Legalization Outcomes: Colorado Two Years In

1. LEGALIZATION OUTCOMES
COLORADOTWOYEARS IN
PRESENTED BY
Adam Orens, Founding Partner
aorens@mjpolicygroup.com
www.mjpolicygroup.com
Marijuana Policy Group

2. ABOUT
 Leaders in economics, finance and policy
 Market intelligence – policy design
 Founded in 2014
 Colorado MED cannabis economist
 Experience in 12 states, 2 countries:
‒ Market sizing
‒ Demand estimation
‒ Market analytics
‒ Business modeling and planning
‒ Government consulting
2

3. 3
OUTCOMESCOVERED
 Use prevalence
 Demand
 Medical vs. adult use
 Pricing
 Product mix
 Economic impacts
 Supply channels

4. 4
PASTMONTH
PREVALENCE—18+
6.5%
7.3% 7.5% 7.8% 8.1%
9.2%
9.8%
11.3% 11.0%
10.4%
12.7%
14.9%
6.2% 6.1% 6.0% 6.0% 5.9% 6.0% 6.4% 6.8% 6.9% 7.1% 7.4%
8.0%
0%
2%
4%
6%
8%
10%
12%
14%
16%
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Colorado U.S.

5. 5
DEMAND
0
20,000
40,000
60,000
80,000
100,000
120,000
140,000
160,000
2014 2015
MetricTons
Tourist
<1 days/mo.
1-5 days/mo.
6-10 days/mo.
11-15 days/mo.
16-20 days/mo.
21-25 days/mo.
26-31 days/mo.
Cohorts for Use
Days per Month
130.3
total metric tons
147.8
total metric tons
4%
19%
62%
7%
7%
10%
65%
9%

6. 6
MEDICALVS.ADULT
USE
 Medical – 6 percent growth
 Adult Use – 88 percent growth
55.2%
41.0%
44.8%
59.0%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2014 2015
Adult Use
Medical

7. 7
PRICING—FLOWER
$6.87
$5.61
$14.82
$10.25
$22.79
$9.98
$0
$5
$10
$15
$20
$25
$30
Medical $/Gram - CO Adult Use $/Gram - CO Recreational $/Gram - WA

8. 8
PRODUCTMIX—
MEDICAL
77.3%
14.1%
6.3%
2.4%
73.1%
19.3%
6.4%
1.2%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Flower Concentrate Infused Edible Infused NonEdible
2014 2015

9. 9
PRODUCTMIX—
ADULTUSE
70.1%
11.6%
14.7%
3.6%
67.0%
17.0%
13.6%
2.4%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Flower Concentrate Infused Edible Infused NonEdible
2014 2015

10. 10
ECONOMICIMPACT
7,088 jobs 3,048 jobs 10,135 jobs+ =
+ =$996 Million
Total
Impact
Secondary
Impact
Direct
Impact
Manufacturing
Retail
Cultivation
Colorado
Cannabis
Market
$1.39 Billion $2.39 Billion

11. 11
0
20
40
60
80
100
120
140
160
2014 2015
MetricTons
Regulated Market - Medical
Regulated Market - Adult
Use
Unregulated Market
(Homegrows, Caregivers,
Grey Market, Black Market)
130.3
total metric tons
147.8
total metric tons
26.5%
40.9%
32.6%
29.7%
42.7%
27.6%
ELEMENTSOFSUPPLY
Regulated
market

12. 12
SUMMARY
 Prevalence and demand 
 Casual users 
 Prices 
 Concentrate sales 
 Strong economic impact
 Regulated market serving nearly 75% of demand

13. 13
DISCUSSION
 Legalization
 Prevalence, Users, Demand 
 Potency, product safety 
 Arrests, Incarceration costs, Illicit market 
 Social indicators - ???
 Prohibition
 Prevalence, users, demand 
 Illicit market prevails
 Social Indicators - ???

14. Adam Orens
Founding Partner
Marijuana Policy Group
1999 Broadway Suite 2200
Denver, Colorado 80202
www.mjpolicygroup.com
info@mjpolicygroup.com