
September 2, 2016
By Nic Vescovo
Louisiana Governor John Bel Edwards signed legislation that made Louisiana the first state in the Southeast to legalize the production and distribution of medical marijuana on May 19, 2016. The law gave the Louisiana State University Agricultural Center and the Southern University Agricultural Center the right of first refusal to be licensed as the state’s sole production facilities. If neither university opted to become the sole producer of Louisiana’s medical marijuana, then private entities would have the opportunity apply for the exclusive right to produce the State’s medical marijuana.
A University with a State-Sanctioned Monopoly
While many commentators thought that universities would decline the offer (due to the potential loss of federal funds that the universities receive), the boards of each university authorized their respective Agricultural Centers to begin exploring whether to create the Nation’s second university-sponsored cannabis production facility. LSU has reportedly met with investors in New Orleans interested in helping the university develop a business model for the production of medical marijuana and has met with a Colorado medical cannabis law firm to research the issues that LSU may face.
LSU and Southern University’s decision to move forward is unprecedented given that previous state universities that have had the opportunity for state-sanctioned medical marijuana monopolies have declined the offer given the uncertainties of the law and the potential loss of federal funding. The same concerns have not hindered LSU or Southern University’s interest.
Limitations With Louisiana’s Medical Marijuana Law
Louisiana is also limiting the right to dispense medical marijuana to licensed pharmacies, and only 10 such licenses will be issued state-wide. The Louisiana Board of Pharmacy is crafting the rules for dispensing, supply, quality, testing and licensure for the pharmacies and has until December 2016 to issue its rules and regulations. As of the publication of this article, the board has not issued any regulations, but has stated that it will do so by the end of the year.
Louisiana is limiting the ailments for which medical marijuana can be recommended to “debilitating medical conditions,” defined to include only the following: cancer, positive status for human immunodeficiency virus, acquired immune deficiency syndrome, cachexia or wasting syndrome, seizure disorders, epilepsy, spasticity, Crohn’s disease, muscular dystrophy, or multiple sclerosis. Noticeably absent from this list of “debilitating medical conditions” is more common ailments such as pain or nausea. The law also requires the THC levels of the state’s medical marijuana be “reduced to the lowest acceptable therapeutic levels available through scientifically accepted methods.”
Such vague language could likely be the subject of further debate as the medical marijuana program gets underway, especially given that each patient may have a different “therapeutic level” depending on the patient’s ailment and tolerance. A patient will Stage IV cancer may very well require a higher therapeutic level of THC to treat his or her ailment that a patient that is HIV-positive.
Finally, Louisiana is expressly carving out marijuana for inhalation from its medical marijuana program. Any medical marijuana recommended by doctors will have to be ultimately consumed as an extract or oil. This alone presents another hurdle for the universities seeking to be Louisiana’s medical marijuana growers, as processing a marijuana extract will require some additional expertise that the university’s Agricultural Centers may not.
Given this complexity in production, it is not surprising that Veronica Mosgrove, the spokeswoman for the state’s Department of Agriculture & Forestry, has already said that LSU may look to an unidentified “affiliate” to process the marijuana, as the New Orleans Advocate reported. This also opens the door for companies with expertise in producing edible medical marijuana to contract with the universities as well.
A Step Forward in the South
Despite the limitations imposed by Louisiana’s medical marijuana legislation, industry analysts still expect that the state’s 10 pharmacies will be in high demand. Interested pharmacies or investors can visit the Louisiana Board of Pharmacy’s website to obtain its forthcoming regulations, when they are released by the Board.
In the interim, any interested parties are advised to ensure that all licensing with the Louisiana Board of Pharmacy is accurate and up to date. For those interested parties that do not currently have a Louisiana pharmacy license, time is of the essence given that only 10 pharmacies will receive a license to be a medical marijuana dispensary. Once the board issues its regulations, it is expected that new companies will submit pharmacy license applications.
About the Author: Nic L. Vescovo is an intellectual property attorney at the AmLaw 100 law firm of Baker, Donelson, Bearman, Caldwell & Berkowitz, P.C., that focuses his practice on providing IP-related advice to clients ranging from Fortune 500 companies to start-ups. Marc J. Adesso, a corporate finance and securities attorney, and D. Eric Setterlund, a data privacy and information security attorney, both at Baker, Donelson, Bearman, Caldwell & Berkowitz, P.C., contributed to this article.
Louisiana Governor John Bel Edwards signed legislation that made Louisiana the first state in the Southeast to legalize the production and distribution of medical marijuana on May 19, 2016. The law gave the Louisiana State University Agricultural Center and the Southern University Agricultural Center the right of first refusal to be licensed as the state’s sole production facilities. If neither university opted to become the sole producer of Louisiana’s medical marijuana, then private entities would have the opportunity apply for the exclusive right to produce the State’s medical marijuana.
A University with a State-Sanctioned Monopoly
While many commentators thought that universities would decline the offer (due to the potential loss of federal funds that the universities receive), the boards of each university authorized their respective Agricultural Centers to begin exploring whether to create the Nation’s second university-sponsored cannabis production facility. LSU has reportedly met with investors in New Orleans interested in helping the university develop a business model for the production of medical marijuana and has met with a Colorado medical cannabis law firm to research the issues that LSU may face.
LSU and Southern University’s decision to move forward is unprecedented given that previous state universities that have had the opportunity for state-sanctioned medical marijuana monopolies have declined the offer given the uncertainties of the law and the potential loss of federal funding. The same concerns have not hindered LSU or Southern University’s interest.
Limitations With Louisiana’s Medical Marijuana Law
Louisiana is also limiting the right to dispense medical marijuana to licensed pharmacies, and only 10 such licenses will be issued state-wide. The Louisiana Board of Pharmacy is crafting the rules for dispensing, supply, quality, testing and licensure for the pharmacies and has until December 2016 to issue its rules and regulations. As of the publication of this article, the board has not issued any regulations, but has stated that it will do so by the end of the year.
Louisiana is limiting the ailments for which medical marijuana can be recommended to “debilitating medical conditions,” defined to include only the following: cancer, positive status for human immunodeficiency virus, acquired immune deficiency syndrome, cachexia or wasting syndrome, seizure disorders, epilepsy, spasticity, Crohn’s disease, muscular dystrophy, or multiple sclerosis. Noticeably absent from this list of “debilitating medical conditions” is more common ailments such as pain or nausea. The law also requires the THC levels of the state’s medical marijuana be “reduced to the lowest acceptable therapeutic levels available through scientifically accepted methods.”
Such vague language could likely be the subject of further debate as the medical marijuana program gets underway, especially given that each patient may have a different “therapeutic level” depending on the patient’s ailment and tolerance. A patient will Stage IV cancer may very well require a higher therapeutic level of THC to treat his or her ailment that a patient that is HIV-positive.
Finally, Louisiana is expressly carving out marijuana for inhalation from its medical marijuana program. Any medical marijuana recommended by doctors will have to be ultimately consumed as an extract or oil. This alone presents another hurdle for the universities seeking to be Louisiana’s medical marijuana growers, as processing a marijuana extract will require some additional expertise that the university’s Agricultural Centers may not.
Given this complexity in production, it is not surprising that Veronica Mosgrove, the spokeswoman for the state’s Department of Agriculture & Forestry, has already said that LSU may look to an unidentified “affiliate” to process the marijuana, as the New Orleans Advocate reported. This also opens the door for companies with expertise in producing edible medical marijuana to contract with the universities as well.
A Step Forward in the South
Despite the limitations imposed by Louisiana’s medical marijuana legislation, industry analysts still expect that the state’s 10 pharmacies will be in high demand. Interested pharmacies or investors can visit the Louisiana Board of Pharmacy’s website to obtain its forthcoming regulations, when they are released by the Board.
In the interim, any interested parties are advised to ensure that all licensing with the Louisiana Board of Pharmacy is accurate and up to date. For those interested parties that do not currently have a Louisiana pharmacy license, time is of the essence given that only 10 pharmacies will receive a license to be a medical marijuana dispensary. Once the board issues its regulations, it is expected that new companies will submit pharmacy license applications.
About the Author: Nic L. Vescovo is an intellectual property attorney at the AmLaw 100 law firm of Baker, Donelson, Bearman, Caldwell & Berkowitz, P.C., that focuses his practice on providing IP-related advice to clients ranging from Fortune 500 companies to start-ups. Marc J. Adesso, a corporate finance and securities attorney, and D. Eric Setterlund, a data privacy and information security attorney, both at Baker, Donelson, Bearman, Caldwell & Berkowitz, P.C., contributed to this article.