Practice Matters: Considerations About Exploring a Cannabis Business
Thinking about getting into the cannabis space? Here’s what established doctors have to say.
While the opportunities in cannabis medicine seem ripe for the taking right now, those who are long established in the field know that there are still plenty of obstacles to overcome in order to achieve true success. Two established doctors share their thoughts about the hurdles beginners may face.
There’s more than one path you can take to transition into the field, says Rachna Patel, MD, founder of Doc Patels, which helps put medical-grade CBD products in the hands of licensed health care professionals while also providing education and training. There are doctors who are interested in establishing a medical dispensary or practicing cannabis medicine exclusively—and there are those who only want to add cannabis products into an already established practice, Patel says.
“The latter is the path of least resistance,” she says. “You’re up against less regulations. I also know that in some states, laws forbid physicians from having a financial interest in a medical marijuana dispensary, especially if they’re issuing medical marijuana cards, recommendations, or certifications—so that’s something else to consider.”
But there are many doctors who have an established base of patients struggling with a number of conditions and already asking about these types of products, Patel says. Adding CBD products to their existing practice is an easier step into the field.
“Physicians can sell CBD products either by wholesaling or through private label, and it’s pretty easy to do,” she says.
Of course, some doctors are more interested in developing a medical cannabis practice and dispensary. Though there may be more resistance—and risk—there may also be a lot of gain.
According to Leslie Apgar, MD, cofounder of the Maryland-based dispensary Greenhouse Wellness and creator of women-focused cannabis-infused products under the brand Blissiva, gaining the much-coveted licenses is a challenge in and of itself. Doctors who have money to invest and are interested in cannabis medicine should start building relationships in the industry so that if a license does come up, they’re already familiar with the space, she says, adding that this isn’t the type of industry you just “jump into.”
Doctors also must become much more business focused than they are—something that Apgar says has been a downfall for those who have struggled.
“It’s paramount that you understand expenses [and] margins, and have good people watching your numbers,” she explains. “Unless you take good care and pay attention to the backbone of your business, you are going to face hardships. Hire good people and educate them so that you aren’t on your own doing this.”
In fact, Apgar says much of the business aspect come down to “aligning yourself with good people.” By surrounding yourself with those who can pick you up where you fall short, she says, you can have the business support that you need.
Apgar also cautions about the need to have enough capital to get started. She’s witnessed dispensaries fail because they weren’t adequately capitalized.
“Unexpected problems arise—the power might go out or you might have to replace something,” she advises. “It’s best to be overcapitalized if you’re thinking about opening a dispensary.”
Furthermore, according to Apgar, it’s not easy to get a loan or a line of credit, as banks view it as risky. Securing real estate isn’t easy, either. Because many landlords may be reluctant to lease the space for a cannabis business, she says, you may need to be prepared to have the capital to purchase a space.
Of course, the actual nuts and bolts of starting a cannabis business are complicated, too. “If you’re thinking about starting a dispensary, my best advice would be to align yourselves with existing dispensaries and look at what they’re doing,” she says. “What happens behind the scenes might surprise you. Make sure that you know what you’re getting into.”
As you figure out the logistics, you must also think about what’s going to set your business apart and make you unique, Apgar says. “As this field expands, you need to start thinking about why you’re special. What will make someone choose you over hundreds of other choices? Once you figure that out, believe in yourself and hold true to your mission, your statement, and your goals. This industry can be tough, but don’t let it bring you down.”
Bridging a Knowledge Gap
Regardless of which business path you consider, knowledge and education are critical. Another area in which physicians often fall short is in essential cannabis knowledge, Patel says.
“I do think a lack of knowledge holds physicians back,” she says. “They’ll say that they weren’t taught about cannabis in medical school, so they can’t imagine prescribing it. But as physicians, we prescribe medications for off-label use. When doctors think about it that way, it shifts their mindset.”
Physicians who are new to the space must be willing to learn, Apgar says, and then relay what they’re learning to their patients. Physicians who get into this space and aren’t willing to put in the education time are hurting the industry as a whole, she adds.
“If you aren’t interested in being an educator, this is not the right field for you,” according to Apgar. “The uphill climb of us educating patients on a daily basis is hard, and we need more like-minded individuals to join that climb. Education takes time, but you’re doing the patient an enormous disservice if you’re certifying or recommending without educating.”
Patel says that the best place for physicians to start educating themselves is right at the source—PubMed. There are more studies existing than many people realize, and physicians are often surprised by how much research has already been done, she says.
“My best advice is look at the literature,” Patel continues. “As doctors, that’s what we’re trained to do—and that’s where all my knowledge has come from on this. Let that dictate the decisions that you make.”
Part of Patel’s mission has been to educate other doctors and partner with them. Patients, she says, want to turn to a trusted source for information. “There are so many patients who have been dealing with chronic pain for such a long time and have tried everything. They want to be able to go to a doctor and explain that they don’t want to get high, but they need pain relief that works. Doctors need to be able to answer these questions so that the patients aren’t left to figure it out on their own.”
An Ever-Changing Business
Both Patel and Apgar acknowledge that the cannabis industry has seen a lot of changes—and change isn’t stopping any time soon.
“The medical community has opened up significantly since I got started in the industry in 2012, and that’s largely been the result of patient demand,” Patel says. “But there’s still a long way to go. There are still many changes that we can expect on the horizon, and we must be prepared to address them.”
Apgar agrees, adding that the COVID-19 pandemic is a great example of the way that the future can unexpectedly throw a curveball. “Because of the pandemic, we must be willing to pivot as the industry or the market changes,” she says. “You have to be able to react to change. We pivoted our entire model to curbside, and now we’re doing all of our consultation by telemedicine or by phone. Being able to adapt to whatever the future holds will help set you up for the most success.”
— Lindsey Getz is an award-winning freelance writer in Royersford, Pennsylvania.