Cannabist Co Hldgs Inc (CBSTF)

[JohnCM]

New York Cannabis Deal to Open Big Market for Marijuana Companies

BY Dow Jones & Company, Inc.
03/24/2021

Columbia Care Inc. ( CCHWF ), Curaleaf Holdings Inc. ( CURLF ) and Vireo Health International Inc. ( VREOF ) are among the companies poised to gain new business as elected officials in New York move forward with a plan to legalize cannabis in the state.

Under a marijuana-legalization deal reached between New York Gov. Andrew Cuomo and state lawmakers, companies that currently provide cannabis under a medical-use program will be permitted to start selling marijuana for recreational use, so long as they continue offering medical products, The Wall Street Journal reported Wednesday.

Entities controlled by Columbia Care ( CCHWF ), Curaleaf ( CURLF ) and Vireo are among the providers of medical marijuana, according to a state-health department website last updated in November.

Shares of Columbia Care ( CCHWF ) trading in Canada were off 4.9% in afternoon trading, while Curaleaf ( CURLF ) shares fell 2.7%. Vireo's Canadian shares fell 3.5%.

Many cannabis company stocks have risen so far this year, with gains fueled in part by better financial performances in 2020, analysts have said, and by expectations that federal lawmakers will pass legislation that would make it easier for cannabis companies to operate.

Marijuana is still considered a controlled substance by the federal government.

Members of the House of Representatives and Senate recently have introduced bills that would permit cannabis companies to access banking services.

Senate Majority Leader Chuck Schumer (D-N.Y.) said in a tweet Wednesday that he was working on comprehensive cannabis legislation that would end the federal prohibition of the substance and provide for criminal-justice reforms, among other goals.

Meanwhile, in New York, legislation the governor and lawmakers agreed to back would create a new Office of Cannabis Management to issue licenses for growing and selling cannabis for recreational use, according to the report in the Journal.

New York, given its large population and the tourist traffic that New York City traditionally drew before the pandemic, is considered a critical end market for cannabis companies.

In February, New Jersey Gov. Phil Murphy signed legislation allowing adults to use cannabis recreationally.

"New Jersey appears to be creating a domino effect we anticipated, triggering a wave of potential adult use legalization across the highly populated Northeast market with New York, Pennsylvania, and Connecticut, and Maryland likely to follow suit," Curaleaf ( CURLF ) Chief Executive Joseph Bayern told investors earlier this month

He estimated those states represented a new, $6 billion market opportunity.

Under the deal between Gov. Cuomo and legislators, adults in New York may be able to start using cannabis recreationally by next year, the Journal reported.