Medical Marijuana Businesses Are Beginning to Struggle in Legalized States

When a state passes recreational marijuana, people usually don't think about what will happen to the medical cannabis businesses already operating in the state. But wouldn't things just improve for them? Well, not exactly.

The Idaho Statesman recently published an article documenting how Oregon's medical marijuana industry is doing in the wake of recreational legalization. Unfortunately, the news isn't good. In Oregon, dispensaries are separated into two categories: Medical and recreational. Medical marijuana dispensaries can only sell to individuals with prescriptions for cannabis. But recreational dispensaries can sell to anyone, including those with prescriptions. So many people with cannabis prescriptions are simply going to recreational dispensaries, meaning medical only businesses are suffering as a result.

The newspaper noted that as a result, many medical marijuana dispensaries are either switching to recreational or going out of business. One county in Oregon had 31 medical dispensaries in April 2015. Today, that number is down to only two, and it's possible it will be zero next year.

Of the 21 medical dispensaries in Oregon right now, five have told the state they plan on switching to recreational next year. And only four of the 21 have indicated they plan to stay as a medical dispensary in 2018.

There's also been a decrease in the number of medical marijuana cardholders in Oregon as well. In 2015, the state had over 78,000 cardholders. That number is down to only 59,000 this year. So not only are customers going to different dispensaries, but the number of possible clients is dwindling as well.

Last spring, the Oregon state government gave dispensaries the opportunity to switch to recreational ones for 2018. And there's not really any reason not to. Medical dispensaries are allowed to sell more powerful strains of marijuana, but other than that they're virtually identical to recreational.

So it seems that if you're operating a medical dispensary in a state about to legalize recreationally, it's best that you move on. Because your business will probably suffer otherwise.

(h/t Idaho Statesman)

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