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A big shockwave was sent through the Florida medical marijuana industry yesterday. From the Tampa Bay Times: “A 1st District Court of Appeal decision in Tallahassee called the current, vertically integrated system unconstitutional for the way it caps licenses and charges companies with essentially being one-man bands — they must grow, process, package and sell medical marijuana without bringing in businesses to handle different parts of the process.”

This is what many called an oligopoly: a state of limited competition, in which a market is shared by a small number of producers or sellers. The system was set up this way because of fears that having multiple companies involved in the supply chain for medical marijuana would supposedly create a higher risk of the product being stolen, redirected to the illegal market, contaminated, or otherwise create unnecessary risks.

Now that this has been struck down there is a lower barrier to entry to become involved in the medical marijuana industry. Supporters of the move say this could help create more competition. So now someone can choose to only grow, or only sell, or only process the product or any combination of these they choose. However growing *or* processing medical marijuana in any volume is quite an undertaking so many small growers rising up and challenging the big players seems unlikely. Getting a larger company to sell it wholesale to you so you can somehow resell it and make a profit that seems unlikely. This seems more like a stripping of regulation rather than an attempt to help small businesses. All this did was remove any limit on the size of the large established companies.

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November 2020
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