A year after the legalization of recreational cannabis in Canada, Law 360 turned to Patricia Olasker for her expert insights on how the interplay between the Canadian and U.S. markets is playing a major role in the evolution of the cannabis sector.

In the article (available to subscribers), Patricia describes how the past two years have seen U.S. cannabis companies flocking north to list on Canadian stock exchanges and Canadian companies rushing to establish footholds in the much-larger U.S. market.

Patricia explains that companies on both sides of the border have been scrambling to diversify and build scale before capital dries up and only the largest cannabis companies are able to compete.

“Especially in Canada, but also in the U.S., we do expect cannabis producers to be winnowed down to a handful that have either scale or a significant specialization,” she says. The big question in the minds of all the Canadian cannabis companies, Patricia notes, is what will happen if the United States legalizes cannabis federally within the next few years. “Will we end up being merely cannabis cultivators who ship product across the border to be formulated into high-margin products by U.S. companies, and reprise our traditional role as ‘simple hewers of wood and drawers of water?’”

“Or,” she adds, “Will we be able to compete on an equal footing?”