MedMen Enterprises announced plans last year to purchase Illinois-based PharmaCann in a $682-million all-stock deal that would double MedMen’s market reach and give the company a presence in 12 U.S. states.
Now, nearly one year later, the companies are abandoning the transaction.
“In sum, the circumstances that led us to make the deal with MedMen a year ago are no longer present today,” Jeremy Unruh, a spokesman for PharmaCann, told Cannabis Business Times. “PharmaCann’s leadership believes we are in a great position to move forward as the same PharmaCann our patients, consumers and regulators have come to know and appreciate.”
The transaction has faced its share of regulatory hurdles along the way; for example, in an Aug. 29 statement, the New York Department of Health told Cannabis Business Times that it had “contingently approved the MedMen/PharmaCann merger, pending their ability to meet the stipulations provided by the Department.” These stipulations mandated that PharmaCann close its four retail locations in New York and surrender those licenses to the Department of Health, as the state’s registered organizations (Ros) cannot operate more than four dispensaries (MedMen already operates storefronts in New York).
“The State Department of Health is always clear and open with ROs about New York’s regulatory requirements, and have always diligently worked with ROs, including MedMen and PharmaCann, to help them navigate our regulations and processes to realize their operational goals in New York State,” the department told Cannabis Business Times Oct. 9, in light of the deal falling apart.
MedMen said it now plans to focus on investment in the California market, expanding delivery and loyalty platforms “to grow the business” and deliver on promises to investors,