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Mar 2020
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March 10, 2020

Michigan's Legal Marijuana Commercial Markets Will Soon be Supplied Solely by Licensed Marijuana Vendors

The Michigan Marijuana Regulatory Agency issued an advisory bulletin dated March 1, 2020, which begins the process of completely terminating the rights of medical marijuana growers and processors to acquire marijuana product from medical marijuana caregivers. While some participants in Michigan’s marijuana industry are content to leave the current system as is, other licensed marijuana industry participants will welcome this bulletin.
 
The sale of medical marijuana cultivated by “primary caregivers” to licensed medical marijuana growers, processors and retail provisioning centers has been occurring with the blessing of the MRA (and its predecessor) under a Resolution on Marijuana Product Access for Patients adopted by the Medical Marijuana Licensing Board on March 21, 2019. A very brief history of marijuana legalization in Michigan will establish the context for the temporary allowance of transfers of medical marijuana from caregivers to licensees, and the change in that allowance by the bulletin.
 
In 2008, Michigan voters approved the Michigan Medical Marihuana Act*, which authorizes patients suffering defined medical conditions and others willing to provide care to those patients to possess and use marijuana for medical purposes. Caregivers defined in that law could assist up to five patients by growing and harvesting up to 12 marijuana plants per patient. No state license was issued to a caregiver, who were merely required to register with the state.
 
Effective in 2018, the Michigan legislature adopted the Medical Marihuana Facilities Licensing Act, which created a broad legal framework for the commercialization and licensing of medical marijuana production, transportation, testing and retail sale to patients. Unfortunately, the license application and approval process started very slowly and many medical patients could not find a licensed MMFLA source, so they continued to obtain their medicine from their MMMA caregivers or certain quasi-legal retail “dispensaries.”
 
In 2019, Michigan had more than 300,000 registered medical marijuana patients, second only to California. To ensure those patients had access to medicine while the MMFLA licensing process approved adequate licenses to supply their needs, the Medical Marijuana Licensing Board authorized licensed growers, processors and retail provisioning centers to purchase medical marijuana from caregivers. This authorization was subsequently revised in an MRA Advisory Bulletin issued December 26, 2019, which limited the type of marijuana product that caregivers could transfer to MMFLA licensees to the marijuana flower only. It also limited the legal authorization to purchase marijuana flower to licensed growers and processors. The recently issued March 1 bulletin continues that limitation process but has now established the date of Sept. 30 as the last day on which any MMFLA licensee can lawfully purchase any type of marijuana product from a caregiver.
 
In describing the rationale for the bulletin, the MRA observed that Michigan has now licensed nearly 200 medical marijuana growers and 25 processors. Presumably, the MRA has determined there is a sufficient supply of medical marijuana produced by licensed facilities to meet the needs of patients in the state of Michigan. In addition, the bulletin does not alter the right of a patient to continue to acquire medical marijuana directly from a caregiver. The legal right of a caregiver to support and assist the caregiver’s patients is not altered by the bulletin. A caregiver may continue to grow, harvest and deliver medical marijuana from up to 12 plants per patient, with a limit of five patients per caregiver.
 
What the bulletin changes is the authorization of licensed medical marijuana facilities to acquire any sort of medical marijuana from a caregiver after Sept. 30. In the words of the MRA press release describing the bulletin, “a licensee who accepts an external transfer [from a caregiver] after Sept. 30, 2020 will be subject to disciplinary action by the MRA.”
 
About the author: Robert A. Hendricks is a corporate attorney who now concentrates his practice on Michigan’s medical and recreational cannabis laws. He can be reached at rhendricks@wnj.com or 616.752.2291.
 
*The word marijuana is spelled with both a "J" and an "H" in official Michigan parlance.

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