Kentucky about to hold first lottery for medical marijuana businesses. Another is delayed
Starting in January, Kentucky will open the application process for state residents to become medical cannabis cardholders. Given that marijuana remains illegal at the federal level, Kentucky must also build its own supply chain, from cultivator, to processor, to dispensary.
For the past several months, the work to build the commonwealth’s medical cannabis market has been playing out behind the scenes. Kentucky doctors and advanced practice registered nurses have been able to apply to become medical cannabis practitioners since July.
To date, the state’s medical cannabis program has received nearly 5,000 applications for business licenses – more than 4,000 of which are for dispensaries. The competition to break into this budding market is fierce given only 48 dispensary licenses will be granted initially.
On Monday, Oct. 28, the public will get its first peek at how the process is playing out when the state holds a lottery for cultivator and processor licenses. It will be live-streamed by the Kentucky Office of Medical Cannabis on its YouTube account.
Another separate lottery for dispensaries is in the works, but a date for that lottery has not been announced. Originally, state officials planned to hold that lottery in October, but a large number of dispensary applications will likely push that lottery to November, Gov. Andy Beshear said at a recent press conference.
Here’s what we know about how these lotteries will work, including why the dispensary lottery may be taking so long.
What we know about the lotteries for cannabis business licenses
Sam Flynn, the executive director of Kentucky’s Office of Medical Cannabis, which has been tasked with implementing and running the state’s program, spoke to lawmakers Wednesday. Appearing before the legislature’s Interim Joint Committee on Health Services, Flynn offered an update on Kentucky’s medical cannabis program.
During the meeting, Flynn briefed lawmakers on the lottery for cultivator and processor licenses, set to take place Oct. 28. The lottery will be conducted for a total of 16 cultivator licenses and 10 licenses for processors.
In Kentucky’s medical cannabis ecosystem, processors convert the raw plant material into consumable products, such as edibles and oils. Kentucky’s medical cannabis law generally pushes patients toward edibles, oils, tinctures and vape products. Smoking marijuana is still illegal under Kentucky law.
The lottery for cultivators and processors will take place at 2 p.m. Eastern Standard Time Oct. 28, Flynn said.
As for dispensaries, Flynn told lawmakers “we’re still working through the large volume of applications that we’ve received, and we will be announcing the dispensary license lottery date at a later date.”
Only 48 dispensary licenses will be granted at the launch of Kentucky’s medical cannabis program next year. These dispensaries will be spread across the state, specifically in 11 licensing regions throughout the state.
This is to ensure equitable access to medical cannabis despite where patients live, Flynn said.
“We wanted to make sure that dispensaries are spread throughout the commonwealth so that folks can get access. So somebody from Pikeville is not driving to Lexington for their medication,” Flynn said.
Four dispensary licenses will be issued per region, except for the regions containing Jefferson and Fayette counties. Those two counties will each get two dispensary licenses, “because they are our largest population centers,” Flynn said.
Everywhere else in the state, only one dispensary will be allowed per county.
“This is something we heard from our mayors, our county judge executives,” Flynn said. “One of the concerns early on was ‘well, we don’t want these things cropping up on every street corner.’ We listened.”
Flynn did not address the state’s expectation for demand when the cardholder application process opens in January.
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