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Recent ruling opens door for multi-state medicinal cannabis operators in Missouri

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A Thursday ruling from a federal judge changed the landscape for the medicinal cannabis market by ordering a permanent injunction against Missouri’s residency requirement.

Since 2018, Missouri-based marijuana companies, such as dispensaries and manufacturing plants, have been required to be at least 51% owned by Missourians with at least one year of residency.

During last week’s hearing, Judge Nanette Laughrey of the Missouri Western District made the preliminary injunction against this requirement, which she had ordered in June, into a permanent injunction.

Plaintiff Mark Toigo, a Pennsylvania resident and minority owner in Organic Remedies MO Inc., sought to end what he described as a “sweetheart deal” for residential operators, which he argued was in violation of the commerce clause of the U.S. constitution.

With the residency requirement gone, investors like Toigo no longer have to maintain a minority interest in cannabis-related businesses. Having equity with local vendors will allow him to help them grow and become more competitive, he said.

“It’s good for everybody in Missouri who wants to grow the cannabis space,” he said. “Now you don’t have to necessarily find Missourians to invest. You can bring in out-of-state investors, you can bring in capital from all over to improve the program.”

One multi-state operator that will benefit from this ruling is Columbia Care Inc., which currently operates 99 dispensaries and 31 manufacturing and cultivation centers across the country.

The company manages a recently opened dispensary in Hermann and plans to have a new manufacturing and cultivation center in Columbia operational by the middle of November.

“Now that (the law) has changed, it opens it up for business owners out of state to come in and help out the supply,” said Derek Coxson, general manager of the Hermann dispensary.

Coxson hopes that an increase in supply will lead to both a wider availability and wider selection of products, as well as reduced price points.

“We just want to make a positive influence on the world,” he said. “We’re just hoping that we can have a positive outlook and turn things around and make a better quality of life for patients.”

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