Text by William Weir, Hartford Courant; video by Angelica Spanos, Fox CT
Can medical marijuana distributors advertise their product? (Yes, but with certain restrictions). How much can they charge? (Market forces will determine prices).
These are just a few of the issues addressed in the 76 pages of regulations for the state’s new medical marijuana program. Tuesday, the General Assembly’s regulation review committee is expected to decide whether the document passes legal muster.
Last week, attorneys for the legislature submitted their review of the regulations with a recommendation of “rejection without prejudice.” By the end of the week, though, the state Department of Consumer Protection, which oversees the medical marijuana program, had addressed the attorneys’ concerns, and the recommendation was changed to “approval in whole.”
If the committee approves the regulations, the state will seek applications for marijuana growers and sellers. William Rubenstein, consumer protection commissioner, said he expects that producers and dispensaries will be up and running by spring or early summer next year.
Almost a year after the law allowing medical marijuana took effect, questions still persist. Here’s a look at some key issues.
Eligibility And Certification
To qualify, a patient must be diagnosed with one of the following debilitating medical conditions: cancer, glaucoma, HIV, AIDS, Parkinson’s disease, multiple sclerosis, damage to the nervous tissue of the spinal cord with objective neurological indication of intractable spasticity, epilepsy, cachexia, wasting syndrome, Crohn’s disease or post-traumatic stress disorder. The Department of Consumer Protection can add other medical conditions to the list, in consultation with a state-appointed, eight-member board of physicians.
The patient would receive certification from a physician and register with consumer protection. The state then would check that the patient meets other qualifications — that he or she is at least 18, is not a prison inmate and is a Connecticut resident.
The only way certified patients will legally obtain marijuana is through a state-licensed medical marijuana dispensary. The state will issue dispensary licenses only to Connecticut-certified pharmacists. If the regulations are approved, Rubenstein said, his department will set a maximum number of dispensaries that can be licensed.
Under the law, patients cannot grow marijuana themselves or purchase it from out-of-state dispensaries.
Ensuring ‘Pharmaceutical Grade’
The regulations require that all marijuana sold in the program be “pharmaceutical grade.” That means the product must be free of pesticides and be labeled with the results of an active ingredient analysis and an analysis of any contaminants. Each batch of marijuana will be analyzed by a state-appointed laboratory.
Rubenstein said this all serves to ensure consistent quality of the products.
Each medical marijuana product will be sold under a brand name, which must be registered with the state for $25. All products sold under a brand name must have a similar makeup of active ingredients. If a laboratory analysis shows that the makeup of one batch differs by more than 6 percent, the producer can’t legally sell it under that brand name but will have to register a new name.
Thomas Macre, whose company C-Three plans to apply for both production and dispensary licenses, said meeting those restrictions might be a challenge because the chemical makeup of marijuana can vary widely within the same plant. Also, there’s a certain margin of error in the machines used to run the analyses, he said. But he agrees that strict regulations are needed to improve the program’s chances of success.
The two chemical compounds in marijuana that can ease patients’ symptoms are tetrahydrocannabinol (THC) and cannabidiol (CBD).
Macre said he plans to use different ratios of the compounds to make products aimed at treating specific maladies. For instance, someone with a condition that causes chronic pain might want marijuana with a high level of CBD, which is known to control pain but doesn’t cause a psychoactive effect — that is, people using it don’t get high. The same product might contain low levels of THC — that’s the chemical that causes a high feeling. Macre said that at present it’s impossible to eliminate THC altogether. But a patient whose symptoms include anxiety or insomnia might want a product with higher levels of THC.
If he gets a license, Macre said, he plans to hold seminars to educate patients on which products would be best suited to their conditions.
Products And Prices
To be licensed to grow marijuana and produce medical marijuana products, applicants must put $2 million in escrow with the state, which will be gradually reduced over five years as the licensee hits certain milestones. Producers also will have to pay a $25,000 application fee and a $75,000 license fee. (The application fee for a dispensary facility permit will be $1,000, plus an additional $5,000 upon approval.)
At a public hearing in April, some potential applicants balked at the $2 million escrow, calling it unnecessarily onerous. But Erik Williams, COO of Biltin Advanced Propagation, a company that plans to apply for a production license and open a facility in New Britain, said it’s a good way to ensure that the state gets only serious applicants.
“That’s one of the greatest patient protections we have within the bill,” he said. “It prevents, first and foremost, someone from acquiring the license and not producing.” He said it will prevent situations like the one in New Jersey, where several companies received licenses, but only one has produced any product. That’s expected to change in a few months, though, when two more production facilities are expected to open.
“It’s really a good way to show that [Connecticut is] committed to making sure high quality marijuana will be produced,” Williams said.
Physicians will be allowed to certify patients to purchase up to 2.5 ounces of marijuana per month, or the equivalent plant material used for various products.
Under the regulations, medical marijuana may be sold as smokable products, extracts, sprays, tinctures placed under the tongue, oils, lotion, skin patches, baked goods, capsules or pills. It may not be sold as a beverage or candy.
Insurance companies currently don’t cover the cost of medical marijuana. The state is not going regulate consumer prices.
Williams said pricing the product will be a matter of striking a tricky balance: Price it too high, and consumers could end up going to the black market to buy marijuana. Price it too low, though, and the product could end up being diverted to the black market.
Rubenstein said he’s not concerned about prices being too low. The same law enforcement methods to keep other pharmaceutical drugs from reaching the black market will be used with medicinal marijuana.
“We hope the prices are the lowest that they can be, and we expect that competition will drive the prices down,” Rubenstein said.
Ethan Ruby, who hopes to open a production facility in Watertown, said prices in other states usually are on par with the street value of marijuana — $300 to $500 an ounce.
The state will decide how many producers will receive licenses — at least three but no more than 10 — as well as the number of dispensaries based on how many patients they expect to qualify for medical marijuana use. As of last month, more than 700 patients had registered, but Williams cautioned against reading too much into that figure.
“I’ve talked to a dozen doctors about that,” he said. “Doctors clearly see medical marijuana as a choice for patients, but there’s clearly a hesitancy for doctors to recommend it now. Once doctors and patients see there’s a safe means to obtain medical marijuana, more patients will register.”
Federal law, which continues to list marijuana as an illegal substance, also has made some investors skittish.
“It’s certainly a concern with investors,” said Ruby, who added that he was able to line up enough backers for him to go forward and apply. On the other hand, the federal law has made it easier for investors to get in on the ground floor of the industry, he said. If the U.S. government declared medical marijuana legal, the competition to get in on the action would be fierce, and a lot costlier.
“It’s a finite window of opportunity, but clearly there is some risk,” Ruby said.
Marketing And Packaging
Producers and dispensaries will be allowed to advertise their product, with certain restrictions. All proposed advertisements will be reviewed by the Department of Consumer of Protection. Although the state doesn’t have the authority to approve ads in advance, Rubenstein said, it can penalize companies whose ads run afoul of state regulations.
No promotional material can suggest marijuana be used recreationally or as anything other than a pharmaceutical drug for a debilitating condition. Advertisements must include information about side effects and contraindications, and cannot include claims about a product’s efficacy or safety unless they’re supported with clinical data.
Anyone depicted in an ad as a patient or doctor must actually be a patient or doctor.
Also prohibited are ads that feature “the use of a figure, symbol or language that is customarily associated” with anyone under 18. That would rule out Joe Camel-style mascots, for instance.
Rubenstein said ad placement also will be considered in the department’s review. He said a commercial targeted for a local news show would be fine. “But not Saturday morning cartoons,” he said. Outdoor billboards could be allowed, he said, but not at a high school football field.
Last year, Denver banned outdoor advertising of medical marijuana after complaints that it was tacky and put the industry in a bad light. For the most part, though, Williams said advertising that he’s seen in other states has been fairly subtle.
“Advertising on TV is something that someone’s not going to do much of, because airwaves are federally controlled, although maybe you’ll see it on a local cable system,” Williams said, adding that most ads likely will appear in health publications.
Macre, of C-Three, said the state’s marketing restrictions seem fair.
“We’re not going to be aggressively marketing,” said Macre, who owns MedTech Healthcare Solutions, a medical equipment supplier in Orange. “We’re not going to do any billboard stuff.”
As far as packaging, the regulations prohibit any brand name that is obscene or similar to any other product names, or that suggests that a product is for recreational use, or that is designed to appeal to people under 18.
Macre said he’s heard of medical marijuana producers in other states giving their products names like AK-47. If his company gets a license, he said, its brand names will be bland and fitting for a pharmaceutical product.
Ruby said he expects that smokable products will be the most popular at first, but based on what he’s seen in other states, that will change over time.
“People at first are going to want what they’re used to having, and that is the plant itself,” Ruby said. “Once [patients] become more educated, the concentrates become more popular, because they have less of the carcinogens.”
All marijuana products will be packaged by the producer. Some potential applicants have argued that the dispensary should do the packaging, which would allow consumers to handle the product and inspect it for qualities like density and moistness.
At the public hearing in April, Jay Czarkowski of Connecticut-based Advanced Grow Labs said that consumers need to see certain qualities to determine if a product is right for them.
“The issue is, at least culturally right now with patients, patients like to see that flower,” Czarkowski said. “They like to study that flower, the component of the plant.”
Rubenstein disagrees. The whole point of laboratory analyses is to eliminate the need for imprecise assessments.
“This is a medical product,” he said. “The question isn’t how you bond with the product on a cultural basis. People use that feel test and smell and look at it as a proxy for when they don’t know what’s in it.”