As it seeks judicial relief from a run-in with the law last year in Kern County, Calif., hemp grower and researcher Apothio has decided to not merely move key parts of its business to the next city, county or state over—it’s hauling its research-and-development operations to North Bay, Ontario, thousands of miles away.
While Apothio will continue to conduct hemp research in the U.S., it will set up its Canadian head office in North Bay, where experts in the Innovation Centre for Advanced Manufacturing and Prototyping (ICAMP) and the DNA lab at Canadore College will work on R&D for the company. Canadore Director of Cannabinoid Research Dr. Pritesh Kumar will supervise efforts, including the sequencing of hemp DNA using Next Generation Sequencing (NGS), according to a press release.
“We will [focus on] genetics all the way to clinical trials to patient outcomes, to building truly an infrastructure that you cannot build in the United States,” Dr. Trent Jones, founder and managing partner of Apothio, told Hemp Grower.
Canadore has applied for a hemp research license, and Jones said his company will proceed with its plans there once the approval is complete in October.
The work on genetics will provide for the evolution of hemp cultivars with specific cannabinoid, terpene and terpenoid profiles. Jones said he and his team plan to patent the genetics, make formulations, conduct clinical trials, develop patient consumption methods and dosing and deliver patient outcomes.
Working through the genomics lab at Canadore, Jones said, “What you can do is take the whole plant—the analogy is that [the] whole plant, with 500 active molecules in it, is the white paint, if you will. You can extract and isolate THCV, CBDV or one of these [other] cannabinoids, or a terpenoid or a flavonoid, and drop it into the white paint and see how it changes the overall outcome.
“But instead of chasing singular molecules, you’re given a whole-plant extract and you’re defining what you get from that whole plant. … How does that one singular model affect chronic pain versus autism or insomnia, et cetera?”
Under Canadian law, products made from hemp can be shipped to regions around the world, Jones said, including the European Union and parts of Eastern Europe, Africa, Australia and Southeast Asia. Apothio may send extracted formulations to Europe; elsewhere, such as in the U.S., it may use its seeds to grow plants and develop products for commercial sale.
“We’ll retain the option for both based upon whatever the regulatory model [in importing countries] allows us to do,” he said. “But we have choices. That’s the beauty of it.”
Apothio’s new Canadian headquarters were made possible, Jones said, with the help of Frank Suraci, Canadore’s director of innovation and The Village services. Suraci linked together Apothio and Canadore, per the release, and, it says, he “continues to build an incredible network of public and private joint ventures in and around North Bay and Canadore College.”
For Kumar’s part, Jones said, “Relative to our research, we’ve focused on whole plant versus isolated molecules. There’s only been a few whole-plant studies approved in Canada, and Pritesh was one of the principal investigators for that research.”
Members of the Apothio leadership team, including Jones, will split their time between the U.S. and North Bay. The company will also hire from the Canadian workforce.
Jones, a retired chiropractor, said he is impressed with the overall science curriculum at Canadore. Now, the college is working on a cannabis curriculum under Kumar, who previously worked at the University of Louisville and whom Canadore hired in late 2019.
“Canadore will engage a significant number of their own students, they’ll recruit students internationally—that’s an opportunity,” Jones said.
Strict cannabis regulations in the U.S. compared to Canada have hamstrung some companies’ ability to develop intellectual property in the states, Jones said, adding, “There’s a great opportunity for some of the leading science in the U.S. to go there.”
Kern County Fiasco Redux
While Jones is excited about Apothio’s prospects in Canada, his company is still fighting Kern County, the Kern County Sheriff’s Office (KCSO) and the California Department of Fish and Wildlife (CDFW) in court over the local and state agencies’ alleged 2019 destruction of 500 acres of Apothio hemp. The company estimates the losses exceed more than $1 billion.
“Most U.S. hemp farmers do not have the means to defend against law enforcement’s abuse of power in destroying their property,” Katherine Eskovitz, a founding partner of Roche Cyrulnik Freedman and an attorney representing Apothio, told HG. “This case is significant to protect the will of voters and legislators to protect the U.S. hemp industry, U.S. farmers and small businesses, and U.S. research, including hemp research to treat children with rare forms of epilepsy, against the abuse of power of law enforcement.”
In June, KCSO and CDFW filed motions to dismiss the lawsuit in the U.S. District Court’s Eastern District of California, according to court records. Referring to hemp as “marijuana” in their motions, the defendants’ attorneys refer to the product as “contraband” and use this characterization to justify the hemp’s destruction.
“Defendants repeatedly and improperly rely for their motion on alternative facts beyond the well-pleaded Complaint,” Apothio’s attorneys wrote.
Apothio states in its KCSO opposition that some of its crops may have contained higher than the federal hemp limit of 0.3% Delta-9-Tetrahydrocannabinol (THC) prior to harvest. However, members of the company’s management team relayed this information to the county and destroyed any hot crops tested on a dry-weight basis as it conducted hemp research, including for partnerships with Pardee Rand Graduate School and Cerro Coso Community College.
In speaking with HG, Eskovitz said a judge ruled in the case Granny Purps, Inc. v. County of Santa Cruz, in California’s Sixth Appellate District, that state-legal cannabis is not “contraband per se.” “In that case, the court held that the authorities could have gone to court to get an injunction or issued a fine, but they cannot abuse their power by simply destroying the plants,” she said.
In its motion to dismiss in the Apothio case, CDFW said they didn’t need a search warrant. However, they obtained one.
Eskovitz said the plaintiffs want to see the probable cause affidavit and that it should have been attached to the warrant within 10 days of the authorities’ warrant execution last year.
“Eleven months after executing this warrant, KCSO refuses to disclose even a single word of this affidavit, or even produce any evidence that any of the search warrant materials were sealed after execution of the warrant,” Eskovitz said.
California Attorney General Xavier Becerra’s name is attached to the CDFW complaint. However, Eskovitz notes, Becerra defends the department and KCSO’s actions in the case while his department conducts a pattern-or-practice investigation into KCSO.
“Pattern or practice refers to the regular practice of policing, rather than isolated, accidental, or sporadic instances,” according to the Center for American Progress.
Eskovitz shared the following information with HG:
“While the California Attorney General is publicly criticizing the way the Kern County Sheriff’s office conducts its business, acknowledging that the California Department of Justice is investigating KCSO for its troubling tactics, the California Attorney General is at the very same time defending KCSO's abuse of power against a U.S. small business, U.S. farmers, and educational institutions in court, while expressly telling the Court in writing that the legal analysis submitted to the court by the California Attorney General does ‘not represent a formal opinion of the California Attorney General.’”