A leading Canadian cannabis company has hired a second lobbying firm as it looks to the bountiful US market to try to right its struggling business.
Canopy Growth Corporation of Smith Falls, Ontario, has hired Cozen O’Connor Public Strategies effective May 1 to lobby on “cannabis and hemp agricultural issues” as well as two specific bills to roll back federal restrictions on the industry. Lobbying on the account are Cozen O’Connor Chairman Mark Alderman, a former aide to ex-Sen. Evan Bayh, Democrat of Indiana, along with Kaitlyn Martin and Patrick Martin.
They join Erik Huey and his firm Platinum Advisors DC, which has been lobbying for Canopy since June 2019. Huey was previously a top lobbyist at the Entertainment Software Association.
The first cannabis company in North America to be publicly traded, Canopy Growth appeared well positioned when Canada became the second country (after Uruguay) to legalize recreational marijuana use in 2018. But the company has fallen on tough times, reporting losses of almost $1 billion for the fourth quarter of 2019 as its chief operating officer and chief commercial officer left the company last month.
Its turnaround hinges largely on the massive but heavily regulated US market, where cannabis remains illegal under federal law even as more and more states legalize it for both medicinal and recreational purposes. Last year, Canopy struck a $3.4 billion deal to purchase US multistate cannabis operator Acreage Holdings once the United States legalizes the production and sale of cannabis.
“Our right to acquire Acreage secures our entrance strategy into the United States as soon as a federally permissible pathway exists,” Canopy Chairman and co-Chief Executive Officer Bruce Linton said at the time.
To that end, Cozen O’Connor and Platinum Advisors are lobbying on bipartisan legislation first introduced in 2018 that would amend the Controlled Substances Act so that companies that follow state law would no longer be in violation of federal law. Sens. Elizabeth Warren (D-Mass.) and Cory Gardner (R-Colo.) introduced the STATES Act in the Senate and Reps. Earl Blumenauer (D-Ore.) and David Joyce (R-Ohio) in the House. President Donald Trump has said he would “probably” end up supporting the bill if it reaches his desk.
The two firms are also lobbying on the SAFE Banking Act, which would allow banks to work with the cannabis industry without fear of running afoul of the federal government. First introduced by Rep. Ed Perlmutter (D-Colo.) in March 2019, the bill made it into a $3 trillion coronavirus stimulus package that passed the Democrat-led House last month but is stuck in the Senate.
Canopy Growth’s lobbying is also getting a helping hand from US beer giant Constellation Brands, which owns almost 40% of Canopy Growth. In the first quarter of 2020, Constellation paid Heather Podesta‘s Invariant $90,000 to lobby Congress, notably on the STATES Act and the SAFE Banking Act.