William Sumner
What kind of effect does adult use cannabis have on the medical market? The answer may surprise you. At the Green Market Summit, where some of the cannabis industry’s most prominent thought leaders were gathered, a discussion panel was held on the unforeseen consequences of legalizing adult use cannabis on the medical market. The following report “The Economics of Adult Use Marijuana on Medical Marijuana” was issued as a result of the panel members.
Moderated by Marijuana Policy Group co-founder Adam Orens, the discussion included Emily Paxhia, Founding Partner & Managing Director at Poseidon Asset Management; Jeannette Ward Horton, Vice President of Global Marketing and Communications at MJ Freeway; and Jessica Billingsley, CEO and Co-Founder of MJ Freeway.
Distinguishing this panel from all the other was the fact that it was the only all-female panel at the event. Although the panelists mused that someday such a panel would neither be significant or out of the ordinary, the audience reacted to the observation of the all-female panel with approval and applause.
Starting off the conversation, the panelists discussed the pre-adult use medical market and many of the early predictions of what would happen when adult use cannabis sales became legal. Although some predicted that the medical market would remain static, others, like MJ Freeway, predicted that the market would take a dip; which is precisely what happened. According to Paxhia, it was easy to see why.
“Living in San Francisco, some of those [cannabis] clinics, I felt like I was going to get sick from going in there,” recalled Paxhia. “I think there’s a number of reasons why people for a long time side-stepped getting medical cards. Once it became adult use, there were some very ready purchasers.”
As the adult use market began to mature in Colorado, Washington, and other states; the consensus became that adult use of cannabis would always kill the medical market. However, looking at the data, Horton and her partners discovered that after 12 months of legalization, the medical market actually grew by 45% while the adult use market only increased by 38%.
“People think the medical market is dead. Recreational shows up, people aren’t investing in those products, they’re not developing IP around those products, and they should be,” said Horton. “There’s a real medical market, and there are real medical patients, and that’s an opportunity I think people aren’t spending time on.”
Closing out the event, the panelists speculated on the future of the medical cannabis market and whether or not both the medical and adult use market would eventually fade away into just one unified cannabis market. Although it is a possibility, Billingsley was skeptical, stating that there would always be a need for medical cannabis.
“There will always be medical conditions that need a medical product that has some true efficacy for that condition,” said Billingsley. “It is a recreational substance, but it also has a truly efficacious benefit on the medical side.”
Stay tuned to find out more about happened at the Green Market Summit, as the Green Market Report gives you an in-depth look at the event throughout the week. Click here to read the previous recaps on cannabis banking, international cannabis, and an exclusive interview between legendary financial analyst Jim Cramer and The Green Organic Dutchman CEO Brian Athaide.
