FRANKFORT, Ky. (AP) — A new law makes it possible for Kentucky to begin licensing businesses to participate in the state's medical marijuana program a few months sooner than previously allowed.
Gov. Andy Beshear signed House Bill 829 into law this week. Among other things, the bill moves up the timeline for cannabis business licensing from Jan. 1, 2025, to July 2024.
The issue with Jan. 1, 2025 is that it is the same day when the medical marijuana program goes live in Kentucky. It would have made it impossible to have cannabis products ready for patients because businesses cannot start growing marijuana until they are licensed. Federal rules also require all of Kentucky's medical marijuana products to be made within the Commonwealth. So, the state cannot bring external products in.
"All of our medical cannabis must be cultivated, processed, and produced right here in the Commonwealth," explained Beshear. "That whole system has to happen within our borders."
"The ability to purchase medical cannabis was supposed to begin January 2025 and that's the first time we could license a business," said Beshear. "So, there was no way everything was going to be up and running because you have to be licensed to have the product or to grow the product."
Under the new regulations, businesses can begin applying for a cannabis business license beginning July 1 through Aug. 31. Then, sometime in October, a lottery system will award an initial round of licenses to businesses competing to participate in the state’s startup medical cannabis program.
With the new business licensing timeline, there earliest that growing can begin is sometime in October. So, there is still the question of whether there will be enough time to have medical marijuana products for patients when the program goes live in January.
It is unclear how long it'll take Kentucky businesses to grow and process the medical cannabis products. So, is there concern that even with the new, expedited timeline, there will not be enough time to produce products for the beginning stages of the medical marijuana program?
"I believe that it's likely, in January, that there will at least be limited supply," answered Beshear.
The governor emphasized that under the previous timeline, there would have been no chance. The new timeline gives the state the opportunity to make it happen.
"What we did is buy ourselves another six months to try to get prepared and to get this done," said Beshear.
As far as the lottery for cannabis business licenses go, the governor called it a fair way to give each applicant that clears the screening process an opportunity to land a license for the program.
The lottery, set for October, should remove any temptation to lobby in an effort to “get a leg up in different ways that we don’t want to see,” Beshear said.
“It reduces or eliminates litigation, and it creates a more fair process, not one where people bid against each other and only then the big companies can be a part of it,” the governor added. “But one that provides at least a chance for everyone who can meet the criteria.”
The state initially will issue 48 medical cannabis dispensary licenses, divided among 11 regions. The goal is to ensure the shortest possible drive times for Kentuckians with qualifying health conditions, said Sam Flynn, executive director of the medical cannabis program.
Each region will be allocated at least four dispensary licenses, and counties will be limited to one dispensary with the exception of those that are home to Louisville and Lexington, which can have two licenses, Flynn said.
Limited numbers of cultivator and processor licenses will be issued.
Caps on licenses are meant to avoid flooding the market with medicinal cannabis products and exceed demand, which would hurt businesses and patients, the governor said.
“You can see this is not about having a dispensary on every corner,” Beshear said. “It is a limited program that we can monitor and fulfill the promise we made of doing this safely, but also having access in each region for people that do qualify.”
The program can be expanded with more businesses in the future depending on demand and whether more qualifying medical conditions are added.
“This is likely the minimum that you will see on the program moving forward,” Beshear said. “But again, you can always scale up. Scaling back hurts businesses, hurts people and hurts access.”
“We don’t start huge. We start with a manageable program that, yes, can grow,” he added.
Patients who can participate in the program include those suffering from a range of debilitating illnesses, including cancer, multiple sclerosis, chronic pain, epilepsy, chronic nausea, and post-traumatic stress disorder.
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The Associated Press contributed to this report.
