Louisiana lawmakers on Wednesday killed a proposal to break up the duopoly of medical marijuana producers, likely dooming for this year the effort to expand the insular licensing structure for growers.
Patient advocates and prospective growers, complaining of lack of access, high prices and little variety at the limited number of pharmacies, are pushing to add more companies to the program. Currently, only two companies – businesses partnered with LSU and Southern University’s agricultural centers – are allowed to grow the drug. Only nine pharmacies are licensed to dispense it.
But several lawmakers on the House Health & Welfare Committee said the state, in setting up that licensing system a few years ago, made a promise to the universities and their partners that they would have the exclusive right to grow the product until 2025 at minimum. The committee unanimously voted to kill Rep. Joe Marino’s HB 767, to add six new growers.
Instead, the Legislature has advanced a proposal to tweak the pharmacy side of the program. Speaker Pro Tem Tanner Magee’s HB 697, which cleared the House this week on a 77-16 vote, would add a new pharmacy in Jefferson Parish and give current pharmacy owners the ability to open new locations, eventually letting in new companies as patient count rises. The bill’s primary purpose is to dramatically change the way marijuana is regulated, transferring it from the Agriculture Department to the Louisiana Department of Health.
Magee has said he’s open to amending the bill to add more growers or pharmacies, but noted those efforts might face political headwinds gaining favor among legislators and the governor.
As lawmakers have debated a host of proposals to change the medical marijuana system, there’s been little agreement about how bad the supply problems are and who is to blame. The number of patients has skyrocketed this year after marijuana flower hit the shelves for the first time in January.
Marino argued patients are being pitted against the two universities, which have a financial stake in retaining their licenses. The schools get payments from the private growers; they were initially added to the program as a way to make the bill more palatable to the conservative Legislature by giving the schools another funding source amid grim budgetary times.
“We have a monopoly in Louisiana on medical marijuana,” Marino said. “We’re allowing basically one company to dictate the market. To dictate the price of medicine to our patients.”
Marino said the Louisiana Association of Business and Industry, the state’s most powerful business lobby, should be advocating for a free market for medical marijuana. LABI hasn’t publicly waded into the debate and didn’t return a message seeking comment Wednesday.
Marino’s effort faced headwinds from the start. Gov. John Bel Edwards, a Democrat who helped usher the program into law, has said he likes the current structure and doesn’t want to see a big expansion. House Speaker Clay Schexnayder, R-Gonzales, is against expanding the number of growers. And Black Caucus members, a key constituency in the medical marijuana debate, have come to Southern University’s defense, arguing against proposals to expand growing to more private companies.
Good Day Farm President John Davis told lawmakers his company sells its product wholesale more cheaply than it can be purchased in nearby medical states like Arkansas.
“I think that goes to the fact that we are contracted with a public institution with the board of supervisors that expects us to have competitive pricing,” Davis said.
Good Day, which is based in Arkansas and partners with LSU, has dramatically scaled up its production, building a big growing facility in Ruston with the help of a multi-million dollar investment from Boysie Bollinger, a well-known businessman and GOP donor. The company produces more than Ilera Holistic Healthcare, the company partnered with Southern University.
David Brown, co-owner of Willow Pharmacy, the lone medical marijuana pharmacy in the north shore region, disputed the growers’ claims about low pricing. He said the prices here are higher than in other states. Brown said adding more growers and pharmacies to the market would increase competition and drive down prices.
“If you’re not gaining market share you have a couple of options. One of them is to lower prices,” he said.
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