Cannabis companies are racing to get in on the Arizona market now before full legalization…
It may receive less attention than the Florida cannabis market, but smart executives are buying up businesses in Arizona left and right.
There are more than 200,000 qualifying medical patients to serve in Arizona. In comparison, New York has roughly three times the population, but it has less than half as many patients, according to Leafly.com.
Over the past year, Curaleaf Holdings Inc. (CSE: CURA, OTC: CURLF) made two separate acquisitions for a combined total of $25.5 million in Arizona. Green Growth Brands (CSE: GGB, OTC: GGBXF) paid $12.3 million for a vertically-integrated operation.
4Front Holdings LLC also acquired PHX Interactive LLC, which manages a vertically-integrated license holder.
Now, entering a medical-only state is a strategy we like.
It allows companies to build a framework, work out the kinks in their business models, and start to garner brand recognition. Firework stands open in June because they want people to know where to go in July.
It’s the same idea with dispensaries. Open one now, and when recreational legalization takes place, people will know where to turn.
The Legalization of Recreational Cannabis in Arizona
The state’s efforts to fully legalize recreational cannabis in 2016 came up short, but there are already potential ballot measures in the works for 2020.
At first glance, it’s an interesting market because it’ll be in close proximity to Utah and New Mexico, two states that haven’t legalized recreational cannabis.
While we don’t foresee Arizona receiving a flood of people from either state hankering to cross state lines and buy recreational cannabis, we believe the state’s huge population of seniors is the ace up its sleeve.
A study released from the National Survey on Drug Use and Health found that cannabis use among seniors had doubled between 2013 and 2016.
And one of the reasons is the myriad of health problems that older Americans face.
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We’ve talked about this before with the concept of a “health span.” It’s great if you live to be 120, but if you have chronic pain starting at age 60, you’ll spend half of your life being miserable. The quality of life is what matters, and that’s why people of all ages are turning to cannabis.
The National Council on Aging says that around 92% of seniors have at least one chronic disease.
In Arizona, 17.5% of the 7.1 million people are 65 or older.
Cannabis-based medicine has shown signs of reducing inflammation, promoting a sounder sleep, helping to fight stress and anxiety, improving heart health, and alleviating cancer-related symptoms.
Recent studies have also shown that CBD oil could help play a role in the treatment of arthritis. According to the Centers for Disease Control and Prevention (CDC), over 50 million Americans suffer from arthritis, and it unfortunately can cause a great deal of stiffness and pain.
While CBD oil may not be a direct cure, it could help alleviate some of the pain.
Arizona appears to be the next domino to fall, and smart executives are rightfully making moves to get into the state now.
Executive Director, National Institute for Cannabis Investors
P.S. With the wide array of applications for CBD products, it’s not surprising that the sector is on track to grow more than 15 times faster than the overall cannabis market. And thanks to one landmark event, sales in the sector are projected to hit $22 billion by 2022 – that’s a 3,622% increase in the next 12-36 months. This major jump is why our team has identified two under-the-radar CBD companies that you need to know about today. For more information, click here.
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October 09 2019