Tobacco Wholesalers Ogle Marijuana Supply Chain

Tobacco wholesalers want to monopolize recreational marijuana distribution in Massachusetts. The Boston Globe reported that the companies responsible for tracking, delivering, and taxing cigarettes sold in the Commonwealth are trying to insert themselves as a key player in recreational marijuana sales, once the market opens for business in 2018. Touting their experience with cigarette distribution, the wholesalers have been lobbying state officials to require that all marijuana producers sell through them. The wholesalers contend that their high-tech tracking technology will guard the cannabis supply chain and help smother the black market.

Paul Caron, the executive director of a large tobacco trade group, spoke with the Globe. He urged that we not “reinvent the wheel” and that we entrust this function to his distributors: “My members are willing to collect all the taxes on behalf of the state and stamp any marijuana product being distributed for sale.” How considerate.

Unsurprisingly, marijuana supporters are not on board. They vehemently oppose a system that would force retailers to go through a middleman, like in the alcohol industry. Jim Borghesani, a leader for recreational marijuana, told the Globe that “[t]he last thing this state needs is another three-tiered commerce system that gouges consumers and enriches middlemen.” Other recreational states seem to concur—they allow dispensaries to buy directly from cultivators or grow their own. These states effectively use cannabis tracking systems and Massachusetts is expected to establish its own, which would obviate the need for another link in the supply chain. Senator Patricia Jehlen, chair of the Marijuana Policy Committee, agrees that the starting point for the Bay State is a reliable tracking system, rather than a tobacco takeover.

Medical licensees, which enjoy a head start on recreational sales, are sure to balk at the intrusion by tobacco wholesalers. Will Luzier, another recreational marijuana advocate, told the Globe that because medical licensees grow their own cannabis, they “would have to sell the product they grew as a cultivator to these distributors, and then buy it back from them as a retailer on the other end.”

This is not the first time that a major vice industry tries to cash in on cannabis. But hopefully our lawmakers will swipe left on this unwelcome suitor.

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