Florida health officials will accept applications for 22 medical marijuana licenses in late April, according to the Tampa Bay Times, opening to well-heeled investors the state’s tightly guarded treasure trove of licenses. The long-awaited move was announced Friday by Gov. Ron DeSantis’ administration.
With only 22 businesses licensed to legally operate in Florida, cannabis licenses in the state are extremely valuable and have sold for well over $50 million. Naturally, the industry has been buzzing with excitement over the announcement that more licenses will be made available.
Florida is the largest and most lucrative medical-only cannabis market in the United States, with Brightfield Group expecting the state to register 25 percent year-over-year revenue growth in 2022 to $1.7 billion.
The Sunshine State is poised for even more growth this year.
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Big-Time Growth
Since Florida’s launch of medical sales in 2017, the market has been a growth engine and cash cow for the big multi-state operators (MSOs) that have licenses there: Curaleaf, Trulieve, GTI, Cresco Labs, Verano and Ayr Wellness. Those MSOs make up six of the Top 10 cannabis companies in the Global Cannabis 50 rankings we published in December.
For cannabis entrepreneurs, Florida presents a unique opportunity for those that can afford it. The Florida medical cannabis license is different from licenses in most states in two critical ways:
Licensed cannabis businesses in Florida can build and manage an unlimited number of production and retail facilities. This makes Florida one of the few medical markets in the U.S. where the capacity of a cannabis business to grow is entirely dictated by the appetite of its consumer market.
The other major feature of Florida’s cannabis license is that it requires full vertical integration by license holders.
For cannabis entrepreneurs, the new licenses in Florida present enormous upside: Florida has 776,365 active medical cannabis patients, representing more than 20 percent of the registered patient count in the entire U.S. Ultimately, with nearly 2 million monthly adult cannabis consumers, Florida could become the second biggest market in the country when the state transitions to adult-use.
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How It Will Work
The new licensing opportunity in Florida is expected to be similar to its special Pigford/BFL batching cycle for Black farmers who: 1. Won a judgment from the U.S. Department of Agriculture (Pigford v. Glickman) over the agency’s history of racial discrimination, and 2. Contested the Florida Department of Health’s non-issuance of even one medical marijuana treatment center (MMTC) license to a Black applicant before Pigford/BFL.
The cost to submit the application in the new round is a whopping $146,000. That is more than double the $60,830 charged during Florida’s initial application round. The barriers to entry to Florida’s medical cannabis market will remain high, and Florida is likely to remain a market with a limited number of large-scale players.