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By MICHAEL C. PATTERSON
The U.S. currently has 34 states in which medical cannabis is legal. Since cannabis is still considered illegal by the federal government, each state must create their own rules when it comes to legalizing and implementing a medical cannabis program. This leads to the effect of each state becoming their own "country" when it comes to cannabis law and regulation. Some states have law allowing the medical cannabis market to grow quickly (which could be bad), and some have more balanced law to grow slowly and build over time (which is more ideal).
Marijuana Business Daily recently performed analysis of the fastest growing state markets in the United States. They found Oklahoma is highest in daily patient growth, followed by Florida, Ohio, and Illinois.
The historical average for patients who qualify for Medical Marijuana (MMJ) is 2-4 percent of the state's total population. Oklahoma's Medical Marijuana program growth is 641 patients per day (currently total number of patients are 4.1 percent of population). This growth is unbelievably high in such a short amount of time (OK legalized through Constitutional Amendment in 2018). The state requires a physician recommendation for MMJ but has ZERO qualifying medical conditions. Furthermore, there are no limits on the number of licensed MMJ cultivators, processors, and dispensaries. As of July 2019, Oklahoma has over 150,000 total MMJ patients and over 6,500 licensed businesses!
This unprecedented rapid growth of MMJ patients and stores has led to problems such as robberies of MMJ dispensaries and internal employee theft, black market sales of product, and decreased tax revenue by the OK Tax Commission due to dealing with an all cash MMJ businesses. Furthermore, certain marijuana businesses are starting to fail due to the low "bar" set by the constitutional amendment which states the only requirement to open a marijuana business is passing a background check and paying $3,500 (there is no requirement for previous business experience of any kind). In regard to banking marijuana businesses, few banks in Oklahoma publicly advertise the ability to bank marijuana companies, which can create a tremendous public safety problem with so much cash being moved around society.
Florida's growth has been just as impressive as Oklahoma but has taken many more years to become steady. Florida is increasing the number of MMJ patients by 609 each day (over 222,000 per year). The big difference in Florida's system is limited marijuana business licenses (only 22 as of August 2019), and slower roll-out of dispensaries (approximately 130 across Florida as of August 2019). However, Florida allows statewide home delivery which increases access for people with limited mobility. This limit on the number of licensed entities has caused prices to remain high, but there have been ZERO public safety issues within the state related to MMJ (no robberies, theft of dispensaries or processors, no major compliance issues with licensed entities).
Florida' percentage of population who currently have an MMJ doctor recommendation is 1.6 percent. This is low but will continue to grow exponentially to over 4 percent of the state population (over 880,000 residents) by 2021. With the state of Florida gradually continuing to increase licensed entities, it will allow the state to continue steady, consistent growth of the MMJ program, decrease prices of medicine, and keep public safety of the program strong. Growth of a statewide MMJ system is good, but strong, consistent, safe growth is better. The Florida MMJ system is not perfect, by any means, but it is one of the safest MMJ systems in the country due to its current regulatory structure.
Michael C. Patterson, founder and CEO of U.S. Cannabis Pharmaceutical Research & Development of Melbourne, is a consultant for the development of the medical marijuana industry nationwide and in Florida. He serves as a consultant to Gerson Lehrman Group, New York and helps educate GLG partners on specific investment strategies and public policy regarding Medical Marijuana in the U.S. and Internationally. He can be reached at mpatterson@uscprd.com
