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Medical Marijuana Businesses Are Suing New York State

New York wants to double the number of marijuana providers, but these companies want to recoup their investment.

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Five medical marijuana companies are suing New York State after the state Health Department announced plans to double the total number of MMJ manufacturers allowed in the state. The Health Department commissioner believes that the Compassionate Care Act gives the department the ability to add marijuana providers as it deems necessary. The New York Medical Cannabis Industry Association (NYMCIA), which represents the five companies currently licensed to produce medical marijuana in the state, is arguing that the law strictly limits the number of providers to five.

“From Day 1, we made clear our commitment to the continued growth of this program so that the New Yorkers who qualify for this therapy have access to it,” the NY Health Department said in a statement. “The Court's decision Friday not to block this expansion while the lawsuit is pending certainly helps those residents. We will continue to fight any attempts to block patients from the relief they deserve."

In the lawsuit, the NYMCIA argues that the five currently-licensed companies “are still operating at a loss, are utilizing a fraction of their manufacturing capacities, and they have not yet come close to recouping the substantial investments they made into becoming pioneers in the Program." In a statement, the association noted that the companies have collectively “invested more than $50 million dollars over the last few years to make New York's program the best in the country.”

“We are here for the right reasons, and we've shown that commitment to regulators, patients and physicians since day one,” the NYMCIA added. “It's time that commitment to making New York's program the best in the country was matched by our partners in government."