Cannabis Project Newsletter - March 13th, 2020
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What Happened in March?
Summary by Cole White
Legal Extern, Wyoming College of Law
In early March, as some organizations began emphasizing the importance of FDA oversight, the FDA Commissioner released a statement on the agency's current stance on CBD products and their efforts to regulate an industry growing at an incredible pace. Concerns have been raised that consumers are unaware of the current status of CBD and are using unapproved CBD products to treat severe medical conditions.
On the state and local levels, law enforcement and regulators are grappling with how to address issues of drugged driving and the illicit market. State officials are also beginning to emphasize social equity in the marketplace more heavily.
D.C. Attorney General Karl Racine hosted a Cannabis Law and Policy Webinar this month where he called on public and private sector leaders to address social equity in the cannabis marketplace.
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Nevada Contemplates Drugged Driving Laws
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Legislators are contemplating a change to the state's per-se limit on driving while under the influence of marijuana. Current Nevada law states that a person can be convicted for driving under the influence of marijuana if their blood contains 2 or more nanograms of Delta 9 THC per milliliter, and 5 nanograms per milliliter of Metabolite 11 Hydroxy THC. Many are concerned that a per-se limit results in arrests of marijuana users who were not impaired at the time they were driving. Still others are concerned that the removal of a per-se limit leaves detection of marijuana impairment to an officer’s determination, which can be unreliable due to underfunding of drug impairment training for law enforcement officers. To date, 6 states have instituted per-se limits on driving under the influence of marijuana. Click
here
for more info.
Utah Opens First Medical Marijuana Dispensary
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Utah’s first medical marijuana dispensary, Dragonfly Wellness, opened its doors to customers on March 2nd. Since 2018, medical patients have been able to consume marijuana with a doctor’s note, but those patients have not been able to purchase marijuana inside the state. Medical marijuana in Utah has long been opposed by the Church of Jesus Christ of Latter-day Saints, which maintains a large share of political power in the state, but strong public support eventually prompted a change in position. The state’s second dispensary is scheduled to open in March, with the final 12 dispensaries to be in operation by the end of July. Click
here
for more info.
Ohio's Amendment to Legalize Recreational Cannabis
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Supporters of an amendment to the state's constitution which would allow for the recreational sale and purchase of marijuana to adults 21 and over in the state have submitted their petition to the Attorney General’s office. Support for the amendment stems largely from the perceived failures of the state’s medical marijuana program to address the needs of their patients. Existing medical marijuana businesses in the state would be the first to switch over to recreational sales, with the number of additional retail establishments being capped at 200 until 2026. If the initiative is approved by the Attorney General, supporters would then need to gather almost 450,000 signatures before July 1 in order for the initiative to be placed on the November ballot. Click
here
for more info.
West Virginia's Senate Passes Bill on Medical Cannabis
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The Senate has passed a bill which would significantly alter the state’s medical cannabis program, which has not yet launched. Most significantly, the bill allows for “dry leaf or plant form” cannabis use, where the prior legislation only allowed the use of medical cannabis in the form of pills, gels, lotions and other distilled forms. The bill also authorizes the Commissioner of the Bureau for Public Health to make additions to the forms of cannabis that may be used, as well as the conditions that would authorize medical cannabis use. The bill is now headed to the House for consideration. Click
here
for more info.
Kentucky's House Passes Medical Bill
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On February 20th, the House passed a bill, HB 136, which would legalize medical cannabis in Kentucky. Supporters of the bill are now worried about Senate leadership, in particular Senate President Robert Stivers, who is heavily opposed to the legislation. Opponents have introduced legislation which would require more research on marijuana before the medical bill could be passed, in an effort to slow down the process. If the bill is passed, it is expected to be signed into law by Gov. Andy Beshear. Click
here
for more info.
New Hampshire Senate Passes Medical Home Grow Bill
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The Senate approved SB 420 which would allow medical cannabis patients and caregivers to grow up to three mature plants, three immature plants and 12 seedlings each. Current law stipulates that while medical cannabis use is legal, personal cultivation is a felony offense. The bill is expected to face opposition by Governor Sununu, who vetoed similar legislation last year. Click
here
for more info.
Illinois Sheriff Says No Arrests for Cannabis So Far
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With a month of legal recreational sales behind them as of the second week of February, Sangamon County Sheriff Jack Campbell says his department has not issued any citations or arrested anyone over marijuana since legalization on Jan 1. The Department was expecting confusion over use in public, and Sherriff Campbell expects citations and arrests to rise as the weather improves, but so far all signs point to a well-educated public on the state of the law. Click
here
for more info.
Cherokee Nation Considering Medical / Recreational Cannabis
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The Cherokee Nation has tasked its Executive Work Group on Hemp, Cannabis and Related Opportunities with investigating the legal obstacles to medical and recreational marijuana. Marijuana is still illegal under tribal law, and that law was unaffected by Oklahoma’s medical legalization movement in 2018. Cherokee Chief Chuck Hoskin Jr. hopes that marijuana will offer new opportunities to improve tribal economies, but has also expressed his desire to move forward in a safe and responsible way. Click
here
for more info.
Overall, 2020 may result in major changes in state cannabis programs. Several states are continuing the nation-wide trend towards legalization. The Alliance Cannabis Project will continue to monitor and report on state developments on a bi-monthly basis throughout the year.
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Summaries by Cole White
FDA Commissioner's Statement on CBD
In early March, the Commissioner of the FDA released a statement updating the public on the FDA’s position and actions with regard to the exploding CBD market. The statement highlighted the agency's three primary areas of focus at this time: (1) educating the public about the potential risks of CBD, (2) providing more information on safety and potential benefits, and (3) continuing to monitor the marketplace.
The Commissioner highlighted the fact that most Americans using CBD believe that the products are FDA approved when in fact they are not. The FDA is concerned that the public is using CBD to treat serious and potentially life-threatening conditions in place of approved medical treatments. Public education campaigns will continue to emphasize the unregulated nature of the products, while also continuing to update the public as new research comes out.
With regard to research, the FDA pointed out the need for more detailed data on the effects of CBD, specifically on the most vulnerable populations like pregnant women and young children. The FDA is conducting its own research in these areas, but is encouraging private sector studies and data to be submitted in an open comment period, which has been extended indefinitely, in order to acquire as much information as possible.
Finally, the FDA will continue to monitor the market and reprimand companies who make unsubstantiated medical claims about CBD products. The FDA specifically addressed the point of consumer confusion and inconsistent amounts of CBD, referenced in the summary below. Moving forward, the FDA hopes to develop a risk-based enforcement policy which would provide greater transparency into the process of how the FDA will pursue enforcement actions. Click
here
to read the full statement from the FDA Commissioner. Regulatory resources, including how to submit data to the agency, can be found
here
.
Consumer Confusion Over CBD Found in Recent Study
A new report from the Digital Citizens Alliance (DCA) released in March highlighted the need for regulatory oversight of the CBD industry. While studies have found that 3 in 10 Americans have tried some form of CBD, those studies show that 80% of those who have tried CBD believe that it is regulated by the FDA. In fact, besides one CBD derived anti-seizure medication, the FDA has not approved any CBD products. The DCA’s report highlights the fact that there are significant discrepancies between the amount of CBD advertised on products, and the amount the product actually contained.
In more than half of the products tested for the study, the amount of CBD found in the product was 20% higher or lower than advertised. In some products, the amount of CBD was less than half what was advertised. This is a problem since more and more individuals are using CBD to treat a wide variety of ailments, from chronic pain to cancer symptoms. The study concludes that FDA oversight is needed immediately to address consumer confusion in the marketplace, and for that more research is required on the medical benefits of CBD.
Click
here
for more info, and click on the button below to read the DCA report.
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Summaries by Cole White
CDC Study Finds Increase in Cannabis Vaping Among Students.
Last September, the CDC released the results of the National Youth Tobacco Survey from 2017-2018. The study concluded in part that the percentage of youth – middle and high-school students – who reported having consumed some form of marijuana in an e-cigarette increased to 14% in 2018, up from 10% in 2017. Click
here
to download the data collected from the survey.
How Addictive is Marijuana?
In a recent Chicago Tribune article, some cannabis users opened up about their addiction to cannabis and their process for treatment. About 1 in 10 people who use cannabis regularly will develop “cannabis use disorder,” meaning they compulsively use cannabis, and that number rises to about 1 in 6 when the user is under 18. Many people don’t know that cannabis use disorder can have similar characteristics as other drug use disorders, including increased tolerance leading to increased use and experiencing withdrawal symptoms. The problem with cannabis, however, is the common perception that you can’t become addicted to it, which creates a stigma for those seeking treatment. Marijuana Anonymous, the cannabis equivalent to Alcoholics Anonymous, is holding more and more meetings in cannabis-legal states and hopes that legalization will help to increase awareness of the addictiveness of marijuana and encourage more people to seek treatment. Click
here
for more info.
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Cannabis Businesses are Slowly Gaining Some Financial Protections
Summaries by Cole White
Bankruptcy & Cannabis
Michigan has introduced two bills, HB 5490 and 5491, which would require the state regulatory agency to issue guidance to state judges on how to handle marijuana businesses that go bankrupt. The bills would require the appointment of a receiver to operate a bankrupt marijuana business, since federal law stipulates that these businesses would not have access to the federal bankruptcy option. Courts across the national are struggling to come to grips with the same issue. Click
here
for more info.
Banking Options for Cannabis Employees
The founders of Hardcar, a cannabis logistics company, have founded a new financial technology services company called Payzel, which specializes in securing home and auto loans for employees of cannabis companies. Traditionally, banks are weary of loaning money to employees of cannabis businesses because of federal uncertainty, meaning these employees have a difficult time accessing capital. Payzel offers a one-stop shop for cannabis businesses, offering financial services to the business as well as helping manage the banking services needs of the business’ employees. Payzel is one of the first financial firms in the industry to specifically focus on employee financial services. Payzel founder Todd Kelparis explained that “We are the Trip Advisor and Lending Tree of Cannabis.” Click
here
for more info.
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Canada's "Value Marijuana" Attempts to Combat the Illicit Market
Summary by Cole White
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Canada’s three largest cannabis companies will begin selling “value” marijuana brands in an effort to compete with the illicit market. A year after legalization, marijuana sales in Canada hit $908 million, but 70% of consumers are still purchasing through the illicit market. Currently, the average price for a gram of marijuana flower costs about $8 in the regulated market, but only about $4 in the unregulated market. These value brands will focus on providing quality product around the $4 per gram mark, in an effort to drive more consumers to the legal market. Click
here
for more info.
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Cannabis Project Meeting April 21
– At the Attorney General Alliance and CWAG Spring Dinner on April 21st, the Cannabis Project will host a forum for Attorneys General Staff and interested parties to dialogue on legal and policy issues inherent in this space. Topics will include consumer protection, public health and safety, the illicit market and law enforcement, financial transparency, hemp & CBD. For questions or inquiries on how to partner with the Cannabis Project or attend, please contact Austin P. Bernstein, Director and Assistant Attorney General.
The health and well-being of our members, event attendees and staff is a top priority for the AG Alliance. With the information currently available, the Cannabis and Cybersecurity working groups and our Spring Dinner
WILL
continue as scheduled. We are closely monitoring the situation and following the advice of the CDC and WHO. According to CDC, the immediate health risk for the general American public is considered
low
. Please visit their
current travel advice
webpage for more information.
We are staying in close communication with officials and our event location. We will provide additional updates as necessary.
Announcing the Cannabis Litigation Blog
– We are excited to announce the creation of the AG Alliance Cannabis Litigation Blog! In partnership with our Cannabis Project Advisory Council, the Cannabis Litigation Blog will identify and analyze decisions affecting the development of cannabis law in jurisdictions across all 50 states. The goal is to educate Attorneys General on litigation trends developing across the country.
Click
here
to visit the website and read our first post; a case summary of Yates v. Hartman, 2018 COA 31, which addressed a court's power to appoint a receiver over licensed marijuana businesses.
Interested in becoming a contributing author? Contact Austin Bernstein at abernstein@agalliance.org.
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| THE AG ALLIANCE CANNABIS PROJECT |
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