Arizona Medical Marijuana Program June 15 th , 2018

1. Arizona Medical Marijuana Program June 15th, 2018

2. Outline • How did we get here? • ADHS’ Responsibilities • What are some of the challenges? • Where are we now?

3. How did we get here? • What is the Arizona Medical Marijuana Act (Proposition 203 or AMMA) • Proposition 203 - Would allow a "qualifying patient" who has a "debilitating medical condition" to obtain an "allowable amount of marijuana" from a "nonprofit medical marijuana dispensary" and to possess and use the marijuana to treat or alleviate the debilitating medical condition or symptoms associated with the condition. The Arizona Department of Health Services (ADHS) would be required to adopt and enforce a regulatory system for the distribution of marijuana for medical use, including a system for approving, renewing and revoking the registration of qualifying patients, designated caregivers, nonprofit dispensaries and dispensary agents. The costs of the regulatory system would be paid from application and renewal fees collected, civil penalties imposed and private donations received pursuant to this proposition. • Nov 2, 2010: Proposition 203 was on the ballot and passed (841,348 “yes” 837,008 “no”)

4. How did we get here? • March 28, 2011: ADHS publishes Final Rules • April 14, 2011: AMMA becomes effective and ADHS begins to accept applications for qualifying patients and designated caregivers • May 14-25, 2012: ADHS accepted dispensary applications • August 7, 2012: ADHS allocated dispensary registration certificates via a Random Selection Process • December 6, 2012: First dispensary opens

5. ADHS’ Responsibilities • ADHS is responsible for: • Issuing registry identification cards or registration certificates to the following: • Qualifying patients • Designated caregivers • Dispensary agents • Dispensaries • Considering petitions for adding debilitating medical conditions

6. ADHS’ Responsibilities-Qualifying Patients • "Qualifying patient" means a person who has been diagnosed by a physician as having a debilitating medical condition. • Must have one of the following qualifying conditions • Cancer, glaucoma, HIV, AIDS, Hepatitis C, Amyotrophic Lateral Sclerosis, Crohn’s disease, Agitation of Alzheimer’s disease, PTSD, or • A chronic or debilitating disease or medical condition (or the treatment for) that causes • cachexia or wasting syndrome • severe and chronic pain • severe nausea • seizures or • severe or persistent muscle spasms

7. ADHS’ Responsibilities-Qualifying Patients • May obtain 2 ½ ounces of marijuana every 14-calendar days from a licensed dispensary • May grow their own marijuana (up to 12 plants) in an enclosed, locked facility if they live more than 25 miles from a licensed dispensary • If the QP designates a caregiver, the caregiver can grow up to 12 plants for the QP if the QP lives more than 25 miles from a licensed dispensary • May “give” (receive no compensation) usable marijuana and marijuana plants to dispensaries

8. ADHS’ Responsibilities-Qualifying Patients • Must have a written certification from a physician confirming diagnosis of QP’s debilitating medical condition • doctor of medicine • doctor of osteopathic medicine • naturopathic physician • homeopathic physician

9. ADHS’ Responsibilities-Qualifying Patients • Must submit an application for and obtain a registry identification card issued by the ADHS • Personal demographic and identification information • Written certification from physician • Whether QP is designating a caregiver and his or her personal information • May request to cultivate (if they live more than 25 miles from a dispensary) or request caregiver to cultivate • Attestation not to divert marijuana and application is true and correct • Copy of identification • Current photograph (to be placed on the card)

10. ADHS’ Responsibilities-Qualifying Patients • QP under the age of 18 • Requires certification from 2 separate physicians • Parents or legal guardians must become caregiver and attest to: • Assisting minor patient with medical use • Allowing the minor to use the marijuana • Will not divert the marijuana to anyone who is not allowed to possess • Have not been convicted of an excluded felony offense

11. ADHS’ Responsibilities-Qualifying Patients Patient ID Card Front and Back Fees are $150 per year. $75 for Food Stamp Eligible. Requires annual renewal.

12. ADHS’ Responsibilities-Designated Caregivers • "Designated caregiver" means a person who: • Is at least twenty-one years of age. • Has agreed to assist with a patient's medical use of marijuana. • Has not been convicted of an excluded felony offense. • Assists no more than five qualifying patients with the medical use of marijuana. • May receive reimbursement for actual costs incurred in assisting a registered qualifying patient's medical use of marijuana if the registered designated caregiver is connected to the registered qualifying patient through the department's registration process. The designated caregiver may not be paid any fee or compensation for his service as a caregiver. Payment for costs under this subdivision shall not constitute an offense under title 13, chapter 34 or under title 36, chapter 27, article 4.

13. ADHS’ Responsibilities-Designated Caregivers • Must submit an application for and obtain a registry identification card issued by ADHS • Had to have been previously designated by QP • CG’s personal demographic and identification information • Attestation • Copy of identification (driver’s license, identification card, passport, previously issued registry card) • Current photograph (to be placed on the card) • Fingerprints (to be mailed to ADHS P.O. Box)

14. ADHS’ Responsibilities-Designated Caregivers Designated Caregiver ID Card Front and Back Fees are $200 per designated caregiver card (for up to 5 qualifying patients). Requires annual renewal.

15. ADHS’ Responsibilities-Dispensary Agents • "Nonprofit medical marijuana dispensary agent" means a principal officer, board member, employee or volunteer of a nonprofit medical marijuana dispensary who is at least twenty-one years of age and has not been convicted of an excluded felony offense.

16. ADHS’ Responsibilities-Dispensary Agents Dispensary Agent ID Card Front and Back Fees are $500 per dispensary agent card. Requires annual renewal.

17. ADHS’ Responsibilities-Dispensaries • "Nonprofit medical marijuana dispensary" means a not-for-profit entity that acquires, possesses, cultivates, manufactures, delivers, transfers, transports, supplies, sells or dispenses marijuana or related supplies and educational materials to cardholders. A nonprofit medical marijuana dispensary may receive payment for all expenses incurred in its operation.

18. ADHS’ Responsibilities-Dispensaries • Password-protected website: • Verification system for law enforcement, employers, and dispensary agents • Point of Sale system for dispensary agents • Dispensary Agent applications • Employers may use the verification system only to verify a registry identification card that is provided to the employer by a current employee or by an applicant who has received a conditional offer of employment. • Law enforcement will be able to see the last 60 days of transactions from a dispensary

19. ADHS’ Responsibilities-Dispensaries • Every dispensary is required to appoint a physician to serve as the medical director • Provide training to dispensary agents • Develop education materials for qualifying patients • Must be onsite or available by phone during dispensing hours • May not provide written certifications for medical marijuana for any qualifying patient

20. ADHS’ Responsibilities-Dispensaries • Inspections • Approval to Operate • Compliance • Administration • Inventory Control System • Product Labeling and Analysis • Security • Edible Food Products • Physical Plant • Complaint

21. ADHS’ Responsibilities-Debilitating Medical Conditions • A debilitating medical condition or treatment approved by ADHS under A.R.S. 36-2801.01 and A.A.C. R9-17-106 • Adding Debilitating Medical Conditions process – every January and July starting in 2012

22. What are some of the challenges? • The AMMA has a strict confidentiality statute (A.R.S. 36-2810) • ADHS cannot disclose information to anyone regarding: • Applications (content & supporting info) • Physical addresses of dispensaries* • Cardholder names • Physicians who certify *ADHS does provide the names and addresses of dispensaries to active qualifying patients.

23. What are some of the challenges? • Unless a failure to do so would cause an employer to lose a monetary or licensing related benefit under federal law or regulations, an employer may not discriminate against a person in hiring, termination, or imposing any term or condition of employment or otherwise penalize a person based upon either: • The person’s status as a cardholder OR…

24. What are some of the challenges? • A registered QP’s positive drug test for marijuana components or metabolites, unless the patient used, possessed, or was impaired by marijuana on the premises of the place of employment or during the hours of employment

25. What are some of the challenges? • State of Arizona v. United States of America, United States District Court, District of Arizona No. CV 11-1072-PHX-SRB (January 4, 2012) (order dismissing for lack of ripeness the states complaint for declaratory judgment regarding whether AMMA provides a safe harbor from prosecution under the Controlled Substances Act). • Compassion First LLC v. State of Arizona, Maricopa County Superior Court No. CV 2011-011290 (January 18, 2012) (minute entry invalidating as ultra vires certain rules and directing the Department to proceed with implementation of AMMA) and (May 14, 2012) (awarding the plaintiffs’ attorneys’ fees and costs of $86,935.68).

26. What are some of the challenges? • Total Health & Wellness, Inc. v. Arizona Department of Health Services, Maricopa County Superior Court No. CV 2013-005901 (September 11, 2013) (order invalidating Arizona Administrative Code § R9-17-308(A), which required approval to operate the dispensary as a condition of renewing a dispensary registration certificate). • Arizona Cannabis Nurses Ass'n v. Arizona Dep't of Health Services, 242 Ariz. 62, 392 P.3d 506 (App. 2017) (affirming the Department’s decision setting conditions under which persons with Post-Traumatic Stress Disorder could register as qualifying patients with a debilitating medical condition). • State v. Sisco, 239 Ariz. 532, 538, ¶ 28, 373 P.3d 549, 555 (2016) (“[T]hose patients that live more than twenty-five miles from the nearest dispensary may be authorized to cultivate up to twelve marijuana plants.” (citing A.R.S. § 36-2804.02(A)(3)(f)).

27. What are some of the challenges? • Parsons v. Arizona Dep't of Health Services, 242 Ariz. 320, 395 P.3d 709 (App. 2017) (Department permitted to consider a felony conviction that had been set aside in determining whether to grant, deny, or revoke designated caregiver registry identification card). • Compassionate Care Dispensary, Inc. v. Arizona Dep't of Health Services, 1 CA-CV 16-0470, 2018 WL 414940 (App. Jan. 16, 2018) (AMMA and regulations governing the process for establishing compliance of medical marijuana dispensary applicants with local zoning regulations contemplated a two-step process – compliant zoning when applying for a dispensary registration certificate and any required additional special or conditional use permits, variances).

28. Where are we now?

29. Where are we now?

30. Where are we now?

31. Where are we now? • Dispensaries Licensed: 130 • Dispensaries Operating: 115 • Cultivation Sites: 91 • Kitchens: 31

32. Where are we now? • Sales in May 2018 • Sales in 2018

33. THANK YOU Tom Salow, Branch Chief Krystal Colburn, Bureau Chief azhealth.gov @azdhs facebook.com/azdhs