Three small companies — two of them in the Austin metro area — are on the verge of making history by winning the first Texas licenses to grow, process and sell a form of medical marijuana in the state.
But the renown isn’t expected to equate to quick profits, and success over the long haul likely depends as much on the Texas Legislature as on their business acumen. The companies – Compassionate Cultivation, Surterra Texas and Cansortium Texas – are facing strict state regulations that limit their customer bases and how they formulate their products, on top of investment costs running into the millions of dollars.
“It is safe to say that it is a challenging market,” said Morris Denton, chief executive of Compassionate Cultivation, which is retrofitting a 7,200-square-foot Manchaca warehouse with customized equipment for growing and processing cannabis.
Surterra Texas is planning to operate on Wells Branch Parkway in North Austin, according to documents filed with the state, while Cansortium Texas will be on West U.S. 90 in Schulenburg. Neither Surterra nor Cansortium made executives available for comment.
“For us in Texas, the opportunity is long term,” Denton said. “The market holds promise for the future.”
He said an initial goal for his company is simply to prove that medical marijuana can be dispensed safely in Texas and is beneficial to patients, in the hopes that state leaders increase access to it in coming years and render the business more lucrative. Proponents of medical cannabis in Texas already