Starting next month, Illinois adult-use cannabis stores can apply to add a permit allowing them to also dispense medical cannabis — and, possibly more importantly, pursue registration with the U.S. Drug Enforcement Administration following federal marijuana rescheduling.
The tweak is expected to help operators and consumers by boosting sales amid flagging revenue – as MMJ users pay lower taxes – and by making it easier for existing Illinois cannabis operators to qualify for federal tax relief.
Beginning Sept. 10, cannabis retailers holding an active Adult Use Dispensing Organization License can apply for a Medical Cannabis Dispensing License, also known as a “15-37 License,” Illinois News Joint first reported.
Can Illinois cannabis retailers register with the DEA?
When Illinois launched adult-use sales in 2020, authorities issued dual-use “companion licenses” to existing medical operators already permitted.
Later licensing rounds under the Cannabis Regulation and Tax Act permitted only adult-use operators.
As a result, the number of medical cannabis retailers in the state has stood steady at 55, according to state data. By contrast, there are 230 adult-use cannabis stores in the state, according to the state Cannabis Regulation Oversight Officer.
As of April’s Justice Department final order reclassifying state-compliant medical cannabis as a Schedule 3 drug, medical retailers are no longer subject to Internal Revenue Service Code 280E.
Adult-use cannabis is still a Schedule 1 drug, pending the outcome of historic U.S. Drug Enforcement Administration hearings that concluded last month.
Senate Bill 3222, signed by Gov. JB Pritzker in June, allows adult-use operators to also become medical.
“I think that’s part of where the Legislature was going with this change,” Irina Dashevsky, a partner with GreenspoonMarder in Chicago, told MJBizDaily in June.
What other states are accommodating dual-use licenses?
An expedited application window for DEA registration closed in June 22, but legal experts believe registration provides businesses with a “safe harbor.”
Illinois is not the only state giving adult-use cannabis retailers the opportunity to participate in the medical marijuana market now that it’s been reclassified to Schedule 3.
California has streamlined the process for operators to obtain separate medical and adult-use licenses for the same operation to enable DEA registration.
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Other states with dual-use systems could follow suit.
Ohio has 223 dual-use marijuana dispensaries, according to the state’s Division of Cannabis Control.
