A Florida appellate court ruled that the state’s medical cannabis licensing system is unconstitutional, setting the stage for greatly expanded business opportunities in one of the country’s fastest-growing markets.
Found unconstitutional were legislative measures that imposed license caps and vertical integration.
“The takeaway here is that while the decision will most likely be appealed to the Florida Supreme Court, this opens the door to the possibility of the Florida market opening up to more players, with the barriers to entry being lowered,” Florida cannabis attorney Sally Peebles wrote in an email to Marijuana Business Daily.
Peebles added that if vertical integration is eliminated, it will be less expensive to enter the market, “allowing more mom and pops to enter the market.
In addition, more licenses will be issued if the cap is lifted, according to Peebles. That would create a “more competitive environment,” leading to more innovative products and eventually, lower prices, she contends.
Jeffrey Sharkey, executive director of the Medical Marijuana Business Association of Florida, concurred.
“If upheld, this ruling could dramatically change the medical marijuana regulatory landscape in Florida,” he wrote in an email.
As of last Friday, six vertically integrated MMJ businesses operated 120 of the state’s 142 dispensaries.
Marijuana Business Factbook 2019 projects that MMJ sales in Florida will reach $425 million-$525 million this year, up from $225 million-$300 million in 2018.
The ruling by the First District Court of Appeal won’t have an immediate impact, even if the state decides not to challenge the decision.
While the appellate court affirmed a lower court decision, it differed in that it allows the Florida Department of Health time to establish various standards before issuing additional MMJ licenses.
Written by Jeff Smith
Marijuana Business Daily