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The Wholesome Bud Co. in Springfield is developing medical marijuana packaging as it pursues state licensing.
Photo provided by The Wholesome Bud Co.
The Wholesome Bud Co. in Springfield is developing medical marijuana packaging as it pursues state licensing.

Blazing Ahead: SWMO medical marijuana dispensary hopefuls prefile applications

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Medical marijuana facility preapplication forms and fees are adding up at the Missouri Department of Health and Senior Services, with less than three months until applications will begin to be accepted.

Missouri companies are looking to jump into an industry the U.S. Joint Economic Committee estimates will hit $23 billion nationwide by 2022.

In southwest Missouri, 37 out of 269 total dispensary applications have been filed with DHSS, as of April 25, the most recent event since Missouri voters approved medical marijuana through Amendment 2 in November 2018.

Missouri’s timing lines up with a 2018 Time magazine report that found 94% percent of Americans favor medical marijuana legalization with 66% of Americans in favor of recreational legalization.

Deadline approaching
Between Aug. 3-17, DHSS will accept applications for dispensaries, cultivation centers and medical marijuana-infused manufacturing facilities. The state’s approval process is slated to last until the end of the year.

State officials say they’ll license the top-scoring 60 cultivation facilities, 192 dispensary facilities and 86 medical marijuana-infused manufacturing facilities. The state will divvy out at least 24 dispensary licenses in each Congressional district, per Amendment 2’s language.

“After careful due diligence based on broad input and other states’ experiences, we are establishing the number of licenses in this first year to be consistent with what is outlined in the Constitution,” DHSS Director Dr. Randall Williams said in a news release. “Moving forward, we will continually reassess to ensure access for patients is adequate.”

A University of Missouri medical marijuana market study for the state projects the number of qualified patients in the state will be approximately 19,000 in 2020 with an increase to 26,000 by 2022.

In addition to the 269 dispensary preapplications, there’s been 151 prefiled applications for cultivation facilities and 79 for medical marijuana-infused manufacturing facilities, according to DHSS.

The 499 total prefiled applications as of April 25 have generated nearly $3.6 million in fees. 

Missouri companies can apply for more than one license. The application fees are $10,000 for cultivation facilities and $6,000 for both dispensaries and medical marijuana-infused manufacturing facilities.

Facility license forms and instructions will be available on DHSS’ website beginning June 4.
 
Dispensary hopefuls
Desmond Morris and his business partners are on the path toward licensing.

They’ve organized The Wholesome Bud Co. LLC in Springfield, with intentions to cultivate, manufacture and sell medical marijuana.

Though the industry has yet to launch, Morris said the day-to-day operations include team development, patient advocacy, talking with doctors around the state, and communicating with state and local officials.

“A lot of it is developing our relationship with the community, developing a brand and putting together the application,” Morris said via phone, on a drive back from Jefferson City where he attended medical marijuana advisory council meetings.

Morris said one issue is finding doctors and pharmacists to connect with potential patients. The company has added a master grower and an operations executive to its staff in the last month and now has 15 employees.

Morris said Wholesome Bud has contracts for two buildings in Springfield. He declined to disclose the locations but said the company currently offices out of Morris’ Pride Auto Detailing at 2835 E. Division St., Ste. P.

Wholesome Bud worked with Carnahan, Evans Cantwell & Brown PC attorney and shareholder Chip Sheppard to register with the Missouri secretary of state’s office. Sheppard was part of the New Approach Missouri team campaigning for Amendment 2.

Morris said when he first considered entering the industry, after the passage of Amendment 2, he wanted to work with a lawyer who had a strong understanding of the amendment.

“It was a no-brainer to reach out to Chip,” he said.

Sheppard said the law firm embraced the burgeoning industry after shareholders met with a former deputy sheriff from Texas who relocated to Missouri.

The sheriff, who had multiple sclerosis, was taking some 25 medications before using medical marijuana in his home state. His use of medical marijuana, Sheppard said, allowed him to get out of a wheelchair and significantly cut down on his prescription drugs.

The Time report found a 64% reduction in opioid use by patients using marijuana for chronic pain.

Sheppard said now the law firm is working with dozens of clients in the medical marijuana industry, with services such as transactions, business development, real estate and employment.

Government hang-up
Those in the budding industry say it’s had some early challenges, starting with the federal law.

“The fact that it is federally illegal makes everything exponentially complicated,” Morris said.

Springfield City Council currently is weighing a bill regarding the distance requirements for medical marijuana dispensaries and product manufacturing facilities from schools, day care centers and churches. The bill’s current language states a 200-foot separation, though a current amendment would push the distance minimum to 1,000 feet.

John Price, another CECB attorney, addressed council members April 22 about a group of clients applying for dispensary licenses. He said they’re in the process of leasing property but are unsure if it will meet the city’s proposed requirements.

Price did not identify his clients at the council meeting, and he couldn’t be reached for additional comment by press time.

Council is scheduled to vote on the bill May 6.

Springfield Public Schools Chief Communications Officer Stephen Hall provided a statement to the Springfield Business Journal on SPS’ stance for the distance requirements: “When Missouri voters approved Amendment 2, the language established safeguards for schools by setting a perimeter of 1,000 feet, with the ability for that boundary to be modified by local governing bodies. This amendment to our state’s constitution is a new endeavor for Missouri, with unknown implications for neighborhoods and schools. For this reason, SPS encourages a conservative approach.”

Springfield resident Kim Andrews, who’s planning to open a dispensary with her family, addressed council on April 22 about the distance requirements.

“Once our dispensary location is tied to the license, it’s not an easy thing to move,” she said. “We have to have permission by DHSS to move. In order to get a location, you have to have a debt-free facility.”

From the financial standpoint, and since marijuana is illegal at the federal level, the American Bankers Association has taken the stance that, “contact with money traced back to marijuana operations could be considered money laundering and could expose a bank to significant legal, operational and regulatory risk.” The ABA is seeking “greater legal clarity” to banks operating where medical or recreational marijuana in legal from Congress and other regulatory agencies, according to its website.

“The banking issue impacts you in more than just funding,” Morris said, adding obtaining property and paying employees are other issues. “We’re trying to communicate with our state representatives to get banking laws relaxed.”

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