Virginia Receives 49 Applications For The State’s First 5 Medical Cannabis Licenses

Photo Credit: David Zalubowski

Virginia has received 49 applications from medical-cannabis companies hoping to be among the first to set up shop in the state, giving officials plenty of options as they prepare to hand out five licenses this summer.

The applications, which required a $10,000 filing fee, were due last week to the Virginia Board of Pharmacy, which is planning to issue licenses to allow one medical cannabis oil dispensary in each of the state’s five health service areas.

Several participants said the number of applications was slightly higher than they expected, indicating a strong interest from local entrepreneurs and established industry players looking for a foothold in Virginia.

“It takes a significant amount of money to build this infrastructure, plus know-how,” said Dave Albo, a former state delegate turned lobbyist representing a Northern Virginia business group, Nova Pharma Processors LLC, that has applied for a license.

“I’m surprised that many people were able to organize in that period of time,” said Jake Bergmann, the founder and CEO of Atlanta-based Surterra Holdings, which applied in three of the five health areas.

The state opened the application process in mid-April.

Interest was highest in the Hampton Roads area, which saw 15 applications. Northern Virginia, with its high-priced real estate, drew seven applications, the fewest of any region. The service area that includes Richmond had nine applications.

The state is not releasing the applications themselves because they contain proprietary information.

The General Assembly recently passed legislation to allow in-state production and sales of medical cannabis oils to any patient with a certificate from a doctor, expanding on a law that initially only provided some legal protection for patients who wanted to use CBD oil or THC-A oil to treat severe epilepsy.

The legislature passed a law preventing epilepsy patients from being criminally prosecuted over cannabis oil, but several families said they still had to risk legal trouble by traveling outside Virginia to buy the oils and bringing them back across state lines.

Proponents tout benefits

Cannabis-derived oils are not approved by the U.S. Food and Drug Administration, but proponents say they help relieve pain, inflammation, seizures, muscle spasms and nausea, without the high that comes with smoking or ingesting marijuana. The oils only contain a minimal amount of THC, pot’s psychoactive compound. Virginia law limits THC levels to 5 percent.

When they open, the facilities will be limited to selling cannabis oils. But the first wave of licensees could have a bigger role in the future if the state relaxes medical marijuana laws further or legalizes marijuana for recreational purposes.

Over the next few months, state officials will review the applications and award conditional approvals in mid-August. The chosen applicants will then undergo criminal background checks before final approval in late September.

Under the state’s evaluation system, each applicant will receive a score based on several criteria, including financial standing, expertise growing cannabis, building plans, security measures and marketing efforts. The guidelines note that marketing material should not promote recreational use of the oils or marijuana.

Albo, a Republican who in 2015 sponsored one of the first bills to sanction CBD oil use, said that when advocates first approached him to talk about loosening marijuana laws, he thought Virginia’s tough-on-crime past meant it would never happen. He said he asked the advocates to come back to him with hard medical evidence that it can help people, and they did.

“This is not snake oil,” Albo said. “From our standpoint, it’s about manufacturing medicine.”