DOVER – A new date for Delaware’s future recreational adult-use marijuana industry launch has been set with some industry professionals chomping at the bit to get started.
Delaware’s new Marijuana Commissioner Joshua Sanderlin announced Thursday that medical marijuana licensees that also have a conversion license in Delaware may finally begin selling recreational adult-use products as of Aug. 1.
Sanderlin told the Delaware Business Times that other licensees, including those who fall under the social equity category, may begin operating as soon as possible, depending on when they get all of their paperwork into the state.
“But we’ve eliminated half of the barriers,” he said proudly.
Licensees seeking to bust into Delaware’s newest industry and ultimately manufacture, test or sell recreational adult-use marijuana, have faced significant barriers up until this point. Those challenges include financing debacles, as many lenders simply cannot work with these businesses due to the federal drug classification.
Other barriers have included the need for background check availability through the federal government, the lack of a marijuana commissioner since Rob Coupe left the office months ago, as well as strict zoning requirements that municipalities imposed that would essentially ban the business altogether.
While financing continues to plague future recreational adult-use marijuana businesses with no end in sight, the three latter concerns have been addressed by recent measures. In May, after previously being denied in April, Delaware was finally given a Federal Bureau of Investigation (FBI) service code for a fingerprinting service following the signage of House Bill 110 which made adjustments per the request of the FBI. Sanderlin also fills the need for the commissioner role- he started on June 6.
A new bill would also eliminate buffer zones between marijuana businesses and schools, daycares and churches to 500 feet. Senate Bill 75 cleared the General Assembly weeks ago and awaits Gov. Matt Meyer’s signature.
With three out of four major barriers addressed, Sanderlin said it’s time to get down to business.
“This program has been on hold for too long. We’re losing about $1 million per month in revenue to other states,” he told the Delaware Business Times.
He added that while those with conversion licenses will be able to get started as of Aug. 1, more than a dozen other conditional licenses have been granted since he started, including the one he signed on his first day in his new role.
In fact, to date, Delaware has officially issued three cultivation licenses, four microbusiness licenses, four manufacturing licenses and 14 retail licenses, according to the NCS Analytics dashboard linked on Delaware’s Office of the Marijuana Commissioner Website. It does not distinguish between conversion, social equity or other licensee or whether the licensees are from Delaware or not.
First State Compassion Center, Delaware’s oldest medical marijuana company, is among those that received a conversion license. They were recently acquired by national, Massachusetts-based outlet MariMed and leaders say they’re ready to jump into this new section of the marijuana market.
From its manufacturing location in Milford, Vice President of First State Compassion Emily Wilkins told DBT that their team was excited to hear the news that Delaware’s recreational adult-use marijuana industry would soon be up and running. Their operations, including retail sites in Lewes and Wilmington, are ready and gearing up for the influx of customers, she added.
“This is a history-making event for us here in the state,” she said. “We’re ready. We’ve had plenty of time and we’re excited to help open the market and excited to participate in the adult-use market. We’ve been ready for ten years.”
Although many were excited to hear the news, others say the industry isn’t quite ready to start and doing so now will give an unfair advantage to those established with medical businesses, versus others who are new to the scene and have invested dollars to get a start in the business but can’t start just yet.
The Delaware Cannabis Advocacy Network posted on its Facebook page after the announcement, “The existing medical marijuana dispensaries lobbied for less competition and to begin sales before new businesses, and now, with the OMC caused delays, they will end up with first sales and absolutely no competition. This is not what the people supported. The post also asked people to reach out to the commissioner’s office directly to “. . . demand a fair, affordable and competitive market.”
But Sanderlin said he doesn’t anticipate an unfair advantage by starting with the medical marijuana conversion licensees as consumers will ultimately choose retail businesses based on convenience metrics like closeness to their homes or workplaces, rather than who opened first.
“The argument doesn’t hold water in my opinion,” he told DBT. “If we were opening up a medical market where customers would have to pick a location and stick to it, that would be true. But we’re opening a recreational market, it’s more akin to the alcohol market. You’re not going to look at who opened first.”
If anything, Sanderlin hopes the opening provides one more benefit to all licensees as they strive to open their businesses soon – positive conversations in the near future with investors who have been wary of sending dollars to Delaware without a firm opening date.
“I think that while this in part helps those companies [medical marijuana licensees], it’s done in essence to help the larger industry in Delaware. Without opening, we’ll just continue to backslide. If we want to ensure the viability of this industry, taking action now was the most important thing to do,” Sanderlin said.
