Charge Them 'An Arm And A Leg!' Florida Gov. DeSantis Takes Aim At Cannabis Stocks

Zinger Key Points
  • DeSantis: 'Why wouldn’t we take the opportunity to make money for the state?'
  • Sally Kent Peebles: 'The idea that cannabis companies are raking in dough just isn't the case.'

The situation is looking gloomy for cannabis companies in the Sunshine State.

Republican Governor Ron DeSantis thinks medical cannabis businesses should pay a lot more for the chance to legally operate in in Florida.

The state “should charge these people more,” DeSantis said, according to the Tampa Bay Times. “I mean, these are very valuable licenses. I would charge them an arm and a leg. I mean, everybody wants these licenses.”
DeSantis didn't specify whether he meant medical marijuana companies that are already operating in the state, such as Trulieve Cannabis Corp. TCNNF, or companies that have yet to do business in Florida but are interested.

Either way, DeSantis' plan is bound to spark chatter among the state's major companies that are both headquartered and established there, including Red White & Bloom RWBYF, Columbia Care CCHWF, Curaleaf Holdings CURLF, Fluent FLNT, and Verano Holdings VRNOF

See Also: Why Can't Black Farmers Get Medical Marijuana Licenses In Florida? Exorbitant Fees And Residual Racism, Many Say

DeSantis’ statement comes on the heels of multi-state cannabis operator MedMen Enterpresies Inc.’s MMNFF $63 million sale of Florida operations to Green Sentry Holdings LLC. And earlier this month, Trulieve, opened a new medical dispensary in Kissimmee.

Back in 2015, medical cannabis operators in Florida had to pay around $60,000 to be allowed to sell low-THC marijuana products. Businesses also have to renew their licenses every two years.

“Why wouldn’t we take the opportunity to make money for the state based off those?” DeSantis said. “But I do think that would require a statutory change (by the Legislature), and I don’t think that’s something we could just do through administrative rule.”

See Also: DeSantis Mimics Maverick In 'Top Gov' Ad, But Resembles Dukakis

What makes Florida medical marijuana licenses so valuable?

According to Sally Kent Peebles, a Jacksonville-based partner at the national cannabis law firm Vicente Sederberg LLP, they are “the most valuable licenses in the world” thanks to the way the state’s medical cannabis industry is structured.

“Most states have much lower fees to get a license," Peebles said. "But Florida is much more unique than any other state because we’re the only state that one license allows you to have unlimited ability to open as many facility locations as you want."

Also, most cannabis companies don’t earn as much profit as it is commonly believed due to their getting “taxed on ghost income” at a rate of 85% or even higher.

“So the idea that these companies are making millions and millions of dollars and are sitting back and twiddling their thumbs and like laughing at everybody while raking the dough in is just not the case,” she said.

See Also: Medical Marijuana In Florida - What Advocates Need To Know

Even if the application fee increases, Peebles believes it wouldn't discourage those interested in running a cannabis business in the state, mostly because many are hopeful that Florida will legalize recreational cannabis in 2024.

New Emergency Rule

Florida health officials recently released a much-anticipated rule establishing THC dosage amounts and supply limits on products physicians can order for medical marijuana patients, writes Fox 35 Orlando.

Under the new emergency rule, there’s a 70-day total supply limit of 24,500mg of THC for non-smokable cannabis. Dosage caps for various methods of administration such as edibles, inhalation, and tinctures are also established.

The rule further promotes a state law that imposes a 2.5-ounce limit on smokable cannabis products over 35 days. When it comes to THC in smokable products such as whole flower, the limit is actually based on weight and not on levels of THC. Furthermore, under the new regulations, there’s a process for physicians to demand an override for patients they believe need more than allowed under the limits. The rule took effect on Monday.

Photo: Benzinga Edit; Sources: Courtesy of Add Weed via Unsplash and Wikimedia Commons

Posted In: CannabisGovernmentNewsPenny StocksRegulationsPoliticsSmall CapMarketsGeneralFlorida CannabisFox 35 Orlandomedical marijuaan FloridaRon DeSantisSally Kent PeeblesTampa Bay Times

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