Operating In Uncertainty

SPEAKER_02 0:00

Something that I operate with in a big way, it is uncertainty and being able to operate where we don't know what's going to happen next and we're making decisions about things as they come to us. I didn't necessarily define the whole pathway here years ago and say we're going to go do that. It was take one step at a time and keep building on that and watch the market move, watch how consumers are behaving, watch how regulators are taking stances and adapt to the environment, which is what I think most cannabis companies have had to do in many ways, right? But so I think embracing that uncertainty can be really important for companies to do and figuring out how you again fit in the market today and survive while thinking about where you need to be in five and ten years and having a vision for what things will look like when they become mature, and the stigma doesn't exist anymore.

Welcome And Summer Talk

Ben Larson 1:17

And I'm Anna Ray Gramstein. And we're recording June 2nd, 2026. And we have a great show for you today. We have Ala Linquist from FloraWorks coming on to talk about CBN, true CBN, and all things minor cannabinoids, hemp, and the regulated channels. Lots to talk about there. But before we do, Anna Ray, happy summer. Is it summer? I don't know. My kids are in summer and it's driving me nuts already.

AnnaRae Grabstein 1:45

But it's fine.

Ben Larson 1:46

I don't feel like it's summer yet.

AnnaRae Grabstein 1:49

I talked to a friend in Denver this morning and she was texting me pictures of snow outside her window. So um I think it is we're moving quickly towards summer, but I'm not sure that the weather's caught up. Um I don't know.

Ben Larson 2:02

It was pretty hot here yesterday.

AnnaRae Grabstein 2:03

Yeah. I

A 52-Hour Train To Chicago

AnnaRae Grabstein 2:05

just did something that I've never done before, which is I booked a train ticket to go from the West Coast to Chicago uh to get myself to the Ignite It conference um in a week and a half. So old school.

Ben Larson 2:23

Um I was how long does it take to train ride from from California to Chicago?

AnnaRae Grabstein 2:29

It's gonna take me 52 hours. Um, and I'll leave on a Friday afternoon and get there on a Sunday afternoon. And uh yeah, you know, I was complaining to my husband about how there's no dignity left in plane travel anymore, and he flippantly told me that I should just try taking the train. And I thought he was crazy and told him so. And then that night I was just scrolling on my phone and I realized that you can actually take one train from the West Coast all the way to Chicago. It is called the Zephyr train, it's Amtrak, and I booked myself a sleeper car, and I'm hoping it is dignified instead of plane travel. And I've got a private car all to myself. It comes with food and a bathroom, and who knows? Yeah.

Ben Larson 3:18

I just want to point out that is a crazy series of events that has you taking a train from California to Chicago for a cannabis conference. I just want to point out I whatever your husband's thinking, I stand with him. Uh but I hope it's a great time. I I guess there's no like security, so you can bring whatever you know um consumables you want on the train and enjoy your 52 hours.

AnnaRae Grabstein 3:45

Exactly. I get to look out the window through the Rocky Mountains and the Sierras. I think it's gonna be beautiful, and if it's not, then I will nap.

Ben Larson 3:54

I think it will be beautiful. It's that's just yeah, not efficient travel, but why why why the hate for air travel? Is it just I mean was it dignified? I just never that that descriptor just never came to mind for me.

AnnaRae Grabstein 4:11

I don't think our listeners need us to understand why plane travel is undignified. Everyone knows terrible.

Ben Larson 4:18

Okay, and I still will be flying home, but we need to get you status on some some airline or something.

AnnaRae Grabstein 4:26

What's going on with you? Are you doing any kind of wild travel coming up?

Ben Larson 4:30

Uh no, anti-travel lately, with the exception of uh Oklahoma City, which I've actually never been to, but OKC who actually I think they just got beat by San Antonio, so wom womp. But um going out to Oklahoma City for the Canra conference, uh, this external stakeholder event. So once a year, get to commune with all the stakeholders, uh, all the all the regulators from all across the US and and beyond. So um it'll be a good year for it, I guess. I there's so much happening, which we'll we'll talk about a lot in the show today. So looking forward to that. But other than that, baby watch. I mean, we're in the last month, end of this month, we're uh I'll be locked down. Um, maybe doing a podcast or two, but yeah, not too much more.

AnnaRae Grabstein 5:16

Well, and the Canra Conference, you know, you you make it sound not like that big of a deal, but it is pretty fancy invite only. They only let certain stakeholders in the room. So it's good that you're there and uh and that that you're getting those invitations.

Ben Larson 5:31

Yeah, yeah. Well, we've had Jillian on the show. That may or may not have been a hack. Uh, but also, you know, it when when you're representing um, you know, an organization as a board member or something like that. So NCIA will be there, Cabo will be there, and then I kind of pretend to do both.

AnnaRae Grabstein 5:49

So I'm not sure it's pretending. I know you show up with those things. Well, let's jump into some news and then bring our guest on.

Reverse Stock Splits And Uplisting

AnnaRae Grabstein 5:57

Uh, the first news that I wanted to highlight today is all about reverse stock splits. And we heard last week that CuraLif had announced a reverse stock split of three to one, but then this week woke up to more news of Verano and Virio doing similar uh actions. The Verano stock split um is closer in in kind of form and function to what CuraLeaf did. CuraLif's was um one for three, and uh Verano is going to be one for five, but Virio, and they're not even calling it a reverse stock split, they're calling it a consolidation of shares, has a board to make a decision of a consolidation of somewhere between 20 and 40 shares to one. And there's an assumption that it's going to land at 30 shares to one. And um everybody says that this is in preparation for up listing and general financial hygiene as a quick primer Nasdaq stocks must trade above one dollar to be in compliance with the market. Uh but for me, I look at these stocks that have really just been on this downward trajectory for a very long time, and I wonder if this is just inflating the value higher to give more room for the stocks to drop. Uh, the trajectory has not been great. What do you think, Ben?

Ben Larson 7:22

Um yes, you're right. Um and I I I I'm not loving the fact that we're entering like this phase again for the cannabis industry of potentially just seeing uh press releases to announce like big nothing burgers. Um also major cannabis companies, you know, banking on on future action or future opportunity, where most operators in the space have known just to play the game as it lies today, and then if changes come, then then act on them. And so all this um predictive movement, I I don't know. It's it's it's gonna I would say that it's just gonna create froth, but I think the retail uh buyer knows to not act until something actually happens. So we'll see. Yeah.

Three GOP Bills On Hemp

AnnaRae Grabstein 8:13

Well, we continue along playing the game of threes. We had three stock reverse splits, and now we also have three House Republicans that are attempting to thwart the intoxicating hemp product ban that's coming in November. Um, three separate bills, three separate representatives, um, three separate angles. Uh the angles are basically delay, regulate, or unfund. And the representatives are Barr, Russell, and Comer, all from the southern states of um Kentucky, South Carolina, and Kentucky, um, in that order. So really interesting to see that there's all these different perspectives coming to the table as it relates to what um is right now currently scheduled to happen in November. And um, what I can tell you for sure is that they can't all three move forward because they would almost like defund each other. Um, but maybe one or both or a combination of some will get um swallowed up into some other bill or pushed forward uh before November, which is certainly what the hemp industry is hoping for.

Ben Larson 9:18

Yeah, no, I think this is great public signaling, uh, especially if you think about progress since last year, where basically it was Rand Paul and Senator Ted Cruz standing up and and supporting the category. There was other positive votes, but for the most part on the Republican side side, that's that's what we had. Um, and now we have three new Congress people, you know, throwing their hat in the ring, and and two from Kentucky, which famously is where Mitch McConnell's from. Andy Barr recently getting, you know, Trump's endorsement and and showing some momentum there, and then you know, very publicly uh announcing that he's been working with the White House, working with Congress to put it to put together language that uh is passable. And so all these things put together, um, it feels like momentum is building, and that this is just large signaling that Congress has to get something done uh to support this category, to support uh what the president uh stated in his executive order. So um which one goes through, how it goes through. Um, maybe it's none of these, right? Uh and what it does do is call people to the table to make sure that we do have a consolidation of effort and and choose the right vehicle on the right path forward.

Why The Public Still Misses It

AnnaRae Grabstein 10:38

Yeah, you know, I've been following the prediction markets a bunch and trying to see what the broad public thinks about things to predict prediction markets like polymarket or it's the Yeah, like Calci is the one that I looked at. And surprisingly, I didn't see anything on there about anybody placing bets about if hemp products will continue on past November or not. People are are placing bets on all kinds of other things.

Ben Larson 11:05

Um I think that I think that just shows like how we have successfully penetrated the political layer, but still like the the general public probably doesn't recognize a that there's one of two things, right? They they don't recognize that THC products are kind of in the open marketplace, you know, around the country, or two, they don't realize that they're going away. Um, and so that's why you've seen folks like WSWA create their campaign to make it really easy for people to uh message their Congress people, but not just that, they're also trying to inform the general public that these products are at threat of going away in November. So if you don't want that to happen, submit a letter. So um I think the program's called Save Hemp Beverage as far as the WSWA one goes. I know Diana Eberline just posted something on LinkedIn today. It's her birthday. Happy birthday, Diana. Um, but for her birthday, go to this post, click through, and send a letter to Congress.

AnnaRae Grabstein 12:05

Sounds amazing. Yes, and happy birthday, Diana. Uh, let's move on to bringing

Meet Ale Linquist Of FloraWorks

AnnaRae Grabstein 12:10

our guest on. Our guest today is Ale Lindquist. He's the founder and CEO of FloraWorks, a company with roots as a wholesale minor cannabinoid supplier to major brands like Wild and Heirloom, and now has developed um a consumer product called TrueCBN, a proprietary form of CBN that is backed by peer-reviewed placebo-controlled sleep study. The company recently announced that TrueCBN is implementation ready for the CMS substance access BEI program, which is a mouthful, with a 1,020-person clinical trial and documentation built for all the scrutiny. Uh, so we are excited to welcome Ale onto High Spirits today and talk about all things minor cannabinoids. Welcome.

Ben Larson 12:57

Hey, thanks for having me. Yeah, hey, great to see you. Yep. Long time, like just a quick shout out. You you guys have been a long time partner, supplier to us at Virtosa. Uh, you know, from very early on. It just was clear that you wanted to do things right, that you know, the the the process that you're doing, the purity that you're doing, uh, you know, we really appreciated that. And even the the sample kits you would send us, uh, you inspired us to do better sample kits at one point. Uh, so yeah, just appreciate how you've been kind of leveling up the ingredient layer for for many years now.

SPEAKER_02 13:34

How long has it been? Uh, we're a six-year-old company now since we first started producing CBN uh back in the day. And uh we were the first company to actually manufacture it at any type of scale and brought it in through a couple of our uh local oriting companies, Groon and Wild, back in the day. And uh those products took off and became major, major uh winners. And now I think pretty much every edible company in the country uh has a CBN product, CBN SKU, as well as now, you know, multiple minor infused kind of I guess I'll refer to them as uh effect-based uh formulations, you know, specific effect-based formulations that people are working on. And so it's been nice to see just the evolution of the products in the industry, uh and particularly kind of consumer behavior and how they're adopting uh and prefer this route. So uh it's been a journey uh trying to go through all the different hoops and changes and things, but uh we've got lots to do ahead of us, and we're excited about kind of how things are unfolding, the regulatory landscape, the interest in the in cannabinoids as therapeutics and medicine, and what we think that will kind of bring about from new research and uh new consumer trust and confidence uh that comes from that. So thanks for having me.

AnnaRae Grabstein 14:59

Yeah. Uh

Where Minor Cannabinoids Come From

AnnaRae Grabstein 15:01

before we get into all of the new developments around medicine, I do want to dive a little bit deeper into the ingredient supply chain. Uh and I think that a lot of consumers and even a lot of operators don't realize that CBN and THCV and CBG don't necessarily come from the same indoor cultivation in regulated cannabis that that same jar of flour might that they're buying at a dispensary, and that there is a whole nother realm of cannabinoid manufacturing outside the regulated supply chain for minor cannabinoids. And I'd love for you to enlighten our audience about what that looks like and what you've built at FloraWorks in terms of that supply chain.

SPEAKER_02 15:43

Yeah, so we we've kind of transitioned over the years. Um we are not a cannabinoid manufacturer anymore. We are a process licensee. We we do contract manufacturing basically for for CDN now, um, which we have a patented process that we think is really unique and scalable. Uh, we've standardized that um so we could approach, you know, FDA pathways like dietary ingredients and a future drug drug pathway as well. Um, but in the current markets, the the big issue that we really saw is just the fragmentation of the supply chains and uh kind of just filled the need there to make sure that product was QC'd correctly, that it was flowing smoothly to the clients when they needed it, um, not from like a batch to batch. Hey, I've got some CBN today and I'm gonna sell it and I'm gonna have to make another batch. So we've really been a logistics and supply chain company uh for a little while here. CBN we is more of a recent change. We have been manufacturing that for many years, but uh are just kind of transitioning now to setting up multiple contract manufacturers under our proprietary process. Um But yeah, it's really just been making sure that companies have you know the quality and and the consistency that they need to build their products and not have to worry about you know where it's gonna come from next. Um, and it's been a shaky road. You know, we've we've had to juggle those supply chains pretty aggressively and invest in you know large-scale purchases of inventory to make sure it was always gonna be available. So it's been an interesting dynamic to kind of do that as a requirement almost as a company, where our core focus has been clinical research and really where is this gonna go from a regulatory landscape down the road and kind of living in two worlds essentially is where do we think it's gonna be in five and ten years, and what do we have to do today to satisfy where the market exists and how to survive as a company. So it's been uh been interesting there. But um yeah, excited to excited to see it coming together and and I think there's gonna be more to come for these miners, uh, certainly.

Ben Larson 18:03

So

Synthetic Versus Safety With Regulators

Ben Larson 18:04

the topic about like where it comes from and all that kind of stuff, I've I've been thinking a lot about about it lately, and and you know, I've been acutely aware of where CBN comes from, where TACV comes from, um, and all host of other minor cannabinoids. At the same time, been involved in a lot of conversations at the federal level, and it's been difficult to create a nuanced conversation around like what's synthetic, semi-synthetic, which is a whole umbrella of different things. And I'm curious from your lens, because I'm I'm sure you have a lot invested in this, you know, how are people parsing between semi-synthetic intoxicants versus the minor cannabinoids that both the regulated and hep supply chains rely on?

SPEAKER_02 18:53

Yeah, I mean, it's definitely a complicated conversation with regulators. You know, we Oregon was the first state to essentially create uh rules around what they referred to as artificially derived and and though and how they define that. And so we were front lines, you know, years ago in negotiating what was uh in general an attempt to stop converting CBD into THCs, you know, and and and basically allow, you know, trying to curb that and and getting washed up in it, I guess, or pulled into that that conversation. Um, Oregon was unique where they they ended up creating kind of an approval pathway for cannabinoid that is process agnostic, uh, but safety forward. And so uh grass and NDI requirements for so that you could make what they would refer to as an artificially derived cannabinoid under their definition, which I really don't like that word, but uh um they they did allow for safety work to be done to get that approved into the market here. Um we we kind of had two paths because we've worked on a lot of chemistry. Uh not all cannabinoids are enzymatic, as you'd call them. So the plant doesn't produce the particular, you know, doesn't produce CVN. CVN is an oxidative derivative. So many of the cannabinoids, you know, they kind of go through this chain of morphine in the plant. And then when the plant is harvested, some of those cannabinoids will then start to break down into other cannabinoids. So you have this huge family of molecules um that are potentially therapeutic in our view, you know, each one uniquely, kind of uh mechanistically different. Uh not all of them, but some of them are uniquely different and kind of stand alone in their own place. And so um I think that conversation is definitely complicated. Um, we're having it across multiple states right now, um, trying to navigate how they've decided to put language together here. Um, at the federal level in the fall here, the language um is they have you know three different categories the FDA was supposed to have created. They'd missed their deadline and it didn't happen, uh, waiting to see what comes of that. But there was going to be a list of natural cannabinoids made by the plant uh that are non-intoxicating. There was going to be a list of natural cannabinoids that are intoxicating and not allowed, and then there was going to be a list of synthetic THCs and intoxicants that were not allowed. Um the definition they put around that was manufactured outside the plant. They failed to define that also. Makes this a really complicated situation. Um, but yeah, for us, it's, you know, trying to do more efficacy and safety work. And use that as the core piece of the conversation because, in our view, the intent of any regulator, given, you know, different regulators, different views, uh, is not to restrict access to a compound that has a therapeutic or a beneficial value that is safe. It's to, you know, stop compounds that have never been consumed by humans before, uh, and kind of the Pandora box of chemistry that come comes with kind of adding this new layer to the industry. As a company, we're agnostic to manufacturing pathway. It's really about what is the most economical pathway to produce a clean molecule. Um and so uh, you know, that that would be consistent with every other category of things that we consume, where you know, caffeine and energy drinks is is made certain, you know, synthetically. Um cytametaphen is made as a synthetic molecule. Um, so this is it's all over the place. And in just in cannabis, it's kind of a complic, complicated conversation.

AnnaRae Grabstein 23:07

Uh

November Risk To CBN Supply

AnnaRae Grabstein 23:09

I hear that what you're talking about is is really these nuances around manufacturing, and and I think it's really important for people to understand. And at the same time, I think that there is there is some fear around what happens to access to minor cannabinoids broadly after after the hemp ban and if the existing um miners that people depend on using today's manufacturing work streams are still going to be available. Uh, in particular, like I looked at some BDSA data before we got on this recording today. And in in every single state that I looked at, when I looked at top edibles in the market, um, at least one of the top 10, if not six out of the top 10, had had CBN in them. And uh, and so that's a that's a massive amount of of consumer adoption of of products with with CBN in particular, but there's certainly other popular miners as well, CBG and NTHCB. Uh, is there a risk that those miners won't be available after the hemp ban goes goes into place in November?

SPEAKER_02 24:25

I mean this is that I think there's always a risk with regulators because I've certainly gotten wrapped up in what feels like more of an argumentative kind of engagement where it's not friendly in many cases and and they're not there to work with you to create you know good legislation, they end up kind of taking a really adversarial approach. So it certainly can happen. My view is the FDA is more friendly than they've ever been when it comes to cannabinoids today, whether they like the current landscape of how they've kind of moved into the markets and into consumers' products uh without any oversight, I think is still, you know, their their biggest concern here. But um as it comes now, you know, some of them won't be affected at all in theory. You know, uh this 90-day list that never came out, you know, certainly I haven't been able to get an answer from the FDA on that. And I've given them quite a bit of documentation to support a full range of minor cannabinoids that should be accepted and are exist in literature and are present in the plant in biomass and you know, naturally you know, compounds, but um you know, CBG is uh is an enzymatic. The plant has been bred to produce that. Um some of the others, like CBC and THCV, are much more difficult to get uh from the plant. Uh there are genetics that are being worked up for those. Uh, they're just not not viable yet for producing scale. CBN is an oxidative compound, is basically always a process to make it because it, you know, it's a process that deforms naturally anyway in the environment. It's oxygen as as a chemical, uh, in this case, under under you know, the real conversations around chemistry, uh, degrades cannabinoids and and CBN is kind of a core uh degradation molecule. It kind of lands there and is stable. Uh and so um to be determined, but I feel pretty confident that we're gonna cruise through this, um, even if no legislation of these three bills you've talked about end up passing before that. Um I think the FDA has a very complicated argument around this manufactured outside the plant, which give them leeway to be aggressive or not aggressive in this. Um, and from a legal perspective, you would say, well, everything's manufactured outside the plant uh the moment you harvest it and start extracting it. And so they didn't define that, you know, it's gonna be complicated, but um you know, I think they and even if they were in the case of CBN to say this is this is not hemp, uh, it kind of just puts CBN into a normal molecule category where it's not it's not scheduled uh by the FDA. It uh would just be like any new plant molecule that doesn't have a grass or a dietary standing yet, uh it and would go towards that path. I mean, that's what we have tracked for many years here of different new molecules that have come to market. And you know, I would argue the FDA has always had a regulatory path for products. It it was more that uh I think the biggest issue is CBD has a complicated um drug preclusion provision in the drug language because the it was not already a food ingredient or a dietary ingredient prior to the farm bill. Uh, and epidilex was approved prior to that. Um, basically, the FDA has this little rule written in that says a drug can no longer become a dietary ingredient or a food ingredient if it didn't have those prior to becoming a drug. And so it has this complicated regulatory thing that's hung it up in this weird quasi-gray zone for all these years, where the rest of these miners don't have that. And so conceptually, what we've been working on all these years is that there this would be the normal pathway of any molecule that is presumed to be safe, could walk down these pathways and get approval either externally as a self-affirmed grass by a third-party panel as safe or through a dietary ingredient filing. Um, and that that would open up, you know, significant market access, uh, essentially, that has been uninterested in touching cannabinoids under the lack of clarity today. Uh so to be determined uh when we get into the FDA of really how they felt about this the whole time.

Why CBN Is A Sleep Standout

Ben Larson 29:15

So, I mean, you're pretty early on all this and and been investing a lot into it over the last six years. And we'll talk about just how much with you know the launch of true CBN and all the clinical work going into that. Um, but like what was it about CBN in the very early days that made you be like, yep, this is the one, and and we're gonna throw every what was that how it went? It's like it's like six years from now, we're gonna be talking to the FDA and we'll be on the verge of creating supplements and medicine and all that kind of stuff because it's not CBD or TAC.

SPEAKER_02 29:49

Yeah, no, uh there's a little bit of stumbling forward in this one, uh, and I actually was not the founder of FlorerWorks. Um, the company was created. There was a chemist that believed that CBN was an interesting molecule and wanted to work on manufacturing that. And uh I kind of came in as an advisor to help them. And, you know, company moved forward for almost two years. And then the investors that had uh stepped in when I had stepped in to fund that um asked me to take over. So that was the point in which it was kind of a pivotal moment of well, what are we really doing here? You know, how does the supply chains look for this? You know, the market for CBN is still arguably not that big. Uh, you know, there's there's more productive capacity today than there is consumption um for CBN. It's still relatively nascent and it, you know, fits into the edible market really well.

Ben Larson 30:46

Probably because most people aren't doing effective doses.

SPEAKER_02 30:49

Yeah, no, I mean there's plenty to come, I think, in terms of what doses is really effective for products. I think that's going to translate across all minor cannabinoids. You know, I don't like the word minor cannabinoid, I suppose, but just cannabinoids in general. Um and uh so you know, it it was uh basically just taking a look when I kind of stepped in as a CEO role to say, well, what are these other markets look like? And why are not why are cannabinoids not being accepted into mainstream uh channels for wellness and well-being or you know, drugs. At that time, epidilex, there was a clear path. It's like, you know, in theory, you could go down the path of proving a cannabinoid effective. The cost is extreme. And, you know, ebidialex was a very long, slow, and expensive road to get that approved, but they paved the path in theory and and create, you know, showed that there was at least uh some level of friendliness of the FTA to approve a cannabinoid. And so uh it was just trying to say, what can we do uh to again improve consumer interest and trust in these products? Um stigma is always a hard thing in this industry. And surprisingly enough, you know, as someone who's been in this industry all these years, is we there's still quite a bit out there, you know, of stigma that we face uh, you know, for for these compounds. So um doing anything we could to get rid of that stigma or or kind of soften it so that people could see that these things are safe and that they are effective, um, and and proving where they were. And so it was kind of luck back to your question that CBN was the molecule. And in our in my view now, CBN I think is going to be one of the most important cannabinoids in the family of cannabinoids out there when it comes to therapeutics and and wellness. Um, it's got unique polypharmacology to it that we've kind of discovered through a handful of different research initiatives. Sleep is great, and that's that's unique and it stands out amongst cannabinoids as a sleep molecule and has um you know unique uh mechanisms that we believe are are are part of its sleep effect there, uh, that don't show up in other places. And you know, some of the research that we've seen that was not done by us, but we're we've just written a paper that we're putting in for peer review right now, uh basically looking at the totality of sleep research around CBN over the years, um, and kind of synthesizing that into a current state of the science. And, you know, things like THC can have perceived improvement with sleep, but generally will show rim sleep or architecture decline in sleep. And studies that have looked at CBD with CBN uh generally have shown that CBD will inhibit the sleep effect of CBN or diminish it, and that CBD by itself is kind of hit or miss and it's not it's not a heavily supported sleep bait. And so yeah, we really look at the market for sleep as a huge and growing issue, uh, or that sleep is a big issue and there's a big market for it, and that uh the only option out there today that's really is melatonin and it's got more and more kind of negative side effects. It's a hormone, which is you know always something new to consider when you start planning with your hormones uh in your body and and can kind of maybe great for circadian rhythm uh management during you know long distance travel. But outside of that, you know, has has shown some some real issues for people that have taken it consistently for long periods of time and struggle to stay off of it and struggle to kind of rebalance their own natural sleep cycle. So, you know, as as the mission becomes uh in health, you know, how do I not only get to sleep and stay asleep, but how do I actually have quality sleep? You know, it's what molecules out there can contribute to improve sleep architecture and improved recovery. And CVN looks like it does this uh uh and does it well compared to the landscape out there for sleep. So um, you know, but this is in my view, the the narratives that are really going to bring cannabinoids into the mainstream and and make them part of, you know, everybody's medicine cabinet down the road, the way all these other compounds and and things are are you know all over the place. So um I think we're really in a in a great time right now. It's been a tough five years, I think, or six years in this industry, whereas like the big wreck boom exploded and and came, and then it was not as lucrative for the investors, and that set a big negative tone. And uh it kind of got overlooked. Um the the therapeutic and research side of it kind of died out for a number of years here, uh, at least from a company perspective, you know. But sorry, I'm talking for a long

TrueCBN As Ingredient And Platform

SPEAKER_02 36:10

time.

AnnaRae Grabstein 36:10

That's cool. At least, you know, you're talking about the medicine cabinet, and um, you've really you're not abandoning your ingredient business, but you're certainly expanding to the medicine cabinet. Um, as opposed to bulk ingredients, you've made a decision to go all in and focus on true CBN, which um is the name of a product that you've rolled out that's focused on CBN. It's meant for individuals. Um, it is a um oil-based capsule, from what I can tell from reviewing the information that's out there. Uh talk talk about this decision to build a consumer healthcare product on top of an ingredient foundation.

SPEAKER_02 36:53

Yeah, so actually, true CBN is an ingredient. And so we we we researched it as a peer molecule, uh as an ingredient. So all of our work was about creating a uh a more substantiated ingredient and being able to bring that to our clients as a uh better, you know, not better CVN. CVN is kind of CVN, you know, if it if it's of pure quality, but uh putting the regulatory and efficacy work behind it so that they could open up new markets. So the consumer product side is is a relatively smaller thing within the company. Our focus is still ingredients, but we had to create the product to run that clinical trial. So we had a way to ingest it. And so we carried that over. And currently it's it's actually primarily a real world evidence platform for us. And so we have a uh real-world evidence uh platform set up. We are recruiting into that basically as many people as we can. The primary goal was to uh capture more objective data from wearables. And so if you have an aura ring or you know, a Fitbit or one of these devices, you'd be able to sync it up with um with the app that has all of the tracking in it. So today it's still a research project more than anything. We don't really go out and push that product as a consumer product today. Um when it comes to like this new uh BEI program that Medicare, um, we're we're kind of looking at both sides. You know, we we are want this ingredient out there. We want companies to have access to this program with a substantiated ingredient. So that's our core focus. Um, if if our product ends up making it in, you know, that would be great. But uh we really see this as um just substantiating CBN as a whole. We're not looking to be an independent CBN company. We want CBN to be a major ingredient, and we're trying to build the foundation for that ingredient to be out there. Um, you know, examples would be KSM66, which is an Astro Gonda company. And it's like, you know, there's Astra Gonda that is not KSM66, but it's very little. Uh and it, you know, it comes from from lesser supported side, you know, suppliers. And so we're we really took that as the model. And there's other dietary ingredients, specialty dietary ingredients. So we basically said that's the model for cannabinoids. It is less substantiate these things, let's make them give them all of the framework to access markets and get approvals and and build consumer trust. So uh, you know, consumer side is great. It gives us this access to people and understanding how they're using it and what the feedback is and gather more data. Uh, but the really push is just to make true CBN as common as a setometophane or melatonin.

The Clinical Trial And Toxicology Bill

Ben Larson 40:04

All right. So I'm having a little science envy here. Uh selfishly, I want to dig into the the nuts and bolts around kind of proving true CBN. And so you guys ran this thousand plus person randomized, double-blind, placebo-controlled trial, uh, which sounds very pharmaceutical grade. Um, you've talked about toxicology. Can we just like get real about like the time, the expense, like how much that takes to support to get products through the through that process? Because I think that's top of people's mind right now as we think about the CMS program, as we think about kind of entering this new phase of cannabis' schedule three. Um, and we've all heard, and I think it's scared a lot of people off of investing into it in the past about like how poor of an investment it was, but you guys got there or getting there. Um, so yeah, I would I would just love to hear more about it.

SPEAKER_02 41:01

Yeah, I I think there was short-term investment interest in this sector, and this is not short-term investment type of return categories, right? It takes years. So uh when we first started selling CBN and and you know, we did believe there was the old anecdote that old cannabis made you sleepy because the THC had degraded to see some CBN, and so that there was like this old myth, I guess, that drove that sleep narrative. Uh, but once that was out there and people were consuming it and they were returning for those products and and it was going really well, that's where the sleep study came in is that can we validate this anecdote in a way that um proves that it's real? You know, it's not just people talking, it's not an anecdote anymore. And uh so we ran that study. It it's a uh a subjective study, and so it's it's not like a in-lab objective data collection study, but it's a statistically large um study. We use uh radical science, which is what they do. They they build these studies, they you know, register them for IRB and uh oversee them. So that gave us uh what we call structure function claims in the eyes of the FDA. And we've notified them of this and you know, send the letter in basically. Um, but things like clinically proven to improve sleep quality, we're putting sleep on the front of the box, those type of statements uh all require substantiation behind them. And so this was our first study to kind of build that foundational uh piece there, which is a big when it comes to consumers, as well as not getting sued and not having the FTC come after you, which does happen in this industry occasionally. And I think we're gonna see a lot more of it. Um we've got that.

AnnaRae Grabstein 42:51

Does this get you there? Can you put sleep on the front of the pack as a result of this study and not get sued?

SPEAKER_02 42:57

I think yeah, we have we have now the substantiation on the ingredient itself that when used at the dosage in the study, you could say clinically validated to improve sleep quality. You could say improve sleep quality, you could put sleep on the front of the box. Um, you know, there's a handful of different ways you could kind of twist that statement up that would still be valid. Well we couldn't say is you treat insomnia with this. It goes from what you call a structure function claim to a disease claim, and that does require any full drug process approval. Uh so we're we're and we want CBN to live in the dietary space. We don't want this issue where CBD is available, but it's not recognized as a dietary ingredient or food ingredient, and essentially all of it is being sold illegally under that rule. Um, and so we we want to make sure that CBN is available. That makes the price point of it much cheaper than going down the drug path. So, you know, and and it's it's safe, you know. So it's not something that really needs to go down that route, in our view. You know, we we have other thing indications that we would pursue with CDN particularly, but sleep would probably not be one of them unless it was something unique like uh treating sleep disruption in alcohol use disorder recovery. Where you're you're picking something kind of narrow that uh and studying that very specifically. Those could be drug claims, but in the general sense of that, you know, just want it to be asleep, a sleep day out there with melatonin. Uh so so so what what is the effective dose or or what the the range that Yeah, so we ran um it was actually also the largest study on melatonin in history, was our study. So we ran we ran a double uh a blind, you know, gel cap with nothing. We ran 25, 50, and 100 milligrams of CVN, and then we ran um a dose of melatonin as well. And uh 25 had improvement in sleep, but it didn't quite hit what we consider a statistical improvement in sleep. Uh 50 milligrams was a statistical improvement in sleep quality, and then the 100 milligrams, we saw no improvement essentially from 50 milligrams, which is an interesting kind of you know, release. It was interesting to us, it was interesting to the research ours, you know, that was no benefit to just taking more, essentially, is it kind of saturated the the receptors that are potentially uh you know at play here, and there was no need for any extra CBI. Um and then we also that 50 milligram outperformed melatonin in the study. And so uh that was, you know, kind of phase one for us. You know, it gave us the structure function claims, um, it proved that the anecdote was real. Um, since then we've run, you know, and and just research generally, you know, what are the mechanisms at play here? And uh the big one here, and much more expensive than that study, which was somewhere around 200, okay, to do that, uh, is the toxicology work. And so, you know, you start with what is called a gap analysis and basically assess the current state of the research, particularly around safety and you know, current consumption, and and determine what studies and what's missing from that to basically go in for this dietary ingredient or food standard. And so that's where we we've run motor battery function to prove that you know CBN is not impairing or intoxicating. Um, we're actually going back to do more work on that just because they're telling us we have to. This is where the the uh stigma around cannabinoids comes in, where it's like, well, we need to prove this thing is not impairing, um, you know, first, and and then you know, all the toxicology in rats basically uh proving that up to 400 milligrams a kilogram is is still not toxic, basically. Um so that gives you this huge, you know, essentially you're trying to prove that even at huge consumption, the molecule is still safe, and then that gives you like a factor of safety. And so that was the bigger work, and we spent about a million dollars just on those studies over the course of the three years here. Wow. Um, our our big one, 90-day oral tox, is going into peer review, it's in peer review now, uh, to be published.

Ben Larson 47:34

Um,

Effective Dosing And Real-World Data

Ben Larson 47:35

and so I just want to point out that 50 milligrams sounds like a pretty heroic dust compared to what most people are consuming. I've seen products that have two milligrams of CBN, and so it's like if 50 is the equivalent of melatonin, then I don't know what that makes too. But um yeah, the whole the whole like intoxicating conversation is interesting because I do find that CBN acts a little bit different than a typical sleep product that does at high doses tend to make you feel like kind of loopy and groggy. Where I don't know if I've ever felt that with CBN. I also can't remember if I've had a 50 milligram dose or not, but like, do you have specific findings around how it makes you feel versus its actual effectiveness when you're when you're sleeping?

SPEAKER_02 48:20

I mean, the there's anecdote of taking CBN of people saying, you know, I feel more relaxed. Um, you know, there was in our sleep study there was some stress measurements as well, and there was some you know reduced stress effect in there that you know probably contributes to that perception that that you know people are feeling there. Uh haven't really had you know kind of impairing or intoxicating responses, even up to very high doses that people have taken. Again, this is an anecdote, you know, because looking at there was actually um an insomnia trial on CBN now in Australia where they dosed at 300 milligrams, and they also did not report any intoxication there. But you know, the products that exist today, most of them have THC, which is you know, a different thing when you add that. And so I can't say today that 10 milligrams of THC and two milligrams of CDN isn't, you know, isn't effective at improving sleep quality. You know, again, the the research around THC generally shows uh degraded architecture and and insomnia rebound is kind of the historical narrative there. Um when you try to stop taking it. And so, you know, whether it's you know, I think that's that's to be determined. Um, we did a real-world evidence study on a one-to-one recent laid. So 10 milligrams, which is the most common product, and it it reported very well um in terms of perceived sleep improvement. Um who the who is well-being effect, basically. It's a measurement of well-being, and there was a significant improvement in well-being at that dosage, uh, 10 and 10. So um that was the first time we had had validated or or kind of ran anything that we see in the rec markets today, you know, equivalent to the that's the most common rec formulation with CBN out there. Um but we uh we have a 50 milligram insomnia trial running right now, or not we do, but we we've collaborated with uh Drexel University and they are running a seven-day insomnia trial with 50 milligrams of CBN. And so that'll be really interesting to see uh the results of here. It'd probably take another nine months before we see those. Um and uh we're just getting deeper in the mechanisms uh uh that these are working on. And I think that's where myself is I'm most excited for the evolution here is what are what are these molecules doing at the mechanistic level?

CBN Research Beyond Sleep

SPEAKER_02 51:02

They're they're doing a uh they're polypharmological, so they're hitting multiple receptors, um, but they're also operating outside of receptor activity. And so one, you know, we we've had a really uh cool uh collaboration with the Salk Institute, and they've got uh a uh Alzheimer's research division where they've been looking at a neuronal cell death pathway they call oxytocin ferobtosis, that they believe is essentially the path that cells die in neurotrogenic diseases, and have been looking for compounds that inhibit this pathway. And uh CBN turns out to be a compound that does a very good job at inhibiting the cell death pathway. And uh we actually looked at 40 different cannabinoids. So we gave a big family, tried to look at the structure activity differences between all of these, and CBN is an outlier for this, which is why we're very excited about the future here. Um and we we moved that from petri dish studies looking at the mechanism into a mouse study and essentially reversed age-related cognitive decline in these uh mice that have dementia uh in a meaningful, meaningful amount. Um you know, this this was published just last year.

AnnaRae Grabstein 52:19

Um but uh the yeah, I don't I don't know exactly where I'm going with this, but so so Ale, you know, you've you're talking about doing clinical trials, do going through the grass process at a time when most of the cannabinoid industry broadly has not been doing anything like that. And um, the level of science that you're bringing to this conversation is definitely unique compared to a lot of other um CEOs that we talked to. I'm just wondering over the course of the past couple years, are there moments when you've questioned that focus when it seemed like consumers, investors, kind of the market generally was not supporting this hypothesis and how you got through that?

SPEAKER_02 53:04

I don't know if I ever questioned the thesis of doing it versus questioning whether we were gonna be able to do it. Uh, and I think I still question, you know, how how far are we gonna be able to go here? Um like I said, we basically became a supply chain fulfillment company along in parallel, which is beneficial because it puts us kind of in the middle of all these compounds and and close to them and and dealing with the manufacturers and how do we add value to these things beyond just manufacturing them, right? That's where we see Floorworks' kind of ultimate goal here is defining the use cases for these and then validating those use cases. So um yeah, it was certainly tough uh along the way. And you know, part of me was pretty surprised we made it uh as a company uh today. And you know, we're grateful for all of the customers that we have. You know, that that's I'm sure it helped us doing the research kind of stand out as a supplier out there that we we want to elevate the industry and we want this to elevate our customers' products um and really kind of uh see, you know, again, a new renaissance and a new, you know, we're seeing it with the medical and and you know, new markets opening up in Germany and things, and all these conversations around medical cannabis. And um this is what is going to do that and build that and get regulators, get doctors, clinicians on board, and get, you know, broader consumer interest to come is is the research. And there's actually been a lot coming out over the last few years. Uh, we're we're working on a big paper and looking, and there is so much more coming out of institutions in the last three to four years uh that's really exciting to see.

Ben Larson 54:57

Yeah, yeah. Well, you you you have arrived here

Leadership Lessons In Frontier Markets

Ben Larson 55:01

and you are in this moment. And I you were an advisor at one point. You got kind of pushed into this CEO role, and now now sitting here today reflecting, like, what do you feel is like the most salient piece of advice you've either received or or that you have to give other leaders such as ourselves, um, in kind of navigating this moment and and kind of getting to that next stage of of where cannabis is going.

SPEAKER_02 55:29

Yeah, is there is there lessons uh and is there um you think sometimes, like I said, it feels like we've we've kind of fallen and gotten lucky in certain places, fall in the right spot. But I think, and I just was on a panel recently about frontier markets actually, and and what it means to operate when you don't have a landscape ahead of you and you have to build that. And I think, you know, this is where investors differ big time, is they want certainty. And I think something that I operate with in a big way is it is uncertainty and being able to, you know, operate where we don't know what's gonna happen next and we're making decisions about things as they come to us. You know, I didn't necessarily define the whole pathway here years ago and say we're gonna go do that. It was take one step at a time and keep building on that and watch the market move, watch how consumers are behaving, watch how regulators are taking stances and adapt to the environment, which is what I think most cannabis companies have had to do in many ways, right? You know, especially going back to the earlier years of the rec markets and things. So I think, you know, embracing that uncertainty can be really important for companies to do. Um and figuring out how you again fit in the market today and and survive, well, thinking about where you need to be in five and ten years and having a vision for what what things will look like when they become mature and the stigma doesn't exist anymore, right? It's like you know, and that's just taking the examples of other industries and and trying to apply, but it's that nuance in between because there's been plenty of people that come in and say, Well, this is how you do it over here, and this is how you're gonna do it here, and they crash and burn hard. Uh they just don't they don't allow it to be flexible at the moment. So I think that's a big thing that you know I think has helped us, and I think has helped other companies that have been successful is embracing that um of that uncertainty.

AnnaRae Grabstein 57:31

And

Last Call Collaboration And Wrap

AnnaRae Grabstein 57:32

well, that's that's a great segue to our final segment, which is our last call. And um, Ale, I think that you have been really salient with what you just said as it relates to the nuance of of uncertainty and forward thinking, which I think is really cool. Uh, but I'd I'd like to ask you one last question, which is what is your final message for our listeners? Call to action, closing thought, or any kind of advice?

SPEAKER_02 57:56

Um Well, I mean, if you're interested in CBN, Floorworks is here. As I said, you know, we we want this to be a major ingredient and we need companies to build products around that and and use the data. And so, you know, we really want to collaborate. Um, another one is we we really believe in the science and we're collaborating across many fronts right now. We're bringing institutions together with other institutions to create studies, we're supplying materials for studies. So um these are these are the two big areas that we'd love to you know have people reach out and and kind of operate within, um, which we hope will one, you know, lift up the cannabinoid market and bring more consumers, but also just the research is going to be important here. So um, yeah, I mean that that's probably my simple message as you know, we we'd love to collaborate and we're we are I believe a very friendly and collaborative company. Who does?

Ben Larson 58:53

Uh so I love it. I love it. LA Linquist, CEO of FloralWorks, thank you so much for spending the last hour with us. I'm going to order some true CBN and actually run my own little study. I I I track all my metrics all the time. I have the whoop band.

SPEAKER_02 59:09

So like I said, we have that real world evidence uh platform, so I can give you the link uh for that and you can promote it with the podcast, and anyone who wants can get a free box and participate in the 30-day real world evidence trial. So I guess that's the real one sign up to be Lab Rats. Yeah, thanks for having me. Really appreciate it. Love the conversation.

Ben Larson 59:30

All right, we'll talk to you soon. Take care. Anna Ray, you're gonna do a sleep study with me?

AnnaRae Grabstein 59:36

Sure. I've never tried CBN without THC. So I think I need to try it as just CBN.

Ben Larson 59:41

Yeah, yeah, I'm into it. What do you think, folks? Are you gonna sign up? We're gonna drop the link, we'll get it from LA. Uh let us know what you think. Let us know how it works. Thank you so much for spending the last hour with us. If you've enjoyed this episode, please leave us a like, subscribe, review, do all the things you know what to do. Thank you to our teams at Virtosa and Wolfmeyer, and of course, our producer, Eric Rossetti. As always, folks, stay curious, stay informed, and keep your spirits high. Until next time, that's the show.