Despite a recent expansion of the state’s medical cannabis program, New York’s licensed producers are still in the red, Buffalo News reports. The program has been online for just over a year but the current 14,000 registered patients is far from the 200,000 patients estimated at the program’s launch.
Ari Hoffnung, president of Vireo Health of New York, indicated the company “is not close to break-even yet.”
“And based on my understanding, no one has made a dime here in New York,” he said in the report.
Other industry executives said that of the 14,000 registered patients about half are regular customers and the other half have stopped buying legal products because of high costs or long travel distances to one of the state’s 20 dispensaries or because they have died.
State Sen. Diane Savino, one of the bill sponsors, said the program is lacking not only patients but also doctors; there are fewer than 900 physicians signed on to certify patients in the state and two counties do not have a single enrolled physician. Three counties have less than five.
A plan by the Cuomo Administration to allow five more licensed operators has at least one licensed producer “terrified.” Jeremy Unruh, general counsel of PharmaCannis said if the plan is approved the industry “will get blown up” in the state.
“I hate to complain about economics because this is and ought to be about patients,” he said in the report. “But we’re terrified they’re going to allow new production operations.”
An industry insider, who spoke anonymously, indicated that if all of the existing companies were to shut down today they would still have an eight-month supply on hand.
“It’s going to be financial devastation not only for the existing operators but eventually for the new ones,” Hoffning said of the plan. “What they’re doing is instead of creating more patient access, they’re creating more supply, and that supply is not needed in any way, shape or form.”
One company, Bloomfield Industries, was purchased in January by California’s MedMen after experiencing “financial constraints” for at least six months.
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