Texas is poised for a significant transformation in its medical marijuana sector, with an influx of new operators, expanded facilities, and an increasing number of participants in the program expected this year.
In September, the state initiated the most extensive expansion of the Texas Compassionate Use Program (TCUP) since its inception in 2015. This overhaul introduces additional qualifying conditions such as chronic pain, inflammatory bowel disease, Crohn’s disease, traumatic brain injury, and terminal illness. It also enhances treatment options, including prescribed inhalers, increased THC limits, and improved access to dispensaries statewide. The number of licensed marijuana distributors will rise from three to 15 under this expansion.
These legislative changes came in response to concerns voiced by distributors regarding stringent state regulations on THC limits, operational locations, and cultivation practices, which they argued stifled growth and led to patient losses to more affordable and accessible hemp products.
“The previous high costs associated with TCUP stemmed from its niche nature combined with a heavy regulatory burden. With the program’s expansion, regulatory costs will decrease as a percentage of overall expenses, leading to lower product prices over time,” explained Nico Richardson, CEO of Texas Original, a Central Texas medical marijuana company.
The Texas Department of Public Safety anticipates that by the end of 2025, approximately 135,470 patients will be registered in the Compassionate Use Registry, marking a 32% increase from the previous year. Distributors attribute this surge to the recent program expansion.
The law’s immediate advantages are being realized by the state’s three dispensing organizations: Texas Original, goodblend, and Fluent. While these companies primarily operate online and have yet to open additional storefronts, they are establishing more satellite facilities statewide to store inventory, which enables faster and cheaper delivery to customers. Prior to this law, companies were required to return products to the original dispensary daily, inflating overhead costs.
“We aim to establish a satellite location in all 11 public health regions within the next six months,” Richardson stated.
Texas Original has also upgraded its operations, moving from a 7,700-square-foot facility to a new 75,000-square-foot headquarters in Bastrop to cultivate a wider variety of marijuana strains and expand its product offerings.
Goodblend, based in Austin, has launched its first satellite location in San Antonio, which facilitates same-day pick-up. The company plans further expansion into Texas to reach more remote areas.
“We’re also developing a range of new products and formats related to vaporization, with hopes to introduce something new within the next six months,” added Jervonne Singletary, a spokesperson for goodblend.
Additional medical marijuana operators are set to join the existing three, with one of the key aspects of the expansion being the addition of 12 licensed dispensing organizations by April 1, as outlined in House Bill 46.
The first phase is already in motion, with the DPS awarding nine businesses conditional licenses. However, these businesses cannot cultivate, manufacture, distribute, or sell cannabis products until they receive final approval from the department, according to Sheridan Nolen, a DPS spokesperson.
Each dispensing organization will be assigned to a specific health region. “Additionally, House Bill 46 restricts dispensing organizations from operating more than one satellite location within a public health region until they have established at least one satellite location in each public health region,” Nolen added.
Many of these distributors already operate in cannabis markets outside Texas and are expected to utilize existing resources to quickly establish themselves in the state.
“After receiving a Conditional Dispensing Organization License in December, we continue to collaborate with key stakeholders on the necessary next steps in the process,” said George Archos, founder and CEO of Chicago-based Vernano, which will serve public health region 10 in West Texas. “We are eager to cultivate Texas-grown cannabis for patients statewide in accordance with the law.”
These new marijuana distributors have a two-year window post-approval to become fully operational in Texas, although Singletary anticipates it may take around nine months to a year for them to start functioning.
She believes that once these additional businesses commence operations, the prices of medical marijuana products—currently ranging from $40 to $70—will continue to decline, based on trends observed in other states that have undergone similar expansions, such as Florida.
Despite these promising developments, distributors cite a significant barrier preventing the program from reaching its full potential: the medical providers themselves.
Awareness Among Medical Providers
The Texas Compassionate Use Program has relied heavily on medical providers since its inception, yet only a small fraction have registered to prescribe medical cannabis, limiting Texans’ access to the program.
Richardson noted that out of approximately 80,000 board-certified physicians in Texas, only around 800 are registered under TCUP.
“Our focus is squarely on doctors, as they serve as the initial access point for patients seeking to qualify for the program,” Singletary emphasized.
To register to prescribe medical cannabis in Texas, providers must access the Texas DPS registry portal and submit their Texas Medical Board license, American Board of Medical Specialties certification, and driver’s license.
A primary reason for the slow registration process is the lack of awareness among medical providers regarding the program’s existence.
Richardson expressed frustration that state agencies have largely refrained from promoting the program, leaving distributors to enhance awareness and increase the number of registered providers.
<p"For the past seven or eight years, we have been focused on educating doctors about the program. DPS has not launched any campaigns to recruit physicians into the program; this has primarily been a Texas Original initiative," he stated.
Additionally, many medical providers have not seen a compelling reason to register, as most of their patients have not met the eligibility criteria.
Dr. Matthew Brimberry, an Austin-based physician and medical director of the Texas Cannabis Clinic, noted that he did not join the state’s medical program until 2019, when the list of qualifying conditions expanded from just intractable epilepsy to include terminal cancer.
Other factors contributing to medical providers’ reluctance to join the program include their existing workloads and a lack of understanding regarding the benefits of cannabis.
“It adds another electronic health system portal for patient registration, which can be overwhelming given the numerous portals already in use,” Brimberry explained. “Moreover, with limited education surrounding the medicine itself, many providers are hesitant to recommend something they are unfamiliar with.”
Brimberry pointed out that no specific healthcare field has taken the lead in prescribing medical cannabis, leaving it to interested providers to advocate for its use.
To mitigate the challenge of having a limited pool of registered providers, local medical marijuana distributors have begun utilizing telemedicine to connect patients with specialized providers statewide. However, Singletary expressed a desire for a future where any Texas doctor could discuss medical marijuana with patients.
“While I’m glad there is an alternative for those who may feel uncomfortable discussing this with their physician, I would like to see more Texas doctors involved in the program,” she stated.
New Opportunities on the Horizon
In December, President Donald Trump signed an executive order aimed at expediting the reclassification of marijuana from a Schedule I drug to Schedule III, aligning it with substances like ketamine and certain steroids.
This year, the federal Department of Health and Human Services recognized marijuana’s acceptable medical use, noting that healthcare practitioners across 43 jurisdictions can recommend medical marijuana to over 6 million registered patients for at least 15 medical conditions.
While this reclassification does not legalize recreational marijuana nationwide, it alters regulatory frameworks, removes barriers to scientific research, lessens the industry’s tax burdens, and enhances access to banking services.
“The loosening of capital markets, improved banking relationships, and better interactions with the IRS will unlock investment opportunities, inspire new product development, and reduce costs. This rescheduling, which remains somewhat uncertain, presents a significant opportunity,” Singletary remarked.
The evolving perspective on marijuana from the Trump administration may also indicate a shift within the Republican Party towards full legalization.
“Finally, we have a federal government that, despite being a decade behind current trends, is acknowledging the medical benefits of cannabis, something we’ve recognized for a long time,” Richardson asserted. “It’s clear that denying this reality is no longer tenable.”
The cannabis industry sees Texas’s expansion as a potential blueprint for other southern states to enhance their cannabis programs, given the state’s vast geographic and economic resources that could position it as a national leader in medical marijuana.
“Most of the structural challenges within the TCUP program have been addressed. With improved access through satellite locations and a broader range of available products, the program is now viable and rapidly growing,” Richardson concluded.
