Oklahoma's Booming Medical Market

Connor Skelly

Medical markets in the United States are starting to mature. As a whole, the medical cannabis industry, specifically flower, has seen steady growth since 2012. Dispensaries have become more sophisticated, fine-tuning their customer segments and better understanding the demographics of their area, which has helped streamline production and inventory. Additionally, state regulations across the entire country have moved to support medical, if not recreational, programs and operations.

Generally, states that have newer medical markets or even restrictive regulations will see positive growth for 2019. Other established markets, like California and Colorado, are likely to see decreased growth in medical flower sales as those states expand into edibles, concentrates, and CBD product segments.

One of the most interesting states to see significant growth in 2019 is Oklahoma. There were initial pricing and safety concerns from patients when the program opened in August of 2018 and since then, supply has increased to a level where dispensaries are comfortable reducing their prices and expanding their product lines. According to Oklahoma's Tax Commission figures, their medical market sales amounted to $4.3 million in February which is a 400% increase from the previous month. We anticipate Oklahoma's medical flower market alone will exceed $40 million in the program's first full year.

There are numerous reasons as to why this market is performing above average compared to other states with active medical programs. One of the largest reasons is the state has no numerical cap on business licenses, giving the market plenty of room to grow and helping generate revenues for the state; The Oklahoma MedicalMarijuana Authority reported that it generated more than $13 million in licensing fees alone. Furthermore, doctors in the state are free to recommend cannabis products - including flower, which has been banned in a number of states' medical markets - for any condition they deem appropriate. without tight limitations on conditions, as seen elsewhere.

Other states that are expected to have a stellar first year for medical flower are Ohio, Pennsylvania, and North Dakota with varying ranges of growth rates beyond 2020. While flower still remains the"Ol' Faithful" of the cannabis market, other products continue to surge. Cannabis and CBD brands need to keep a close eye on where growth is happening in the markets they want to serve, tailoring product offerings and evolving with the market to ensure a steady increase in revenue for the years to come.