California Cannabiz – What’s the Deal with Vertical Integration?

The state of California recently consolidated the rules and regulations for both medical cannabis and recreational cannabis, officially merging the Medical Cannabis Regulation and Safety Act (MCRSA) and the Adult Use Marijuana Act (AUMA) to form the Medicinal and Adult Use Cannabis Regulation and Safety Act (MAUCRSA).  MAUCRSA serves as the all-encompassing, official set of rules and regulations for both medical and recreational cannabis in the state of California.  So now that we officially have guidelines on how cannabis businesses are allowed to operate, one big question atop people’s minds is, “What’s the deal with vertical integration?”  The reason this is such a big question is because the state intentionally made it difficult to establish a vertically integrated business, at least at first.

With the way the rules are currently structured, the closest you can get to a true full vertical cannabis business still limits you to only three retail dispensary locations.  There are several licensing combinations currently being offered, most of which allow you some combination of a cultivation license and a manufacturing license, with a few combinations…