Week in Review: Judge tosses NM medical cannabis plant cap, Sessions fired & MA adult-use sales expected to start soon

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A New Mexico judge strikes down the state’s cap on the number of plants medical marijuana producers can grow, Attorney General Jeff Sessions is fired, and a top cannabis regulator in Massachusetts says adult-use sales are expected to begin soon in the Bay State.

Here’s a closer look at some notable developments in the marijuana industry this week.

New Mexico opens up

A New Mexico judge’s decision to strike down the state-imposed limit on the number of plants medical marijuana producers can grow should be a boon for the state’s vertically integrated MMJ businesses.

The judge called the 450-plant limit “arbitrary and capricious.”

Under the cap, vertically integrated MMJ businesses were forced to buy plants from the wholesale market because they couldn’t grow enough to stock their dispensaries. The plant limit also was blamed for high MMJ prices and product shortages.

Business owners, who’ve been paying $2,000 a pound or more for wholesale cannabis flower, reckon the elimination of the 450-plant limit will boost supplies and drive down prices.

“This ruling reflects what we’ve believed all along – that this plant count is not based on data. It was not providing an adequate amount of products statewide,” said Marissa Novel, communications manager for Ultra Health, a vertically integrated company based in Bernalillo, New Mexico.

Ultra Health operates 11 stores in New Mexico. Like other companies, it was forced to tap the wholesale market to keep its dispensaries stocked.

“We’re really looking forward to growing more plants, but also a wider variety of plants,” Novel said. “This will take the product selection to the next level in New Mexico. These complex products require more plant matter.”

After the judge’s decision, Ultra Health plans to expand throughout the state. It hopes to open 20 more stores.

Rachael Speegle, founder and chief operating officer of the Verdes Foundation dispensary in Albuquerque, said her company will be able to grow more strains.

“We’d like to grow them smaller and healthier and have shorter vegetative cycles so we can turn these plants over faster,” she said.

Sessions aftermath

President Trump’s firing of U.S. Attorney General Jeff Sessions may benefit marijuana businesses and have an impact on federal cannabis reform, experts agreed.

But don’t hold your breath.

“It depends on who gets the gig permanently,” said Douglas Berman, an Ohio State University law professor who follows marijuana policy.

Matthew Whitaker, a former U.S. attorney in Iowa and Sessions’ former chief of staff, has been appointed the acting AG.

It’s unclear how long Whitaker, a conservative, will be in the position, and experts doubt he’ll take any action on marijuana in the meantime.

Below is a sampling of how experts view Sessions’ ouster:

  • “Without the negative pressure from the head of law enforcement, hopefully Congress will feel they have more safety in promoting reasonable cannabis policy reform.” – Morgan Fox, spokesman for the National Cannabis Industry Association
  • “Hopefully the (permanent) AG will have a more open mind for the benefits of medical cannabis and the success of states that have legalized adult use.” – Henry Wykowski, California cannabis attorney
  • “It would certainly be nice to see someone with a more modern, evidence-based viewpoint on marijuana policy in that position. Regardless, though, we need Congress to take action to bring about real change.” – Mason Tvert, media relations director for the Marijuana Policy Project

Massachusetts rec sales imminent?

Massachusetts recreational marijuana sales could start in a few days now that regulators have authorized two testing labs to begin operations.

The authorizations come after Steve Hoffman, chair of the Massachusetts Cannabis Control Commission (CCC), said on Nov. 1 that rec sales could start within two weeks.

That’s about the same time frame that one Massachusetts marijuana executive – Norton Arbelaez of New England Treatment Access (NETA) – said his MJ business would likely begin recreational sales.

“We’re very close,” Arbelaez said in a recent interview.

The CCC said Wednesday the labs received “notices to commence operations” after they passed final inspections and took other steps to open their doors.

The labs have “a minimum of three calendar days to coordinate opening-day logistics with their host community, local law enforcement, marijuana establishment colleagues and other essential stakeholders before adult-use operations begin,” a CCC statement said.

Now that the two laboratories – MCR Labs and CDX Analytics – have the green light to open their doors, how will they be able to test products quickly enough so sales can begin in a few days?

The answer: They don’t have to, because products already have been tested.

Under Massachusetts law, MMJ businesses that are licensed and approved to sell recreational cannabis can use up to 65% of their medical inventory for recreational sales. That medical product has already been tested under the state’s MMJ regulations.

So far, two medical dispensaries – NETA and Cultivate – have received their final recreational licenses.

The two operators can now transfer medical product to their rec inventory and start selling once they’ve registered their employees with regulators and inputted their adult-use (formerly medical) inventory into the state’s seed-to-sale tracking system.

The start of sales will be historic: They’ll be the East Coast’s first legal adult-use sales.

Bart Schaneman can be reached at barts@mjbizdaily.com

Jeff Smith can be reached at jeffs@mjbizdaily.com

Omar Sacirbey can be reached at omars@mjbizdaily.com