In September, Texas officially rolled out the most significant expansion of its medical marijuana program since its launch in 2015.
After lawmakers blunted expansion for years,
Texas’ medical marijuana industry is slated to see more marijuana
operators coming online, current ones opening more facilities and more
Texans enrolling in the program this year.
In September, Texas officially rolled out the most significant expansion
of its medical marijuana program, the Texas Compassionate Use Program,
since its launch in 2015. The expansion adds new qualifying conditions
such as chronic pain, inflammatory bowel disease, Crohn’s disease,
traumatic brain injury, and terminal illness. It also added more
treatment options like prescribed inhalers, higher THC limits, and
better dispensary access across the state. The expansion will also
increase the number of marijuana distributors from three to 15.
Lawmakers enacted these changes after
distributors in the program said strict state regulations on THC
amounts, locations, cultivation, and more hampered the program’s growth
and, in fact, contributed to them losing patients to cheaper, more accessible, and diverse hemp products.
“What made TCUP expensive in the past was the
fact that you had this niche program with a huge regulatory burden on
top of it. Now, as you expand the program, the cost of regulation
becomes a smaller percentage, and therefore the marginal cost of
products will come down over time,” said Nico Richardson, CEO of Texas
Original, a Central Texas medical marijuana company.
The Texas Department of Public Safety reported
that by the end of 2025, 135,470 patients were listed in the
Compassionate Use Registry by their physicians, about 32% more than the previous year. Distributors are attributing it to the news of the budding expansion.
The law immediately benefits the state’s
three dispensing organizations, Texas Original, goodblend, and Fluent.
Since these companies mostly sell their products online, none of them
have opened more storefronts yet, but they have created more satellite
locations across the state to store their products, allowing products to
be cheaper and delivered to customers faster. Before the law, companies
would have to return the product to the original dispensary every day,
raising overhead costs.
“We are planning to have a satellite location in all 11 public health regions within the next six months,” Richardson said.
Texas Original has also moved from a
7,700-square-foot facility to its new 75,000-square-foot headquarters in
Bastrop to cultivate more strains of marijuana and expand their product
options.
Austin-based Goodblend has opened its first
satellite location in San Antonio that allows for same-day pick-up and
plans to expand further into Texas to reach remote locations.
“We are also working on a slew of new
products and formats as it relates to vaporization and hopefully have
something down the pipe in the next six months,” said Jervonne
Singletary, goodblend’s spokesperson.
And, more medical marijuana operators will
soon join the existing three. One of the most heralded parts of the
expansion is the addition of 12 licensed dispensing organizations by
April 1, as outlined in House Bill 46.
The first phase
is underway with DPS awarding nine businesses with conditional
licenses. These nine businesses are not authorized to cultivate,
manufacture, distribute, or sell any cannabis products until the
department grants final approval, said Sheridan Nolen, Texas Department
of Public Safety spokesperson.
The dispensing organizations will be assigned
a health region. “Additionally, House Bill 46 does not allow dispensing
organizations to operate more than one satellite location in a single
public health region until they operate at least one satellite location
in each public health region,” Nolen said.
Most of these distributors operate in
cannabis markets outside of Texas and are expected to leverage existing
resources to get a quick start here.
“After being awarded a Conditional Dispensing
Organization License in December, we continue to work collaboratively
with key stakeholders on all required next steps in the process,” said
George Archos, founder and CEO of Chicago-based Verano, which will serve
public health region 10
in West Texas. “…We look forward to putting plants in the ground that
are grown in Texas, by Texans, and delivered to patients across the
state, in accordance with the law.”
These new marijuana distributors have up to
two years after final approval to become fully operational in Texas, but
Singletary expects it might be a little after nine months to a year.
She said once those additional businesses get
up in running, she expects the prices on medical marijuana products
that can range from $40 to $70 to continuously drop based on what she
has seen in other states that have undergone an expansion like Florida.
All of these changes are great on paper, but
distributors say the one hurdle that is holding the program back from
its full potential is the medical providers themselves.
Awareness among medical providers
One of the key cogs of the Texas
Compassionate Use Program when it was first created was medical
providers, but very few have registered to prescribe medical cannabis,
limiting the options Texans have had to enter the program.
Richardson said there are around 80,000 board-certified physicians in Texas, and only 800 are registered in the TCUP program.
“We’re absolutely laser-focused on doctors,
because they are really the patients’ first entry point into the
program, by asking your physician if you qualify,” Singletary said.
To become registered to prescribe medical cannabis in Texas, a provider must visit the Texas DPS registry portal
with their Texas Medical Board license, American Board of Medical
Specialties certification, and driver’s license to complete the
application.
Among the reasons for the sluggish enrollment is a lack of awareness about the program among medical providers.
Richardson said state agencies have mostly been hands-off in spreading awareness of the program, leaving it up to distributors to boost the number of subscribers.
“That is all we have done for the past seven
or eight years is educate doctors on the fact that the program exists.
DPS hasn’t had a campaign out there to bring doctors into the program.
This has pretty much been a Texas Original effort,” he said.
Also, most medical providers didn’t see a need to register, since most of their patients weren’t eligible.
Matthew Brimberry, an Austin-based doctor and
medical director of the Texas Cannabis Clinic, said he didn’t join the
state’s medical program until 2019, when the list of qualifying
conditions expanded from only those with intractable epilepsy to include
terminal cancer.
Other reasons why medical providers are
hesitant to join the program include workload and lack of knowledge
around the benefits of cannabis.
“It’s another electronic health system portal
that you have to register patients into, which can be a hurdle when you
are already dealing with so many portals,” Brimberry said. “Also, the
nature of the medicine itself, there is not a lot of education on it.
Being a medical provider, you aren’t going to recommend something you
don’t know about.”
Brimberry said no health field has taken the
lead on prescribing medical cannabis, leaving it up to providers who
have a specific interest in it to advocate for it.
To get around this problem of having a small
pool of providers to choose from, local medical marijuana distributors
have been using telemedicine
to connect patients with specialized providers across the state, but
Singletary said in an ideal world, patients would be visiting any doctor
to learn more about medical marijuana.
“I am happy there is an alternative route for
folks that might not be comfortable talking to their physician about
this. But I want to see more Texas doctors in the program,” she said.
New opportunities on the way
In December, President Donald Trump signed an
executive order to expedite the reclassification of marijuana from a
Schedule I drug, alongside heroin and LSD, to Schedule III, like
ketamine and some steroids.
In 2023, the federal Department of Health and
Human Services determined marijuana has acceptable medical use after
finding that health care practitioners across 43 jurisdictions are
authorized to recommend the medical use of marijuana to more than 6
million registered patients for at least 15 medical conditions.
The rescheduling doesn’t make recreational marijuana legal across the nation. However, it changes how it’s regulated, removing barriers to scientific research and reducing the industry’s tax burden, and improving access to banking services.
“The thawing of the capital market, better
banking, and better relationships with the IRS will free up some capital
for more investment, create new products, and drive down costs, so this
rescheduling, which we still don’t know a lot about yet, is potentially
a big opportunity,” Singletary said.
This changing view of marijuana from the
Trump administration might also signal the rest of the Republican
Party’s warming toward full legalization.
“We finally have a federal government, which
is frankly 10 years behind the times right now, recognizing the medical
benefits of medical cannabis, and we’ve known this for a long time,”
Richardson said. “I think we have reached the point where denying this
no longer makes any sense at this point.”
The cannabis industry views the expansion in
Republican-led Texas as a model for other southern states to expand
their cannabis programs, and Texas’ large geographic size and economic
infrastructure could make the state a national hub for medical
marijuana. .
“Most of the structural problems of the TCUP
program have now been solved. Whether it’s access through satellite
locations, it’s better and available products that patients were looking
for, just know it’s a viable and growing program right now,” Richardson
said.
