Colorado\u2019s prohibition on publicly traded cannabis companies and limits on out-of-state investment were officially lifted at the start of this month, heralding a new era of growth in the state\u2019s industry \u2014 and potentially one of further corporate consolidation.<\/p>\n
The changes went into effect on Nov. 1, under\u00a0emergency rules<\/a>\u00a0issued by the Colorado Department of Revenue\u2019s\u00a0Marijuana Enforcement Division<\/a>\u00a0in August. These were drawn up to implement\u00a0House Bill 19-1090<\/a>, \u201cConcerning Measures to Allow Greater Investment Flexibility in Marijuana Businesses,\u201d which was signed into law by Gov. Jared Polis on May 29.\u00a0<\/p>\n This was the second shot at overturning the restrictions on out-of-state investment in the Colorado cannabis industry. A similar measure was among a handful of bills to loosen up Colorado\u2019s cannabis sector that were\u00a0vetoed last June<\/a>\u00a0by outgoing Gov. John Hickenlooper \u2014 like Polis a Democrat, but a far more conservative one. Polis\u2019s victory that same month was\u00a0hailed by the cannabis community<\/a>\u00a0as a favorable sign.<\/p>\n HB 1090 passed the House by a vote of 54-11 and in the Senate 27-7. All the \u201cno\u201d votes were from Republicans. In addition to overturning the ban on\u00a0publicly traded cannabis companies, it also lifts the 15-person limit on the number of out-of-state investors in any one such company. In the interest of transparency, public disclosure of information about investment is mandated by the law.<\/p>\n The restrictions were first imposed after Colorado legalized cannabis in 2012 to protect small businesses, amid concerns about a flood of outside capital into the state\u2019s burgeoning cannabis biz. Opinion is divided as to whether the state\u2019s industry has evolved to the point that such protectionist policies are no longer mandated.\u00a0<\/p>\n As the\u00a0Denver Post<\/a>\u00a0stated when HB 1090 was passed in May: \u201cThe change in law is expected to bring new cannabis products to Colorado from companies that have previously stayed away from the state. It could also accelerate consolidation, with large national chains purchasing Colorado\u2019s smaller cannabis shops faster than ever\u2026\u201d\u00a0<\/p>\n Some opposition to the bill of course came from cultural conservatives, such as\u00a0Colorado Christian University, who were worried about the spread of legal cannabis. Jeff Hunt, director of the university\u2019s think-tank, the\u00a0Centennial Institute, told the\u00a0Denver Post<\/a>: \u201cThe marijuana industry is quickly becoming Big Tobacco 2.0. By allowing publicly traded companies to invest in marijuana, Colorado is creating marijuana conglomerates with the sole purpose of getting as many people using the drug as possible. Similar to tobacco, we will experience public health problems for a generation due to \u2018big marijuana.’\u201d\u00a0<\/p>\n But it certainly isn\u2019t just such conservative and generally cannabis-phobic voices that are wary of the corporate floodgates being opened. As Denver\u2019s\u00a0Westword<\/a>\u00a0notes, \u201cWhile some mom-and-pops had been waiting for the day when they could sell their brands and business licenses to deep pockets, others viewed the move as a step toward corporate cannabis and consolidation.\u201d<\/p>\n This consolidation is already underway. Over the past year, two of the Colorado\u2019s largest dispensary chains,\u00a0LivWell<\/a>\u00a0and the\u00a0Green Solution<\/a>, have each bought up several independent dispensaries throughout the state.\u00a0Lova<\/a>, a new privately held cannabis brand, has\u00a0purchased five<\/a>\u00a0Denver-area dispensaries this year<\/p>\n In September,\u00a0Solace Meds<\/a>, a Front Range dispensary chain,\u00a0completed its buy-out<\/a>\u00a0of a smaller Denver dispensary chain,\u00a0Sticky Buds<\/a>\u00a0\u2014 which had actually been operating since 2009 (that is, three years before general legalization) under Colorado\u2019s medical marijuana program.<\/p>\n Denver\u2019s\u00a0Medicine Man Technologies<\/a>, a cannabis cultivator that\u00a0started as a medical marijuana producer\u00a0in 2009<\/a>, is also going through a phase of explosive growth. Over the past year, it has agreed to purchase more than 30 dispensaries throughout the state \u2014 deals that are to become official imminently. It is to acquire all three Denver-area\u00a0Colorado Harvest Company<\/a>\u00a0dispensaries, five\u00a0Starbuds<\/a>\u00a0outlets statewide, and the six mountain dispensaries of the\u00a0Roots RX<\/a>\u00a0chain. It also has plans to acquire some 10 more outlets through the purchase of southern Colorado chains\u00a0Mesa Organics<\/a>\u00a0and\u00a0Strawberry Fields<\/a>, according to Medicine Man Technologies CEO Andy Williams.\u00a0\u00a0<\/p>\n Westword<\/a>\u00a0also reports that on Nov. 5, days after the new law took effect,\u00a0Green Solution<\/a>, one of Colorado\u2019s biggest dispensary chains, announced that it has been purchased by\u00a0Columbia Care<\/a>\u00a0\u2014 a publicly-traded cannabis company registered in Canada although headquartered in New York.\u00a0<\/p>\n Medicine Man Technologies is especially taking advantage of the new regulatory environment. It has operated up until now as a publicly traded consulting and technology firm \u2014 covering those aspects of the enterprise that don\u2019t actually touch the cannabis. The cultivation centers, research facilities and dispensaries have been operating under separate licenses, all privately held. Now, they are about to be consolidated under a single publicly-traded roof.\u00a0<\/p>\n Contacted by Cannabis Now, Medicine Man Technologies co-founder and CEO Williams exemplified the sense of ebullience among Colorado canna-businesses eager for expansion.<\/p>\n \u201cThe regulatory change, as a result of HB 19-1090, will provide Medicine Man Technologies with the opportunity to unite the most successful and innovative pioneers of the most mature market in cannabis to become one of the largest vertically integrated seed-to-sale operators in the global cannabis industry,\u201d Williams said.<\/p>\n Medicine Man Technologies\u2019 intellectual property includes the\u00a0Three A Light<\/a>\u00a0methodology for cannabis cultivation. Acquisition is also pending of\u00a0MedPharm<\/a>, a major Denver development laboratory and cannabis processing facility with Good Manufacturing Practices (GMP) certification.<\/p>\n \u201cThe HB 19-1090 bill allows us to work on a series of recently announced pending acquisitions in Colorado,\u201d Williams enthuses. \u201cUpon closing, which we anticipate will occur in 2020, we will bring together 12 cultivation operations, seven product manufacturing operations, 34 dispensaries including two currently under construction, and world-class R&D capabilities all under one parent company. Our goal is to be a global leader in responsibly moving the cannabis industry forward and the HB 19-1090 bill is the first step in achieving this in Colorado and beyond.\u201d<\/p>\n TELL US<\/strong>, do you think cannabis business consolidation is a good thing?<\/p>\n The post Colorado Loosens Rules on Investing in Cannabis Businesses<\/a> appeared first on Cannabis Now<\/a>.<\/p>\n
Colorado\u2019s prohibition on publicly traded cannabis companies and limits on out-of-state investment were officially lifted at the start of this month, heralding a new era of growth in the state\u2019s industry \u2014 and potentially one of further corporate consolidation. The changes went into effect on Nov. 1, under\u00a0emergency rules\u00a0issued byContinue Reading<\/a><\/span><\/p>\n","protected":false},"author":190,"featured_media":0,"comment_status":"false","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[50,21,170,12814,1522,11346],"tags":[],"_links":{"self":[{"href":"https:\/\/cannabiscultivatornews.com\/home\/index.php\/wp-json\/wp\/v2\/posts\/39411"}],"collection":[{"href":"https:\/\/cannabiscultivatornews.com\/home\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/cannabiscultivatornews.com\/home\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/cannabiscultivatornews.com\/home\/index.php\/wp-json\/wp\/v2\/users\/190"}],"replies":[{"embeddable":true,"href":"https:\/\/cannabiscultivatornews.com\/home\/index.php\/wp-json\/wp\/v2\/comments?post=39411"}],"version-history":[{"count":1,"href":"https:\/\/cannabiscultivatornews.com\/home\/index.php\/wp-json\/wp\/v2\/posts\/39411\/revisions"}],"predecessor-version":[{"id":39412,"href":"https:\/\/cannabiscultivatornews.com\/home\/index.php\/wp-json\/wp\/v2\/posts\/39411\/revisions\/39412"}],"wp:attachment":[{"href":"https:\/\/cannabiscultivatornews.com\/home\/index.php\/wp-json\/wp\/v2\/media?parent=39411"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/cannabiscultivatornews.com\/home\/index.php\/wp-json\/wp\/v2\/categories?post=39411"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/cannabiscultivatornews.com\/home\/index.php\/wp-json\/wp\/v2\/tags?post=39411"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}Colorado\u2019s Cannabis Consolidation\u00a0<\/strong><\/h4>\n
High Ambitions at Medicine Man<\/h4>\n
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\nRead More: Colorado Loosens Rules on Investing in Cannabis Businesses<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"