SB46 (Hall Compassion Act) Medical Cannabis
SB46 was signed into law by Gov. Kay Ivey on May 17, 2021 and makes Alabama the 37th state to legalize a form of medical cannabis. This bill is 102 pages long and is not laid out the way you may think. Other than the general details of the bill there are some very important aspects that could have a serious effect on anyone looking to get a medical cannabis card. 1/4 of all licenses issued shall be awarded to business entities that have at least a 51% minority ownership. There will be a 9% sales tax on all medical cannabis products. A medical cannabis privilege tax will be imposed on all businesses in the industry. This tax will be set up similar to the business privilege tax Alabama businesses are already familiar with. Here is a link to the text of the bill if you would like a closer look.
The bill defines medical cannabis as the following:
1.Oral tablet, capsule, or tincture.
2. Non-sugarcoated gelatinous cube, gelatinous rectangular cuboid, or lozenge in a cube or rectangular cuboid shape.
3. Gel, oil, cream, or other topical preparation.
4. Suppository.
5. Transdermal patch.
6. Nebulizer.
7. Liquid or oil for administration using an inhaler.
The term medical cannabis does not include any of the following:
1. Raw plant material.
2. Any product administered by smoking, combustion, or vaping.
3. A food product that has medical cannabis baked, mixed, or otherwise infused into the product, such as cookies or candies.
As you can see from the states definition of medical cannabis, raw plant material is not allowed to be used by the patient. Insurance providers will not be required to cover the use of medical cannabis. One part of the bill allows for potential patients drivers license to be suspended. The text reads “Any person who is recommended a daily dosage of medical cannabis that exceeds 75 mg of delta-9-tetrahydrocannabinol under paragraph (f)(2)b. of Section 20-2A-33, Code of Alabama 1975, shall automatically have his or her driver’s license suspended, regardless of whether he or she holds a valid medical cannabis card under Chapter 2A of Title 20, Code of Alabama 1975.”
Types of licenses surrounding medical cannabis
Under the bill there will be 5 types of licenses available or a person/entity could apply for an integrated license to cover all of the divisions. An application can be applied for starting September 1, 2022. All licenses require a background investigation which will be $2500 and non-refundable. If an entity passes the background process they will need to purchase a license which will cost no less than $10,000 and no more than $50,000. The packaging of all products will contain the universal state symbol printed in color at least 0.5 in. x 0.5 in. The commission will establish one universal flavor for all products.
- Cultivation
- Processing
- Laboratory
- Dispensing
- Secure Transporter
The medical cannabis commission will only issue a specific number of licenses to begin with. There will be no more than 12 cultivator licenses, 4 processor licenses, 4 dispensary licenses. The bill leaves a process for the number of licenses to be increased and will be based on the population of the state, the number of active registered qualified patients, market demand, the unemployment rate, the need for agricultural and other business opportunities in communities, access to health care, infrastructure, and other factors the commission deems relevant in providing the greatest benefits to the residents of this state and taking into account the racial and economic makeup of the state.
Cultivators
These are some important bullets for cultivators. By becoming a licensee you are essentially surrendering your 4th amendment rights.
- Cultivators will be regulated by the Department of Agriculture instead of the Medical Cannabis Commission.
- The Commission and Department of Agriculture will have the authority to investigate applicants and employees of licensees.
- At any time without a warrant and without notice to the licensee, investigators, agents, or auditors may enter the premises, offices, facilities, or other places of business of a licensee.
- If a licensee fails to cooperate with an investigation the authority may impound, seize, assume physical control of, or summarily remove from the premises all books, ledgers, documents, writings, photocopies, correspondence, records, and videotapes, including electronically stored records, money receptacles, or equipment in which the records are stored.
- There will be periodic audits of all licensees.
- Required to have a minimum of 2 million dollars of liability and casualty insurance.
- Other financial guarantees may be added.
- Cultivation facilities must remain fully enclosed and locked at all times and have a monitored security alarm system.
- All individuals entering and exiting facilities shall be monitored by video surveillance and keypad or access card entry.
- Comply with seed-to-sale tracking requirements.
- Must have the ability to start cultivation within 60 days of application approval.
- Must be able to properly destroy unused cannabis and waste products.
- Have the ability to provide proper testing of individual batches and lots.
- All employees may not have any conviction within the past 10 years for a controlled substance-related felony or a controlled substance-related misdemeanor other than a conviction that was overturned on appeal or a charge that was expunged pursuant to Chapter 27 of Title 15.
- Nothing in this section shall be construed to prohibit the hydroponic growing of cannabis.
- A secured transporter is required to move all cannabis and cannabis products from the premises.
Processors
These are some important bullets for Processors.
- A processor license authorizes the processor to transfer medical cannabis only by means of a secure transporter.
- The commission shall issue no more than four processor licenses.
- All medical cannabis products must be medical grade product, manufactured using documented good quality practices, and meet Good Manufacturing Practices, such that the product is shown to meet intended levels of purity and be reliably free of toxins and contaminants. Medical cannabis products may not contain any additives other than pharmaceutical grade excipients.
- Medical cannabis products may not be processed into a form that is attractive to or targets children, including all of the following which are prohibited: Any product bearing any resemblance to a cartoon character, fictional character whose target audience is children or youth, or pop culture figure. Any product bearing a reasonable resemblance to a product available for consumption as a commercially available candy.
- All of the following shall apply to all packages and labels of medical cannabis products: Labels, packages, and containers shall not be attractive to minors and may not contain any content that reasonably appears to target children, including toys, cartoon characters, and similar images. Packages should be designed to minimize appeal to children and must contain a label that reads “Keep out of reach of children.”
- All medical cannabis products must be packaged in child-resistant, tamper-evident containers.
- All product labels shall include lot and batch numbers, a license identification number for the cultivator and processor.
- The following statement shall be included on each label, if space permits, or as an insert within the package: “WARNING: This product may make you drowsy or dizzy. Do not drink alcohol with this product. Use care when operating a vehicle or other machinery. Taking this product with medication may lead to harmful side effects or complications. Consult your physician before taking this product with any medication. Women who are breastfeeding, pregnant, or plan to become pregnant should discuss medical cannabis use with their physicians.”
- Any advertisement and any package or label may not contain any false statement or statement that advertises the health benefits or therapeutic benefits of medical cannabis.
Dispensary
These are some important bullets for dispensaries.
- A dispensary license authorizes the purchase of medical cannabis from a cultivator or integrated facility.
- A dispensary can dispense and sell medical cannabis to a registered qualified patient or registered caregiver.
- Medical cannabis can only be transported by a licensed secure transporter.
- The commission shall issue no more than four dispensary licenses.
- Each dispensing site must be located at least one thousand feet from any school, day care, or child care facility.
- Each dispensing site must have surveillance cameras that are focused on each point of entry and that operate on a continuous basis. The dispensary must maintain surveillance records for a minimum of 60 days following the date of recording.
- Enter all transactions, current inventory, and other information into the statewide seed-to-sale tracking system as required.
- Medical cannabis products may not be used on the premises.
- The commission will establish a training program for dispensers.
- Dispensers will be required to enter the date, time, amount, and type of medical cannabis dispensed into the statewide patient registry.
- A licensee may operate up to 3 dispensing sites which must be located in different counties from any other dispensing site.
- Licensee may not operate a dispensing site in an unincorporated area of a county or in a municipality that has not adopted a resolution or ordinance authorizing the operation of dispensing sites.
Secure Transporter
These are some important bullets for secure transporters.
- Can store or transport cannabis and medical cannabis for a fee.
- The license does not authorize transport directly to a patient or caregiver.
- Employees who have custody of cannabis shall not have been convicted or released from incarceration for a felony in the past five years or have been convicted of a misdemeanor involving a controlled substance within the past five years.
- A route plan and manifest shall be entered into the statewide seed to sale tracking system and a copy must be carried in the transporting vehicle.
- Medical cannabis must be transported in sealed containers and made inaccessible in transit.
- The vehicle may not have markings that indicate it is carrying cannabis.
- A secure transporter is subject to administrative inspection by a law enforcement officer at any point during transport.
State Laboratory
These are some important bullets for a state testing laboratory.
- Will test during cultivation, processing and dispensing.
- Ensure that all dispensed medical cannabis is consistently high grade and maintains a consistency with less than 0.5 percent variability among batches of the same product.
- Labs will test for Total THC, Total CBD, THC/CBD ratio if applicable, Percent of THC relative to original plant material, Terpene profiles, Heavy metals, Chemical contamination, Microbials, Mycotoxins, Residual insecticides, fungicides, herbicides, and solvents.
Integrated Facility
These are some important bullets for integrated facilities.
- applicants need to provide a letter of commitment of the applicant’s ability to secure a performance bond issued by a surety insurance company approved by the commission in the amount of $2,000,000, Proof of $250,000 in liquid assets, Proof that the applicant has the financial, ability to maintain operations for no less than two years.
- May operate up to 5 facilities all located in different counties.