It’s been almost two years since Hawaii legalized medical marijuana dispensaries and nearly a year since the first were expected to open. It’s still unclear when the first one will.
None of the the state’s eight licensed medical marijuana companies is erecting “Opening Soon” signs yet, because so much depends upon a Department of Health dispensary program that has been plagued with delays.
“Because there are so many moving parts, it’s hard to say a date or even a particular time frame,” said Keith Ridley, who runs the department’s Office of Health Care Assurance.
He said the department is making progress and hopes at least one medical cannabis store will open this summer.
Only half of the eight licensed companies have gotten approval to grow marijuana, and they’re located only on the islands of Oahu and Maui.
Meanwhile, the Legislature doesn’t want other companies to apply for licenses to grow and sell marijuana. Under current law the Health Department has the discretion to issue additional licenses in October. But the Legislature just passed House Bill 1488 that, among other changes, would push that date back to October 2018.
Bills to decriminalize marijuana or legalize the drug for recreational use didn’t get very far this session. Gov. David Ige made it clear early on that he didn’t want to approve more marijuana-related legislation until the first dispensaries get up and running.
Medical marijuana has been legal in Hawaii since 2000 but patients haven’t had a legal place to buy it. Instead, they have had to grow their own plants or find a caregivers to do it for them. When the Legislature passed a bill in 2015 finally legalizing dispensaries, patients and advocacy organizations cheered. Two years later, many are frustrated.
Christopher Garth of the Hawaii Dispensary Alliance said he’s disappointed with both the Ige administration and the Legislature. He worries that not licensing more companies prevents competition that would lead to lower prices for patients.
“We don’t want another Big Five,” said Garth, referring to large agricultural companies that once dominated Hawaii’s economy. “But that’s ultimately where we’re headed.”
When they approved the dispensary system in 2015, lawmakers adopted an aggressive timeline to try to get medicine to patients within a year.
The Health Department moved quickly to publish administrative rules weeks before they were due. But since then, there have been numerous setbacks.
While the department started accepting dispensary applications in January 2016, it didn’t choose members of a selection panel until March, just four weeks before the first licensees were supposed to be chosen. The actual announcement was pushed back a couple of weeks.
More significantly, the department took nearly a year to negotiate a contract with a company that would provide software to track marijuana from seeds to point of sale. It’s part of an effort to make sure the drug only goes to patients in limited amounts.
Ridley said contract negotiations lasted longer than expected due to disagreement over pricing.
The legislative timeline for getting dispensaries up and running was, in retrospect, “not well thought-out,” said Sen. Rosalyn Baker, who leads the Senate committee that deals with health care issues.
Carl Bergquist, who leads the Drug Policy Forum of Hawaii, said that while the timeline was aggressive, “You can’t blame that timeline for this delay. That’s a cop-out.”
Teri Gorman, director of communications for Maui Grown Therapies, said the delays have cost the company hundreds of thousands of dollars. The company was ready to begin growing medical marijuana last August but couldn’t because the Health Department took so many months to finalize the contract for seed-to-sale tracking.
Now Maui Grown Therapies is hoping to open a dispensary in Kahului in late July or early August.
Helen Cho, director of integrated strategy for Aloha Green, said the Oahu-based medical marijuana company was ready for production last September and also had to wait until February when the Department of Health gave the green light to start growing.
Cho said it’s hard not to have an answer when patients ask when the company will open its dispensary on King Street. It’s hoping for summertime, but that’s not certain.
“They’re not asking to get high, they’re asking because their child has seizures,” Cho said of the patients. “For us it’s difficult because we don’t know.”
The Health Department has been coordinating not only with dispensary licensees but also with lab owners, county zoning agencies and other state departments.
This has been a first-of-its-kind undertaking, and has involved conducting inspections of marijuana production facilities in the islands, said Ridley from the Office of Health Care Assurance.
The Health Department’s dispensary program recently lost three of five employees, but Ridley said that hasn’t affected the department’s progress.
Even now, a lot could go awry.
Brian Goldstein owns the medical marijuana company Manoa Botanicals and hopes to open a dispensary in Ala Moana this fall.
Goldstein is concerned about how long it will take the department to merge the state’s patient registry with the traceability software. That’s necessary to make sure the dispensaries can verify that their customers are registered patients, and so that they don’t buy more marijuana than they’re legally allowed.
Ridley said the agency is in the final stages of making sure the software works and hopes to announce that it does within the next several days.
Goldstein is also worried about when the agency will certify labs.
“This has been a significant concern,” he said. “We cannot sell any product that’s not been lab tested.”
The department only recently approved a list of pesticides that the labs must test for, despite months of discussions. Ridley said he hopes to have at least one lab certified this summer.
While Michael Rollins, who owns a lab on Maui, wasn’t happy about how long the deliberations took, he has bigger concerns now. He said he’s waited months for the state to finalize how lab samples can be transported and how big the samples can be.
Rollins says poor communication has been one frustrating part of the process. “To get a meeting with the administrative side of DOH is like trying to get a meeting with the president,” he said.
Dana Ciccone, who owns the Steep Hill lab on Oahu that is also trying to get certified to test cannabis, said he’s lost money because of the delays but that the department’s procedures have improved since April.
“The delays are because we are all learning together and this is a new industry to Hawaii and sometimes learning can be costly,” he said.
The Health Department isn’t solely to blame for how long it’s taking to get Hawaii’s medical marijuana industry up and running. For instance, Rollins said malfunctioning equipment is part of the reason his lab may not get certified until July.
Richard Ha, a former banana farmer who owns Lau Ola, one of two licensed medical marijuana companies on the Big Island, likely won’t open a dispensary until next year. He said the delay is due to the need to construct a production center that his team hadn’t originally planned on building.
Justin Britt, who holds the only license to grow medical marijuana on Kauai, said that his company Green Aloha is hoping to start growing cannabis this month. Obtaining a county permit for his production center took nine months, about three times longer than he anticipated.
“The state delays and county delays that we’re facing have been parallel. For us it’s working out perfectly,” he said.
Green Aloha was sued last year by one of Britt’s business partners, Winston Welborn, who alleged he stole money to fund the business. A judge ruled against Welborn, and Green Aloha countersued, contending the original suit was malicious because Welborn was an investor in a rival medical marijuana company, HK Medicinal, that lost out on getting a license.
Welborn’s case against Britt is ongoing, and Britt was recently sued again by other business partners. He declined to comment on the cases.
Considering all the delays, the licensees say it’s only fair that additional competition be postponed as well.
“Because of the delays we haven’t been able to open and begin recouping the costs of being the first mover in the industry,” said Cho from Aloha Green on Oahu.
“The law stated that dispensaries should legally be able to sell marijuana as of July 15 and of course here we are, we are in mid-May and nobody has the ability to sell anything,” said Gorman from Maui Grown Therapies. “I think it’s premature at this point to open up the process for more licensees because we don’t know what the demand is.”
But Pamela Lichty, a longtime advocate with the Drug Policy Forum of Hawaii, said that she’s worried if new companies aren’t allowed to apply for licenses until October 2018, it could be another two years before they get off the ground.
Ciccone from Steep Hill Hawaii said he understands the reasoning behind pushing back the date to allow new medical marijuana companies, but added, “I do hope that in 2018 there’s a great list of new dispensary owners.”
But Rep. Della Au Belatti said it’s possible that next year, the Legislature could push back the date even further.
Two years ago, Belatti was a proponent of issuing more than 20 licenses. But now she says there needs to be more analysis before more licenses are issued.
“The department’s time is better spent in fact addressing the more foundational pieces of the dispensary system rather than beginning the process of thinking how do we open up the licenses,” she said.
“Because it’s a very rigorous process to get a (dispensary) license, I think the way we did it is probably a better way initially and then get into seeing if we really need to add others or if there’s another option,” said Baker, who doesn’t think there will be enough demand to justify putting dispensaries on Lanai or Molokai.
HB 1488 has other provisions, including adding rheumatoid arthritis, lupus, epilepsy and multiple sclerosis to the list of conditions that qualify for medical cannabis. The bill would allow the Department of Health to permit existing license holders to grow more plants and open more stores in underserved areas.
Dispensary owners are generally happy about changes that limit how long they have to keep video security recordings, and patient advocates are pleased with a provision to allow residents who grow their own marijuana to test it in the soon-to-be-certified labs.
Still, the lawmakers’ perspective on expanding the industry worries Lichty, who feels that the extension “gives more power to the people who already have the licenses.”
“It deepens the influence of the licensees and makes them even more entrenched,” she said. She’s worried about how the potential for crop failure on an island like Kauai, where Green Aloha is the only licensee, could affect patients.
Meanwhile, the delay in getting dispensaries open has had consequences for patients.
Kristin Wohlschlagel is a hospice nurse on the Big Island. She teaches patients who are mostly elderly about how cannabis can help alleviate symptoms of various illnesses, and is a medical marijuana patient who grows her own.
She knows of one patient whose husband spent thousands of dollars to fly to California to buy cannabis to help his wife, who was suffering from cancer.
“We have patients in hospice who are dying who will not have access to (medical marijuana),” said Wohlschlagel, noting that many patients can’t grow the plant themselves and are only comfortable buying medicine that’s been tested. “That’s happening every day and it’s a big deal.”
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