New Market: Once Maryland fixes problems, ample MMJ opportunities await
By Bart Schaneman
Marylands medical marijuana program rollout has been rife with stumbles, delaying what could become one of the largest markets on the East Coast.
Still, industry officials and regulators are working to get the states MMJ program on steadier footing and launched.
Regulators, in fact, hope dispensary sales will begin later this year. But industry observers are less bullish, predicting the first dispensaries will open in 2018.
That would be four years after state lawmakers approved legislation in 2014 laying the groundwork for the states new medical marijuana program. Maryland officials initially had aimed to have the states medical cannabis program operating by the second half of last year but were slowed by a flood of program applicants and disputes over the racial diversity of license winners.
Once the program is up and running I think it will be an immensely popular program, said Meredith Kinner, a partner in the law firm Kinner & McGowan, a cannabis-focused practice with offices in Maryland and Washington DC. Once people see that it is not just a pipe dream.
Despite the halting rollout, the 102 dispensary license winners should see sizable opportunities.According to
How the market unfolds will hinge on solving the stumbling blocks that have emerged.
Most notably, the Legislative Black Caucus of the Maryland General Assemblyhas expressed concerns that the states diversity Marylands population is about one-third African-American was not reflected in the licenses awarded last year by the states medical cannabis commission. A court caserelated to the diversity issue also is pending.
The rollout has been a freak show in Maryland, said John McGowan, who is Kinners partner in the law firm. Very slow.
Other hurdles abound.A lack of available real estate and impatient investors could hamper potential business opportunities, as could a possible shortage of testing labs.
On the flip side, entrepreneurs will have the chance to participate in the usual ancillary businesses ranging from security and transport to energy-related technology and legal services.
Business opportunities
Maryland technically legalized medical marijuana years ago, but the law was considered unworkable from a business perspective.
In 2014,Maryland lawmakers revamped the lawby establishing a framework of rules similar to those found in other medical marijuana states.The new program dissolved the states previous MMJ plan.
I think the business opportunities in Maryland are just starting to move forward, said Ivan Lanier, CEO of Greenwill Consulting Group in Annapolis, Maryland. His firm has started receiving more calls from investors looking to invest in growers and processors.
Hes also receiving calls from interested banks and financial institutions as well as human resources firms. There has been a search for a competent HR firm that has industry experience, Lanier added.
New cost-saving energy technology should have a stake in the marketplace, according to Lanier. Security and transportation should also be ripe for business. And, Lanier said, many license holders will be looking for people who are familiar with transporting funds in armored cars.
Licensing, timeline
In 2016, the Maryland Medical Cannabis Commission gave preliminary approval to 15 medical cannabis cultivators, 15 processors and 102 dispensary operators.
The preapproved companies are currently working through the second stage of the approval process, which includes undergoing criminal background checks, completing regulatory requirements, securing local zoning approvals, constructing facilities and completing regulatory compliance inspections.
The preapproved firms have 365 days to complete this process: For cultivators and processors, that would be August; for dispensaries, December. The MMCC will vote on final licenses in public meetings once the companies have complied with the requirements.
The commission expects medical cannabis to be available to patients from a licensed dispensary sometime this summer.
But Kinner said that might be a little optimistic.
There are a lot of moving parts in stage 2, McGowan added, referring to the final approval process. A lot of hoops you have to jump through before you get licensed.
No dispensary can receive a license until it has product from a licensed cultivator or processor. Maryland has yet to license a testing lab, though one has been preapproved.
There could be a bottleneck if all the cultivators are trying to get their product tested at the same time and theres only one testing facility.
A year is nothing, McGowan said ...
