Medical Cannabis Industry Taking Root in Maryland

medical cannibis
Maryland is establishing what may be a multi-billion dollar industry in medical cannibis.

Medical cannabis is beginning to take root as a statewide industry, now that the commission overseeing the program has awarded preliminary licenses to companies that will grow, process and dispense the plant.

People are looking forward to exploring medical cannabis for relief from such ailments as chronic pain, seizures and multiple sclerosis. Others wonder whether the medical marijuana program will be a gateway to recreational use.

Businesses fortunate enough to have received the pre-approved licenses are anxious to take their first foray into a lucrative industry that is already legal in 28 states and the District of Columbia.

The Natalie M. LaPrade Maryland Medical Cannabis Commission, which develops the policies, procedures and regulations, and oversees all licensing, registration, inspection and testing, was established under legislation that passed in 2014. Interest was much higher than expected and the commission had to extend its deadline for review and decisions. Finally, the commission began awarded licenses last fall.

Fifteen businesses have been pre-approved as growers, which will cultivate and manufacture the cannabis in various counties. Each of the 47 senatorial districts will get up to two dispensaries, which will sell and distribute the products to the patient. A total of 102 firms were awarded dispensary licenses, including 10 growers who also applied to dispense the drug. Fifteen processors were selected. A processor is one that transforms medical cannabis into another product or extract, such as an oil, ointment or suppository.

The firms must go through background and financial investigative processes before final licenses are issued; the companies have 365 days to implement their operations.

Who received the preliminary licenses?

The commission received nearly 1,081 applications to grow, process and dispense cannabis in Maryland before the deadline, and like the other jurisdictions, Baltimore County saw a lot of interest. Most of the 882 applications came in for all 47 senatorial districts, including dozens for the county. The majority—811—was for dispensary licenses; 124 applied to be growers and 146 to be processors.

It is difficult to readily determine from the list who some the owners and members of the companies are. However, the commission has announced that it awarded preliminary dispensary licenses to the following companies:

District 10: MMRC and Pallia Tech Maryland LLC

District 11: Cannavations MD LLC and Chesacanna Inc.

District 12: AmediaCanna Dispensary LLC and Gina Dubbe

District 44: Charm City Relief Partners LLC and Mission Maryland LLC

Temescal Wellness of Maryland LLC was pre-approved as a grower and processor for Baltimore City and will set up shop in Baltimore County as a dispensary.

Curio Manufacturing LLC will locate its processing facility in Baltimore County District 46. Doctors Orders Maryland LLC, the firm for which Del. Dan Morhaim has been criticized for possible ethics violations, has a preliminary grower and processor license for Dorchester County and a dispensary license for District 46.

Applicants for a dispensary or processor license could submit multiple license applications in multiple senatorial districts but the commission awarded one license in each license category per applicant. Applicants for a grower license could only submit one license application.

Charm City LLC, a business involving Milford Mill native and business owner Kalpesh Shah, applied for six districts and was awarded a processor license for Anne Arundel County. The seven-member woman-led team is comprised of five Asian Americans, including Shah.

The promise of helping people, such as family members debilitated from the pain of cancer, and children who have seizures or who may suffer from Tourette syndrome, made it an attractive business opportunity, Shah says. A native son, he attended Milford Mill High School and University of Maryland Baltimore County, and owns a liquor store and a Subway restaurant in Windsor Mill.

Shah says, “We want to guarantee local residents that this particular business and product will be highly secure, of the highest quality, and not easily accessible. We must account for every gram and it’s tracked.”

Minority Participation Questioned

The pre-approval process has not been without controversy. The law states that there would be racial and geographic diversity in the awards, but the commission did not consider race. It did award licenses to two applicants to achieve geographic balance.

Del. Cheryl Glenn, chair of the Legislative Black Caucus, says that the licensees lack the proper diversity—a charge commission chairman Paul Davies denies. The commission is named after Glenn’s late mother, who she believes could have been comforted by cannabis while she was suffering from kidney cancer.

Glenn is spearheading emergency legislation that would change the commission’s membership and change the criteria to award additional licenses to prospective growers, processors and dispensaries to help include more minority-owned businesses.

Shah says he supports the Legislative Black Caucus efforts. The growers control the industry and there are only 15. Even though the process was to be double-blinded, he believes the selected growers are very influential people. Because pricing is not regulated by the state of Maryland, the grower can set any price it wants. Because the growers can also be dispensaries, they have the competitive advantage.

“I am hopeful that we are given a second chance that was not given to us initially. We hope that minority inclusion is for the growers because that was the law,” Shah says.

The lengthy applications asked grower applicants for essay-type responses to up to 185 questions on information such as how cleaning and equipment maintenance logs will be maintained and how each plant will have unique identifiable, tamper evident tags; dispensary apps would include questions about how they will verify prescriptions and that the cannabis is properly labeled.

The MMCC commissioned Towson University’s Regional Economic Studies Institute (RESI) to coordinate the review of applications, which included third-party evaluators.

A third-party subject matter expert reviewed the applications and assigned scores in areas such as operations, safety and security, and business and economics. RESI ranked the applications based on the scores, so MMHC can review them and make a final decision.

County Zoning

With residents concerned about the impact on communities, crime and traffic, Baltimore County considered how to address where the dispensaries and growing would be located. Councilwoman Vicki Almond of District 2 originally proposed strict requirements in 2015 that prohibited a cannabis related business to set up within a certain distance of houses of worship, parks and recreational centers, public libraries, day care centers and schools. After strong push back from certain state legislators supporting medical marijuana, Almond later amended County Bill 61-15 to prohibit the shops from opening within 500 feet of schools. The bill also requires that a cannabis business must be located at least 2,500 feet from one another and must get a special exception to locate in one of the county’s 17 commercial revitalization districts.

—J. Anderson

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