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Illinois Delta-8 Regulation Bill Stalls in House of Representatives

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An Illinois bill to legalize hemp-derived cannabinoids such as delta-8 THC has stalled in the House of Representatives after lawmakers left the state capitol without passing the legislation that would have banned sales of the popular products. 

The measure was supported by many representatives of Illinois’ regulated marijuana industry who argue that unregulated hemp products give minors unfettered access to intoxicating substances and are a risk to consumers. Hemp advocates maintain, however, that the bill will destroy the fledgling industry and the small businesses it supports.

Jennifer Weiss, the owner of Chicago-based Cubbington’s Cabinet, a manufacturer and retailer of personal and pet CBD-infused products, said the bill jeopardizes the viability of the business.

“The bill is so restrictive it would outlaw almost everything in my store,” Weiss said, according to a report from local news.

Over the weekend, the Illinois Senate voted 54-1 to approve a bill that would have limited sales of hemp products that contain THC to licensed marijuana dispensaries. Democratic Senator Kimberly Lightford, the sponsor of the bill, said the legislation was a bipartisan attempt to control unregulated sales of delta-8 THC and other intoxicating hemp cannabinoids. But on Wednesday, members of the House of Representatives adjourned for the summer without taking up Lightford’s bill.

“After months of negotiations, the Senate passed a bipartisan bill that all sides agreed upon, further ensuring our common goal to have a fair, just and safe industry,” Lightford said in a statement, the Chicago Sun-Times reported. “The bill we put forth showed the dire need to regulate the hemp industry before we lose yet another young life to these pervasive products. It’s unfortunate the House could not meet the urgency.”

Competing Bill Also Stalled

Democratic state Rep. La Shawn Ford agrees that sales of delta-8 and other intoxicating cannabinoids need to be regulated but says that the bill passed by the Senate is not an appropriate solution. Ford sponsored a competing bill favored by the hemp industry, but the House of Representatives failed to advance the legislation.

“We don’t want pop-up smoke shops opening on every corner,” said Democratic state Representative La Shawn Ford. “We need to make sure we have some licenses and limit how many we have, so we don’t turn Chicago into ‘Delta and Marijuana City.’”

Ford’s bill would allow existing hemp companies to continue doing business by obtaining a $500 license and completing required product testing. The bill would also levy a 10% tax on hemp businesses and restrict sales of hemp products to adults aged 21 and older.

“It’s not like we can get rid of it. You can’t ban something that’s grown like this,” Ford said. “Let’s not try to have an industry that directly competes with cannabis. Put this industry in its own lane, just like beer is in its own lane and rum and spirits are in their own lane.”

Tiffany Chappell Ingram, executive director of the Cannabis Business Association of Illinois that backed Lightford’s bill, said that members of the group “are disappointed the House failed to pass needed reforms to our state’s cannabis laws and will continue to allow synthetic hemp products that are sickening children and adults to be sold with no oversight.”

“Despite overwhelming bipartisan support for these measures in the Senate, there is clearly more work to do to educate legislators about these important matters,” Chappell said in a statement.

Adam Terry, CEO of cannabis-infused beverages manufacturer Cantrip, encouraged lawmakers to continue working to develop a plan to regulate hemp-derived cannabinoids.

“The Illinois legislature is trying to do what we all want – find a path to regulating the consumable hemp products market,” Terry wrote in an email to High Times. “But in the session, it didn’t get to a workable solution.”

“All good faith hemp operators are interested in affirmative regulation that lays out clear and workable guidelines,” he continued. “Any hemp operator simply clamoring to exist in a perpetually unregulated state of affairs is not serious about long-term business health or public safety.”



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Business

Incannex Healthcare lands $60 million financing deal

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The firm last month received FDA approval to proceed with a Phase 2 trial for its psilocybin-assisted psychotherapy program.

Incannex Healthcare Inc. (Nasdaq: IXHL) announced Tuesday it has secured a financing agreement with Arena Investors, LP for up to $60 million, in a bid to advance the company’s clinical-stage drug candidates.

The deal includes up to $10 million in secured convertible notes and a $50 million equity line of credit. The Australia-based Incannex plans to use the funds to support ongoing clinical trials and general corporate purposes, it said.

“We are pleased to be partnering with Arena and ABS on this strategic financing, which strengthens Incannex’s ability to advance our lead programs through key late-stage clinical milestones,” Joel Latham, Incannex’s President and CEO, said in a statement.

The financing arrangement provides for an initial funding tranche of $3.33 million upon closing, with the option for two additional tranches totaling up to $6.67 million. All tranches include a 10% original issue discount.

Additionally, the $50 million ELOC agreement with Arena affiliate Arena Business Solutions (ABS) gives Incannex the flexibility to issue and sell shares of common stock over a 36-month period, the company said.

Incannex is currently conducting several clinical trials for psychedelic and cannabinoid-based drugs, including:

  • Phase 2/3 study of IHL-42X for obstructive sleep apnea
  • Phase 2 trial of PsiGAD for generalized anxiety disorder
  • Phase 2 study of IHL-675A for rheumatoid arthritis

The company said it recently completed dosing in a 115-participant bioavailability/bioequivalence trial for IHL-42X. It also received approval from the Food and Drug Administration to proceed with a 94-patient Phase 2 clinical trial for its psilocybin-assisted psychotherapy program, PsiGAD, using Incannex’s psilocybin compound known as PSX-001.

Arena Investors, LP, with $3.5 billion in invested and committed assets under management as of June 30, according to the news release, specializes in providing capital to complex industries, including healthcare.



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