Chart: North Dakota’s medical marijuana program gathers steam, but challenges remain

After a slow start, North Dakota’s budding medical marijuana industry appears to be finding its footing.

Limited access to MMJ, the temporary closure of a dispensary in the state’s most populous city and general complications from the coronavirus pandemic still present hurdles to medical cannabis operators, however.

Nearly 15 months after sales began in March 2019, more than 2,900 patients – or roughly 0.4% of the state’s population – are registered in North Dakota’s program.

That figure is low relative to other states that recently launched medical marijuana programs, including:

  • Arkansas: 1%.
  • Maryland: 0.8%.
  • Ohio: 5%.
  • Oklahoma: 1.8%.

There are several likely reasons for North Dakota’s slow adoption.

Only eight dispensaries serve the state, and not all of those were open when the program launched.

While nearly half of North Dakota’s population lives in the eight cities where medical marijuana dispensaries exist, many current or would-be MMJ patients still live hundreds of miles from the nearest location.

Furthermore, flower – the most popular form of MMJ – initially was allowed only if specifically authorized by a health-care provider.

Lawmakers, however, abandoned that provision altogether: Flower is now sold alongside all other types of MMJ.

The Legislature also approved several other measures to improve the program. Some notable changes include:

  • Adding 12 qualifying conditions, such as anxiety disorder and migraines.
  • Allowing physician assistants to recommend MMJ.
  • No longer requiring health-care providers to note whether a patient is likely to receive therapeutic or palliative benefits from medical cannabis.

Patient growth in North Dakota has been robust in 2020, with close to 1,000 new patients added since the end of 2019 – an increase of 40%.

Monthly patient growth is averaging 9%, which is in line with – and, in some cases, above – other MMJ programs at similar points in their development.

In early April, however, The Botanist dispensary in Fargo – owned by New York-based multistate operator Acreage Holdings – closed its doors because of operational challenges caused by the COVID-19 pandemic.

With more than 120,000 residents, Fargo is nearly 70% bigger than Bismarck, the state capital and next-largest city in North Dakota.

While the closing of the Fargo dispensary was a major blow to the entire North Dakota MMJ program, it also proved to be short-lived.

In mid-May, ownership of the dispensary was transferred to Pure Dakota Health, which reopened the location on May 19.

While the full impact of the COVID-19 pandemic on North Dakota’s program is not yet known, sales in 2020 could fall short of the $5 million-$6 million projected earlier in the year.

That poses a significant risk to operators in the state, as biannual license fees for cultivators and dispensaries are $110,000 and $90,000, respectively – among the highest in the nation.

Eli McVey can be reached at [email protected]

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