illicit market Archives - Green Market Report

StaffDecember 12, 2022


The Daily Hit is a recap of cannabis business news for Dec. 12, 2022.


Experts Predict New York Cannabis Taxes Will Undercut Legal Market

Prices of legal recreational cannabis across New York will likely be at least twice as much as marijuana sold by unlicensed dealers and smoke shops, which will lead to a struggle for survival for much of the industry, according to a white paper authored by a pair of tax attorneys. Read more here.

Personal Liability for Cannabis Business Debts? Maybe, Says Tax Expert

Since business bankruptcy protections aren’t available to cannabis companies, executives don’t have the same personal protections they do in other industries, and it means their personal bank accounts could get ravaged by tax collectors, if they’re not careful. Read more here.

MariMed CEO Bob Fireman Passes Away Unexpectedly

MariMed Inc.  (CSE: MRMD) (OTCQX: MRMD) announced that Chairman, CEO, and co-founder Robert Fireman died unexpectedly on Dec. 11, 2022. The company said it will provide further information on succession once the board has had an opportunity to determine the best path forward. Read more here.

Kansas Lawmakers to Revisit Medical Cannabis Legalization Next Year

A Republican state senator in Kansas plans to introduce a bill in January to legalize medical marijuana, putting the state on the list of potential new U.S. cannabis markets that could be on the horizon. Read more here.

Jushi Makes Money Moves

Jushi Holdings Inc. (CSE: JUSH) (OTCQX: JUSHF) announced the second closing of its previously announced private offering of 12% second lien notes and detached warrants to purchase the company’s subordinate voting shares at an exercise price of $2.086. Jushi also entered into a sale-leaseback situation on equipment. Read more here.


Health Canada

Health Canada announced amendments to the Cannabis Act and its regulations concerning cannabis research and testing, and cannabis beverages. The updates include an increase to the public possession limit for cannabis beverages that will now allow adults in Canada to possess up to 17.1 litres (equal to 48 cans of 355 ml each) of cannabis beverages in public for nonmedical purposes. Read more here.


Workers laid off by Trulieve Inc. (CSE: TRUL) (OTCMKTS: TCNNF), Florida’s largest medical marijuana operator, have filed a potential class-action lawsuit alleging the Tallahassee-based company failed to give adequate notice before letting them go. Read more here.

Andrew WardJuly 12, 2022


New York is often considered a likely major player in the US cannabis market. 

While reasonable, the state’s immense unlicensed consumption habits have some wondering if it will face problems as California has. If so, what might happen to New York’s licensed operators, including social equity license holders, a priority component of the state’s Marijuana Regulation and Taxation Act

With New York not fully rolling out its regulations, sources across the sector feel it’s too early to predict how the state will contend with the unlicensed market. Most appear optimistic that the state will become a significant player but caution that several factors could alter the outcome. 

Illicit Market Value 

As New York waits for final regulations, the unlicensed market continues to perform, likely earning one to several billion in untaxed sales yearly. Juliana Whitney, CEO, and founder of Cann Strategy estimates illicit market sales to be between $1.5 and $2 billion annually. 

“New York has a strong legacy market, and it will remain that way, even with the existence of licensed dispensaries,” she predicts.

Andrew Livingston, director of economics and research at Vicente Sederberg LLP, estimated the illegal market’s value at around $1.8 billion. Livingston believes the licensed market would benefit by focusing on tourist consumers while many residents remain illicit market buyers. He also recommends that the state avoid overregulating and focus on market accessibility and bringing legacy buyers to the licensed market. 

“It is all about enticing consumers, many of which who are accustomed to bike messengers meeting them at their apartment or outside their building,” he said.


Some see the illicit market earning much more per year. There are some that estimate New York’s illegal sales totaled $5.1 billion in 2022. However, this figure can’t be verified. Curaleaf (OTC: CURLF) CEO Matt Darin said, “That’s a significant amount of money that could be taxed and go towards community reinvestment and public education.”

Cost, Access, and Supply All Critical

A strong legacy market and unfinished regulations are just two of the substantial remaining hurdles that cloud market outlooks. Early-stage access was critical for numerous sources, indicating that the market must avoid shortages during the launch period. In previous years, countries like Canada and Germany have faced product shortages. Domestically, Nevada, Washington state and Illinois are all significant markets to experience such an issue. 

Vicente Sederberg’s Livingston said New York would have to compete with illicit access points, including park tables and food trucks. “The city will need to find a way to make cannabis more appealing to access via regulated storefronts or delivery services than it currently is,” he said. 

Curaleaf’s Darin said getting to market is critical. He feels a sooner-than-later market launch would help compete with the illicit market, maximize job growth, generate revenue and seed social equity programs. He feels that the state should include craft and small farmers and existing medical operators like Curaleaf to combat supply concerns.

“Existing operators in the state have the infrastructure and resources to help launch adult-use quickly and ensure that there is ample supply of product to serve both the adult-use and medical use markets,” he said.

Jeremy Unruh, senior vice president of public and regulatory affairs for PharmaCann of New York, offered a similar opinion. He also feels that allowing existing medical players like, PharmaCann, would bring the market online sooner. “The question is whether the [CCB] will capture the lion’s share of that megamarket, or allow illicit operators to continue to dominate and proliferate in New York State,” he said.

Unruh claimed his company’s analysis found that using existing infrastructure could result in $1 billion in additional tax revenue and 10,000 more full-time jobs over the first five years. 

Even if the market launches soon, results may take time to reach their full potential. “Regardless of preparation, it usually takes new markets a bit of time to stabilize the supply,” said Cann Strategy’s Whitney. She also warned that the legal market would have initial training and pricing hurdles for customers and dispensaries. 

“Not many New York job candidates will have preexisting experience working in licensed cannabis business and therefore will all require adequate and accurate training,” she said. 

Whitney feels employees will need to work on providing confident customer service while working within a strict regulatory space, unlike most other retail sectors. 

She said that sticker shock will always impact legacy market buyers when first buying licensed products. However, Whitney expects “many will move away from the legacy market just because the new purchasing experience fits more into their usual lifestyle,” which includes a demand for convenience and lab-tested products. 

StaffFebruary 14, 2020


Editors Note: The Northeast Cannabis Business Conference is an advertiser on GMR. 

One of the largest problems facing the cannabis industry is the illicit market. Next week at the NCIA Northeast Cannabis Business Conference, the industry association plans to tackle the issue head-on.

The illicit market has steered away important tax revenues and endangered consumers through unregulated products like vape pens. Most of the deaths in the vape crisis were attributed to illicit market vape pens that were adding fillers to the cartridges. Had these pens been sold by reputable dealers this wouldn’t have been allowed. 

Low cannabis prices and high taxes have also been blamed for cannabis producers that take the chance at selling in the illicit market. Many of these companies say they can’t make a profit when the taxation is reaching levels of 50%. Plus, the costs to operate remain the same while the prices for the product have been falling. Some in the industry are sympathetic, while others chafe at being financially penalized for following the rules.

Counterfeit products have also flooded the market making it difficult for consumers to discern what is real and what isn’t. This has created an opportunity for software companies to develop quality codes for products, but once again adds more to the cost of doing business. 

Covering this important topic is NCIA’s Director of Public Policy Andrew Kline. Kline has a background in public policy, law enforcement, and coalition creation/management. Prior to joining the NACB, Kline served as Chief of Staff and Senior Advisor for Intellectual Property Enforcement in the Executive Office of the President [Obama] where he led public-private partnership and public policy efforts to address online trademark theft, copyright infringement, consumer safety, national security, and the protection of domestic business interests globally. 

He is joined by Britte McBride who is a Commissioner of the Massachusetts Cannabis Control Commissioner and former Police Commissioner of the Boston Police Department from 2006 through 2013 Edward Davis. Also on the panel is Ean Seeb is the Special Advisor on Cannabis to Governor Jared Polis. He previously co-owned one of Colorado’s oldest and most successful medical cannabis businesses, Denver Relief, which was sold to Willie Nelson’s team in 2016. 

The illicit cannabis market continues to divert precious law enforcement resources away from other law enforcement priorities. It harms the profitability of state-legal cannabis businesses and it diverts anticipated tax revenue from cash strapped states and municipalities.

Although the actual summit will be closed to the public, leaders from the Illicit Market Summit will present a report recapping and highlighting a path forward that encompasses best practices for sharing information through a public-private partnership and alternatives to arrest and incarceration.

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The Green Market Report focuses on the financial news of the rapidly growing cannabis industry. Our target approach filters out the daily noise and does a deep dive into the financial, business and economic side of the cannabis industry. Our team is cultivating the industry’s critical news into one source and providing open source insights and data analysis


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