No one knows for certain how the term "420" came to be associated with marijuana use, but each and every year, April 20 (i.e., 4/20) is celebrated universally as the day marijuana users and supporters recognize their love for the still federally banned substance.
Acknowledging 4/20 with four impressive marijuana accomplishments
This year could prove especially sweet for marijuana supporters, with the 2016 elections looking to add perhaps a dozen or more new state approvals for medical and/or recreational marijuana. But it's marijuana's impressive accomplishments since its first approval for medicinal use 20 years ago in California that's really on display in 2016.
With this in mind, and in honor of 4/20, let's look at four of marijuana's most impressive accomplishments over those past 20 years.
1. Nearly half of all states have approved medical marijuana
Since California's compassionate-use approval in 1996, 23 other states have also legalized the use of medical marijuana. The latest of those is Pennsylvania, which became the 24th state to legalize medical marijuana this past Sunday. What's most interesting about Pennsylvania's approval is that it came about wholly through legislative proceedings (i.e., no resident voting), implying that certain state legislatures view marijuana as an important medical alternative for some patients.
Further, President Obama has suggested that as more states approve marijuana's use, the more Congress will be compelled to seriously consider decriminalizing or legalizing the drug at the federal level.
2. Marijuana's real-world medical benefits
Building on the prior accomplishment, we're also seeing real-world medical benefits from marijuana, even if the federal government still lists the substance as illicit.
For example, GW Pharmaceuticals (GWPH) has launched Sativex, an oromucosal spray derived from two cannabinoids (CBD and THC), in 15 countries outside the U.S. to treat spasticity related to multiple sclerosis. However, even more encouraging is the work GW Pharmaceuticals has done in childhood-onset epilepsy, namely Dravet syndrome and Lennox-Gastaut syndrome, with experimental therapy Epidiolex. In midstage clinical trials, Epidiolex reduced seizure frequencies of patients with both types of epilepsy by greater than 50%.
Marijuana or its cannabinoids have also shown promise in treating type 2 diabetes, certain cancers, Parkinson's disease, and Alzheimer's disease, to name a few ailments.
3. Legal recreational marijuana is now a thing
A decade ago, the concept of legal recreational marijuana would have been laughable. Today it's a real thing in four states -- Colorado, Washington, Oregon, and Alaska.
The approval of recreational marijuana serves two key purposes for the marijuana industry. First, these states provide real-world experiments for federal lawmakers to follow to see if recreational marijuana could be in the cards on Capitol Hill at some point in the future (assuming no adverse societal changes coincide with its use, such as increased crime rates). Secondly, like medical marijuana's expansion, it puts pressure on Congress to reconsider its stance on marijuana.
According to Gallup's October poll, 58% of respondents favor the full legalization of marijuana, and those are tough numbers to ignore.
4. Colorado's legal sales top $1 billion on a trailing-12-month basis
Finally, marijuana sales, when taken as a whole, continue to soar, especially in Colorado. In February, Colorado's recreational sales totaled $58.2 million, a 17% year-over-year increase, helping to push total marijuana sales for the month to $92.7 million. More impressively, after selling $996.2 million worth of marijuana in Colorado in 2015, the $92.7 million in sales for February puts the industry over the $1 billion mark for the trailing-12-month period.
This isn't just a Colorado story, either. ArcView Market Research foresees the industry growing by 30% per year through 2020, making it one of America's fastest-growing industries.
Challenges remain, but investors are excited about the future
Of course, inaction on Capitol Hill still creates some industry concerns. Most marijuana businesses have little to no access to basic banking services, forcing them to deal solely in cash, while the IRS hammers home the federal government's ban on marijuana by not allowing marijuana businesses to take normal deductions on their taxes. Maybe the worst insult is the licensing fees and taxes marijuana businesses pay, which can make it tough to compete with the black market.
Nonetheless, investors remain excited. Medical studies imply there could be new treatment options available for chronic disease sufferers, recreational sales in legal states are soaring, and tax money generated by marijuana is helping add revenue to education and law enforcement for select state and local governments. This is an investment trend that could very well be worth a closer look, but only if the federal government changes its current stance on marijuana.