Altria Group and Cronos Group are two names making headlines in the medical marijuana industry. Cronos announced on 7 December that they have agreed to a $2.4 billion (Canadian dollars) investment from Altria Group. Shareholders approved of this agreement on 21 February of this year. This deal has a few implications for the budding field of medical cannabis, but before we get into that, we need to look at who these groups are and why they may\u2014or may not be\u2014major players.<\/p>\n
According to the Cronos website, they \u201care a geographically diversified and vertically integrated cannabis group\u201d from Canada that \u201coperates within Health Canada\u2019s Access to Cannabis for Medical Purposes Regulations and distributes globally.\u201d That is a wordy way to say that they grow cannabis and create marijuana products within Canada\u2019s legal framework.<\/p>\n
Altria, on the other hand, is a United States tobacco corporation. They are a massive producer of tobacco products\u2014one of the largest in the world. Most people know the name Philip Morris. That was Altria before the rebranding that took place in 2003.<\/p>\n
Now that we have taken a brief look at the players, what are the implications of this investment?<\/p>\n
Right off the bat, the knee-jerk reaction is to be upset that a cannabis group sold out to a tobacco company. Altria is not just any tobacco company either. Like others, they have a history that is peppered with shady activity.<\/p>\n
In 2006 Altria was found guilty of racketeering and civil fraud. While they got off the chopping block\u2014which should not come as a surprise given that Philip Morris spends millions on lobbying\u2014this did nothing to garner faith in their brand. People view them as an evil corporation. That\u2019s because they are<\/em> an evil corporation. For decades now they have manufactured, supplied, and marketed cigarettes. There is no question that tobacco cigarettes are harmful, to say the least. However, the investment into Cronos could see some benefits for both parties.<\/p>\n Due to the investment, Cronos will have access to more funds for development, marketing, and research. The investment also comes with brand recognition that looks strong to potential investors. Altria\u2019s stocks do well enough, and other investors will see the investment as a power move.<\/p>\n We reached out to both parties, but both declined to offer quotes on the investment. Regardless, both sides seem to be excited.<\/p>\n Mike Gorenstein, CEO of Cronos Group, said that Altria\u2019s \u201cexpertise and complementary capabilities will better position Cronos Group to support our efforts in cannabinoid innovation, as well as the creation of differentiated products and brands across medical and recreational channels and throughout our global network.\u201d It seems that the plan is in some way to use the funds and brand recognition to develop new cannabis products.<\/p>\n It is clear that the products will be focused not only on recreational use\u2014as Philip Morris has been known to focus on, the recreational use of tobacco\u2014but also on medical marijuana products. This is a massive upside to the whole deal.<\/p>\n Seeing new, innovative medical cannabis products means that more ways to help patients in pain will be sought. Just about any investment into the safe, natural, and smart relief of pain, illness, and suffering is a good investment. This is because companies should<\/em> be considering that people are people, not products. Bottom lines will still be met if the focus switches from pure profit to compassion. Companies can grow souls\u2014they just need to work harder at it.<\/p>\n Overall, the investment from Altria Group into Cronos Group looks to be interesting, if not great. The possibilities are there for amazing work to be done, but that will fall into the hands of those at the top of both companies.<\/p>\n As long as they each strive to pursue avenues of genuine progress there will be no issue. That is a tall order for Altria Group. But Cronos is still a relatively new company. Their brand is smaller than other cannabis companies, but their potential is unlimited. The ball is in their court at this point.<\/p>\n No matter the initial implications of this investment, time will shed some light on the outcome. Let\u2019s hope it\u2019s a bright light.<\/p>\n","protected":false},"excerpt":{"rendered":" Altria Group and Cronos Group are two names making headlines in the medical marijuana industry. Cronos announced on 7 December that they have agreed to a $2.4 billion (Canadian dollars) investment from Altria Group. Shareholders approved of this agreement on 21 February of this year. This deal has a few implications for the budding field…<\/p>\n","protected":false},"author":42,"featured_media":1768,"parent":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[255],"tags":[32,72,154],"class_list":["post-1767","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-news","tag-altria","tag-cronos","tag-news"],"acf":[],"yoast_head":"\nIn Summation<\/h2>\n