🌿 Target broadens hemp THC beverage rollout, DEA extends medical cannabis registration system, and U.S. cannabis licensing continues years long decline

Happy Friday Pre Rollers! Welcome to another edition of The Pre Roll, the cannabis newsletter that keeps you up-to-date on the industry happenings you need to know.

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Target market. Target is significantly expanding its hemp-derived THC beverage rollout, adding the products to more than 300 stores across Florida, Texas, and Illinois following a successful pilot program in Minnesota, a move that underscores the growing mainstream acceptance of cannabis drinks even as the industry faces mounting regulatory uncertainty at both the state and federal levels.

The retailer said the expansion is part of an effort to meet shifting consumer tastes, with products limited to customers 21 and older and sold only in jurisdictions that permit hemp-derived THC beverages.

According to sources the move will include several established cannabis beverage brands such as Cann, Wynk, Trail Magic, Stigma, Gigli, Señorita, and Daizy’s.

Industry observers view the move as a major milestone for the cannabis beverage category, which has increasingly positioned itself as an alternative to alcohol and a key growth segment for hemp brands seeking broader retail distribution.

Take form. The Drug Enforcement Administration (DEA) is expanding its cannabis regulatory framework by preparing new registration forms for state-licensed medical cannabis manufacturers, distributors, cultivators, and testing laboratories, extending a system that recently opened for dispensaries following federal rescheduling efforts.

Late last month, the DEA launched a new medical dispensary registration portal to allow state-licensed medical cannabis businesses to formally register with the federal government.

The forthcoming applications, which are expected to roll out through the agency’s Diversion Control Division, would allow non-dispensary operators to formally register under Schedule III handling rules, potentially granting a clearer federal pathway for manufacturing, distribution, cultivation, and lab testing activities.

While dispensary registrations are already underway in a 60-day expedited window, the broader rollout signals an effort to standardize oversight across the full medical cannabis supply chain as federal policy continues to evolve.

Steady decline. U.S. cannabis business licensing has now declined for more than two years, marking a sustained industry contraction driven largely by shrinking cultivation permits, market consolidation, and regulatory slowdowns in mature states.

Total approved and pending licenses fell about 4% in early 2026 to 4,175, down 18% year-over-year and extending a seven-quarter losing streak that leaves overall licensing levels roughly 9% below where they were two years ago.

While pre-licensing activity ticked up modestly, suggesting some renewed interest in entering the sector, heavy concentration of pending applications in New York has skewed national figures and masked weaker momentum elsewhere.

Analysts note that the pullback reflects both market saturation in established cannabis states and ongoing exits by operators struggling with pricing pressure, taxes, and regulatory burdens.

Arizona: A conservative activist who once pushed to repeal recreational cannabis legalization has abandoned the effort after concluding his fears about cannabis being marketed to children were overstated and recognizing that public and federal attitudes toward cannabis have shifted in favor of legalization.

Florida: Most major 2026 gubernatorial candidates oppose legalizing recreational cannabis, with Democrat David Jolly as a notable exception; Jolly previously served in Congress as a Republican before breaking with the party, becoming a prominent critic of Donald Trump, and later switching to the Democratic Party ahead of his gubernatorial run.

Indiana: Regulators say they are waiting for federal cannabis rescheduling to become final before considering policy changes, while Republican state Senator Mike Bohacek is preparing a 2027 bill to legalize medical cannabis and regulate its sale and use.

New Jersey: An appeals court ruled that Jersey City illegally fired police officers for using cannabis off duty, finding that state law protects lawful cannabis use outside work even for officers who carry department-issued firearms.

New York: The Cannabis Control Board announced it approved 32 new adult-use cannabis licenses, expanded financing and showcase event opportunities for businesses, and reported continued market growth with more than $553 million in 2026 sales so far and over 655 legal dispensaries now operating statewide.

Virginia: The FBI raided the Portsmouth office and cannabis business of state Senator L. Louise Lucas as part of an apparent federal corruption investigation tied to cannabis operations, prompting Lucas and allies to claim the probe may be politically motivated.

LEEF Brands locks in fundraise

The cannabis extraction and branded products company closed the final tranche of its oversubscribed $9.3 million financing, which was led by investment firm Mindset Capital and included participation from both existing shareholders and new strategic investors.

RYTHM reels in noteworthy partnership

The cannabis beverage brand has been named the official THC drink partner of Chicago waterfront entertainment destination Navy Pier, the most visited destination in the Midwest, marking a multi-year deal that will bring hemp-derived beverages to venue bars and programming beginning this summer.

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ACE Venture acquires controlling interest in Vireo NY

The New York-based MWBE cannabis holding company has acquired a 51% stake in Vireo Health of New York, completing a deal that establishes majority social equity ownership of the operator and launches Boukét as its flagship cannabis lifestyle brand built around culture, community ownership, and vertically integrated cannabis operations.

Apollo adds MJBiz portfolio

The asset management company is acquiring Emerald Holding, which owns major cannabis industry media and events assets including MJBizDaily and MJBizCon, as part of a broader deal to build a scaled North American B2B events platform spanning multiple industries.

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Stay tuned for more cannabis industry news next week!

💚,

The Pre Roll Team

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