TX: San Antonio, Houston Cannabis Companies Challenge DPS Marijuana Licensing

Ron Strider

Well-Known Member
At least three Texas-based cannabis companies are preparing to battle the state Department of Public Safety over its awarding of provisional licenses to dispense medical marijuana.

Chad Sykes, founder of Indoor Harvest in Houston, said his company pioneered technology that has been embraced by MIT and Canada-based Canopy Growth Corp., the world's largest legal cannabis company. Indoor Harvest, which partnered with Houston-based Vyripharm Biopharmaceuticals and Alamo CBD in San Antonio, should have been a shoe-in for a license, he said.

Instead, Indoor Harvest and other applicants were excluded thanks to scoring methods that weren't disclosed and by DPS personnel who may know little about the science behind medical marijuana, Sykes said.

On May 28, members of the newly formed Medical Cannabis Association of Texas sent DPS a letter saying state leaders are making it overly difficult to get licenses – which they say goes against the intent of the enabling legislation – and requesting a hearing to make their case.

"Your agencies' notification that we were not awarded a conditional license is in effect a constructive denial that has the same effect on our business interest as a formal denial under the CUP (Compassionate Use Program) rules," the letter says, adding that the statute says the department "shall issue or renew a license to operate as a dispensing organization to each applicant who satisfies the requirements."

The legislation required the DPS to license at least three dispensing organizations by Sept. 1, 2017.

On May 1, the DPS approved three companies for conditional licenses in the Central Texas area. Forty-three companies applied, and while the DPS initially estimated 12 companies would be needed to meet the needs of the state's approximately 150,000 intractable epilepsy patients, the department ultimately decided to limit the licenses to the minimum required by the statute.

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