Marijuana Business Magazine September 2018

MARKET AT A GLANCE Main measure Senate Bill 923 and House Bill 881 (the identical measures replace House Bill 1101, a 2013 law that proved unworkable) Year passed 2014 (both) MMJ business regulations Very heavy. The state has set caps on the number of dispensaries and growers allowed, and licensing costs are some of the highest in the nation. Regulations govern all aspects of grower, processor and dispensary operations, from location, transportation, testing and security to recordkeeping and packaging. State tax requirements 6% sales tax Sampling of state licensing & application fees Application Dispensary: $5,000 Cultivator: $6,000 Cultivator/Dispensary: $11,000 Processor: $6,000 Testing lab: $100 License Dispensary: $40,000 (annually) Cultivator: $125,000 (annually) Cultivator/Dispensary: $165,000 (annually) Processor: $40,000 each year (annually) Testing lab: $100 (valid for two years) What to watch • Maryland Gov. Larry Hogan signed a bill in April to expand the state’s medical marijuana industry, in large part to resolve a conflict over minority representa- tion in the sector. The bill authorizes an additional 20 business licenses – seven for cultivation and 13 for processing – which will be awarded using a new process for choosing license recipients that focuses on both race and barrier to entry for minorities. • Allegations that ForwardGro – a medical marijuana cultivator in the state – illegally used pesticides to grow MMJ have sparked an investigation into the company’s practices. The development could prompt additional inquiries into other cultivators throughout Maryland, all of which have been trying to ramp up production amid an early supply crunch. Maryland Maryland’s medical marijuana market launched at the end of 2017, and despite a few supply shortages early in the year, the program has pro- gressed smoothly. As of June 2018, approximately 32,000 patients had been granted MMJ cards, with nearly 13,000 additional applications still pending. Sales of MMJ came in at just under $35 million through the first six months of the year, much stronger than many industry insiders had anticipated. Market activity is expected to increase significantly as more dispensaries open their doors and patients register for the program – potentially propelling the state to $100 million in MMJ sales in its first year. The Inner Harbor in Baltimore. Photo by Sean Pavone September 2018 • Marijuana Business Magazine • 117