Adam JacksonMarch 8, 2023
Organizers had planned to have the measure on the midterm ballot in November 2022.
Oklahoma Archives - Green Market Report
Adam JacksonMarch 8, 2023
StaffOctober 18, 2022
The Daily Hit is a recap of cannabis business news for Oct. 18, 2022.
ON THE SITE
Flower One Files for Canadian Bankruptcy, Plans to Go Private
After the markets closed on Monday, Flower One Holdings (CSE: FONE) (OTC: FLOOF) announced that it and its Canadian subsidiaries obtained an Initial Order of the Supreme Court of British Columbia pursuant to the Companies’ Creditors Arrangement Act, which is considered the equivalent of the U.S. bankruptcy court. The company also said it planned to become a private company by the end of the year to reduce the expense of being a publicly traded company. Read more here.
Audacious Ready for New York (Even if NY Isn’t Ready)
New York may not have an adult-use cannabis program in place, but that doesn’t mean cannabis companies are waiting. Australis Capital (CSE: AUSA)(OTCQB: AUSAF), also known as Audacious, said it has successfully completed its first harvest of adult-use cannabis in New York state with its partner Hempire. Audacious said it shipped its flower for processing and manufacturing into vapes and edibles. Read more here.
Fire & Flower Finds $16 Million From Circle K Owner
Fire & Flower Holdings Corp. (TSX: FAF) (OTCQX: FFLWF) has fashioned a financing deal with Alimentation Couche-Tard, the owner of Circle K convenience stores, in which ACT would supply the company with a $11 million principal amount loan. The two have also revised a stock purchasing agreement, in which ACT will snap up $5 million worth of common shares of Fire & Flower. Read more here.
Commentary: Does Crime Pay in Regulated Cannabis Market?
Now that recreational marijuana prices have collapsed and margins have evaporated, Michigan’s legal marijuana industry is all in on rooting out bad seeds. Pressure on the Cannabis Regulatory Agency (CRA) is on the rise from the state’s largest growers and retailers to identify and eliminate illegal marijuana making it into the legal market. Read more here.
IN OTHER NEWS
Oklahoma
The Oklahoma Bureau of Narcotics (OBN) is investigating and dismantling criminal organizations operating within the state’s medical marijuana program. Over the past two weeks, OBN has served Search Warrants at nearly a dozen marijuana farms across Oklahoma. Read more here.
Alabama Medical Cannabis Commission
The Alabama Medical Cannabis Commission said it had received 566 application requests for cannabis licenses before the deadline expired Monday. The commission will issue just 37 dispensary licenses for the first year. Applications for licenses will go out October 24 along with guidelines on what the AMCC is looking for in a potential applicant. Read more here.
StaffAugust 31, 2022The Daily Hit is a recap of cannabis business news for August 31, 2022.
John SchroyerAugust 31, 2022
The state's high court declined to order ballots printed with a still-pending recreational marijuana legalization ballot question on them.
Julie AitchesonOctober 7, 2020
To understand the unique distribution challenges of Oklahoma’s exploding cannabis market, one must first address the question that has preoccupied researchers, entrepreneurs, and investors ever since Oklahoma became second in the nation for dispensaries per capita, trailing only Oregon. That question being, “Why Oklahoma?” According to a 2018 Verilife study, for every 100,000 Oklahomans there are approximately 15.6 dispensaries. Over 7,000 cannabis business licenses have been approved in Oklahoma, with per capita cannabis spending projected to reach $226.40 by 2025.
The recent Marijuana Business Factbook projected that Oklahoma’s medical cannabis sales would hit $700 million-$860 million in 2020, more than double the $345 million brought in a year ago. The state looked like it could potentially place adult-use cannabis on the November ballot, but just a week ago Channel 6 in Oklahoma reported that the Oklahoma Supreme Court has struck down a petition that could have put recreational marijuana on the ballot. “If the petition were to have gotten enough signatures, State Question 813 would have been on the ballot in 2022. The court said the wording of the petition was misleading, and people who signed the petition weren’t getting enough information to make an informed decision.”
Liberal Licensing
Oklahoma’s liberal approach to licensing (it only costs $2500 to get a license there, as opposed to most other states where it can cost millions) and a 4% tax rate have been major factors in the state’s booming cannabis economy. This, in addition to the fact that Oklahoma has registered a comparatively high (5.8) percentage of the population for medical marijuana patient cards relative to other states with no qualifying conditions necessary means that there should be plenty of buyers to keep all of those businesses profitable. But given the sprawling geography of Oklahoma and a large number of dispensaries, success hinges on an efficient distribution model in order to keep shelves stocked and customers happy.
One company, Colorado-based 1906, has partnered with Stash House, the #1 distributor in Oklahoma. To date, Stash House has placed 1906 products in over 150 dispensaries across the state. So that covers getting the product from Point A to Point B, at least for 1906, which has logged record-breaking sales and reorders since entering the Oklahoma market, but distribution issues extend beyond product delivery. Issues related to packaging and liability, for example. A company that manufactures boxes used to sell marijuana may still be held liable under the law even though they may be removed from the actual sale of marijuana by a factor of two or more.
Also, given the scale of the cannabis distribution network necessary to keep Oklahoma’s dispensaries supplied and the fact that partial legalization necessitates more oversight (and thus more bureaucratic red tape, etc.), there is an additional burden on suppliers, distributors, and businesses to comply with stringent regulations. This additional scrutiny includes that from taxing agencies since cannabis is still illegal at the federal level. This burden can impact the ability of companies to reinvest profits in refining and expanding their distribution models.
Perhaps Oklahoma will take California’s lead, where state-licensed distributors take possession of goods before selling them to retailers. These distributors can represent multiple brands but must also test products for safety and pay state taxes on the goods. While there have been delays and sparsely stocked shelves as licensing and testing procedures are refined, this wholesale supply chain model is expected to inject new capital into the cannabis economy and encourage growth. Whatever route Oklahoma retailers and cannabis companies looking to get in on the action taken to address their distribution dilemmas, new capital and growth will certainly rank among the top priorities.
Other companies that have seized the opportunity to help simplify the supply chain include The MJSupply, OK Buds, and Argent Cannabis to name a few.
Debra BorchardtJuly 31, 2020Oklahoma has essentially been shunned by the largest multi-state operators (MSO’s) in the country. Most legal states tend to have a handful of MSO’s who plant their flags and make a big showing. Cresco Labs in Illinois or Trulieve in Florida and great examples of this. However, Oklahoma is a massively fractured market when it comes to ownership and the jury is out on whether it’s a good idea or not.
Oklahoma’s Market Size
Medical marijuana was legalized in Oklahoma through a ballot referendum in 2018. The state looked like it was on track to move forward for full legalization, but that has been delayed by the pandemic. The state has been on a licensing frenzy with over 7,000 businesses approved.
Oklahoma is now forecast to make it to the top ten list of states for per capita spending on cannabis. The per capita spending as per a recent ArcView/BDSA report showed Oklahoma at $90.40 in 2019 spending and that is projected to grow to $226.40 by 2025.
The state recorded $365 million in sales in 2019, the first full year, and that number is estimated to grow to $950 million by 2025. That will be even bigger than Pennsylvania’s estimated $770 million in 2025. The legit market took 30% away from the illicit market almost immediately.
These numbers would seem to be enough to entice a big MSO to head to the Sooner State, but that hasn’t happened. According to Cannabiz Media, 6,088 license holders only have one license, while 619 held multiple licenses. There are none of the familiar names in the top 25 license holders list.
Everyone Gets A License
One of the biggest differences for Oklahoma’s program is the liberal approach to licensing and the low 4% tax rate. Unlike the millions of dollars that it costs in most states to procure a cannabis license. it only costs $2500 to get a license in this state. A refreshing difference, but as one unnamed cultivation vendor put it, “I expect to see my products for sale in two years on CraigsList or eBay.”
The state has registered 5.8% of the population for medical marijuana patient cards. That is expected to grow to 10% in 2025. By comparison, Nevada only registered 1.2% and Oregon was at 2.5% in 2014 at its peak. With no qualifying conditions, doctors are free to recommend medical marijuana for any reason they deem fit. Like other states, many of these patients are actually recreational users and if full legalization happens, they are likely to drop their medical cards.
Producers Paradise
The numerous dispensaries though are great for brands. Oklahoma is home to the second most dispensaries per capita, which equals 15.6 dispensaries per 100,000 residents. A new report from Verilife wrote, “It’s interesting to note that while Oklahoma has the most marijuana dispensaries per capita, it has generated the least amount of tax revenue from cannabis out of all the states where marijuana is legal. The state is home to nearly 600 dispensaries but generated only $70,000 from marijuana in 2018.”
According to LeafLink, Smokiez Edibles is the number one brand in the state. The brand also sells its products in California, Washington, and Oregon and comes from a California-based privately-held company called LoudPack Inc. This quiet brand has been amassing numerous awards for its quality and quickly looked to the state as a place to dominate.
Top Oklahoma Brands on LeafLink in 2020 – 7/29/20
- Smokiez Edibles
- US Cannabis Pharma
- Pharmicated
- Cartel Oil Co
- Sublime Brands OK
Top Oklahoma Products on LeafLink in 2020
- Maui Waui Outdoor Flower from Argent Cannabis
- KIMBO KUSH from Happy Hour Medicinals
- Sublime 100mg Caramel Chew from Sublime Brands OK
- Multi-Piece Watermelon 250mg Sweet Fruit Chews from Smokiez Edibles
- 500mg GANJA GUMMIES from CANNA BASICS
Colorado-based edible brand 1906 said it was choosing to enter into the Oklahoma market in lieu of California and Oregon, due to the state’s burgeoning cannabis scene within its major cities such as Tulsa, Oklahoma City, and Norman. The brand is aiming to become not only the largest edibles company in Oklahoma but west of the Rocky Mountains. The promise Oklahoma holds is the brand’s first foray into becoming the market leader in the emerging region.
1906 CEO Peter Barsoom said, “Oklahoma is the most “free market” of medical and adult use markets with low barriers to entry for patients and business owners. As a result, you have a vibrant market with one of the highest per capita patient counts, competitive prices, and high accessibility (lots of dispensaries). Which had translated into one of the largest medical marijuana markets.”
He added, “The financial success of MSOs is dependent on regulatory arbitrage. Keeping competition out, prices high, and vertical integration requirements. So if those are the requisites of success for an MSO, Oklahoma is not an attractive market. The business model of most MSOs is dependent on a supply-constrained large arbitrage between the cost to cultivate cannabis and the cost the consumer/patient pays.”
StaffJune 27, 2018Oklahoma became the 30th state to legalize medical marijuana after voters approved State Question 788 on Tuesday. The measure was leading 56-44 with 85 percent of precincts reporting when the New York Times called the election. According to StateImpact Oklahoma, The Oklahoma State Department of Health has already begun drafting rules for a Medical Marijuana Control Program.
“The passage of State Question 788 highlights the strength and diversity of public support for laws allowing the medical use of marijuana,” said Karen O’Keefe, director of state policies for the Marijuana Policy Project. “Most Oklahomans agree that patients should be able to access medical marijuana safely and legally if their doctors recommend it. It is noteworthy that this measure passed in such a red state during a primary election when voter turnout tends to be older and more conservative than during a general election.”
MPP said that State Question 788 is the fourth medical marijuana initiative in a row to win in a state that went for Donald Trump, and that number could grow to as many as six by the end of the year. They were approved in Arkansas, Florida, and North Dakota in 2016, and they will appear on ballots in Missouri and Utah this November.
O’Keefe added, “We are pleased to see state officials are already working on developing a regulatory framework for medical marijuana, and we hope they will include patients, advocates, and other stakeholders in the process. It is important that patients have reliable access to the products that work best for their conditions. Oklahoma officials can learn a lot from the successes and shortcomings of other states’ programs, and hopefully, they will create a system that will serve as an example for other states in the region.”
Opposition
The National Cannabis Industry Association (NCIA) said that there was a strong and well-funded effort from opponents to the referendum in the months before the vote.
“In spite of a well-financed and misleading opposition campaign, Oklahoma voters proved that medical cannabis is no longer a controversial issue by enacting a sensible law at the ballot box tonight,” said Aaron Smith, executive director of the NCIA. “We applaud Oklahoma for joining the growing list of states that allow patients to legally access the medicine that works for them.”
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