New York’s medicinal marijuana program is designed to fail unless the regulations are changed.
In a rush to get medicinal marijuana legalized, the legislation’s supporters agreed to just about anything so long as the bill would pass. Now as the first round of regulation language is scrutinized, it’s becoming clear that this program is planned to be a money losing proposition – much like New Jersey’s program.
New Jersey’s strict limits on patient population that have resulted in one real dispensary for the entire state.
The Garden State Dispensary stated that when it opened it needed at least 3,000 patients to break even financially and currently, there are only 2342 patients registered in the state. Evan Nison of the New York Cannabis Alliance and NJ NORML said “I would characterize the situation in New Jersey as a failure,”
There are two main problems with New York’s medicinal marijuana program that will cause it to be unprofitable for at least two years if not more.
Limited locations and a restrictive patient population create an environment attract only the deepest pocketed investors that can weather these years of losses. “The challenge of course is that the investments will be front loaded. Everybody that will set up shop in New York will operate for a financial loss for a period,” said David Bernstein, CEO of Weed hire.
To start, New York will issue only five manufacturer licenses and each of those businesses are limited to four dispensaries. So, only 20 dispensaries will be allowed in a state that has 19 million people and 54,000 square miles. “Compare that to Oakland CA which has a population of roughly 400,000-500,000 and has 80 dispensaries.” said Derek Peterson, CEO of Terra Tech an indoor agriculture company.
Also, no delivery systems will be allowed. Patients will need to live near or within driving distance of a dispensary. The patient must enter the facility by themselves as there are no visitor rules. So, if that patient is physically challenged, their driver or aide will have to drop them at the door and wish them luck.