New York Recreational Marijuana Plan Overhauls Medical Cannabis Too: What To Know

Gov. Andrew Cuomo Photo: Shutterstock

Drastic changes to New York’s medical marijuana program are tucked into Gov. Andrew Cuomo’s plan to legalize recreational pot.

From loosening strict patient eligibility rules to permitting homegrown cannabis for medical use, the once anti-marijuana governor has seemingly conceded to many pro-cannabis demands.

Notably, some of the existing medical marijuana companies in New York, which spent millions of dollars lobbying Cuomo and state lawmakers, pushed key aspects of the legislation, called the Cannabis Regulation and Taxation Act.

USA TODAY Network New York reviewed the legislation and interviewed cannabis industry insiders, revealing the expansive scope of marijuana reforms being debated in Albany.

Homegrown risk and reward
Medical marijuana patients could get a special permit to grow up to four cannabis plants at home under the legislation.

Patient advocates pushed homegrown cannabis to counteract the licensed dispensaries that can charge hundreds of dollars per month, depending on dose and illness.

Yet Jeremy Unruh, an executive at PharmaCann, one of 10 medical marijuana companies licensed in New York, said prices reflected the cost associated with treating serious diseases like cancer and HIV.

“These products are also formulated correctly and to what I would call pharmaceutical standards, which is what you want people with compromised immune systems taking into their bodies,” he said.

Unruh acknowledged homegrown cannabis would reduce costs but raised concerns about it reaching the black market, known as diversion.

For example, an experienced home grower with four plants can produce 50 pounds of cannabis in a year, exceeding personal-use needs and posing a diversion risk, Unruh said.

“We are worried about tainting a first-class consumer-protection oriented program with unregulated cannabis,” he said, adding New York requires strict medical marijuana testing to limit use of pesticides and harmful chemicals.

Cuomo’s cannabis bill, however, limits the diversion threat by allowing only certified patients, or their caregivers, to grow marijuana at home with a special permit. The cap is eight plants per household.

Further, growing marijuana for personal recreational use in New York would remain illegal under the legislation.

In contrast, other states that have struggled with smuggling have little oversight of homegrown marijuana.

Patient eligibility expansion
A list of state-approved health conditions could expand based on new medical research and other changes determined by a new office of cannabis management, according to New York’s new marijuana legislation.

The proposed reforms are a step toward allowing medical professionals to use their clinical judgement to certify patients, a recommendation of a recent state Department of Health report.

“All law abiding New Yorkers should be able to have access to the analgesic and other therapeutic qualities of cannabis,” said Dr. Junella Chin, one of the first doctors to participate in New York’s program. “Used responsibly, marijuana can be a powerful and important tool in a healthy lifestyle.”

When the program started in 2016, the list of 10 eligible diseases consisted of cancer, epilepsy and other serious illnesses as diagnosed by doctors registered in the program.

Then, as criticism mounted over limited patient access, regulators began expanding eligibility of medical professionals and conditions, such as chronic pain and post-traumatic stress disorder.

As a result, the tally of certified patients has increased steadily to 87,855, up from a couple thousand in the beginning.

Cuomo’s cannabis legislation proposes granting licences for new clinical research into medical marijuana, which would be added to the eligible conditions. It could potentially add thousands of new patients.

A marijuana bidding war
Current medical marijuana companies interested in getting a recreational use business license could have to submit bids at an auction, according to Cuomo’s plan.

Auction proceeds would fund recreational cannabis business loans for those hit hardest by racially biased marijuana policing. Similarly, a social equity incubator would get some of the money.

PharmaCann executive Unruh described it as a well-intentioned but misguided plan to have medical companies outbid each other.

“What you’re doing is driving up our costs, and that invariably becomes an additional cost or tax on the medical patient in the state,” he said.

Instead of a bidding war, Unruh floated the idea of charging existing companies more during the application and licensing process to support the state’s social equity agenda.

“Maybe there are some fees associated with that so we’re not gladiators in the Colosseum,” he said.

Medical and recreational business
Cuomo’s legislation combined medical and recreational marijuana under the new Office of Cannabis Management, and an executive director with broad powers more akin to a cannabis czar.

Meanwhile, a key pillar of the governor’s social equity plan is a ban on recreational marijuana growers from owning retail pot shops. In theory, this would keep big cannabis corporations from taking over the entire industry.

Existing medical marijuana companies, however, would be exempt from the ban at the cannabis czar’s discretion, the legislation shows.

That means the companies could start growing and selling recreational marijuana within their system of existing greenhouses and dispensaries.

The potentially lucrative exemption would aid powerful cannabis industry leaders, some of which made campaign contributions to Cuomo and lobbied various state officials.

Lobbying and marijuana policy
Speaking for the New York Medical Cannabis Industry Association that represents many of the existing companies, Unruh said the exemption wasn’t part of prior lobbying.

“I don’t know that we had conversations about the granularity of these provisions,” he said, referring to political talks and lobbying tied to Cuomo’s bill.

The trade group pushed linking medical and recreational cannabis programs to prevent patients from self-medicating with adult-use products, Unruh said.

“Nobody wants a 78-year-old with Parkinson’s (disease) to be unleashed on a marijuana dispensary that is more akin to a liquor store without any real guidance on how that 78-year-old…ought to be using these products safely,” he said.

Cuomo’s office didn’t respond to an interview request to discuss his position changes regarding marijuana.

To understand the political shift, consider the Department of Health currently regulates medical marijuana. The move to a cannabis office means it would be within the state’s Division of Alcoholic Beverage Control, despite a ban on recreational use sites serving alcohol.

Meanwhile, other states like Vermont have already seen pushback over conflicting rules for medical and recreational marijuana, which is expected to be part of the debate over New York’s push to legalize recreational pot by April 1.

Meeting cannabis demand
PharmaCann has spent about $50 million developing its Orange County marijuana production facility, said Unruh, who is director of regulatory and external affairs.

Like other medical marijuana companies in New York, PharmaCann’s operation supplies four dispensaries and has room to grow.

But recreational use statewide is expected to require more than 600,000 pounds of cannabis and outpace existing medical marijuana companies’ capabilities, Unruh said.

“Even if we built big Costco size dispensaries, we still wouldn’t be able to serve that entire consumer community,” he said, adding that’s where the governor’s social equity agenda comes into play.

“We know there is room in this industry for smaller or different or diverse licenses, there is no doubt that is the case.”