Medical Supply in Jeopardy as More States Legalize Adult-Use Cannabis

The year 2020 brought a tsunami of events that led to a rise in demand and a fall in supply of medical cannabinoid products in the United States. AJEM spoke with officials and physicians from 3 states that were reporting cannabis shortages—Illinois, Maryland, and Florida—about its effect on patients. Additionally, panic-related buying due to the COVID-19 crisis created supply issues in the United States and around the globe. Experts paint a cautionary tale for the medical supply as more states move toward legalizing recreational cannabis.

A Perfect Storm in Illinois
The undersupply of medical cannabis flower throughout the state of Illinois resulted from the interplay of several factors including the legalization of recreational cannabis, an increase in qualified conditions under the medical marijuana program, and a mismatch between the anticipated vs actual preferred formulation among medical patients (eg, vaping vs smokable).

The Illinois cannabis industry and administration all agree that “medical patients will always be a number 1 priority,” said former state Senator Pamela Althoff, who is Executive Director of the Cannabis Business Association of Illinois, a
nonprofitstatewide association that represents cannabis businesses in the state.

Ms. Althoff confirmed a shortage in cannabis flower for medical use in 2020 and said that although the shortage was initially anticipated, it was exacerbated by a number of other variables that occurred. The industry prioritized medical patients and collaborated to ensure that there were regional balances in medical and recreational cannabis supplies, with all licensed cultivators expected to reach full capacity by the
end of 2020, Ms. Althoff told AJEM. According to an article in the Chicago Sun Times dated February 3, 2021, operators at dispensaries note that, for the most part, the supply issue has been resolved.1

The bill to legalize recreational cannabis in Illinois was signed by Governor JB Pritzker on June 25, 2019, theoretically allowing for a 6-month ramp-up in production before
recreational sales began on January 1, 2020. Licensed medical cannabis growers were allowed to submit applications for adult-use cultivation licenses within 60 days of the bill’s approval, with licenses distributed within 45 days thereafter.2,3

Although all 21 medical growers were granted early approval of adult-use licenses,4
the approval process reduced the time required for cultivation, starting with obtaining cannabis clones all the way down to packaging product and disbursement, Ms. Althoff said. Before the recreational cannabis bill was approved, licensed medical growers had not built out to full capacity, but rather grew what was economically