US states prepping to cash in on cannabis, the next big business
With the controversial cannabis industry projecting an estimated $37 billion in sales in five years’ time, investors, entrepreneurs, businessmen, and revenue-seeking government officials are increasingly finding it hard to look away. The potential is simply too enormous to dismiss, as well as the possibility that other ancillary sectors like transport, tourism, and property development also stand to benefit. Legalization of the growth and development of cannabis and its distribution as medical and recreational drugs is one requirement that interested states are still grappling with.
Just before the latter part of April 2016, only 23 states have made medical cannabis legal, and 14 more are studying bills in their legislative houses proposing the same as well as for the more entertainment-inducing weed. However, the slow pace of the government has only fueled the desire of the more forward-looking states to prepare for the inevitable explosion of legal cannabis into the market and its economic boom that has been likened to a second ‘gold rush.’
The Pittsburgh Post-Gazette forecasts U.S. revenues from the cannabis industry to raise up to $7.1 billion by the end of the year, and then up to $22 billion by the year 2020. It says Pennsylvania, the 24th state to legalize cannabis last Sunday, is heralded as the sixth-largest growth market that will compose 9.2 percent of the US market share. With the state’s medical cannabis industry currently earning only $125 million in revenues a year, legalization will certainly boost its growth, albeit under very definite, if not challenging, conditions.
The regulations that the state’s department of health will craft will be designed to prevent a leak of medical cannabis into the black market. For example, smoking the weed, even for medicinal purposes, is out of the question; patients will have to take them as a pill, ointment, or cream, and will need a license to be given these medicines from the licensed dispensaries. Doctors also need to pass training in order to be given a license to prescribe medical cannabis.
On the upside, Pennsylvania’s Department of Health has prescribed 17 medical conditions that can be treated with medical cannabis, a higher number found in most states that have legalized marijuana. The new law has also capped the number of marijuana-dispensing stores at 150, which is still higher than other states like New Jersey which has allowed only a maximum of six stores.
California, which is the first U.S. state to legalize cannabis, earned $2.7 billion in sales of medical marijuana last year, in effect capturing half of the American cannabis market. Legalization is also persuading interested Californian investors and small-time growers to come out of their industrial hiding places to work with the government to further set the industry on fire.
According to a New York Times report, with usual apprehensions about government crackdown and the participation of criminal elements out of the way, several sectors and their business leaders want to join in the party. The need for raw land to farm cannabis has tripled the price of that particular real estate. The cultivation of medical cannabis has drawn in growers wanting to benefit from a tax windfall; at the same time, these growers, if successful, can help bring in $10 million in tax revenues to the state which allocates that same amount for its public spending every year.
The steady march of legalization and a properly educated public who recognizes the benefits of medical cannabis can bring in needed income – and the investors and shareholders do not necessarily have to relocate to the states that are managing marijuana growth. Med-X. Inc., the California-based health and wellness company, has opened its crowdfunding campaign to American adults, including new college graduates, to place their hard-earned money on the fast-growing industry while it is still ascending to its zenith.
Anticipating that legalization will further elevate the standards of the cannabis industry, separating solid companies with a view of the long-term from fly-by-night operators, Med-X has been building its strength in research, development, and quality control. It also created the pest-free Nature-cide soil that organically grows cannabis that is robust, healthy, and safe for consumer consumption.
“There is money to be made,” emphasizes Med-X CEO, Dr. David Toomey. “We are offering this chance to reserve shares through an equity crowdfunding campaign to give all Americans the chance to be a part of a positive phase in the rapidly evolving cannabis industry. We see tremendous growth potential for the industry at large with both medical and recreational users, as well as a tremendous need for products that the public can trust not to be contaminated with pesticides, mold, or other problematic substances.”
The Med-X campaign can introduce medical cannabis and its benefits to an entirely new generation and invite them to engage as active participants, regardless of which state they are based in. This open-door approach can also accommodate the needs and concerns of the more enthusiastic cannabis proponents living in counties that are still taking a measured approach to legislation. One example, as named by Cincinnati.com, is Ohio which estimates that it will still take two years before their citizens can legally produce, sell, and buy medical cannabis.
Then again, nobody said that the cannabis gold rush will happen overnight. Everything depends on the local government’s willingness to cooperate with the private sector of marijuana producers and other interested parties. But the boom seems to be inevitable – and the investors and operators with foresight are doing their share to prepare their respective states for it, today.