Owing to cannabis’s continued federal ban, the most critical element for entry is a state-awarded license.
When Florida voters approved Amendment 2 in 2016, legalizing the use of medical cannabis for those with debilitating conditions, the state implemented a merit-based application system, including whether a company had a medical director and its experience with cultivation.
Initially, companies could apply for one of five integrated licenses to be awarded for the entire state. Each “vertical” cannabis license — meaning the one license required for the company to own and operate the entire chain of production from cultivation to retail — allowed the winning company to open up to 25 dispensaries.
With the medical market projected to grow in Florida to $956 million by 2022, a scramble ensued for these five coveted licenses. Since then, the number of licensed operators has grown to 22, an expansion spurred in part by a lawsuit filed against the state.
Although states like Florida and New York have limited the number of licenses and required vertical integration, the merit-based application process effectively gave an advantage to large, well-funded corporations, says Andrew Livingston, an economic and policy analyst for the nation’s largest cannabis-focused law firm, Vicente Sederberg LLC, based in Denver.
“If it comes down to a competition between who has the best team and who has the most capital, the most well-heeled multi-state operators are going to win that race,” Livingston says.
Read more at osceolasun.com
