Chart: Florida could someday be home to massive medical marijuana businesses
By Eli McVey
Primed to become one of the nations most lucrative medical marijuana markets once its up and running, Floridas program will license just a handful of businesses to produce, process and distribute all MMJ sold in the state.
Its a situation that may give rise to some of the nations largest marijuana firms.
During a special legislative session this month, Florida lawmakers were finally able to reach an agreement on rules governing the states MMJ program previously thwarted by disputes between the House and Senate about the number of dispensaries each license holder should be allowed to operate.
On top of the seven licensed businesses currently operating under Floridas CBD-focused program, the new bill will license 10 additional vertically integrated MMJ businesses by October 2017, with each allowed to open 25 dispensaries.
Florida Gov. Rick Scott said he absolutely intends to sign the medical marijuana bill.
That will bring to 17 the total number of companies authorized to produce and dispense full-strength medical cannabis across the state. And the maximum number of dispensaries will increase to 425.
The ratio of dispensaries in Florida to the businesses that own them could therefore reach as high as 25:1, far surpassing any other marijuana market in the nation recreational or medical. This may lead to Florida becoming home to some of the largest chains of marijuana retailers in the United State.
While not a one-to-one comparison, Nevadas medical marijuana industry currently has 55 dispensaries operated by 39 separate companies a much more diffuse market that has yet to produce any dominant retail chains.
Though Floridas law has provisions that allow the addition of licenses as the program grows, it wont change the fact the Sunshine State has adopted regulations that effectively create an oligopoly where the market is dominated by a small number of players. While oligopolies are in place in many other states with MMJ programs such as New Jersey and Maine the sheer size of Floridas market creates an unprecedented opportunity for businesses that manage to secure a license.
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For context, total sales of retail marijuana in Washington state in 2016 were roughly $700 million, spread across hundreds of licensed businesses.
And although Floridas market is structured similarly to states such as New York or Hawaii where a limited number of companies are tapped to open a finite number of dispensaries the high license cap in Florida will allow each licensed business to operate much more freely.
For example, New York allows each of its five licensed businesses to open four dispensaries across the state. So while a company may identify 10 ...
