Business
Maine Officials Report ‘Mass Exodus’ of Caregivers Amid Rec Sales
Over 1,300 caregivers left the state’s medical cannabis program, citing oversupply and overregulation.
According to officials in Maine, the number of caregivers applying to supply medical cannabis in the state is plummeting.
The Sun Journal reports that over a quarter of Maine businesses in the state’s medical cannabis industry have closed down in the last two years. Maine regulators pointed out another glaring problem, the loss of caretakers, and blamed it on oversupply in the state’s medical industry, among other problems.
The spring report from the Maine Office of Cannabis Policy (OCP) describes a “mass exodus” of 1,350 caregivers who are registered with the state to supply medical-use cannabis for patients.
Despite the number of people joining the industry, from the end of 2021 to the beginning of 2023 there’s been a net loss of about 950 caregivers. Officials counted 2,070 caregivers as of March 31, according to state data. In 2021, there were 3,032 caregivers recorded, and at the program’s peak in 2016, there were 3,257 caregivers.
The report outlines several reasons why they think caregivers are leaving the program.
“The Maine Medical Use of Cannabis Program (MMCP) saw over 1350 caregivers exit the program from the end of 2021 to the end of January 2023,” the report reads. “The impacts of this exodus—a net loss of over 800 caregivers—have been felt by the remaining caregivers and resulted in a number of unsubstantiated claims about why this trend has emerged and why caregivers are continuing to leave the program. Rather than relying on anecdotal evidence, in early 2023, the Office of Cannabis Policy (OCP) surveyed former caregivers to gain a better understanding of why so many registrants exited the program.”
The OCP blames Maine lawmakers for refusing to update statutes for five years. Even though over 1,000 caregivers have left the program, supply has been uninterrupted, which the OCP proves the market is oversaturated. The report also highlights steep utility and business costs, competition with the adult-use market, and banking restrictions.
“This survey makes clear that the biggest issue facing the medical program is oversupply,” John Hudak, director of the Office of Cannabis Policy, said in a statement. “That oversupply has led to massive drops in wholesale price, making it difficult for registrants to endure mounting energy costs and other market conditions.”
The report also identifies another problem, that caregivers feel as though they are under constant threat, walking on eggshells, in order to not break any rules. Caregivers say that a mandatory track-and-trace system, installed under a recent law, would be too expensive for them to handle, for instance. Clearly a lot of patients found that they can get cannabis just as easily with a state ID at adult-use businesses.
Caregivers Revolt
Caregivers were asked by the OCP in a survey to explain why they aren’t signing up for the state’s medical cannabis program.
“More regulation of the size of recreational cannabis businesses,” one caregiver wrote when they were asked for public comment. “We have allowed big businesses to come in and open recreational cannabis grows and stores. Nobody in the public domain wants to pay $50 for a medical card.”
The former caregiver continued, “Nobody with a small business can afford to compete with the over-saturated market, at a time when prices are going up on electricity and rent (more than double) the recreational market has destroyed medical simply by growing more and dropping prices to rock bottom. Incidentally, our medical market is flooded with caregivers that are forced to sell illegally on the side just to survive in today’s market.”
It’s important to note, however, that the response rate of the caregiver survey was just 8% or 117 completed surveys out of more than 1,300 people who were contacted. The report identifies several things that need to change in order for Maine’s medical cannabis industry to survive.
Source: https://hightimes.com/news/maine-officials-report-mass-exodus-of-caregivers-amid-rec-sales/
New Mexico regulators fined a cannabis operator nearly $300,000 and revoked its license after the company allegedly created fake reports in the state’s traceability software.
The New Mexico Cannabis Control Division (CCD) accused marijuana manufacturer and retailer Golden Roots of 11 violations, according to Albuquerque Business First.
Golden Roots operates the The Cannabis Revolution Dispensary.
The majority of the violations are related to the Albuquerque company’s improper use of BioTrack, which has been New Mexico’s track-and-trace vendor since 2015.
The CCD alleges Golden Roots reported marijuana production only two months after it had received its vertically integrated license, according to Albuquerque Business First.
Because cannabis takes longer than two months to be cultivated, the CCD was suspicious of the report.
After inspecting the company’s premises, the CCD alleged Golden Roots reported cultivation, transportation and sales in BioTrack but wasn’t able to provide officers who inspected the site evidence that the operator was cultivating cannabis.
In April, the CCD revoked Golden Roots’ license and issued a $10,000 fine, according to the news outlet.
The company requested a hearing, which the regulator scheduled for Sept. 1.
At the hearing, the CCD testified that the company’s dried-cannabis weights in BioTrack were suspicious because they didn’t seem to accurately reflect how much weight marijuana loses as it dries.
Company employees also poorly accounted for why they were making adjustments in the system of up to 24 pounds of cannabis, making comments such as “bad” or “mistake” in the software, Albuquerque Business First reported.
Golden Roots was fined $298,972.05 – the amount regulators allege the company made selling products that weren’t properly accounted for in BioTrack.
The CCD has been cracking down on cannabis operators accused of selling products procured from out-of-state or not grown legally:
- Regulators alleged in August that Albuquerque dispensary Sawmill Sweet Leaf sold out-of-state products and didn’t have a license for extraction.
- Paradise Exotics Distro lost its license in July after regulators alleged the company sold products made in California.
Golden Roots was the first alleged rulebreaker in New Mexico to be asked to pay a large fine.
Source: https://mjbizdaily.com/new-mexico-cannabis-operator-fined-loses-license-for-alleged-biotrack-fraud/
Four marijuana companies, including a multistate operator, have filed a lawsuit against U.S. Attorney General Merrick Garland in which they allege the federal MJ prohibition under the Controlled Substances Act is no longer constitutional.
According to the complaint, filed Thursday in U.S. District Court in Massachusetts, retailer Canna Provisions, Treevit delivery service CEO Gyasi Sellers, cultivator Wiseacre Farm and MSO Verano Holdings Corp. are all harmed by “the federal government’s unconstitutional ban on cultivating, manufacturing, distributing, or possessing intrastate marijuana.”
Verano is headquartered in Chicago but has operations in Massachusetts; the other three operators are based in Massachusetts.
The lawsuit seeks a ruling that the “Controlled Substances Act is unconstitutional as applied to the intrastate cultivation, manufacture, possession, and distribution of marijuana pursuant to state law.”
The companies want the case to go before the U.S. Supreme Court.
They hired prominent law firm Boies Schiller Flexner to represent them.
The New York-based firm’s principal is David Boies, whose former clients include Microsoft, former presidential candidate Al Gore and Elizabeth Holmes’ disgraced startup Theranos.
Similar challenges to the federal Controlled Substances Act (CSA) have failed.
One such challenge led to a landmark Supreme Court decision in 2005.
In Gonzalez vs. Raich, the highest court in the United States ruled in a 6-3 decision that the commerce clause of the U.S. Constitution gave Congress the power to outlaw marijuana federally, even though state laws allow the cultivation and sale of cannabis.
In the 18 years since that ruling, 23 states and the District of Columbia have legalized adult-use marijuana and the federal government has allowed a multibillion-dollar cannabis industry to thrive.
Since both Congress and the U.S. Department of Justice, currently headed by Garland, have declined to intervene in state-licensed marijuana markets, the key facts that led to the Supreme Court’s 2005 ruling “no longer apply,” Boies said in a statement Thursday.
“The Supreme Court has since made clear that the federal government lacks the authority to regulate purely intrastate commerce,” Boies said.
“Moreover, the facts on which those precedents are based are no longer true.”
Verano President Darren Weiss said in a statement the company is “prepared to bring this case all the way to the Supreme Court in order to align federal law with how Congress has acted for years.”
While the Biden administration’s push to reschedule marijuana would help solve marijuana operators’ federal tax woes, neither rescheduling nor modest Congressional reforms such as the SAFER Banking Act “solve the fundamental issue,” Weiss added.
“The application of the CSA to lawful state-run cannabis business is an unconstitutional overreach on state sovereignty that has led to decades of harm, failed businesses, lost jobs, and unsafe working conditions.”
Alabama regulators are targeting Dec. 1 to award the first batch of medical cannabis business licenses after the agency’s first two attempts were scrapped because of scoring errors and litigation.
The first licenses will be awarded to individual cultivators, delivery providers, processors, dispensaries and state testing labs, according to the Alabama Medical Cannabis Commission (AMCC).
Then, on Dec. 12, the AMCC will award licenses for vertically integrated operations, a designation set primarily for multistate operators.
Licenses are expected to be handed out 28 days after they have been awarded, so MMJ production could begin in early January, according to the Alabama Daily News.
That means MMJ products could be available for patients around early March, an AMCC spokesperson told the media outlet.
Regulators initially awarded 21 business licenses in June, only to void them after applicants alleged inconsistencies with how the applications were scored.
Then, in August, the state awarded 24 different licenses – 19 went to June recipients – only to reverse themselves again and scratch those licenses after spurned applicants filed lawsuits.
A state judge dismissed a lawsuit filed by Chicago-based MSO Verano Holdings Corp., but another lawsuit is pending.
Source: https://mjbizdaily.com/alabama-plans-to-award-medical-cannabis-licenses-dec-1/
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