Medical marijuana gains foothold in conservative Mississippi

Mississippi’s journey into legalized cannabis is a tale of two sides, one marked by quick business startups and the other by slow patient enrollment.

The combo has created a particular challenge: too much cannabis and too few people allowed to buy it.

Mississippi’s relatively efficient approach to granting licenses to cannabis businesses led to hundred of dispensaries to pop up across the state. However, the same efficiency hasn’t been seen on the patient side, where licensing has moved at a slower pace.

The imbalance between available cannabis and legal customers has caused prices to drop unexpectedly.

On top of that, a testing company had issues before the holidays, which resulted in a large portion of available cannabis products temporarily put on hold. This affected nearly 70% of the market, hitting new retailers the hardest as many had to briefly close shop.

Some told Green Market Report that the amount of product recalled was really closer to 80%.

According to Andrew Livingston, lead data analyst with Vicente, the situation is a classic example of an unbalanced market.

“There was some slower licensing of patients, and that created some dynamics where there was probably more supply than there were patients ready to purchase yet,” he said.

“Not more supply than demand – probably a lot of demand. But that demand wasn’t licensed yet to the system. That essentially caused a price decline.”

Despite solid growth in the number of patients registered with the state, Mississippi’s MMJ registry still has room to grow. (Data provided to Green Market Report by Andrew Livingston of Vicente)

Despite the challenges, dispensaries and processors seem to be doing far better than growers in the state, according to Oxford, Mississippi-based attorney Dee Hobbs, who has worked with several licensees.

Those who are completely vertical have done what they could to optimize and keep sections of cultivation dormant to avoid producing more than they can sell. Still, Hobbs pointed to other issues.

In his eyes, one of the big hurdles for cannabis businesses in Mississippi is where they can set up shop. Strict rules, especially about being too close to churches and schools, make it hard to find good spots for dispensaries.

“It’s got to be 1,000 feet from any church, school, or daycare,” Hobbs said. “There are a lot of churches and a lot of schools in Mississippi, so that knocked out a lot of real estate.”

On top of that, Mississippi might expand its medical cannabis program by allowing more qualifying health conditions. And there’s talk in the legislature about letting people use cannabis recreationally this year, he said.

But he’s generally hopeful about where things are heading in Mississippi, with more people getting access to medical cannabis and possible changes to the law this legislative session. He also expects more M&A activity among growers and even retailers this year.

‘Startup mode’

While many potential operators are waiting to see how the state industry develops, business leaders, like Mississippi-raised Sederia Gray, have waded into the fire, albeit with better timing than others.

“So luckily for me, the timing that I entered into it, I don’t have some of those issues that some of the dispensaries have had with just having a lot of inventory and a lot of product that can’t be sold,” Gray, the owner of Far & Dotter Olive Branch, noted.

She said her store has surprisingly received more support from local officials and the community than she could have predicted. That’s a big change in the state she grew up in, where attitudes toward marijuana historically have been negative.

Gray is hopeful but careful, wanting the state to recognize the benefits of cannabis more actively.

“You know, opioid addiction is very high in the south, but particularly in Mississippi,” she said. “My patients come in every single day excited because they know that there’s a healthy and safe and holistic way to medicate for their sleep issues, for their pain.”

Gray previously lived in more established cannabis strongholds, including Seattle, Washington D.C., and California. She also worked in other industries with strict regulations, such as Boeing, FedEx, and Google, which she said helped her deal with the complex rules around running a cannabis store.

“I kind of look at this as like, it’s a startup to me,” she said. “Like a startup mode, but it’s a very highly regulated startup industry.”

She said more patients are registering for medical marijuana in the state, but paperwork and red tape are holding the industry back. She hopes the department continues to staff up and push qualifying patients through that process.

“I think that the timing right now for the market, I see this year be in a huge amount of growth for Mississippi,” she said.

The South

Kevin Caldwell, who has lobbied in the southeast part of the country for more than two years, said growth in the South has been slow but steady.

“It’s obviously a challenging environment, but we continue to see things move forward,” the Southeast Legislative Manager for Marijuana Policy Project said. “Obviously not at the pace that I would like to see it, but things move a little slower down south.”

One such challenge is the rule in Mississippi that forces pain patients to try opioids before they can get medical cannabis. That creates delays for a swath of new patients looking to get access.

Caldwell also wants it to be easier for doctors to prescribe medical cannabis and for the industry to overcome its growing pains. For example, he’s pushing for lower training requirements for doctors and solutions to other legal hurdles that are slowing things down.

“If we can get to the point that a doctor can write a recommendation for any ailment that the doctor considers debilitating, I think that the industry can support itself,” he said.

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