East Coast Medical Marijuana Update

By: Ben Fuller For Clinical Cannabis Today November 2011 Issue Delaware, Washington, D.C., New Jersey, Rhode Island, Vermont, and Maine are unique on the East Coast because they are the only states with medical marijuana programs. Currently 16 States, and Washington, D.C., have some sort of defense in court for qualified and registered patients who are growing and possessing marijuana. East Coast Medical Marijuana Breakdown Number Stores Distributing to Patients Delaware Washington, D.C. New Jersey 3 5 6 Name of Storefront Distributers Compassio n Centers Dispensarie s Alternative Treatment Programs Compassio n Centers Dispensarie s Dispensarie s Nonprofit / For Profit Patients Can Grow Estimated No. Patients 0 0 0 State Population 2010 Census 897,934 599,657 8,707,739

Nonprofit For profit Nonprofit

No No No

Rhode Island Vermont Maine

3 4 8

Nonprofit Nonprofit Nonprofit

Yes Yes Yes

3,700 355 250

1,053,209 621,760 1,318,301

Delaware The Facts According to DelawareOnline, the Delaware government passed Senate Bill 17 on May 13, allowing patients to possess six ounces of usable marijuana, which could be purchased from a nonprofit dispensary, or from a caregiver providing care to no more than five patients. Six ounces is less than the federal government has determined is a one-month supply for patients in the Compassionate Investigational New Drug Program, says the bill. This bill acknowledges that the medicine will be purchased from dispensaries and caregivers, so patients and owners do not have to fear running into the problems that have arisen in Michigan Registered compassion center means a not-for-profit entity . . . that acquires, possesses,

cultivates, manufactures, delivers, transfers, transports, sells, supplies, or dispenses marijuana, paraphernalia, or related supplies and educational materials to registered qualifying patients. The Delaware Department of Health and Social Services is charged with administering the program in the state. At this time, the department has not yet updated its site to reflect its new responsibilities nor is it collecting patient, caregiver, or compassion center applications. DelawareOnline reports that the DHSS does not have to start collecting applications until July 1, 2012. This means the soonest any patient could legally receive medicine is not going to happen before late 2012 or early 2013. If the normal delays for regulations take as long as in other states, it may take even longer. Entrepreneur Lowdown If you are thinking about jumping into the ground floor of a medical marijuana market, Delaware isnt likely to be a giant gold rush like California and Colorado. Its going to take time. No one can even apply until summer of next year, and its not likely you will be one of the three centers originally chosen. In addition, patients are not allowed to grow, according to ProCon.org meaning even less business opportunity. Few businesses translates to fewer monies for advertisers, marketers and other business service firms, so the only real opportunity left is for doctors providing recommendations. Washington, D.C. The Facts More than 50 contenders have been approved to apply for a license to grow or sell medical marijuana in Washington, D.C. According to The Washington Post, only 15 businesses will ultimately be approved out of the 50, and the winners will be announced in early 2012. This news is welcome for a stalled medical marijuana program in the District. Amendment Act B18-622, was originally approved May 4, 2010, and went into effect on July 27, but no registration cards have been issued. Eligible patients are not allowed to grow but can possess up to two ounces of usable marijuana once registered. The District is using a model similar to Colorado, where 10 for-profit cultivation centers, or grows, and five stores will be licensed to operate, according to Cannabis Culture magazine. The deadline to apply to become one of the 15 has already passed, and another open application period has not been set. Marijuana takes numerous input materials to produce, like soil, light, water and nutrients. These 15 businesses will have to compete against each other, paving the way for ancillary businesses making money providing advertising, management and other supplies and services. Millions of dollars are therefore at stake for all these new businesses serving the half million people in the District, and the thousands of potential patients. Big names such as Montel Williams have applied to be one of the businesses, says The Washington Post: Williams says he has hopes to change perceptions about medical marijuana in Congress, but opening his clinic would come with a risk. Entrepreneur Lowdown Since patients are not allowed to grow their own plants there isnt a demand for grow stores, but doctors and clinics will likely start marketing to medical marijuana patients. The store fronts

and grows will make a lot of money in Washington, D.C. because there are so few of them, and the thousands of potential patients have to purchase their all of the medical marijuana through them. New Jersey The Facts Governor Chris Christie recently allowed the New Jersey medical marijuana program to continue in his state after halting it to evaluate the federal governments position on prosecuting employees in the industry. Earlier in the year, he halted the program due to worries about the federal government prosecuting employees within the program. On June 29, the Justice Department released a memo detailing its position on medical marijuana. The Wall Street Journal says, "it is likely not an efficient use of federal resources to focus enforcement efforts on individuals with cancer or other serious illnesses who use marijuana as part of a recommended treatment regimen consistent with applicable state law, or their caregiver. Christie believes this means the very small and focused program in New Jersey will be outside of the scope that the Justice Department is worried about. But other states should worry because the memo also states that large-scale commercial cultivation, sale, and distribution of pot for purported medical purposes had expanded, and the federal government never intended to shield those types of activities from prosecution. New Jersey approved six nonprofit Alternative Treatment Centers for the medicinal marijuana program. The New Jersey Health and Senior Services Department announced the six centers on March 21, 2011. Patients are required to purchase their medicine from one of these six ATCs or from a caregiver who purchased it from a center. Neither they nor their caregivers are allowed to grow their own medication. Entrepreneurial Lowdown This budding, highly regulated program in New Jersey is not likely to go gangbusters soon. There are only six nonprofit centers selling product, but there are 8.7 million people in New Jersey, according to the latest U.S. Census Bureau Statistics. This would lead to a larger population base then Colorado, which could create even more patients. Colorados medical marijuana industry is valued at over a half a billion dollars, if not more, according to Cannapages.com. A lot of medicine, and therefore money, will be flowing through these six nonprofits. Rhode Island The Facts The Rhode Island Department of Health has had since June 21, 2007, to work out the kinks in its medical marijuana program setup in Senate Bill 710 and 791. It is now accepting patient applications and has chosen three nonprofit Compassion Centers. Patients will soon be able to designate any of these three Compassion Centers as one of their two caregivers. The rules in the state also allow a patient to possess up to 2.5 ounces of usable marijuana, and grow up to 12 plants, according to ProCon.org and the Rhode Island Department of Health. Entrepreneur Lowdown

Grow stores, nutrient suppliers, and basic input material providers are likely looking at Rhode Island as a potential customer base. According to RIPatients.org, more than 3,700 patients are already in the state, but regulation and lack of medicine is preventing Rhode Island from becoming a major player in the medical marijuana industry.

Vermont The Facts The Vermont medical marijuana program started July 1, 2004, and allows patients two mature plants, seven immature plants, and 2 ounces of usable marijuana. Seven Days Vermont reports that in June, the state passed a bill allowing four nonprofit medical marijuana dispensaries in the state. The governor has held up the licensing of only the centers originally chosen to sell medicine in the state due to fears of prosecution of the employees. When the dispensaries finally open, they are limited to 1,000 patients each. Patients must designate the facility as their caregiver if they decide to use it, but this means they can no longer grow their own plants. The facilities must operate by appointment only, and no medicine can be consumed on the premises. Entrepreneur Lowdown It has already been seven years since Vermont removed criminal penalties for registered medical marijuana patients, but only 355 patients exist in the state, according to Seven Days. Until the patient base increases and the state government opens the dispensaries, its unlikely many businesses will explore Vermont. Maine The Facts Eight dispensaries have opened in Maine this year as a part of its Medical Marijuana Program, according to the Providence Journal. These nonprofit dispensaries are located in each of the eight districts in the state, and are heavily regulated by the state. Maines program was introduced in December 2009, and patients are protected from criminal penalties while possessing up to 2.5 ounces, growing three mature plants, and growing three immature plants. Patients visiting from other states are protected under Maines program as well, reports ProCon.org. Entrepreneur Lowdown The States Licensing and Regulatory Services Site says no new dispensaries are planned, but more may be allowed in the future. The low number of patients estimated at only about 250 according to Procon.org, means that there will be few medical marijuana businesses within the state.