Kentucky's leading cannabis businesses are currently at a crossroads as they consider opportunities to enter the medical cannabis space next year.
Despite being less than a year into the Kentucky Medical Cannabis Program, the state has yet to announce regulations regarding the licensing process, the number of licenses to be administered, and how companies in each sector of the industry can apply for licenses. not. or what is required to qualify for a license.
“There are a lot of questions that need to be answered first before Cornbread Hemp can give a yes or no answer,” said Cornbread Hemp co-founder Jim Higdon. “We're working very hard to figure out what's possible and what's not possible here…We want to grow the business naturally and in accordance with the law.”
As the state's agricultural industry is on the brink of expansion, a lack of regulation around business licensing poses challenges for Higdon and others.
The 2018 federal Farm Bill legalized hemp, a cannabis plant with less than 0.3% THC content. Total sales of hemp-related products in Kentucky exceeded $43 million in 2022, former Kentucky Department of Agriculture Secretary Dr. Ryan Quarles previously told the Courier-Journal.
These companies now stand to benefit from medical marijuana legalization in Kentucky, but they must first understand the legal ways to do business.
Under Senate Bill 47, which creates a medical cannabis industry in Kentucky that will be signed into law in March 2023 and operational on January 1, 2025, the state will soon have growers, processors, producers, Various companies will be based there, including safety compliance facilities. and Pharmacy — looking to tap into emerging markets.
But before farmers can trade their tobacco crops for medical cannabis land, the state must issue licenses to all operators planning to enter the industry.
In January, Gov. Andy Beshear and the Health and Family Services Cabinet announced 10 preliminary regulations governing the medical marijuana industry and providing a framework for how companies operate.
more:How will Kentucky's medical marijuana program be regulated? Here's the situation
CHFS spokesperson Bryce Mitchell previously told the Courier-Journal that “in the coming weeks and months,” the Cabinet will create additional regulations on “how businesses can apply for medical marijuana licenses.” he said.
As companies prepare to enter the medical cannabis industry, here's where some of them stand.
Ready to enter, but need more guidance
Higdon said some of the early concerns were about tax penalties and the difficulty of banking for doing cannabis business in the U.S., since marijuana remains a Schedule 1 drug and illegal at the federal level. He said there is.
Another concern is that current regulations do not allow medical marijuana to be grown outdoors. The state allows cannabis to be grown outdoors.
“The idea is to prevent unauthorized access to cannabis grow rooms by potential thieves and others, but it also results in higher cultivation costs, more marginal cultivation, and more benefits for Kentucky farmers.” 'You won't be able to take advantage of the natural advantages that Kentucky has for growing cannabis,' Higdon said.
Despite the current uncertainty, Higdon sees entering the medical cannabis space as a “natural progression of our business” and is looking forward to dialogue with states as CHFS hammers out full regulatory action. He said he was looking forward to continuing.
Wait until all regulations are in place
Dee Dee Taylor, a fellow Kentucky cannabis advocate and small business owner, also has concerns about the program at this point.
Taylor said her concerns primarily revolve around the fees companies may face when entering the industry. So far, the state has not said whether there will be a license fee (though it is expected there will be one), what the fee will be, or what the renewal fee will be.
In addition to fees, Taylor said he would like to see the state intentionally license companies already operating in Kentucky and not allow large companies to develop monopolies.
“My idea is that if we're going to license those companies, make sure that they're ethical and that they're actually part of the Commonwealth, that they're present in the Commonwealth, that they're already doing business in the Commonwealth. “We should,” Taylor said.
At this time, Mr. Taylor has not begun acquiring the assets, equipment, and other business items necessary to enter the medical marijuana field, opting to await a final ruling from the state.
“I see people already taking action … and I hope it works for them,” she said. “But at the same time, I don't know if you're going to waste or spend that kind of money without actually having a license in your hands.”
Ready
While some companies are hesitant, Jeff Stamm, co-founder and chief product officer of Ha's Cannabis Innovations, a local company that makes cannabis beverages, says his company is moving into the medical field. He said he is ready to move on.
“The short answer is yes,” Stamm said. “As you know, we have positioned our two Kentucky-based pharmacies specifically for when pharmaceuticals come along, and more specifically for recreational use one day. I did. I doubt it.”
Stumm said all they need at this point is to truly understand how the licensing process works, but his team is determined to work with the state to get the license.
“I think we're all confident that we're going to be considered as strongly as everyone else for licensing, but you just never know,” Stamm said.
And for now, all businesses wanting to participate in Kentucky's evolving cannabis scene will continue to wait.
Contact business reporter Olivia Evans at oevans@courier-journal.com or on the X Platform, formerly known as Twitter, at @oliviamevans_..
