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How Cuomo's Pot Law Peer Pressures Corporate America Into the Weed Business

TheStreet reached out to the U.S. Attorney's Office for the Northern District of New York and the U.S. Attorney's Office for the Southern District of New York to ask if the Cuomo administration had preemptively discussed the prospects of an executive action that would permit hospitals in the state to distribute medical marijuana for strict cases. Both offices declined to comment for this story.

TheStreet contacted Gov. Cuomo's office, which did not respond to repeated requests for comment as to whether the governor or members of his administration approached the U.S. Attorney's offices throughout New York about the executive action.

But the U.S. Attorney's office may have no incentive to weigh in publicly on this issue.

"If the office says that they wont pursue prosecutions, then they look soft on crime. If they say they will pursue prosecutions, then they're starting a fight with the governor," Greg Magarian, a Constitutional law professor at Washington University in St. Louis, wrote in an email. "Either way, what they end up doing will probably depend on policy determinations higher up in the Justice Department."

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This could dissuade the government from intervening with hospitals that act as dispensaries. But heavily regulated hospitals could be the most trustworthy medical marijuana dispensaries.

Cuomo said in his State of the States speech on Jan. 9 that the program would help to manage pain and treatment of cancer and other serious illnesses. This suggests that the executive action explicitly outline the cases in which the hospitals could prescribe medicinal use. Hospitals are familiar with tight oversight to prescribing prescription drugs.

Who would supply the hospitals and how the suppliers would acquire cannabis remains unknown.

This leaves the state and Cuomo to question what are the economic and political benefits.

The reality is that the progress made on pot legalization is only a recent phenomenon, and it has left researchers with little empirical research to publish definitive conclusions.

"When we started researching this stuff a couple years ago, we were pretty surprised that next to nothing had been done on economic outcomes, or socio-economic outcomes," Mark Anderson, a health economist at Montana State University, said in a phone interview from Bozeman, Montana.

Anderson pointed to the fact that state legislatures didn't begin to pass these laws until the late 1990s as reason for why there is little research.

Cuomo, who many political analysts believe will run for the Democratic nomination in 2016, may have announced this executive action to gain some points as a progressive, but the entrance of hospitals as dispensaries may become the bigger news story. Imagine, multi-million or multi-billion dollar market cap companies distributing an illegal drug for medicinal use.

Maybe it's the move that triggers a nation-wide pot revolution.

-- Written by Joe Deaux in New York.

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