I Heart Radio and Protozoa Pictures. Psychoactive is the
show where we talk about all things drugs. But any
views expressed here do not represent those of I Heart Media,
Protozoa Pictures, or their executives and employees. Indeed, Heed, as

an inveterate contrarian, I can tell you they may not
even represent my own and nothing contained in this show
should be used his medical advice or encouragement to use
any type of drugs. Hello, Psychoactive listeners. So today our

guest is Boris Jordan's. He is the founder and a
major shareholder in the company cure Lee, which I think
is either the biggest or one of the biggest cannabis
companies in the world. Right It's a major multi state operator.
He also has a hedge fund called Measure eight uh
and just took a sense how big it is. He's
got almost six thousand people working for him now, he's

got a hundred and thirty seven dispensaries. Last I looked
in in twenty one states. He's got over two dozen
cultivation sites. I mean, this is a major, major operation
it's valuation is in the billions of dollars on the
Stock Exchange. Uh. He's a major player in cannabis industry
circles and also deeply involved in the politics of all
of this. And he's got a fascinating life even before

he got into cannabis. So Boris, thank you ever so
much for joining me on Psychoactive. I'm super excited to
be here. Okay, well listen more so let's just jump in.
He do need to talk a bit about what's going
on in Congress right now. So this Safe Banking Act, right,
you know, having married people in the industry and businesses
to get access to safe banks, and and the whole

discussion about can or should this go through, you know,
without there being all sorts of racial equity racial justice
provisions that we both include a sponge been that would
also include, you know, ensuring a better level of access
or some preferential access for a minority business owners. You know,
can this happen? I mean Schumer, you know, on on

the show and since then it said I don't want,
you know, any state banking going through unless it's got
some racial equity provisions. In Corey Booker from New Jersey
has been even stronger on that. So what is the
state of play from where you see? Well, even it's
it's it's not a simple, uh, you know, piece of legislation.
I'm sure you more than anybody knows that. Um you know,

it's been I don't know, you know, fifty some odd
years of repression on the sector and we've come to
a situation now where, you know, I actually believe we're
closer than we've ever have been for potentially getting a
piece of federal legislation that at a minimum recognizes the
existence of cannabis as a substance that can be consumed

in various forms by the popular lation at large. So
the short of it is, I think we have a
piece of legislation as being worked on now that has
obviously the safe banking component, and the safe banking component
means that cannabis companies would have access to basic banking
for their businesses. And I think it will also have

a safe harbor provision that would allow investors to invest
in the sector. And I think it will also have
some level of what we call plus love you know,
whope act issues like expungement and potentially and I think
this is the issue that Booking wants the most, and
that is some level of money to help these states

with closing these expungements, because the one thing is you
can come out and say, okay, we have you know,
we've expunged these these these felonies or these misdemeanors. But
another thing is to actually get it off the actual
physical record, and that takes money and time. Obviously, there's
a lot of different advocacy groups that want whatever is
that they want this piece of legislation. We could probably

spend two hours talking about all the different things people
wanting this piece of legislation. The way I look at this,
and I think that's where we're heading, is that this
is the first step in what will be a multi year,
potentially multi generational move towards legalization of not only cannabis,

but other drugs as well. And I think that we
have to see it that way, and we have to
put our I wouldn't say differences, because to be honest,
I'm on the same page as a lot of the
other people are in terms of all the things we'd
like to get in this legislation, particularly on some of
the racial social equity issues. But I think that what
we need to do is get something that we think

can get past, so that we could you know, break
the glass ceiling, say um, and and actually get a
piece of legislation on the books that then you know,
we'll use every year to expand on, expand on, liberalized
and liberalized and for the more spark. That's what happened
in the States as well. A lot of the states
are initially passed very restrictive legislation, and then eventually they

liberalized that legislation. As the sort of the demons of
cannabis came down and people realized it wasn't as bad
as everybody thought it was, they started to liberalize. And
I think that's where we are now. And so I
see the activists saying, you know, what we should have
in there is providing small business administration loans to new
legal cannabis businesses trying to get started, or making sure
that banks provide support for new minority owned enterprises. And

I think the problem has typically been, you know, the
Republicans on this thing, right, I mean, the Democrats, you know,
all for safe banking. They love it. They even passed
it as stand alans before. The Republicans are generally for
stand alone. The Democrats are saying, put some of his
other stuff in, and the Republicans keep you know, now
we don't like that racial equity stuff, get rid of it.
But are the Republicans going to move along on this
stuff and drop their opposition to uh, you know, we

don't like this racial equity stuff. Will do expungement, but
forget all that other preferential preferential stuff. Listen. I think
where we are right now is that we have, if
it was purely safe, we have about eighty votes in
the Senate. As you know, we need sixty votes to
get this through. So the real issue is once you
start adding veterans affairs, small business loans, racial equity expungements,

and all these things, you start to lose votes, and frankly,
not only Republican votes, but there are several Democrats that
you lose votes on as well, the ones that typically
cause a problem for Democrats and a lot of the
legislation that they've been trying to pass. So we so
what we've been trying to do is get Schumer and

Booker to give us a final draft, per se draft.
We understand it will get negotiated that we could go
and cross to the other side and start talking to
the Republicans about what they're prepared to accept and not
prepared to accept. The problem is every time you add anything,
you'll lose a couple of them, right, That's where the

problem is. What happens if the Republicans take not just
the House, which everybody expects, but they also take the Senate.
Are things then dead because McConnell just doesn't want it.
Or when you say there's eighty votes for a straight
safe banking, um that supplies that there's thirty Republicans out
of the forty nine or fifty fifty who would be
in favor of it. So is it conceivable that a

straight out safe banking goes through next year if reblems
have both houses or the Democrats gonna mobilize against it
so much it won't happen on that end, McConnell. McConnell's
the problem in this situation. So there are votes on
the Republican side, but only under democratically controlled House because
McConnell doesn't want to have on his record legalization of

any kind in cannabis. But safe banking is not legalization.
And if you're saying he's got you know, thirty out
of fifty Republicans already saying they want it. I mean,
I mean, you know what's the problem there. I mean,
he did move around on him, maybe because it ran
Paul's influence and being in Kentucky some years ago, but
it's safe. Banking is not real. I mean, so he

regrets ever passing the hemp built he thought it was
he thought it was, you know, um, hemp for rope.
He didn't think it was hemp for weed. And what's
happened is, you know, he he did not think that
what's happening now countrywide with delta eight and delta nine
to th HC components that are being derived from hemp,

and these products are spreading naturally, he's adamantly against that.
And so he is very negative on anything to do
with either CBD, hemp or cannabis. At this stage, I
can't get into the guy's head, but I can tell
you what he said. We are not going to put
either into committee or on the floor vote with anything
to do with cannabis at the Senate if he controls

the Senate. Okay, boys, let me let me just embarrass
He's just a little bit here, right, So I should
tell our listeners full disclosure that you know, after I
stepped down from running drug policy a lines five years ago,
I thought about getting involved in the industry in some way,
and it just felt unseemly to make a switch from
advocacy into that. But last year I said what the hell,
and I decided to make a significant investment for me

in the hedge fund that Boris had set up called
Measure eight. And like an idiot, I did it at
the peak of the market last spring, a year and
a half ago. I have anybody should have known better
than that, And so my investment is now down in
your hedge fund boards, although I understand would probably probably
be down even more if I'd invested in some of
the other funds. But that being said, so i'd go
on a couple of your quarterly calls and I remember,

like a year or ago, you were really optimistic. I'm
talking to people people appreciate, so I'm taking what you
say and you're optimism with a grain of salt. But
why do you think you got it pretty wrong last year? Well,
because I was speaking to you know, the powers that
I had calls with Schumeran and others, and um you know,
they were very optimistic they were gonna get this done,

and they misled. To be honest, a lot of us
and you know, we love to blame the Republicans, he said,
on anything to do with cannabis or you know, liberalization
of drug policy. But the fact is the Democrats of
the Democratic President and two houses the controlled by Democrats,
and they have done zero on this issue. And so

you know today, obviously I'm positive because I can see
the activity, but you know, I'm a person who tries
to believe what I'm told, and I was told by
the higher ups in the party that they were going
to get this done and they didn't. Right. You know,
it's my little suggestion giving the Democrats a little more
loved before you hit him on that stuff, because I

saw I'm watching your interviews in your slamming Schumer and Booker.
They're screwing it up. They should have had this done before.
And then you're saying in the States, the Democrat led
governments in the States, they won't crack down on the
illicit markets because because Biden bailed them all out with
the big federal funding, and once they don't run out
of money, they have to crack down there and they'll see.
But meanwhile, the fact of the matter is, of course,

it's Democrats, with a few major exceptions, who have really
driven this thing nationally, right, It's it's democratic states, which
basically on the places mostly where you're doing really good
business is democratically leadership. In Congress, they led this thing,
you know. It's it's Democratic voters who disproportionately voted in
favor this thing. So I can agree with you to
some extent about Schumer and Booker and how slowly been
on getting their ship together. But on the other hand,

you know, but for the Democrats, if the Republicans were
running things, uh, you know, purely, if your business, the
whole industry wouldn't be much of anywhere. And meanwhile, the
Democrats they got what five or tennessee margin in the House,
they got zero seat margin in the Senate. It's not
like g f DR and a new deal so getting
anything through. So anyway, my suggestion, give a little more

love before you kind of smack them around. It's and
I I spend more money and more love on the
Democrats than on any party in Washington, and so we
I can tell you this, I don't give very little
credit to the federal government and Congress or the Presidency,
both Republics and Democrats on these policies. I give them zero.
I do however, do you have a high grade to

our various governors and local governments that have been really
brave and pushing these policies. But at the federal government,
which you and I are talking about now, I give
him an f So just a few other issues will
wrap up this. Can you know current conversation to a
d about allowing businesses Marijunia businesses take a tax to
duck share that can happen anytime soon is that's still

years away. So they're trying to actually put that into
this current law that they're trying to get past in
the Lame Duck. My concern with that, Ethan, this is
that that's the trojan horse I worked on the Ways
and Meets committe when we were doing tax reform. Kind
of showing my age. But anyway, um, I can tell
you that to change tax policy in the United States

is very complicated. You have to score the tax, you
have to find an alternative for that tax, for the
revenue from that. I don't believe personally that we can
get that done between now and the Lame Duck. And
so my concern is that if they put that into
the law, it's dead on arrival. Even though the publicans
tend to be pro tax reduction, although I'd like to

see what their position would be on cannabis tax reduction,
but they tend to be pro tax reduction. So and
we just say the same thing also about there's this
climb Acts c l i MB that would basically, you know,
provide a safe harbor so that you know, companies like
yours could be listed on US stock exchanges or at
least be able to access Wall Street funding. Same issue
where it's going to be some years down the road

and can't. Don't get things distracted now because I hear
the activists are very worried about it. They see, you know,
opening up the funding for you know, you guys to
Wall Street just you know, enhance this consolidation of this
whole industry. You know, your valuations will you know go
through the ceiling. But the whole consolidation process which activists
and some others are really trying to slow down to
keep some elements of this industry a small business um

that will go by the wayside. Well, I actually have
a completely the opposite view. If if they don't get
rid of two A D and if they don't allow
eventral uplifting, I'm not the one that's to suffer, right,
It's going to be the small entrepreneurs that are gonna
suffer because there's no cheap funding for them. What's happening
with those companies now is that they're having to pay

you know, usually rates to start the company, kind of
the way I had to write when I started this
business to ten years ago. You know, we were paying
you know, for our money to try to start the business. Now,
the fact is we had an open playing field, so
it was much less competitive. Now the market is much
more competitive. Pricing is being squeezed, so the profitability levels

are way down where you're paying basically a seventy tax
rate on that, and so the small companies cannot survive.
I want to reiterate this, without too without safe banking,
and without uplifting, the small business owner is finished in Cannabis.
So if we don't get this in the lame duck session,

over the next two years, the five major companies in
the U S will consolidate the whole industry underneath them
because nobody else is gonna be able to get funding.
Aren't the states kind of limiting how many you know, dispensaries.
You guys can own it anywhere, but they're not gonna
be able to But they're not gonna be able to
keep doing anything because I'm telling you right now, we
have something called three tiers of cannabis companies in the US.

The top tiers the top five companies. Then there's about
ten companies and what we call tier two, and then
everybody else is in tier three, and then there's the
private companies that are Tier four. Everything below Tier two
is going to start going bankrupt because they can't refinance
and there's no money available. Why would investors put money
in the sector where there's no liquidity and they can't

realize their upside. So what's gonna happen is the big
companies will always be able to attract investment, although it
will be more expensive. The medium and small companies are
gonnatract no investment. So what is gonna happen. They're gonna
start going bankrupt and shutting their doors. So what's gonna happen?
We're gonna go to the states to the regulations and say, guys,
here's your alternative. Either these companies shut down and we

lose all those jobs, or you allow us to come
in and consolidate them and at least save the jobs
and business. So, you know, the states are gonna have
to make a decision. Do they want to, you know,
have this sector continue to expand or are they gonna
want to shut it down. And if they decided to
shut it down, they shut it down. But I don't
think that's what's gonna happen. They're gonna want the tax revenues,
so they're gonna want these businesses to keep going, and

so they're gonna allow consolidation to take place in these states.
They're gonna have to. It's inevitable. We'll be talking more
after we hear this ad. Let me ask you about

a particular state, Oklahoma, right, I mean, it looks like
the total Wild West. Basically, it looks like they're giving
out licenses like candy there, and the result is that
you have, i know, massive numbers of dispensaries and outlets,
you know, medical marijuana, but you know, basically anybody can
get it. But when somebody was telling me recently, is
that went ups night of that is that in basically

every little city in town in Oklahoma, you have some
local business people who set up their own little operation.
And if you go to a black town, it's going
to be a black owned dispensary in a white town.
This and and the question what do you think about
that model or is it inevitable that will be consolidation
in Oklahoma as well? They won't be able to survive.
They'll all have to consolidate because there's too many of them.

We saw this in Oregon, we saw this in California.
There's too many of them. There used to be two thousand,
eight hundred dispensaries in California. There's less than eight hundred
now because what happens is they all go out of business. Capitalisms,
capitalism ethm right. You know, you have to make a
great product, you have to invest in that product, you
have to build your distribution. To do these things, you
need a lot of money. This is not a capital

light industry. This is a capital heavy industry. In other words,
you have to invest a lot to get a result,
and people want to return on that investment. I mean,
we've seen this for two hundred years in the United States, right,
lots of small brewers, lots of small um alcohol companies,
cigarette companies, other things. They eventually all merged into these

large conglomerates because of the nature of the way the
system is, of course. I mean, I'll be frank with
you and our listeners here. I mean, you know, on
the one hand, you know, I'm the kind of smallest,
beautiful kind of guy, you know, ideologically, you know, I've
been on records saying I'm not in this whole thing,
the fight for the Marlborization or bud Wiserization of marijuana.
I do think there's a moral obligation to try to

get racial equity provisions and to make them work. But
the other part of me knows we live in, you know,
perhaps the most dynamic capitalist society in history. I look
at when I moved to New York City thirty years ago,
and they're all sorts of different little you know, coffee
shops out. Then Starbucks come along and they all get
wiped out. But now I walk around New York City
and I see more small ownership, the single store, a

few of the three or four stores, and there's been
a proliferation and so the non Starbucks niche seems to
be slowly growing and growing, not unlike what's happened with
micro breweries in the beer area, not unlike has happened
with you know, the microdistilleries. And you see it's still
under ten percent, but it's growing quite dramatically in many places.
And I wonder, you know, when all of sitting done,

is that going to be the inevitable future of the
broader cannabis industry. I agree with you, actually, and I'll
tell you what it is. What happens is the big
companies get lazy, They start to manufacture a product which
is not uh, you know, interesting, They don't innovate, and
the consumer is always looking for the next great thing,

right Ethan. And you know, if I can get a
cup of coffee from a local brewer of coffee that's
much nicer than a Starbucks coffee, I'll even pay up
for that to get that cup of coffee. And I
think that that's what we're seeing. And we're not only
seeing that in the US, particularly in the coffee industry.
We're seeing that across the whole world. If you'll go
to the UK, you've got you know, Cafe Nero, You've
got You've got a whole bunch of these different companies

that are coming up, and they're starting to challenge the
monopolies of you know, the Starbucks in the world, and
I encourage that. I always say to my people at
Cure Leaf, there's some kids sitting in a garage. Sorry
for the cliche, but that's you know, in the garage
thinking of a way to disrupt what we're doing, just
like we disrupted Cure Leaf. How the industry looked, you know,

eight years ago, and so there's always somebody else. And
that's the beauty of the American system. And I believe
in the American capitalist system. It's not perfect. We have
a lot of problems, and we have a lot of
problems to fit. But when I'm not a believer in socialism,
and I never have been, and someone whose family ran
from communism, and someone who saw what was going on

in Russia in the early nineteen nineties when I went
over there as a young man to you know, put
off my footprint, my imprint on that economy, I can
tell you socialism doesn't work anywhere in the world. Of course,
you put on a table with Boris Jourdan's one fascinating guy.
He was born, you know, in Long Island. He's in
his mid fifties now. His parents, grandparents had fled from

you know, during the Russian Revolution in nineteen around nineteen
seventeen or so. His grandfather, I think was involved in
part of you know, at the higher levels in the
Sarist government. You know, he's what you would call a
white Russian and he grows up in Long Island, in
a little white Russian community and Sea Cliff, and he's
really I think still you're very much woven into that.
And then in the nineteen nineties when you're going to

business school, uh, you know, you see all the you know,
the sons of the elites, you know, going to from
Latin America going back and setting up American banking and
you speaking Russian growing up that way, go back to Russia,
become the boy wonder of Russia markets, you know, with
with funds that helping get the Russian stock market going,
you take over a TV station, and TV that goes

on for a few years. You're reportedly friendly with prudent
in those days, and then you piss them off at
old four and life changes. So I want to ask
you in the first question here. You know, you were
involved in Russia deeply in the nineties, the born Yelson years,
the wild West years, and then you come to cannabis.
But what I want to know is, you know, when

was it that you first thought about getting into the
cannabis and just you where were you in your life? Um,
you know what made you think about this. I'd love
to be able to say that I was an early advocate,
as you are, but that would be a lie. Um.
You know, I stumbled into cannabis, so you know, obviously
as a as a college and and high school student,

I smoked weed like everybody else and enjoyed it. But
then I stopped doing it in my mid twenties and
into my thirties, after having children and stuff like that.
Not because I was against it, but I just stopped.
I took on other things and then um uh, you know,
I tend to start businesses in those countries where I live.
So when I was in Russia, I had a whole

series of different companies. Then I moved to the UK
and I started, you know what became the largest data
center operation in Europe, a company called tell A City.
We lived there for eleven years and then I moved
back to United States and I had a friend of
mine come over, a very interesting person. He came to
me and he said, Hey, I'm starting a cannabis UH

medical device business. He came up with a patent for
a machine that was going to deliver dose specific dosage
of cannabis to late stage cancer patients in hospitals, and
he wanted to get that approved by the FDA. Well,
I invested in his business UM, and obviously the FDA
wasn't gonna look at this. And then I kept telling

him and his colleagues that they have to pivot UH
to this vertical business because I started looking into cannabis.
And then I reoriented the company from the medical device
business to this vertical cannabis UH cultivation, manufacturing, and distribution.
So it goes from being a kind of little sideline
interest in fourteen where it absorbs more and more and

more of your time, to the point of today where
it's how you spend your time in business. It's I mean,
I'm a a full time to be honest, I'm spending
most of my time on US. Now, you're right, and okay,
I'm super fascinated with it. So boris I gotta bring
up when Putin invaded Ukraine some months ago. You know,
you took a lot of flak because you put out

this kind of lukewarm thing, a kind of both sides
hope there can be peace resolution. Clearly you were not
you in no public place condemning you know, this brutal
assault on Ukraine by Putin, and you knew the guy
twenty years ago, And I'm just assuming the reason you
haven't said anything more boldly is that you know Pudin

kills people, and he's vicious, and you still have friends
and business interests in Russia, and so your view was,
you know what the cost of my saying something criticizing
Pudin on this invasion is gonna be risky in various ways.
It's just I'd rather take the ship from the community
for not being bolder. Is that basically what happened. No,
I'm gonna tell you. I'm a I'm an old line

student of business, and I know things have changed Ethan,
and maybe I need to change. But everything I learned
about business, not only from my father but also in
school and then my first jobs, is that businesses and
politics are separate. And I have made it a thirty
year issue that I do not get involved in politics

while I'm running businesses. And I'll tell you one of
my mentors, George Sorols, pushed that with me until, of course,
he switched his fund to philanthropy and to a charity,
and then he got involved heavily into politics. But you know,
if you know the old George, which I do, and
if you read his book Source on Soils, he's got

three pages about our relationship in there, you'll know that
he was one of the people that said Boris focus
on the business and stay out of politics. And so
I try to stay out of the politics because I
don't believe there's any upside to business in getting involved
in politics. Well, listen, let's turn to a few other
things here. On the future of the industry, I mean,
if heard you say, look, so many people focus on

how what happened last quarter, and I you focus on
the fundamentals. You think, like Warren Buffett, you think, like
black Rock, this is long term. You're in it for
a long term. One of the things you've been saying
about the nature of this industry, apart from the stuff
we've been talking about, is you think fifty of the
industry will be people drinking their cannabis um within a
few years. And so tell me what you see on

the evolution of this thing in terms of the drinkables,
the edibles, other forms of consuming. How do you see
this thing evolving in lie So it's and I think
the industry is going to break up into three categories.
There's gonna be the pharmaceutical part of the industry, and
that's when synthetic cannabinoids come about. I believe this pharmaceutical
companies will switch from being the biggest opponents of legalization

to the biggest proponents of legalization. And obviously that's not
an area where we intend to play. That's gonna be
really a pharma category. And by the way, I think
the cannabis plant is such such a great medical plant
that I think they're gonna do very well in that area.
The second part of the industry is going to be
what I call the neutraceutical part or the wellness part,

and that is somewhere where we do want to play.
We just launched a rub which is really revolutionary. I'm
recommending it to everybody. It's a rub for arthritis and
muscle and joint pain. It has no psychoactive effect on
the person, but it has high levels of th hc,
c B, D c BG, it's some other uh components
that really really helps with pain and and so I

think that the whole sleep and pain category, it's going
to be a big one. And I think cannabis is
gonna play a role in that. And I think that's
gonna be biologicals rather than synthetics, because people really prefer
Today the world is really moving towards much more homeopathic
medicines than these awful drugs that people have hooked us on.

And so I think that will be a big category,
and purely wants to be a player there. And we
have a i think the largest R and D facility
in the country working on products in that area. And
the third is going to be your recreational market, which
is very similar to you know, alcohol and and and
and other things. So the reason I made that statement
was because I've been watching consumer behavior not only United

States but in the world, and and people are really
trying to move away from smoking. And it's not only
because smoking, in the case of cigarettes, caused cancer, but
it's because anything you put into your lungs that's not
fresh air is not natural, and I think that the
world is heading in a direction where we don't want

to put anything into our lungs except oxygen. And I
don't think this is gonna happen soon ethan, because there's
a huge cannabi's culture of smoking. But I think that
culture is older, and I think the younger generation is
going to move on to other products. Plus, as this
industry and the products spread to new people, new customers,

those people that never used cannabis, a lot of those
are not smokers. It's women replacing a glass of chardonnay,
or men for that matter, with you know, a drink.
And the drinks category in terms of products, consumer based
products is the biggest in the world. And edibles and

drinking that's the biggest. It's much bigger than anything to
do with smoking. As a matter of fact, smoking is
on the decline in the world and and drinks and
edibles are on the increase. And so when I made
the statement at the Benzinga conference in Chicago last week,
so I first of all, I said it's five to
ten years from now. I didn't say it's tomorrow the
next year. I said five to ten years from now.
I expect that the industry will be between drinks eventually

going to and that's because it's a form of consumption
that is really growing within the population, not only United
States but in the world, and smoking is falling off.
Does that mean that the importance of growing is very
high in marijuana in greenhouses? The specific strains in all
this is going to be less important that when you're

doing edibles and drinkables, he can really be outdoor grow.
You don't need to be quite as particular in the
content of these things. So you know, there is a
story and around that. I disagree with it because I
think that the edibles and the drinks are much better
with high grade product and you can taste the difference

and feel the difference in the entourage effect by planting
very good plants. Now you know my view generally, and
I don't know how well the the audience knows this.
You know, I think this whole higher th HC is
better is garbage. I believe it's all in the trpenes.
It's not in the THHC. So you know, I think

at eight U th HC plant UH and AC plant
is going to give you the same effect depending on
the profile of the turpenes. So I do think trpines
are absolutely critical, and for trpenes you need very well grown,
high end cannabis. So I actually think you're gonna still

require really high end and different strains to get different
types of entourage effects from these places. So now in
terms of the broader future of the industry, I mean
you mentioned they are about big big pharma and how
they're gonna want synthetic cannabis. I guess because you control
dosing and purity and your consistency more in that way.
What about you know, big tobacco. You know, I interviewed

uh the chairman and former CEO of Philip Moore's International,
Andro Colenzopolis, a few months ago on Psychoactive, and he said, yeah,
you know, it has been a couple of little investments.
He kind of hedged on where they might go, but
there's clearly evidence of them moving in. Do you see
them ultimately dominating this or given what you're saying about
um people switching to edibles and to uh drinkables, do

you see big alcohol or the big consumer good companies
ultimately dominating this or well, or were pure marijuana companies
actually play there? Continuing major role. I mean, looking out
ten fifteen years from now, what do you think? So
I think they're all gonna be players in the sector.
So I think the tobacco companies, in my opinion, will
no longer be known as tobacco companies. They will be

known as cannabis companies. So I think they'll be prolific
investors in the sector. As you know, the biggest investments
made so far come from drinks tobacco companies. And I
think that, you know, Philip Morris, no matter what he
told you, I can tell you they are spending money
and a lot of time. They are doing enormous amounts

of R and D on the plant, on the cannabinoids,
on the different entourage effects. They're going to be in
the sector, no question. And I personally think they're gonna
get out of tobacco eventually and focus on cannabis and
cannabis related products. It does seem like p M I is,
you know, leading the way. I just heard a presentation
by Vivian Aser, the analystic Cowen who follows the alcohol,

tobacco and cannabis industries, and p M I seems leagues
aheads of all the other big ones in terms of
making that transition. But one thing I do worry about,
and this comes from the kind of public health part
of my advocacy brain, is whether or not we're gonna
see on the legal industry trying to fuse nicotine product
with Canadas. And obviously already people you know, both in

Europe and even the US, whether you know splits, blunts,
whenever they're they're already merging these two products. I remember
when I lived in London for a year. I didn't
like it because all my friends would smoke him in combo,
and I didn't like the tobacco thing. But do you
think that's gonna happen and you think governments are basically
gonna put prohibitions on selling those products in combination? You
probably remember this right, Schumer said that he doesn't want

the tobacco industry involved in the cannabis at all. And
so I do think that there's going to be significant
early pressure to keep the tobacco companies out. But I
can tell you right now, British, American Tobacco, Altria, Philip Morris,
they're all writing big checks, particularly in Europe, not the
United States because of our federal prohibition, but in Europe

and investing in startup companies across the board. But apart
from the company's what about the product itself? And there
was the notion of selling cannabis that also has nicotine
in it. You know, I've never smoked a cigarette. I
think maybe one as a young kid, but I never
liked cigarettes and I didn't like to taste that like,

so I'm the wrong person to talk about cigarettes except
to tell you that I think there's gonna be too
much pressure on them to keep tobacco and particularly nicotine
out of this space. Let's take a break here and
go to an ad so both you among I think

all the major figures in the cannabis world in the
US at least, maybe not Canada, but the US have
been the most excited about the international markets in especially
Europe and everywhere I look. You're talking about Germany, Germany, Germany,
you know, other major multi state operators are not going
to Europe in the same way. But you're big in Germany,
and you pointed out that medical marijuana. You know, they

didn't do that so well. But if they go for
full legalization, um, it will be big. And the new
government says they're gonna do it. So give us your
perspective on Germany before I ask you about the rest
of Europe. First of all, Germany, you know the way
Germany goes, Europe tends to go there the leader obviously,
at least at the moment, especially now with the UK
out of the European Union. I think the Germans are

very very focused. I mean cannabis use and by the way,
psychedelic use is very prolific in Germany. You know, if
you go to Berlin, you can't walk down the street
without smelling cannabis everywhere. Um same thing in Spain. But
the German government is a rational government, right they they
understand the taxation benefits and so they are legalizing cannabis.

It's our view that barring some treaty hiccups that they have,
particularly on the EU side, I think the U N
Treaty is resolvable because Canada did it and there's a
precedent now for it. I think that the EU treaty
nobody has addressed that issue. What Canada did and with
Germany might do is basically to do with Avo Morales,

the former Bolivian president d with Coca, which is to
withdraw from the treaty and then rejoin the treaty saying
we don't agree to the coca provision or in this case,
the cannabis provision, that's what you're talking about, correct, And
they get a they get an exemption on that. Yet
what's interesting is that no one's ever done that near
you yet, at least we don't have a precedent. So

this is groundbreaking now. Obviously, see if there's any country
in the world they could do it, and you it's
it's Germany because the EU basically is Germany from an
economic perspective, So so I think they could lead the way,
but they have to get people on their side. But
luxembourger is trying to get this, Switzerland is trying to
get so they have people, they have other countries that
are on their side. I think there's five countries at

all right now that are trying to get this through
the EU. I mean, it's weird how the Dutch, you
know who almost fifty years ago did the you know,
the coffee shop model with decriminalization, Shane, How they've just
never kind of crossed over to making a fully legal
back door, you know, the legal wholesale production of this stuff.
It's very much the way that medical marijuana dispensaries were
in the US. You know, between the time we first

legalized medical marijuana and California nineties six until we got
the first dispensary law in New Mexico and oh seven.
I mean, basically it was the thing where activists would
start setting it up, first the cops to shut them down.
Then eventually they say, well, maybe this works better this way.
But it's weird how they never gone all the way now.
I also are a lot of people talking about Portugal,
but is that basically because of the cultivation side and

their low cost production. Portugal right now has a medical
program almost impossible. We've We've been an applicant for our
products there for three years and where one of the
biggest cultivators in the country, and we still haven't gotten
our medical license. It takes forever. It's a very bureaucratic
oh siety. I think only one company, I think til Ray,
has a license to sell it's it's not a very

big market because of the way they regulate it, but
they are the center of cultu ovation because the climate.
The climate is very similar to California, and so you
have the ability to grow basically three quarters of the
year outdoors, sun grown or hoop houses or greenhouses. You
can grow very very nice product. And so that's why

Portugal is so popular because it has an absolutely perfect
climate for growing cannabis, and most of the cannabis in
Europe comes from Portugal today rather than from any other country.
Given the factor of class of production, why would a
place like Columbia or Morocco or some other African country
UM emerges a major suppliers in the way they have

with coffee or tea or a whole range of other
UM commodities, including psychoactive commodities. So I think they will.
I think Colombia is you hit it on the nail
on the head. Uganda is already supplying. There's Ugandan product
coming into Germany right now, so right, I mean, I
do think they're going to be. But but I think

that you know, some of these countries, these some of
these regions may put on limits. For instance, uh, you know,
up until last week, it was anticipated that all the
Canada's coming into Germany would be EU g MP. Didn't
matter where it comes from, as long as it's U
g m P, you can import it into Germany for
the wreck program that's starting in twenty four. You know,
there's rumors today that there's certain elements that have lobbied

to say we want to have domestic growing only now.
Obviously that's nuts because Germany is probably the most expensive
place in Europe to do business, and currently with the
energy crisis, you couldn't grow a cannada's plant there, either
in a greenhouse or indoors that would be remotely uh

profitable to sell, or if you were selling, it's all
at such a price that it would be prohibitive for
people to buy in the black market would continue to proliferate.
So I'm hoping that Germans walk away from that. And
this is not Catherine Stone, this is just conversation, and
we're gonna hear this kind of conversation for the next
six months as they go through rulemaking for the recreational program. Obviously,

different interest groups in the country are going to be
lobbying for different things. I personally think it's uneconomic to
grow in Germany and so I hope they walk away
from that. But there is a rumor that they're going
to try and do that. And where do you see
the greatest likelihood is of you know, countries in Central
East jor moving forward leading aside the Czech Republic, which
has generally been more ahead of everybody. In any case,

I think actually interesting enough fin notes. But Ukraine, so
I actually have on my desk right now some due
diligence on Ukrainian UH greenhouses. Uh Zelenski has said that
he wants to legalize cannabis in Ukraine, and so I
think Ukraine could be come out, assuming we can get
some resolution to this conflict. You know, twenty years ago,

the president of Kazakhstein UH now they're by it, basically
proposed that they look at the possibility of legalizing cannabis,
not just him plant but cannabis. And it didn't really
go anywhere here. But I mean, kan has been the
kinic hemp, but you know, bread basket, I guess for
that part of the world for a long time. Do
you see any possibility that among the various stands UH

in the former Soviet republics that UM apart from Ukraine,
that Kazakhstan might begin to play role. So no, I
don't think they're gonna play a role, but I will
tell you there are two major UH middle Eastern countries,
major countries that are very high density populated countries that
are considering medical first and then eventually adults. Which can

you say which ones? Ah? I think I don't want
to jinx it because you know that these are most
these are difficult issues for them, and I don't want
to mess it up. But I've been advising them and
I can tell you that I think that very shortly
you're gonna hear about eighty million plus population country which
nobody would ever think would legalize I think is going

to legalize cannabis and smaller secondary but also very interesting
country that is looking at adult use as a way
to stimulate tourism in that country as well. So it's
very interesting. You know. I I probably spend less time
now ethan on purely specific I'm I'm becoming a bit

more of an ambassador and I'm running around the world
really trying to talk to these governments about opening up
their countries to cannabis. And Thailand, what a bizarre story there,
this sudden legalization, these bizarre politics. Um, you know, how's
that all going to shake out? And are you looking there? Yeah,
we We've had a team in Thailand probably for a

month and a half. We're trying to be the first
company to export from Europe into Thailand. So the transaction
hasn't gone through yet. But you know, these first transactions
are always the most difficult, and after that, you know,
the supply chain starts to work. But we are in
the process of trying to get a fairly substantial first
shipment into Thailand as a test case on supplying that

country with European cannabis. Okay, So to come full circle
back to Russia here, I remember the early two thousand.
You know, Putting comes to power with January one, two thousand.
In those early years, there was some kind of progressive stuff.
There was a decriminalization, people being led out of prison,
there was some support the kind of you know, crazy narcology.
Establishment was kind of a little pushed back a bit.

And I'm wondering in Russia in terms of cannabis, can
you imagine cannabis liberalization or maybe liberalization is their own word,
but medical cannabis and then maybe a broadening out happening
in Russia in the next five to ten years. Listen,
it's gonna be difficult, um for two reasons. Well, Underpoots,
I don't see it happening because, um, he is anti

alcohol and anti any drugs. Right. The man is a
health freak. He is never going to allow it. Although
I don't know where the study is now. He did
allow one Russian government owned organization to build a green
house and to plant cannabis as well as the opium

plant and to do medical research as to whether or
not it actually works, because he had enough pressure on
him with everything going on the United States and Europe
that he allowed for that to happen. And he said,
if you guys can bring me medical evidence that these
things actually cure or at least assist in medical conditions,

and that this would be a cheaper variant two synthetic drugs,
he said, I will seriously give it consideration. I think
that was three years ago. A lot recreational never underputs
his watch. He's adamantly against it. As a matter of fact,
he apparently cracked a joke to someone once, uh saying,
asked some Russian that knew me, is Jordan's still selling

weed to the Americans? And that person said yes, he goes,
oh thank god. So you know his view of cannabis
is is very negative, right, Um, at least for his
own population. However, you know, the population underneath Putin, and
when that old guard steps away from power is very different,

very different. I can tell you that the younger generation
right underneath him is much more open minded to these things.
And so I would if I was a betting man
and I'm in cannabis, so I guess I am, I
would argue that Russia could move very quickly under a
new regime. However, there are massive stigmas in Russia, very

similar to the ones in the United States. A matter
of fact, many people don't realize this, but if if
you take the political establishment class out, I see a
tremendous amount of similarities between Russians and Americans, tremendous amount
The way they think, the way they behave a lot
of things are very very similar. And so the young
generation Russia is very progressive, very progressive. And I think

that that generation, assuming it does run off because of
this war, um, I'm assuming that they would move on
cannabis very quickly. And finally, the last two megamarkets out
there China is their role basically going to be on
the hemp side and maybe the scientific side of a
synthetic cannabis and that's it. Yeah, they're not going to

go recreational, I don't think, or even medical in any
substantial way. I think I think they're very, very conservative.
Although you know what's interesting about China's China is probably
the center of holistic medicine, so so it's kind of
strange that they don't allow it. And you would think
given that their population uses roots and all sorts of

things for medicine, and some of the greatest you know,
acupuncturists and stuff like that come out of China. I'm
surprised frankly that they haven't adopted it. But the language
out of China at the moment is negative. And the
country that may soon as their past China, with the
biggest population in the world, India, where many states have
a long tradition of cannabis use and of drinking bong,

the cannabis infused beverage. You see India making any steps
forward on this. So if this country I'm talking about
in the Middle East moves on cannabis over the next
three months, which I expect that it will, um, I
think that India could be next. Very interesting. Well, Boris
I've been a fascinating conversation. UM, so listen, thank you

so much for taking the time to talk with me
and my listeners on Psychoactive. I think it's remarkable what
you've done in building this mega company. It sounds like
you're gonna be in it for quite a while to come.
I mean, I'm curious. I mean, do you see this
as for the next four or five years of your life?
Do you see ultimately selling Pure Leaf to a bigger alcohol, tobacco, pharma,

some other type of company, consumer goods company. I mean,
what is the future not just for cure Leef. I'm
also asking you to speculate a bit about some of
the other multi state operators and major companies. Is that
one thing I've always this is my fifth company I've built,
and my formula has always never build a company to
sell it. Build a company to compete and be best

in class. And that's what I'm doing. In some cases
those companies got bought. In some cases those companies state
as independent operators. You know, I would love it if
if the landscape in the world was you know, there's
gonna be obviously tobacco companies and alcohol companies and and
you know, food companies that everybody gonna use cannabis. I

would like to think that they'll be one or two,
you know, pure play cannabis consumer goods operators in the world.
And that's what I'm trying to build. And I hope
I'm successful. But you know, I can't predict today what's
gonna happen. But I can tell you one thing. I'm
not building cure leaf to sell it to a tobacco company.
I'm building cure leaves to being competitive in this world.

Is one of the thing I forgot to ask you about,
which is one issue I've become passionate about since I
stepped down from Drug Policy Alliance, is the whole fight
over e cigarettes and tobacco harm reduction. And the scientific
evidence is pretty clear here that if you could snap
your fingers and all the smokers worldwide would suddenly stop
and all take up vaping. And even if the number
of vapors was greater than the number of smokers, and

not just vaping, but the you know, the lozenges, the
things you put in your mouth and oral versions, it
would be one of the greatest advances in public health
in human history. And you made the point before about
you seeing a shift in cannabis consumption from the smoking
and maybe even the vaping too. Things we're not putting
things in your lungs. And here we have a case
where you know, you see the shift from smoking the vape.

You see, it's made a big difference, not just in
places like Japan and Korea, but even in Russian Ukraine,
people stopping smoking, taking up these heat not burn uh
nicotine tobacco stuff. The emergence of e cigarettes in some places, um,
you know, major advantage from a public health perspective in
some respects in many parts of the world, even more
controversial than cannabis is. But I'm curious have you been

keeping your eye on that area. Have you been following
it thinking about investing or the connections to cannabis. I've
been following it very close, is my fact. I've had
numerous calls this week on the Jewel situation that took place,
you know, the settlement that the fine and everything. So
I'm I'm I'm very much on top of the issue
because I think it's very relevant. Listen, I think there's
two things. The first thing is, you know, there's no

question Jewel targeted teenagers, and so in marketing and social
media and everything they were doing, and so in that regard,
and I saw the effects on children firsthand. I five
of them of what vaping can do when you're trying
to get your kid off of it, and I can
tell you it's a nasty look. I mean, hand shaking,

they can't sleep, mood changes really really so, so I
do think that that it's all about what you put
in them. And my biggest question to vaping as a
whole is there hasn't been enough work done on either
the devices or on the effects of the vaping on

the longs of of the individuals. And I know, in
some ways I'm talking against my own book because we
sell a tremendous amount of apens, but there's heavy metals
issues right. A lot of people are putting all sorts
of substances into these vapes. I mean, even edible biologicals
have a different impact in your stomach versus your loans.

And I think that the issue is we need more
work done on that. I am sure. I'm absolutely sure
that there is a way to make vaping safe. I'm
absolutely sure of it. But I think that there needs
to be more work and more transparency on the work
that's already been done for the consumer to understand. So,
for instance, the company Select that I bought years ago,

it was built on a very simple premise. It was
a bunch of young guys out of Oregon that realized
that the vappens that people were using in California, we're
making people cough hard and they were getting really bad coughs.
And what happened was they were using silicon wicks in
their vapens and they were getting sil a coosis and

that was affecting their lungs and making them cough. And
so these young guys did a simple thing. They went
out and they replaced the silicon wick with a Japanese
cotton wick, and all of a sudden, the coughing stopped.
But that's just one element, right, What about the you know,
the metals that are used. I agree with you, but
you know, one sees now the FDA is basically green

lighting a whole bunch of these things, you know, whether
it's Enjoy or the you know blue I think it is.
So they're definitely looking at stuff and even you know,
they blocked jewel and then got mud on their face
because it seemed like they were doing it for political reasons,
not for scientific reasons. So I'm glad you're keeping your
eye on this area because I do think it's a
fascinating one and there's probably nothing that could more advance

public health around the world than seeing a rapid transition
from combustible cigarettes onto the noncombustible forms of nicotine. I
completely agree with you in this product that Philip Marris
has in Europe. It's prolific and it's illegal in the
United States. It's amazing. Yeah, well, just's caught up in
litigation with another I think British Americans bacco or something.

But I think eventually it's just going to get out there,
and it's true. It's and I think especially Russian Ukraine
are two of the biggest places where it can you
know be it's it's proliferic. I can tell you even
I was, you know, I was in greased this uh
the summer for a vacation. I mean, all the Europeans
are using icons. It's amazing. Yeah, well boris On that note,
thank you ever so much for joining me and my

listeners on Psychoactives. If you're enjoying psychoactive, please tell your
friends about it. Or you can write us a review
at Apple Podcasts or wherever you get your podcasts. We
love to hear from our listeners. If you'd like to
share your own stories, comes and ideas, then leave us
a message at one eight three three seven seven nine

sixty that's eight three three psycho zero, or you can
email us at Psychoactive at protozoa dot com, or find
me on Twitter at Ethan Nadelman. You can also find
contact information in our show notes. Psychoactive is a production
of I Heart Radio and Protozoa Pictures. It's hosted by
me Ethan Nadelman. It's produced by Noam Osband and Josh Stain.

The executive producers are Dylan Golden, Ari Handel, Elizabeth Geesus
and Darren Aronofsky from Protozoa Pictures, Alex Williams and Matt
Frederick from my Heart Radio and me Ethan Nadelman. Our
music is by Ari Blucien and a special thanks to
a Brios f, Bianca Grimshaw and Robert Deep. Next week,

I'll talk with Kirch Smoke, a true profile encouraged the
former Baltimore mayor who called for ending the war on drugs.
And putting all alternatives on the table. The country and
the national political scene was moved towards a crime bill
that was going to be very, very harsh, So there
was still basically a feeling that we can prosecute our

way out of this problem, and it just needed, you know,
more police resources, more incarceration, more for the d e A.
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