On April 28, 2017, four out of five licensed New York medical marijuana providers filed suit against the state Department of Health for attempting to expand the number of licensed providers from five to 10.
According to the Times Union, the suit was filed by the New York Medical Cannabis Industry Association on behalf of Vireo Health of New York, Etain, PharmaCann and Bloomfield Industries. The state’s fifth medical marijuana provider, Columbia Care, has yet to weigh in on the issue.
In the suit, the plaintiffs argue that expanding the number of providers would lead to the collapse of the market. Due to low patient demand, many of the state’s medical marijuana providers have been operating at a loss. By introducing more providers, the market could potentially be flooded with medical marijuana when the demand is not there, which in turn would send companies further into the red.
“The program is still in its infancy, and patient demand is currently too low to support an expansion of the supply market for medical marijuana,” the lawsuit states. “As it is, all five of (the Medical Cannabis Industry Association’s) members are sustaining tremendous operating losses, after having made millions of dollars in initial investments.”
In a statement to WGRZ, the state DOH rejected the association’s argument, stating that they would “continue to fight any attempts to block patients from the relief they deserve.”