Iowa CBD program starts July 1, but no supplier in place
DES MOINES, Iowa Iowas medical marijuana oil program will start in weeks, but obtaining the medicine will be difficult and manufacturers said its unclear if the states effort will be viable.
Although the cannabis oil program approved during the last legislative session will begin July 1, there is no immediate supplier of the oil in Iowa, and manufacturers in other states question whether enough people will enroll in the limited program to make it self-sustaining.
Last week, the nonpartisan Legislative Fiscal Office forecast that 6,022 people will enroll in Iowas new program, which allows use of cannabis oil for those suffering from cancer; multiple sclerosis; seizures; HIV or AIDS; Crohns disease; Amyotrophic lateral sclerosis; Parkinsons disease; untreatable pain; and terminal illness with a life expectancy of under a year.
Albert Gutierrez, CEO of MedPharm, a Colorado-based cannabis distributor, said Iowas projected participant level of 6,000 patients comes true, profit margins could be slim.
I think 6,000 is probably a little bit conservative, based on some of the numbers, for a business or dispensary to operate in the Iowa market and be able to be successful, Gutierrez said.
And its possible those projections are overly optimistic.
In Minnesota, a similar medical marijuana law is nearly 2 years old but still has less than 6,000 people enrolled, said Andrew Bachman, the CEO for LeafLine Labs, one of two licensed cannabis manufacturers in Minnesota. He notes that Minnesotas population of 5.5 million is significantly higher than Iowas 3.1 million, and that fewer patients could mean less revenue.
We are 23 months into the program and we are not yet profitable, Bachman said.
Bachman said LeafLine anticipated low initial patient numbers and is ahead of its business plan, but he thinks companies in Iowa should expect to wait before seeing consistent profits.
With the population size being smaller, I would anticipate that ramp up to be somewhat slower, he said.
Under Iowas program, officials will license two in-state manufacturers that can start supplying marijuana oil in December 2018. The state will license up to five dispensaries to supply the drug.
Sen. Joe Bolkcom, D-Iowa City, said manufacturers may compete for an Iowa license and then try to lobby lawmakers to expand the program.
They know right now its a money-loser. Its not sustainable, he said. The folks who make an investment, theyll roll the dice and think they can get the law changed.
Some states with existing medical marijuana laws recognize cardholders from other states. A proposal to provide Iowans access to Minnesotas medical marijuana market failed when Minnesota lawmakers did not approve the measure this session.
Although nearly 30 states have at least limited programs, the federal government still considers medical marijuana a Schedule I drug that cant be moved ...
