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CHICAGO (AP) — Patients aren't the only ones disappointed by delays in Illinois' medical marijuana program. Investors' hopes for financial returns are fading, at least for this year, according to a new report.
ArcView Market Research, a California consulting company, is telling investors the Illinois market could eventually expand to $36 million when it gets off the ground in 2016, but there will be far less revenue this year because of delays. Gov. Bruce Rauner plans to conduct a legal review of the program after former Gov. Pat Quinn declined to award business licenses before leaving office this month.
Because of the setbacks, which will delay planting of the first legal crop, ArcView predicts the state's 2015 market to be worth just $5.7 million, according to figures released exclusively to The Associated Press this week.
Investors are getting cold feet about Illinois, said Downers Grove resident Peter Schweda, who is a partner in a cultivation center business seeking a license in the central Illinois village of Vermont.
Investors' "confidence level has gone way down" because of the uncertainty surrounding the business licenses, Schweda said. "These are business people who don't get caught up in the romance of cannabis. They are expecting to give you $5 million and turn it into $20 million."
Illinois law strictly limits the health conditions that qualify patients for the program, another factor affecting the market size. Officials have said about 13,000 people have started an application for a medical marijuana patient card, but only 650 patients had been approved. Updated patient figures are expected next week.
"It's tough for us to see how people in Illinois are going to make money" under current restrictions, ArcView CEO Troy Dayton said. But investors are betting on Illinois broadening the list of qualifying health conditions, Dayton said, and they believe that ultimately more states will allow recreational marijuana for adults.
Illinois lawmakers have already broadened the list to include children and people with seizures. More patients will apply once the program begins, said Dr. Herbert Sohn, spokesman for the newly formed Cannabis Association of Illinois, a group of patients, advocate, industry suppliers, applicants and health care providers.
The new governor is a businessman who should see the potential for tax revenue, Sohn said. "His advisers will tell him, if he doesn't see it," Sohn said of Rauner.
The U.S. market for legal marijuana reached $2.7 billion last year, ArcView said in its report. An expanded report, to be published next month, will include the Illinois forecast, ArcView spokeswoman Jessica Dugan said. ___
AP Medical Writer Carla K. Johnson can be reached at https://twitter.com/CarlaKJohnson
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