No cannabis market rollout would be complete without its fair share of bureaucratic hurdles. But for Missouri’s medical market, unforeseen circumstances have transformed would-be hurdles into a series of walls. Though nearly two years have passed since Missourians overwhelmingly voted to legalize medical cannabis, dispensaries across the state have yet to open their doors. A confluence of setbacks, ranging from ambiguous state regulations to COVID-19 restrictions, has resulted in what will initially be a limited marketplace. But despite constraints, the first retail sales are set to commence in a matter of weeks.
Though nearly two years have passed since Missourians overwhelmingly voted to legalize medical cannabis, dispensaries across the state have yet to open their doors.
Jack Cardetti, head spokesman for MoCann Trade, recently spoke with industry insiders at MJ Unpacked Midwest, a virtual event for industry leaders. A chief concern among fellow attendees was the lengthy set of verification processes imposed by both the state and the Missouri Department of Health and Human Services. Of the 2,270 facility applications, only 348 have been awarded licenses and only a handful of those have passed inspection. “There are eight different groups that have all of their commencement qualifications for inspection and can move forward,” Jack explained. Three of these groups are cultivators, who won’t be given the green light to send out product until testing facilities are finished with their build outs. According to Jack, this should happen within the next few days.
As testing facilities catch up to demand, vendors and dispensaries will be charged with managing the expectations of over 64,000 medical cardholders. It’s not yet known when derivative products, such as tinctures, edibles, and vapes will be ready for sale. “There’s really going to be a fairly narrow selection of flower, at first,” said Jack. “We’ve yet to have a manufacturing facility, of the 86 that are licensed here in Missouri, pass commencement. Some are very close and should start producing right away.” Until such time passes, dispensaries are advised to supply educational materials to help guide patients toward appropriate strains for specific medical needs. In hopes of establishing clear lines of communication between dispensaries and doctors, MoCann has created a CMA program that will provide cannabis-focused training for participating healthcare professionals.
While testing delays are likely to hobble the market initially, manufacturing is projected to speed up considerably in the coming weeks as more facilities pass inspection. As for long-term challenges, undefined state regulations are creating gridlock within the rapidly changing commercial landscape brought about by COVID-19. Much of this ambiguity can be traced to the fact that Missouri legalized medical cannabis through a constitutional amendment (as opposed to state law), a year and a half before the pandemic hit. While changes to state laws can be made by lawmakers during a legislative session, constitutional amendments can only be changed through a vote of the people. In order to avoid cumbersome election proceedings, authority to change an amendment’s language must be given to a government agency.
“From our perspective, the only thing worse than regulation is uncertainty,” Cardetti noted.
In Missouri’s case, such authority is deferred to the Department of Health and Human Services. While acknowledging the necessity for this relationship, Jack Cardetti expressed concern that dependence on a regulatory body to determine rules on their own timeline might pose a dilemma for an industry that, in his opinion, has benefited from as little regulation as possible. “From our perspective, the only thing worse than regulation is uncertainty,” he noted. “In Missouri, the challenge is coming from the fact that there are some rules in place but a lot of things are just left unsaid.”
Curbside pickup is a key example of an area that needs more clarity as the market rolls out. While COVID-19 is pushing a significant portion of retail sales to curbside, no rules allowing nor explicitly prohibiting this practice currently exists for the sale of cannabis products. “This presents license holders in Missouri with a real problem,” Jack explained. “Do you forge ahead, putting a business plan together that looks at curbside because there aren’t any rules prohibiting it or do you stay away from it, knowing that any day, the department can come in and say no we’re not going to allow curbside service?”
Looking forward, Jack is optimistic that Missouri’s market will benefit considerably from its well-established trade association. As license holders typically view each other as competitors, many states put off assembling a trade association until the industry is already shaped and policy decisions are put into place. “What we wanted to do here in Missouri is bring people together before licensing to work on rules, regulation, and legislation knowing that in time, these people may be competitors,” said Jack. “But in the beginning, we all need to be working together, speaking with one voice and growing in the same direction.”
A “community over competition” philosophy seems like a safe bet for a market facing so many unknowns. But one thing is clear: as the terrain over the next few weeks rapidly changes, success for cannabis entrepreneurs in Missouri will be determined by their ability to adapt.
