Las Vegas Sun

June 29, 2017

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With recreational weed sales coming, what will happen to medical marijuana in Nevada?

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Steve Marcus

A man displays medical marijuana after making a purchase at the public opening of Euphoria Wellness, 7785 S. Jones Blvd., the first marijuana dispensary in Las Vegas, Wednesday, Aug. 26, 2015.

The Denver dispensary is called Medicine Man and was founded on serving medical marijuana patients. Yet, since Colorado legalized recreational marijuana sales three years ago, few of the store's patrons have been making medicinal purchases.

“There’s less need for medical inventory because we have less medical customers,” said Andy Williams, owner and CEO of Medicine Man, one of Colorado’s largest legal marijuana stores selling both recreational and medical marijuana. “People don’t want to go through the hurdles to get their cards anymore.”

A similar scenario will likely play out for Nevada’s pot dispensaries when recreational marijuana sales begin July 1. The first four states to legalize recreational marijuana sales — Oregon, Alaska, Washington and Colorado — have all seen a dip in the number of active medical card-holding patients.

For nearly two years since Nevada’s first dispensary opened in July 2015, medical marijuana has been the only source of legal weed. Nearly 28,000 Nevadans currently hold medical cards, and thousands of other purchases come from out-of-state buyers through the state's reciprocity program, which honors medical cards from other weed legal states.

Williams’ dispensary opened in December 2009 to serve medical patients, but quickly moved away from that model when recreational sales started in 2014, he said. Medicine Man’s name now seems ironic, given more than two-thirds of its customers are recreational buyers and Williams gets less than half of the medical patients he once did.

In Colorado, medical cardholders were down more than 34,000 at the end of 2016 from the program’s peak high of nearly 129,000 patients in June 2011.

Other out-of-state dispensary owners have reported a similar decline in medical pot buyers — from Oregon, where state cardholders fell from 78,015 less than two years ago to 67,141 per the state’s most recent tally, to Alaska, where cardholders fell 40.6 percent from January 2015 to the start of this year.

“I think more people here have decided not to go the medical route because of the high price tag on getting a card,” said Eli Bilton, CEO of Attis Trading Dispensary in Portland, Oregon. “It’s hard to make up for a $400 annual card if you’re not always buying a lot of product.”

While recreational sales have yet to begin in Nevada, the state’s medical cardholder count continues to increase, reaching a record high of 27,952 in April, the last month of data available. But the process of applying for a medical card, similar to those in other states, requires both money and patience.

Patients must pay a combined $100 to request and apply for a medical marijuana card from the state, and an additional $100 to $200 to get a required doctor’s recommendation for the card. That card must be renewed every year, for a cost of $75 plus another doctor’s recommendation. Medical buyers are legally allowed up to two-and-a-half ounces of flower purchases every two weeks or the THC equivalent of concentrates, like shatter, wax and carbon dioxide oil, edibles and other ingestible products like tinctures, vapors and suppositories.

Recreational buyers in Nevada can buy up to one ounce of flower per day, or one-eighth of an ounce of concentrates, edibles or other ingestible products. That allows them nearly six times as much legal weed in the same 14-day period as medical buyers.

And unlike medical cardholders, recreational buyers are not listed in a state registry that also tracks their purchases. That makes it easier to hop from dispensary to dispensary, and even buy more than the legal limit. Nevadans with medical cards are also banned from obtaining a concealed carry weapon permit and those working in certain public sector jobs, like active duty military and most law enforcement agencies, can’t have them either.

“There’s just not a lot being done to make medical worth it anymore, in any of the states,” said New York-based marijuana attorney Mitchell Kulick, whose firm is advising state political offices in both Massachusetts and California on implementing new recreational marijuana programs in their previously medical-only states. “The recreational programs have in part swallowed them up, and Nevada may have a similar result.”

But with Nevada’s medical pot industry seemingly destined for the same fate as those of other recreational weed states, industry leaders and elected officials are working to throw the industry a lifeline.

A state-mandated 15 percent wholesale tax on recreational marijuana sales from cultivation and production facilities to dispensaries, outlined in the voter-approved Ballot Question 2, plus a proposed 10-percent tax proposed by Gov. Brian Sandoval, will allow medical cardholding weed customers to pay up to 20 percent less for the same products at dispensaries, said Andrew Jolley, president of the Nevada Dispensary Association and owner of The+Source Medical Marijuana dispensaries in Las Vegas and Henderson.

The savings could add up to hundreds of dollars annually for those who shop at his dispensary multiple times per week, justifying the costs for a state medical card.

Armen Yemenidjian, president and CEO of Essence Cannabis Dispensaries, who serves as a panelist with Jolley on Clark County’s Green Ribbon Marijuana Advisory Panel, said he’s also planning on a sizable price difference between his medical and future recreational weed buyers, to incentivize patients to come back.

“If you treat everything as recreational, then those patients get lost in the shuffle and there’s no motivation for dispensaries to carry the medical products they’re looking for,” Yemenidjian said. “We’re trying to create a program where there’s big enough cost savings so people are incentivized to keep their card and they’re not seen as second-class customers.”

Assembly Bill 422, sponsored by Assemblyman Nelson Araujo, D-Las Vegas, aims to make getting a medical card worth the trouble for less frequent medical marijuana buyers, too. If the bill is signed into law by session’s end next week at the Nevada Legislature, both first-time applicants and renewing cardholders would pay no more than $50 in annual state fees for their card. Doctors’ recommendation notes could also be valid for two years instead of just one under AB422. If passed, the bill would reduce the annual cost for medical cardholders by an average of up to $130 during a four-year period.

“There will be some digression available to the medical professionals on whether they want to renew the card amounts for one year or two, but the option will be there,” Araujo explained. “And the card will cost no more than $50 when it’s all said and done. It could cost as low as $35.”

Araujo’s bill would also take away the Nevada Division of Public and Behavioral Health’s ability to view information on tracked purchases by medical marijuana cardholders – leaving that information to individual dispensaries. Other regulations associated with medical marijuana, like dispensary licensing and enforcement of violations, would be moved over to the Nevada Department of Taxation to fall under the same regulating body as the new recreational program.

“Part of preserving the medical program is ensuring patients have incentive to use it in a way they feel comfortable,” Araujo said. “Medical patients will not be forgotten in Nevada.”

Editor’s note: Brian Greenspun, the CEO, publisher and editor of the Las Vegas Sun, has an ownership interest in Essence Cannabis Dispensary.

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