West Virginia’s potential $ 40 million medical marijuana program is finally ready for launch on Friday with the opening of the first state dispensary of the multi-state giant Trulieve Cannabis.
The start of medical marijuana sales comes a full four years and seven months after West Virginia passed a law that allows the cultivation and sale of MMJs.
“West Virginia holds the unfortunate record for the slowest state to implement access to medical cannabis,” wrote Karen O’Keefe, state policy director of the Marijuana Policy Project, in an email to MJBizDaily.
“Many patients have certainly died in anticipation.”
Delaware held the previous record of four years and one month, according to MPP.
In West Virginia, state officials blamed for the slow launch on a struggle to provide banking services for the program.
then MPP noted that a United States attorney in the state “exacerbated the problem by threatening to prosecute companies entering the medical cannabis space.”
But the tide seems to have turned.
Florida-based Trulieve said it will open a dispensary in Morgantown on Friday and a second in Weston on November 15.
More activities are expected to follow in the coming weeks, but overall the rollout should be gradual.
A limited market
Revised MJBizFactbook screenings put 2021 sales at just $ 400,000 to $ 500,000, climbing up to $ 6 million in 2022 and up to $ 40 million annually by 2025.
Among the factors that should limit sales: West Virginia has banned flowers and edibles from smoking, which are the main generators of sales in other MMJ markets across the country.
But what makes the market truly limited is that the state has a population of only 1.8 million, said West Virginia cannabis lawyer Floyd “Kin” Sayre III.
Key insights for making informed decisions: MJBizFactbook
Say hello to the marijuana business data, curated by the editors of MJBizDaily to help cannabis industry leaders make informed decisions.
- Financial data of the marijuana industry in the United States
- Licensing, financing and investment trends
- State-by-state guide to regulations, taxes and opportunities
- Insights into business and investment strategy
“That’s not a lot of customers (per store),” he said, although the number of patients is expected to grow over time.
Sayre, a partner of the Charleston-based law firm Bowles Rice, said he has several clients who have obtained licenses, most of them dispensaries.
“A lot of these people are looking at this over the longer term,” he said, noting that operators are betting that West Virginia will eventually allow smoking flowers and recreational marijuana.
Sayre said some of his customers have already received offers to purchase their licenses.
He added that operators are allowed up to 10 dispensing permits and sees consolidation as companies seek to maximize their footprint.
To some extent, this happened in the initial licensing round, with a number of West Virginia companies and MSOs each. winning four to ten dispensaries.
In all, 100 permits went to 26 different entities.
“There are still a few independent dispensaries, but I have a feeling that as the market starts to grow, you will see more consolidation,” Sayre said.
Trulieve is an example of this.
The Florida-based company won four dispensary permits and a processing license, but lost one of 10 grow permits.
So, in May, Trulieve proceeded to buy a cultivation license – and two dispensary permits – for just $ 6 million in cash and stock.
And that came just a month after the company added three dispensary permits for $ 650,000.
Trulieve has quickly paved the way for a 100,000 square foot grow facility and is now poised to be the first to market, with more to follow soon.
In a press release, CEO Kim Rivers said that Trulieve “is particularly eager to take advantage of our first mover advantage.”
It’s a playbook that the company has used before.
Trulieve’s lead in Florida helped the company take the top spot in that state’s huge medical marijuana market, but how it works in West Virginia’s much smaller program remains to be seen.
New York-based Columbia Care, Illinois-based Verano Holdings, Massachusetts-based Holistic Industries, and Maryland-based Harvest Care Medical (no relationship with MSO Harvest Health & Recreation) each have obtained growing, processing and dispensing permits .
Harvest Care and Holistic have won the maximum of 10 dispensary permits, Verano seven and Columbia Care five.
Columbia Care has started building its own cultivation plant in the month of July.
holistic raised $ 55 million in May partly for West Virginia.
And the Harvest Care growing facility in West Virginia is under construction.
MPP’s O’Keefe sees parallels between West Virginia and the nearby Pennsylvania MMJ market.
Both states initially banned flowers and edibles from smoking, though each have since changed their laws to allow the vaporization of raw flowers, he noted.
O’Keefe wrote that he expects the West Virginia market to be similar to that of Pennsylvania, “except for a much smaller population.”
Jeff Smith can be reached at [email protected].