A group of medicinal cannabis operators and advocates in Ohio have joined forces in “strong opposition” to a bill that would dramatically alter the state’s medical marijuana program. The measure, Senate Bill 9 (SB 9), was introduced by state Senators Steve Huffman and Kirk Schuring on January 11.
The bill aims to update Ohio’s medical marijuana law, which was passed by the state legislature and signed into law in 2016. But this week, the Ohio Medical Cannabis Industry Association (OMCIA) came out against SB 9, saying that the increase in medical marijuana dispensaries and cannabis cultivation space included in the measure would lead to an oversaturation of supply that could cripple the industry.
“SB 9 punishes companies like mine that have invested hundreds of millions of development dollars into our state,” Daniel Kessler, co-owner and CEO of medical marijuana cultivator and processor Rivera Creek said in a statement from the OMCIA. “Instead of reducing bureaucracy, this bill does the opposite by adding an additional level of oversight in the form of a commission of lifetime political appointees.”
The group says that the bill would add an additional two million square feet of medical cannabis cultivation space and add more than 60 new medical marijuana dispensary licenses to the 130 permits already issued. The legislation also adds cultivation licenses for some independent cannabis processors, as well as processing licenses for level 2 cultivators.
“What we’ve found is that many of the growers want to expand and grow more,” Huffman said when the legislation was introduced earlier this year. “There’s more growers, there’s more demand. They put an application into the Department of Commerce, and it sits there for 18 months, two years. Hopefully this takes the bureaucracy out of this and streamlines things and make it a better-functioning industry.”
Ohio Group Says Increased Capacity Unnecessary
But the OMCIA says that the increased production capacity would come at a time when “many current cultivators have scaled back their production by 30% – 50% and are not operating at full capacity.” The group also noted that Ohio’s current medical marijuana program regulations already have provisions allowing current operators to expand their operations as the market grows.
“We are opposed to the massive expansion outlined in SB 9 because it lacks the data justifying that such an expansion is needed,” said Bryan Murray, executive vice president of government relations at multistate cannabis operator Acreage Holdings. “The negative impact of oversupply in markets across the nation cannot be overstated – and opening the floodgates in contradiction to market realities would be detrimental to the industry in Ohio.”
Kessler added that “the expansion measures in the bill would add immense supply to an already over-supplied market. Despite my company’s high-quality product reputation, we currently have hundreds of pounds of product in our inventory that we cannot sell. Even at wholesale pricing, the demand is not there. If the bill passes in its current state, it is likely that the industry will crumble, and the only winner will be the illegal illicit market.”
The bill creates a new state agency within the Ohio Department of Commerce, the Division of Marijuana Control, to regulate the state’s medical marijuana program. The legislation also creates a 13-member commission responsible for oversight of the new agency and the medical program. Under current law, the state’s medical marijuana program is overseen by the Ohio Department of Commerce, the State Medical Board of Ohio and the Ohio Board of Pharmacy.
Senate Bill 9 would also add autism spectrum disorder, arthritis, migraines, chronic muscle spasms and opioid use disorder to the state’s list of medical conditions that qualify a patient to use cannabis medicinally. Currently, the list of qualifying conditions includes more than two dozen serious medical conditions including cancer, chronic pain, AIDS, Parkinson’s disease, PTSD and terminal illnesses. The measure also allows medical marijuana use by patients who have other debilitating medical conditions that can be treated with medicinal cannabis, as determined by their physician.
The OMCIA notes that the number of participants in Ohio’s medical marijuana program “has remained stagnant at an average of 163,000 active patients” and argues that adding more production and retail capacity is not needed. Instead, the group called for several changes to make medical marijuana accessible to more patients.
“Ohio’s stagnant patient base does not warrant SB 9’s additional licensure and expansion of cultivation space,” said Matt Close, executive director of OMCIA. “The last thing we need is more supply. Instead, legislation should focus on addressing our industry’s most significant challenge: excessive barriers to patient participation.”
The OMCIA recommends adding anxiety, insomnia and depression as qualifying conditions for the program and for annual medical marijuana identification card fees to be reduced or eliminated. The trade group is also calling for medical marijuana recommendations to be valid for three years instead of the current one year and for patients with incurable conditions to be granted lifelong approval.
Further recommendations from the group include eliminating state, county and local taxes on medical marijuana purchases, employment protections for medical marijuana cardholders and a prohibition on intoxicating hemp cannabinoids such as delta-8 THC from being sold outside the state’s regulated medical marijuana program.
SB 9 is currently under consideration by the Senate General Government Committee, with a hearing on the legislation scheduled for this week.
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