As New York is slated to change its leadership under incoming governor Kathy Hochul, the state is still expected to push through its recreational cannabis sales in the near future, with the sale planning to go through sometime in 2022. Following the increased demand for cannabis products and its legalization in New York, N.Y.-licensee holder PharmaCann unveiled its plans to go public.
PharmaCann is a cannabis company based in the United States. Apart from receiving the license to operate in New York, being one of the recipients of cannabis licenses in the state, it also operates in five other states in the country, reveals Reuters.
PharmaCann’s license allows it to operate in New York. Reuters reports that it currently has four medical cannabis retail stores, as well as a cultivation facility, in the state alone.
According to Reuters, sources close to the company say that the initial public offering of the United States cannabis firm could make its value well over $1 billion. The IPO would also allow the cannabis firm to raise funds prior to New York allowing recreational marijuana sales in the state.
This comes after Canadian cannabis firm, Cronos Group, invested 10.5% in PharmaCann last June 2021, with the investment amounting to $110.4 million. The recent investment by the rival cannabis firm led the company’s valuation to rise to over $1 billion, thus leading the sources to believe that PharmaCann’s initial public offering would bring in a much higher price tag.
Sources told Reuters that PharmaCann submitted the requirements for its planned initial public offering in the last 30 to 45 days. It has submitted the paperwork to both regulators in Canada and the United States.
Ganjaprenuer reports that PharmaCann expects Canaccord Genuity to be the lead underwriter, but expects more banking institutions to support the IPO. Canaccord Genuity is an investment bank based in Canada.
While the initial public offering of PharmaCann could bring its valuation to well over $1 billion, sources told Reuters that the marijuana firm could still back out, especially as its filing was done on a confidential level.
With the decision to go public being reported, PharmaCann representatives have decided to remain quiet about the issue. However, Ganjapreneur states that if the plan pushes through, the company could go public by the fall this 2021.
Current Cannabis Landscape in New York
As of writing, New York has finally legalized the sale of recreational cannabis in the state. It is the 16th state in the country to successfully write the legalization into law.
Despite such strides in the marijuana industry, Reuters states that cannabis is still deemed illegal on a federal level. This entails that the firm, alongside other cannabis firms which sell or manufacture the plant, is not allowed to list its shares with the New York Stock Exchange or Nasdaq.
With Governor Andrew Cuomo signing the cannabis legalization bill in March 2021, the state of New York has now successfully decriminalized the public possession of marijuana of up to three ounces or 24 grams of marijuana concentrates for adult users aged 21 and up.
For home consumption, individuals will now be allowed to stock up on cannabis up to five pounds. However, these items should be stored in a safe and secure location. Marijuana Moment maintains that state regulators will still have to provide rules to govern this, with the rules being reliant on the Office of Cannabis Management.
Home cultivation, on the other hand, will see to it that New Yorkers are allowed to have up to six plants at home at any given time, provided these are designed for recreational consumption. This will only be allowed after the first dispensary in N.Y. opens.
The legalization also allows adults, or people aged 21 and older, to use, smoke, consume, or ingest cannabis products. Likewise, the New York Times states that these marijuana products can also be given to others who are of the same age or older.
New Yorkers of legal age will be allowed to consume and partake of these cannabis products in public, including areas where smoking tobacco is accepted, reports the New York Times. It remains, however, that smoking the drug is prohibited in schools, cars, or places of work.
What’s great about the legalization of marijuana in the state is that New Yorkers who have had previous marijuana-related convictions will have their records be expunged right away, shares the New York Times in a July 2021 article.
Although recreational cannabis use is now permitted in New York, the selling of products is slated to follow suit in the coming year once a regulatory office or commission has been set up. This responsibility of setting up a dedicated department will now fall into the hands of Lieutenant Governor Kathy Hochul once she takes up the governor position that Cuomo will be vacating.
MJBizDaily maintains that while Hochul is fully in support of New York’s marijuana legalization and the recreational cannabis program, the sexual harassment and assault allegations surrounding Governor Cuomo’s resignation can lead to a much slower program rollout.
Among the facilities and services that could be affected by the change in leadership and the current political climate of the state are operators and social equity applicants who are planning to get operating licenses for cultivation facilities, as well as shops and other businesses who are in the cannabis industry, notes MJBizDaily.
Of the issue, co-chair of Cole Schotz, a cannabis firm based in New Jersey, said that “We’re at a critical moment here where we are waiting for the governor to appoint a chair for the cannabis board. Any kind of political disruption certainly can delay (the program), especially at this point in the process.”
Despite varying changes in New York’s political landscape at the moment, many cannabis activists believe that Hochul will be more than ready and supportive towards the legalization of recreational marijuana, compared to Cuomo who was quite reluctant to support the movement.
MJBizDaily states that Hochul has been quoted that the legalization has long been overdue and that it can pave the way for the state to address its monetary concerns, especially as it can usher in a billion-dollar industry. Marijuana Moment reveals that an annual revenue of $245 million for New York can be achieved by the cannabis sector.