An alcohol conglomerate pouring $4 billion into a marijuana startup shouldn’t surprise, but it might be cause for concern.
This week, Constellation Brands invested in Canopy. The former’s products include Corona beer, Woodbridge wine, and Svedka vodka, while the latter is among the largest legal marijuana businesses emerging in Canada, the first major economy to legalize cannabis on a national scale.
Canopy’s CEO called the investment “rocket fuel.” Another Canadian company, Tilray, went public on the NASDAQ exchange in New York last month and is now valued at $2.8 billion.
In the US, the size of cannabis companies is limited by federal prohibition and the varying legal regimes in different states and localities. But as more states approve recreational cannabis use—including California, a larger economy than Canada—Big Marijuana will soon be as real as, or even become, Big Alcohol.
Constellation is among a handful of corporations that dominate global alcohol sales, led by Anheuser-Busch InBev and Heineken Holdings.
The political clout of the booze lobby—on alcohol taxes and drunk driving laws, but also in its quasi-cartels—makes public consumption of alcohol worse for society than it could be. Experts, meanwhile, say the public should extend marijuana the same “grudging toleration” it now does tobacco, which no longer has a free hand in marketing its products.
For now, neither do most legal marijuana businesses, which operate under tight scrutiny. As cannabis’ legal status shifts from illicit narcotic to recreational commodity—often under the slogan “regulated like alcohol”—public health experts fear regulators won’t avoid the mistakes made while creating legal markets for alcohol and tobacco.
But governments need to act quickly, as this cottage industry enters the age of the mega-corporation. As one drug policy researcher observed at a marijuana policy conference in 2016, “there’s a good chance that people in 25 to 40 years will look back and shake their heads and ask, what were you thinking? Why did you think it was a good idea to create an industry of titans to market this drug?”