MedMen's CEO Talks Acquisition: 'I See It As A Leapfrog'
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Fresh off the heels of his company's $682 million acquisition of PharmaCann, MedMen CEO Adam Bierman talked to us earlier this morning about the deal, why it happened, and what to expect.
There are a few marijuana companies you could have acquired, but you chose PharmaCann. Why?
There are a few companies that have similar footprints to PharmaCann, but our determination was that the infrastructure and the people at PharmaCann were best in class.
For eight years now, the plan has always been to focus on California, Nevada, and New York. We believe firmly that those are the markets where the marijuana brands of the future globally will be built. We went public for this reason -- to add velocity to the initiatives that we were already embarking upon. Having locked up those markets, we've announced our entry into Arizona, Illinois, and Florida. Those were the next set of markets that we intended to enter into. And there were two ways to do it: One would be piecemeal, which was the track we were going down. Then we looked at PharmaCann, which has every one of those markets that we had targeted already under their umbrella. They have the assets that we otherwise would have been going after and aggregating on a piecemeal basis. And as we dug in further with PharmaCann, we realized the human capital that they have there now is best-in-class in operation.
As we continue to scale and open more stores in new markets, adding the infrastructure that PharmaCann has built just pushed us over the edge. I see it as a leapfrog, where we now have added the six additional markets that we were already targeting, but we get them all at once.
Will the PharmaCann dispensaries all be rebranded and redesigned as MedMen?
Yes. We'll bring them all into our ecosystem. There will be a transition period, undoubtedly. Some of those dispensaries will be rebuilt immediately. Some of those dispensaries will be moved and then rebuilt. It will probably be a 12- to 18-month process until everything is up and running again.
Any idea which of PharmaCann's dispensaries will be first to flip?
It's been a whirlwind couple of days and I know our ops team is figuring out all these logistics. Look, this is the biggest deal in the history of U.S. weed and so there's a lot of organization that needs to take place. Just integrating these two companies is something that our ops team and our H.R. department have been tasked with, and I feel really confident that we will proceed and we will continue to win.
Aside from their dispensaries and facilities, PharmaCann is known for their medical-use products. Was that a factor in your decision to acquire them?
It's three things for me: It's assets, it's infrastructure and people, and then it's products. What's really interesting about PharmaCann, even in their name, is that they've had a very medical focus from the outset. Their CEO (Teddy Scott) is a Ph.D. scientist with a law degree, and from the outset, they've been all about medical. What's been really fascinating is that, as we've gone down this road with them, we realized we actually have the same objective. We're just coming at it from completely different angles. Our combined objective is how do we make help people feel better. They've come at it from a very medical approach. We've come at it from a very mainstream, adult-use approach. But it's the same objective.
What's great on the product side is they've been doing the R&D and producing best-in-class products on the wellness side, which are an absolute compliment to products like we make under the statemade umbrella. That allows us to get further faster in regards to what would have already been our next initiative when it comes to products that feel more wellness versus recreational, yet have the same objectives.
So can we expect to see a more medical-use line of products coming from MedMen soon?
What I would say to that is that we're trying to shift the narrative from medical to wellness. Wellness encompasses what formerly was known as adult-use. Somebody walks into our stores and they want to buy a vape pen because, at the end of the day, they want to take the edge off. They want to take two hits of their pen, and they want to be able to be present at home. That's wellness just like it is for somebody who has some type of disease or ailment, and cannabis is a much better substitute than pharmaceutical options. They're both wellness. So what we're trying to do with this acquisition is reshape the narrative around medical versus recreational, and bring it all together under this umbrella.
You're a mainstream lifestyle brand, while PharmaCann is more about medical use. Do you foresee a little bit of a culture clash?
First of all, I have so much respect for the CEO of the company. He's built the company over the matter of three or four years that we just bought for $680 million. How can you not have respect for somebody who has done that, especially as an entrepreneur? But I think it gets back to this wellness concept. It's not a culture clash. It would be perceived as such if we were really splitting up medical and recreational -- harsh words that are very binary in nature. But in talking to Teddy and getting to know their team that was never their intention, and in talking to us and getting to know our team, I think they realized that was never our intention, either. We both are pushing for the same thing, which is mainstreaming marijuana and having it be available to everybody over the legal age.
I think Teddy and I were both blown away at how similarly we were looking at this, although if we had never spoken we might have thought otherwise. So let this the acquisition be the turning of the page for the institutionality, permanence and stability of the industry. Let the combination of PharmaCann and MedMen be the beginning of the next chapter in regards to the way in which this industry is spoken about -- starting to rip away at these binary silos of medical and recreational and bringing it together to wellness.