This deep red southern state has a bit of a green thumb, enjoying one of the most sensible medicinal programs outside the west coast. The only restriction in Arkansas is the production of certain edibles, including candies, cookies, brownies, and other treats that may appeal to minors.

In 2016, Arkansas voters approved Amendment 98, the constitutional change legalizing cannabis for medical use. After delays resulting from regulatory snags and court challenges, the state's first dispensaries opened in May 2019. The amendment allows the commission to issue up to 40 dispensary licenses. The commission initially issued 32 dispensary licenses spread evenly across eight geographic zones in January 2019 and has granted six more since then.

Arkansas voters rejected a constitutional amendment to legalize adult use marijuana in November 2022. The results reflect that Arkansas, as a largely rural and religious state, is not ready to legalize marijuana.

As of August 2023, all 40 dispensary license have been issued.

November 2020 | Harvest Health sold Natural State Wellness for $25MM

Arkansas' limited license structure has the potential to provide the fundamentals MSOs want. We have seen Harvest Health divest from this attractive state to focus on higher ROI projects in their core footprint. Look for smaller MSOs to build density in this market, creating attractive future acquisition targets for the majors.

Investors can find positive ROI projects here that will be prime acquisition targets. This green southern belle will continue to expand patient count and ultimately transition to adult use, although that may take time as the medicinal regulatory framework is still under debate.