The Missouri Department of Health and Senior Services (DHSS), through its Division of Cannabis Regulation, has released its annual report detailing what was a year of significant growth and regulatory achievements in the state’s medical marijuana program.

The report, Released December 22, 2023, covers the program year (PY) from Dec. 1, 2021, to Nov. 30, 2022, prior to the enactment of regulated adult use sales beginning in February 2023.

Financial Aspects and Contributions to Veterans’ Fund

One of the key highlights of the report is the financial success of the MMRP. The program reported $380.4 million in cumulative retail product sales, reflecting a robust demand for medical marijuana in Missouri. This financial success translated into significant contributions to the state’s welfare programs. Specifically, $13.2 million in taxes were deposited into the Missouri Veterans’ Health and Care Fund (Veterans’ Fund), demonstrating the program’s commitment to supporting veterans. Additionally, DHSS transferred $18 million to the Missouri Veterans Commission, bringing the total contribution to $26.9 million. This financial contribution underscores the program’s role in supporting not just patients but also veterans through its revenues.

Growth in Patient and Caregiver Registry

The report indicates a substantial increase in the patient and caregiver registry in 2022. Over 235,000 applications were processed during PY 2022, marking a 22.7% growth in submissions compared to the previous year. While patients statistics boomed in 2022, the medical program has seen staggering losses in 2023, following the legalization of adult use marijuana. Between November 2022 and November 2023 the patient population decreased by nearly half, falling from 205,897 to 109,812.

Facility Licensing and Regulatory Compliance

In PY 2022, DHSS awarded 30 new medical marijuana licenses and approved 53 facilities to operate, reflecting the program’s expansion. The majority of the medical marijuana facility licensees were operational by the end of PY 2022, after completing the required commencement inspection process. This growth in licensed facilities aligns with the increasing demand and ensures a steady supply of medical marijuana to qualifying patients.

During PY 2022, DHSS received 123 licensee complaints, with burglary/attempted burglary being the top complaint. The department also suspended four licenses in response to health and safety concerns. In June 2022, the Department would go further – forcing the transfer of those licenses.

Appeals and Legal Proceedings

While DHSS is granted the authority to  deny an application or suspend or revoke a card, license or certification, these actions may appealed and reviewed by the State of Missouri Administrative Hearings Commission (“AHC”). The AHC acts as an independent entity to impartially review these decisions.

From December 2019 to February 2020, the AHC received 857 appeals from denied facility applicants.

By the end of PY22, 96 of those cases had been dismissed in favor of the Department.  15 cases were settled and 2 cases saw AHC grant a license after a hearing.

Operator Achievements

Missouri cultivators harvested more than 1.3 million pounds of marijuana in PY 2022, averaging more than 28,000 pounds per month. Additionally, dispensaries sold $380.4 million worth of retail products to qualified patients and caregivers in PY 22. Flower remained the most popular marijuana product type consumed accounting for 49.9% of all sales in PY22. While edibles represented 16.9% of all sales, vapes represented 15.2% of total sales, and concentrates saw 10.8% of the market share.

Legalization and Future Outlook

The end of PY 2022 saw the passing of Amendment 3, which impacted the medical marijuana program, creating new regulations for adult use sales which would lead to the Division completely revamping rules for marijuana as a whole in the state.

Comparing the report for the program year (PY) 2022 with the developments in 2023, Missouri’s marijuana landscape has undergone substantial transformation and expansion.

The year 2023 marked a significant milestone in Missouri’s marijuana history with the legalization of recreational marijuana use. Since legalization, which officially began on December 8, 2022, and saw sales starting in early February 2023, the state has witnessed a staggering $929.70 million in recreational marijuana sales, and more than $1.2 billion in total sales for the year. This robust increase underscores a dramatic shift in the state’s approach to marijuana, expanding beyond medical use to a broader adult-use market.

While Missouri has made considerable progress in the social justice components related to marijuana use, over 100,000 non-violent marijuana convictions have been expunged from state records, while marijuana-related charges have become all but non-existent in a majority of Missouri’s municipalities.

This transition to recreational use has not only diversified the cannabis market in Missouri but has also contributed significantly to the state’s economy and social equity. The sales of recreational marijuana have added considerable revenue to the state’s coffers, with a 6% state tax on all cannabis purchases funding veteran’s services. The changes have also brought significant growth for the industry and its operators, with facilities finding it necessary to increase staff and production.

But 2023, also brought with it an increased scrutiny of the Division. Legislators called leadership and oversight into question, while the industry fought back against regulatory oversight that many called impractical and overreaching. New regulations led to a recall of more than 64,000 product SKUs and an ongoing legal battle that has been played out both in courtrooms and in the media.

DCR revoked the license of Delta Extraction late in 2023, but the company has said that it will continue to battle against the decision. The Administrative Hearing Commission has yet to hold a full hearing or issue a final decision over the dispute between regulators and the Delta Extraction licensees.

The landscape of marijuana in Missouri has seen remarkable growth and diversification in 2023, building upon the foundations laid in the previous years.

As a whole, the industry and state have not only enhanced their potential economic benefits through the legalization of recreational marijuana but have also taken significant steps toward rectifying the past criminalization of marijuana use and inequity in the space. A slew of Missouri operators, as well as the state’s leading marijuana trade association in MoCann Trade, have taken steps to assist and uplift microbuiness licensees expected to enter the space in 2024. ​

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