Could the failure of Amendment 3 boost the demand for medical marijuana?

Nearly 56 percent of Florida voters supported a measure that would have allowed recreational use of marijuana for adults, but that wasn’t enough to push the proposed constitutional amendment over the finish line.

The failure of what appeared as Amendment 3 on Tuesday’s ballot raises questions about the future of the medical-marijuana industry in a state with more cannabis patients than any other in the nation but where some operators have struggled to gain a foothold.

The recreational pot proposal would have allowed the state’s 25 licensed medical-marijuana companies to begin selling weed products to people over age 21 — including Florida’s 100 million-plus visitors annually — without regard to medical need.

Trulieve, Florida’s largest medical-marijuana operator, pumped more than $143 million into the effort, contributing about 94 percent of the total money collected by the Smart & Safe Florida political committee that sponsored the initiative.

Almost 6 million Floridians voted in favor of Amendment 3. But Gov. Ron DeSantis flexed his executive authority in a state-backed crusade against the measure and played an outsized role in blocking it from receiving the 60 percent approval required to pass.

Without question, approval of the proposal would have reaped big bucks for Quincy-based Trulieve, along with other cannabis companies in the state.Trulieve eclipses other Florida operators in sales and has almost twice the number of dispensaries as its closest competitor.

But the demise of Amendment 3 could strengthen the state’s medical-marijuana industry as it struggles to compete with hemp-based, euphoria-inducing products sold at gas stations, CBD shops and online at a fraction of the cost of items sold by Trulieve and other licensed operators.

“It’s all speculative that Amendment 3 was going to be this gold mine for operators,” John Lockwood, an attorney who specializes in cannabis law, told The News Service of Florida on Wednesday. “Prior to this amendment, Florida was one of the most sought-after jurisdictions for multi-state operators, and regardless of how the vote went yesterday, it will still continue to be that way.”

Florida voters in 2016 overwhelmingly approved a constitutional amendment authorizing medical marijuana. With the possibility of recreational weed on the horizon, investors have continued to be drawn to the state despite fluctuations in the values of licenses to operate medical-marijuana businesses.

As an example, a Florida medical-marijuana license sold for about $60 million seven years ago but another license sold in January for $13 million. Licenses’ values also can reflect the amounts of assets or debt held by companies seeking to shed their businesses.

The number of Floridians who signed up for the medical program steadily grew in the years after its inception.

But the patient count has hovered around 800,000 over the past few months as the push for Amendment 3 intensified, and the lack of a regulated recreational option could cause the number of cannabis patients to blossom, according to experts.

Florida still has a “significant market” even without a recreational program, Tallahassee attorney Jim McKee told the News Service.

“I think where there might be some concern is, there was excitement about recreational marijuana passing, so there were companies that invested a fair amount of capital with the expectation” that the proposal would pass, McKee said.

The lack of a recreational-marijuana market could have a negative impact on some of the Florida operators who were banking on its success.

“Were there entities getting overbuilt a bit, or expended more capital than they otherwise would have, but for the fact that the recreational amendment was on the market? You think about things like potential oversupply, if somebody built out facilities, that might be more than is needed just to service the medical-marijuana market. But I do think we’re going to see the registry continue to grow,” said McKee, an attorney with the Foley & Lardner LLP firm.

As he barnstormed the state in the runup to Tuesday’s election, DeSantis targeted Trulieve’s investment in the pot proposal, accusing the company of corporate greed. He also targeted the initiative’s lack of a provision that would have allowed people to grow their own cannabis, which could have alienated voters who might otherwise be more open to recreational marijuana.

The proposal’s 55.89 percent approval from voters shows that “folks care about this issue,” Trulieve CEO Kim Rivers told the News Service on Wednesday.

“Millions of Floridians signed the petition. Another 6 million Floridians showed up at the polls. We have an opportunity to again make some real change and some forward progress,” she said.

Rivers hopes state lawmakers will work with the industry to expand the medical program or take additional steps to increase Floridians access to marijuana. Patients must pay $75 a year to the Department of Health to register for the program. Patients have to see doctors every seven months to remain in the program. The doctor visits can run up to $400 annually.

Addressing costs and frequency of doctor visits could “reduce some of the friction” with the medical program, Rivers said.

The Trulieve CEO and other operators also hope lawmakers will revisit an effort vetoed by DeSantis in June that targeted euphoria-inducing hemp-based products.

The hemp industry was represented by lobbyists Evan Power, who is the chairman of the Republican Party of Florida, and Bill Helmich, who is the party’s executive director.

“When we think about the fact that we have this completely unregulated, basically open market on the other side, and how the Legislature decides to square those two things, I think that’s one of the conversations that I would hope happens this next session,” Rivers said.

DeSantis, in his opposition to Amendment 3, also highlighted the state’s medical-program and suggested that many more patients could be eligible under Florida law.

“I think it (the campaign) increased the awareness of the medical program and the safety of it, because everybody was discussing it as safe and everybody now knows that there’s all these big, legitimate dispensaries out there,” Aaron Bloom, CEO of DocMJ, told the News Service. “Anytime it’s in the news, it increases awareness and it’s good for patients.”