Cannabis Oil Rules in Texas Kill Small Business’ Opportunity
Earlier this year folks were lauding Texas as one of the more visionary jurisdictions when they opened up the market for medicinal, non-psychoactive cannabis in the state, but new rules proposed in Texas aimed at recovering more of the costs of regulation will squeeze out any smaller players that were contemplating entering this industry.
Application Fees for Non-THC Cannabis Oil to increase by 200+ X !
The new rules will increase the application fee for CBD dispensaries to $1.3MM (all figures US Dollars) from the current $6,000. The biennial license costs will increase from the same $6,000 to $975,000 while the application fee for each company employee will increase to $4,820 from the current $150. Per-employee license fees are also going up by about 16X to $4,820 every 2 years. Whether the intention or not, the outcome of these proposed changes will be an industry dominated by a few very large players, sadly mirroring much of how pharma works today.
In addition to the onerous fees, the proposed new rules will make access to low-THC cannabidiol more difficult for patients. While earlier regulations merely required that the applicant meet all the standards including paying all fees and completing rigorous background/criminal checks on all employees, there is a new requirement that the dispensary be “necessary” (the test for this requirement is at this time quite fuzzy).
Why Should Anyone Care? Big Pharma Is Not New
First off, understand this is MEDICINE we are talking about. It should be as readily available as possible and any restrictions have to be based on evidence, not fear-mongering or decades-old stigmas with highly questionable beginnings. This is about Low-THC oils that are used to treat many neurological conditions, specifically Epilepsy during the dawn of the industry in Texas. We don’t restrict the number of pharmacies, physiotherapy clinics or eye doctors, so why is this product so special that it needs oversight costing millions of dollars per location?
The second issue worth exploring is that as a nascent industry, the Low-THC Cannabis Oil business will command a lot of innovation, and that’s where small business shines. The ultimate beneficiaries of such innovation are the patients, and at the margin they will be less well-served by these new rules.
These new rules are not a fait accompli at this point in time and those who wish to weigh in may make comment to the Texas Department of Public Safety until Nov. 28/16 via email or by mail to Steve Moninger, Regulatory Services Division, Department of Public Safety, P.O. Box 4087, MSC-0240, Austin, TX 78773-0246.