54 Michigan Dispensaries Sold 8,700 Pounds of Medical Cannabis in 4 Months
Despite legalizing medical cannabis use in 2008, Michigan only got around to setting up a licensing and regulatory framework in 2016. Then, a coalition of conservative state lawmakers began passing legislation aimed at taxing, regulating, and licensing the state’s medical cannabis program. But in the eight years in between, an entire informal economy of unlicensed growers, distributors and caregivers emerged, along with dozes of unlicensed dispensaries.
Transforming the informal industry to a regulated, licensed one was and continues to be an arduous and messy process. So much so, that Michigan regulators have implemented different sets of “emergency rules” in hopes of easing the transition. Fast forward to early 2018, and LARA still hadn’t licensed any medical cannabis testing labs or dispensaries. In fact, the first LARA-licensed medical cannabis dispensary, which officials call a “provisioning center,” didn’t open until the beginning of November 2018.
Since then, Michigan has licensed a total of 54 provisioning centers. And in four months, those officially-licensed medical cannabis shops have topped $42 million in sales. That equals out to roughly 8,700 pounds of cannabis. If you’re doing that math at home, that means starting last November, Michigan’s provisioning centers have sold an average of $200,000 worth of medical cannabis each month. For the state, $42 million taxed at 6 percent works out to about $2.5 million in revenue.
When Michigan’s Provisioning Centers Start Selling to Retail Consumers, Sales Could Top $1 Billion
On Dec. 6, 2018, most of Michigan’s Regulation and Taxation of Marijuana Act went into effect. As was the case in California a few years back, where voters legalized marijuana but couldn’t purchase it right away, Michiganders have to wait a year for the state to license and regulate a retail industry. But when customers can finally access dispensaries, aka “provisioning centers,” sales in Michigan will explode. State officials estimate that by the end of 2020, total medical and retail cannabis sales could top $1 billion.
But in order for numbers like that to materialize, the state will likely have to crack down on the many unlicensed dispensaries still operating under LARA’s emergency rules. Michigan regulators have set a March 31 deadline for all unlicensed dispensaries to close. In the past, Michigan officials have attempted to enforce similar deadlines. But dispensaries have sued and won injunctions against state-enforced shutdowns. This time, however, Michigan regulators say March 31 isn’t just a deadline, but a drop-dead date.
The strict deadline is a result of additional pressure and scrutiny facing LARA over the sale of untested medical cannabis products. “Our ongoing discussions with medical marijuana stakeholders have demonstrated that this is the right thing to do in order to provide for continued patient access while ensuring that only tested products are being distributed,” Michigan Gov. Gretchen Whitmer told the Detroit Free Press.