Strategic Partnership Between Metrc and BioTrack Sparks Industrywide Speculation

A major shake-up in the cannabis compliance software market has industry insiders questioning whether the nation’s largest marijuana track-and-trace provider just secured near-total control over the government compliance sector.

Earlier this week, Lakeland, Florida-based Metrc announced a “strategic partnership” with its closest competitor, Fort Lauderdale-based BioTrack. The deal creates a new company, BT Government, that will take over BioTrack’s government-facing contracts while BioTrack retains its commercial point-of-sale and business management tools.

For state regulators and licensed operators, the announcement was short on details and long on unanswered questions, a situation that has already caused delays in New York’s planned roll-out of its long-awaited track-and-trace system.

How Metrc and BioTrack Became the Twin Pillars of Cannabis Compliance

For the past year, Metrc and BioTrack have dominated the seed-to-sale tracking market in the $32 billion U.S. marijuana industry. These systems tag plants and products with unique identifiers, allowing regulators to track the supply chain and reduce the risk of diversion between legal and illicit markets.

Metrc leads with contracts in 29 states, relying on its RFID tag-based system. BioTrack, though trailing with eight state contracts, had previously attempted to strengthen its position by acquiring rival MJFreeway in 2023.

Under the new arrangement, BT Government will manage BioTrack’s government compliance contracts. Led by BioTrack COO Moe Afaneh, BT Government will operate independently from both Metrc LLC and BioTrack’s commercial business.

Unclear Boundaries Between Partnership and Consolidation

Though both companies are calling the move a “strategic partnership,” industry analysts are already speculating about whether it effectively amounts to consolidation in the cannabis compliance market.

Emily Paxhia, managing director of Poseidon Investment Management, noted that the current “patchwork” of state-by-state compliance systems has been a challenge for multistate operators. She suggested that the partnership could eventually streamline operations for these companies.

Still, with neither company disclosing financial terms or operational specifics, observers remain uncertain whether the deal is more about cooperation or market dominance.

Metrc’s Corporate Structure and Cannabis Industry Ties

Metrc LLC, the operating company, is separate from its parent Metrc Inc. Florida corporate records list several notable names tied to Metrc Inc., including Karan Wadhera, a managing partner at Casa Verde Capital — the cannabis-focused venture fund co-founded by Snoop Dogg. Casa Verde was part of a $50 million funding round for Metrc in 2018.

Company co-founder Jeff Wells and Stephen Jaeb serve as directors, while Michael Johnson leads as CEO of both Metrc LLC and Metrc Inc.

Potential End of State-by-State Compliance Patchwork

A unified compliance structure could simplify life for marijuana multistate operators, who must currently adapt to whichever track-and-trace system their state requires.

In theory, merging the strengths of Metrc and BioTrack under a single operational umbrella could reduce inconsistencies and technical frustrations.

However, the companies insist that BT Government will operate separately, leaving it unclear how much integration will occur in practice — and whether states will allow Metrc software to replace BioTrack in existing contracts.

BioTrack’s Existing State Contracts and Market Position

As of this week, BioTrack holds track-and-trace contracts in nine states:

• Arkansas
  
• Connecticut
  
• Delaware
  
• Hawaii
  
• Florida
  
• New York
  
• New Mexico
  
• North Dakota
  
• Virginia
  

However, BioTrack’s grip has been slipping. Illinois dropped BioTrack for Metrc in early 2023, and Massachusetts renewed its Metrc contract the same month.

In New York, regulators awarded BioTrack a five-year, $1.2 million track-and-trace contract in late 2022. That contract’s relatively low cost stands in contrast to Metrc’s California deal, which is worth $113 million over four years.

Disputes Over BioTrack’s Pricing Model Created Tension

BioTrack’s relationship with New York operators has been rocky. The company informed licensees they would need to purchase 10-cent tags for each product — including individual pre-rolls — despite the requirement not appearing in state law.

Critics said the “sublot” tagging rule would dramatically increase costs, particularly for small operators. The dispute contributed to broader frustration that New York was not ready for full-scale compliance implementation.

New York Pauses Track-and-Trace Rollout Following Announcement

Hours after the Metrc-BioTrack partnership was announced, New York’s Office of Cannabis Management (OCM) suspended its compliance requirements, citing the need to “determine systems implications and communicate next steps to all licensees.”

The pause affects cultivators and processors who were supposed to begin reporting to BioTrack’s system this week. New York remains without a fully functional track-and-trace program more than halfway through its third year of adult-use sales.

Confusion Extends Beyond New York to Other BioTrack States

Uncertainty is also spreading to other BioTrack contract states, including Connecticut. Erin Gorman Kirk, the state’s cannabis ombudsman, confirmed that operators there have not yet received clarity on whether the partnership will change their compliance software or timelines.

Industry speculation centers on whether Metrc’s system could be phased in for BioTrack states under BT Government’s management.

Industry Leaders See Potential Benefits but Demand Answers

Some operators see the deal as an opportunity. Mack Hueber, president of the Empire Cannabis Manufacturers Alliance, said replacing BioTrack with Metrc in New York would be “a positive development” that could resolve some of the industry’s most pressing compliance issues.

But Hueber also acknowledged significant unanswered questions — including whether tag pricing will change and if Metrc’s newer, more automated tools will be made available to reduce manual labor.

The Stakes of Clarity and Communication

The cannabis industry’s compliance infrastructure underpins state tax revenues, public health safeguards, and the fight against diversion into illicit markets. Any disruption or confusion in these systems can ripple quickly through the supply chain.

For now, the Metrc-BioTrack partnership leaves as many questions as it answers. Whether it leads to a more unified, efficient compliance landscape or simply reshuffles the same problems into a new structure will depend on how state regulators respond — and how transparent the companies are about their operational plans.

With $1.5 billion in annual legal cannabis sales in New York alone waiting on a reliable system, the stakes are too high for prolonged uncertainty.