State Overview: New York

New York, the fourth-most populous state, has one of the most restrictive medical cannabis programs in the country. Under the Compassionate Care Act, enacted in 2014 and administered by the state Department of Health, New York has licensed only 10 “registered organizations” to grow, process and sell medical cannabis to qualified patients and their caregivers. Vertical integration is mandatory, and each registered organization may operate four dispensary locations. To date, there are only 38 dispensaries open for business in New York.

Over time, and in response to near-constant criticism by patient advocates, the program has expanded to provide a robust list of qualifying medical conditions including chronic pain, opioid use disorder and post-traumatic stress disorder. Initially, patients qualified only if they had severe and often terminal ailments, such as cancer, HIV/AIDS, multiple sclerosis and Parkinson’s — and generally as a “last line” course of treatment. Initially, New York was an “oils only” state, allowing for sales of vape cartridges, tinctures and capsules, which made it difficult for registered organizations to compete with the black market. In response, the state allowed ground dry flower (intended for vaporization), suppositories, chewables, lozenges, topicals, patches and similar products.

The program remains under constant criticism on matters such as: barriers to entry for prospective registered organizations; cumbersome patient and caregiver registration requirements; pricing; arbitrary dosing limitations; and too few dispensaries, product offerings and registered practitioners who may issue medical cannabis recommendations (practitioners must pass a four-hour course to qualify their patients for medical cannabis, and a comprehensive list of registered practitioners is not publicly available).

Nonetheless, New Yorkers are optimistic that, in view of a significant budgetary deficit and stated governmental commitments to police and social justice reform, adult-use cannabis may be legalized in 2020. New York has flirted with legalization before, with measures appearing and failing in successive legislative sessions since 2013 and in budget proposals for 2019-2020 and 2020-2021. This year, activists are hopeful that the small-business-friendly Marihuana Regulation and Taxation Act (S1527) will pass, which borrows upon the successes of other states and includes, among other things, priority licensing for social equity and diverse applicants, home grow, traditional product offerings, tax revenue invested in social programming and decriminalization measures. Given that more cannabis is reportedly consumed in New York City than in any other city in the world, smart regulation is long overdue.

Lauren Rudick | Hiller PC

Lauren Rudick represents investors and startup organizations in all aspects of business and intellectual property law, specializing in cannabis, media and technology. Her law firm, Hiller, PC (www.hillerpc.com), is a boutique, full-service firm with a track record for success in various practice areas including cannabis law, land use and zoning, disability insurance law and business and corporate law.

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