Green Thumb Industries Inc. (GTI) (OTCQX: GTBIF) is buying Virginia-based Dharma Pharmaceuticals LLC for an undisclosed amount. the acquisition is expected to close in the second half of 2021. Dharma was the first operator to provide medical products to Virginia’s patients in 2020 and is strategically positioned to scale in the emerging adult-use market. Last month, Virginia became the first Southeastern state in the United States to legalize adult-use cannabis after the Virginia General Assembly approved legislation.
“Change is happening. We are seeing sweeping cannabis reform across the country in favor of expanded access. This momentum has finally reached the first state south of the Mason-Dixon line to ratify adult-use cannabis sales and we are excited to work with the Dharma team in Virginia,” said Green Thumb Founder and Chief Executive Officer Ben Kovler. “This industry will create consequential economic opportunities and social change in a part of the country that remains void of legal access to cannabis today. We look forward to serving Virginia’s current medical patients, and future adult-use consumers, while supporting the tremendous positive impact that the legal cannabis industry can have on local communities.”
Currently, Virginia has only legalized medical marijuana and while adult use has been also legalized, sales won’t begin until January 2024. With a population of nearly 8.5 million, Virginia is expected to generate over $1.5 billion in legal cannabis sales, which would create significant tax revenue for the Commonwealth and employ thousands of Virginians.
GTI has been rapidly expanding throughout the U.S. Once this deal is closed, the company will have a presence in 13 markets: California, Colorado, Connecticut, Florida, Illinois, Maryland, Massachusetts, Nevada, New Jersey, New York, Ohio, Pennsylvania, and Virginia. GTI noted that as one of only five licenses in the Virginia medical cannabis market, Dharma is licensed to grow, process, and retail cannabis directly to consumers. In a statement, the company said that the acquisition includes an existing production facility and retail dispensary located in Abingdon, VA. Green Thumb will also have the opportunity to open up to five additional retail locations in the Commonwealth.
Kevin Gibbs, Partner and Head of Operations of Merida Capital Holdings, which is the current majority-equity owner of Dharma, added, “Over the past two years our team has worked hard to introduce the first medical cannabis products to Virginia’s patients. Together with Green Thumb, Dharma’s offering will expand to prepare for the introduction of adult-use sales in the first market in the Southeastern United States.”