Caregivers and the DoDo
Marijuana and extinct birds would seemingly never show up in any type of discussion. However, in consulting with our marijuana clients, a lot of them are inquiring about the stability of the Caregiver model, specifically as it was promoted years. What many in the sector have actually described as the "Caregiver Model" is going the way of the Do-Do bird on October 31, 2018. Halloween this year will be the extinction event for the caregiver model as many have actually recognized it for years here in Michigan. While Caregivers will continue to be able to grow and market to their registered patients, and for themselves, if they are additionally registered qualifying patients, the "gray market" where they were marketing their excess, and making a fairly good profit, is coming to an end.
What was the "Caregiver Model?"
Under the old "Caregiver Model," a Registered Caregiver can grow up to seventy-two (72) marihuana plants, if they had five registered qualifying patients (the most you were permitted) and they were a registered patient too. In some cases, multiple caregivers would collect at one place and grow their plants with each other, separated by paint lines on the floor, or in more sophisticated situations, with each having a protected locked area within the larger confined, locked facility. Many Caregivers can create much more functional marihuana than their patients can make use of. Those caregivers would certainly after that market their overages to dispensaries, many of which were operating with municipal approval throughout the State. This "grey" industry caused substantial earnings for many caregivers and dispensary owners. Under Michigan's Medical Marihuana Facilities Licensing Act, nonetheless, caregivers were going to be eliminated by 2021. Lots of Caregivers and market experts felt that indicated the "Caregiver Model" could continue to produce those very same profits for an additional 2 or two and a half years. The State, nevertheless, had other plans.
The State's Response
The State of Michigan, however, had other plans for the upstart cannabis industry. Initially, the Bureau of Licensing and Regulatory Affairs has taken a really scrutinizing technique to licensing applications where any of the applicants were Caregivers. Many of those applications have actually been denied over the past several months due to the fact that the Board has located that there were failures to reveal by many of these caregivers concerning just how much cash they made, how they made it, and for failing to declare that income on a State or Federal Tax Return. Nevertheless, in a September 2018 posting, LARA and the BMMR published that all facilities that are running with municipal approval, but which have not received a State License, have to stop purchasing unlabeled and unauthorized medical marihuana on October 31, 2018. https://www.michigan.gov/lara/0,4601,7-154-79571_79784-479748–,00.html. Any marihuana purchased after the October 31, 2018 date by those facilities need to be correctly classified and coded as required by the policies, and must come from an appropriately State Licensed grower or processor. The caregivers may still grow, but they will have no methods through which to market their product lawfully to a provisioning facility or processor. The old "Caregiver Model" will, effectively, come to an end.
Outcomes and Repercussions
Some may argue that there are still licensed or unlicensed centers that are mosting likely to proceed buying from caregivers, in spite of the State mandate. To make sure, there may be some that take that risk.
Nonetheless, the State has demonstrated a dedication to enforcement and inspection. If the State were to determine that an applicant or a licensed center was still taking caretaker overages and offering them, the State would likely do something about it. If an applicant were to be caught taking part in this model, they would likely be denied asap by the Board. If a licensed facility were to be caught breaking this mandate, the State would likely move on with sanctions against that center's license, consisting of a suspension or cancellation of the license. Provided just how much those licenses are worth, and the expense of getting any one of the permitted facility licensing types, many owners will be really reluctant to take chances with the possible loss of their license, or expertise that their license will not be restored.
If you are a caregiver and do not know what to do come October 31, 2018, are a person thinking of getting a MMFLA license, or are a candidate who requires representation or has questions regarding how these modifications will certainly impact you, give us a call. We have the experience and expertise in the marijuana and marihuana law areas to assist address your inquiries and provide you the advice you require.
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