By Eli McVey
Rather quietly, it appears, Arizona has grown into one of the largest medical cannabis markets in the nation, behind only California and Michigan in terms of patient counts.
The state’s medical marijuana program added nearly 27,000 patients in 2016 – a 30% increase – that brought the total count to nearly 115,000. Arizona’s patient base has now eclipsed Colorado’s, which has dwindled to approximately 100,000.
Growth throughout the year in Arizona was relatively steady, hovering between 1%-3% with an average monthly growth rate of 2.2%.
The inclusion of chronic pain on the list of qualifying MMJ conditions has contributed to the market’s large size.
However, the biggest month for the program came in December, when over 4,000 patients enrolled in the program, more than the previous two months combined. The enrollment spike followed the narrow defeat of a November ballot initiative to legalize adult-use marijuana.
Many consumers who were hoping to take advantage of a new recreational market clearly opted to participate in the existing medical cannabis industry.
Arizona started 2016 with 94 licensed dispensaries, as well as five that were not operating. But in October, the Department of Health awarded 31 additional dispensary licenses to increase the state’s total to 130.
Those licenses were highly coveted: With nearly 750 applicants submitting bids, it was possibly the largest ratio of applications to licenses in any U.S. market.
It’s easy to see why entrepreneurs are so eager to break into the market, as business for Arizona dispensaries boomed in 2016. A record 29 tons of cannabis products were sold over the course of the year, a 53% increase over the 19 tons sold in 2015.
A young, largely male patient base forms the backbone of Arizona’s thriving MMJ program, according to the DOH’s December report. Individuals age 18-30 represent the largest group of patients in the market, at 24%. And within that group, 70% are male. Overall, 64% of patients are male and 45% are younger than 40.
The report also shows that 82% of this young, largely male patient base have signed up for the program to treat chronic pain, suggesting that at least some are using cannabis more for recreational purposes than medical, which has implications for business owners looking to serve this large segment of the market.
Looking forward to 2017, Arizona’s medical cannabis industry shows no signs of slowing down and likely will continue to develop into one of the more lucrative markets in the nation.
Eli McVey can be reached at [email protected]