It's hard to believe that it's been 20 years since California first approved medical marijuana for select ailments under Proposition 215 (which is also known as the Compassionate Use Act). Since 1996, the marijuana industry has expanded by leaps and bounds. Today, we'll tell the tale of that expansion through 20 statistics, some of which will wow and intrigue you, while others may cause feelings of disappointment and concern.
23: Beginning with California in 1996, and counting New York, the latest state to legalize medical marijuana, 23 states, as well as Washington, D.C., have approved the use of medical marijuana. Although approved ailments can vary from state to state, terminal cancers and glaucoma are common ailments for which medical marijuana is approved.
4: This represents the number of states whose residents have voted to approve the use of recreational marijuana for adults ages 21 and up. Colorado and Washington state approved recreational marijuana in 2012, with Oregon and Alaska following suit in 2014.
49%: Based on the 2012 National Survey on Drug Use and Health, essentially half of all Americans (49%) have tried marijuana before, including 12% who admitted to using the drug within the past year. It's probably safe to assume these figures have risen somewhat since this study was conducted in 2012.
84%: According to a CBS News poll conducted in April 2015, a whopping 84% of Americans would like to see marijuana legalized for medicinal purposes. This support has been critical to marijuana's state-level expansion.
58%: The latest Gallup poll showed that 58% of people surveyed were in favor of legalizing recreational marijuana, which tied an all-time high. For context, 20 years ago only around one-quarter of all respondents had a favorable view of legalizing recreational marijuana.
$5.4 billion: Based on the latest estimates from ArcView Market Research, legal U.S. marijuana sales grew by 17% in 2015 to $5.4 billion. Not bad considering that the legal marijuana industry was at $0 two decades prior.
30%: According to ArcView, legal marijuana sales could grow by a compounded average annual rate of 30% between 2016 and 2020. ArcView's forecast takes into account legal use growth in existing legal states, as well as a push to legalize recreational and medical marijuana in a number of other states. By 2020, legal marijuana sales could top $22 billion annually.
$996 million: Following just its second year as a recreation-legal state, Colorado tallied $996 million in legal marijuana sales in 2015. Though it still trailed California in terms of total sales (California's medical marijuana industry brings in $1 billion-plus annually), the $996 million represented a 42% jump from its legal marijuana sales in 2014, including an 88% increase in recreational marijuana revenue on a year-over-year basis.
$135 million: In addition to $996 million in sales, Colorado also generated $135 million in tax revenue and license fees for the state to use. More than $35 million of this has been earmarked for the education department, with law enforcement and drug abuse programs also in-line to receive extra funding.
$3.1 billion: Speaking of tax revenue, NerdWallet released a study in Sept. 2014 suggesting that if marijuana were legalized across the U.S., it would result in state and local tax collection of $3.1 billion per year. This isn't going to close any major budget deficits, but it's a good chunk of change that could go straight into education and law enforcement.
$17.5 billion: This is the amount the federal government and select state governments spend annually to prohibit the use of marijuana. Presumably, if marijuana were legalized nation-wide we'd see this amount decline to nearly $0, and we'd also see court costs drop considerably too.
15: This figure represents the number of diseases and ailments that medical marijuana has demonstrated promise in treating based on clinical trials -- at least the one's we've recently covered. Marijuana's safety profile is still being established, and more possible benefits could emerge during clinical testing.
111: As part of the clinical work that goes into medical marijuana research, scientists recently discovered seven new cannabinoids from the cannabis plant. In total, 111 cannabinoids have been discovered to date. These cannabinoids could be important, medically, because they may induce positive biologic changes in the natural cannabinoid receptor system found within our bodies.
0: In addition to its potential medical benefits, marijuana has also delivered surprising results in the safety column. In 2014, the number of people who overdosed on marijuana and died was zero, zilch, nada! Considering that roughly 18,900 people die each year from opioid-related overdoses, this is a possible endorsement for marijuana as a replacement treatment for opioids in certain ailments.
66%: But marijuana's expansion hasn't been perfect. A recently released study published in The New England Journal of Medicine, which used data from the Colorado Hospital Association, showed that there was a 66% increase in emergency department visits potentially related to marijuana between 2011 and 2014 for Colorado residents. Emergency department visits for non-residents increased even more, and speak to potential safety concerns of the drug.
8: There's also clear concerns about adolescents getting their hands on marijuana products as the industry expands. The National Institute on Drug Abuse notes that regular heavy marijuana use for teens can lead to a drop in IQ score of up to eight points. This is particularly worrisome considering that teen brains are still developing, and thus could be particularly vulnerable to drug use.
1: Of the six remaining presidential candidates, just one fully supports the legalization of recreational and medical marijuana: Bernie Sanders. Donald Trump, the Republican front-runner, has gone on record as saying he would be in favor of legalizing medical marijuana, but would need to see more evidence to approve recreational marijuana. Hillary Clinton and Ted Cruz would keep the current status quo in effect, while Marco Rubio and John Kasich might take a step back with their generally anti-marijuana message. Nonetheless, this is the first presidential campaign where marijuana has received significant attention.
3%: The fact that the marijuana plant remains illegal at the federal level means that most banks don't want anything to do with the industry. At last check, only 3% of the 7,600 banks in the U.S. were offering some form of financial services to businesses in the marijuana industry. Without access to basic financial services, expansion for marijuana businesses can be very difficult.
458: According to AngelList, a company where business start-ups can seek funding, investors can take stakes in start-ups, and consumers can look for jobs with start-up businesses, some 458 start-ups are involved in the marijuana industry (as of March 4, 2016). Of those, the average valuation is $3.5 million. But keep in mind that three-quarters of all start-ups are likely to fail.
$264: Last but not least, according to Priceofweed.com, a site that allows consumers around the world to input the price they recently paid for marijuana (legally or from the black market), the average price of a medium-grade strain of marijuana in the U.S. is $264. Comparatively, recreation-legal Oregon appears to be the least expensive at $180/oz., and South Dakota, where marijuana remains illegal, will set a consumer back $330/oz. at the high end (pun only sort of intended).
As you can see, it's been quite the ride for marijuana. The biggest obstacle remains the inaction of the federal government. That roadblock has created a number of inherent disadvantages, including higher taxes and minimal access to banking services, which have made it very difficult for marijuana businesses to expand. While 2016 could indeed be marijuana's best year yet in terms of state-level expansion come November, it still appears to be a dangerous investment opportunity given the federal government's apathetic view toward the drug and lawmakers' worries about long-term safety.
Sean Williams has no material interest in any companies mentioned in this article. You can follow him on CAPS under the screen name TMFUltraLong, track every pick he makes under the screen name TrackUltraLong, and check him out on Twitter, where he goes by the handle @TMFUltraLong.
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