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Thoroughbreds shouldn’t be the only ones racing towards a finish line in Kentucky in the near future. Those vying for a precious medical cannabis business license in Kentucky’s new medical cannabis program will also need to hustle. Kentucky Gov. Andy Beshear, via HB 829, has expedited the business license application timeline, originally to commence in January 2025, to now begin on July 1, 2024, and run through August 31, 2024. The Kentucky Cabinet for Health and Family Services also revealed more details about the program through newly released regulations that you can read about here and here.

Information about the other applicable regulations and upcoming public comment periods and possible public hearing dates can be found here.

Like most medical cannabis legal and regulatory frameworks, Kentucky’s are dense and robust. This is not intended to be an exhaustive summary but rather meant to address several aspects in which prospective business licensees may be particularly interested.

  1. Limited licenses/Lottery
    • Initially, Kentucky’s medical program will award at least the following number of business licenses:
      • 10 Tier I Cultivator
      • 4 Tier II Cultivator
      • 2 Tier III Cultivator
      • 10 Processor
      • 48 Dispensary
      • Unlimited Safety Compliance Facilities
    • The program contemplates a future “producer” license (cultivation and processing combined) and a Tier IV cultivator license, but it is not currently offering these to applicants.
    • As there should certainly be more applications submitted than available licenses, the state plans to hold a lottery in October to announce the winners.
  2. A certain number of dispensary licenses will be awarded to a geographically drawn “region” in the state.
  3. Dispensaries may offer delivery services for registered qualified patients and designated caregivers and may dispense medical cannabis via a drive-thru window or curbside pickup service if approved by the program and operated in accordance with any local rules. 
  4. The program does not offer a vertically integrated license. However, businesses can hold licenses at different locations in the same category, subject to certain limitations.
  5. Kentucky’s program only allows indoor grown medical cannabis.
  6. While Kentucky’s program will not prohibit the sale of medical cannabis flower, “smoking” medical cannabis will be a prohibited use.
  7. The cabinet will prioritize review of Kentucky hemp companies’ medical cannabis business license applications.
  8. Medical cannabis businesses cannot locate within 1,000 feet of elementary and secondary schools or daycare facilities. The state provides an online “zoning tool” for businesses to identify acceptable locations.
  9. Although Kentucky’s program contemplates a mechanism for nonresident, visiting patients to obtain a card, nonresidents with out-of-state cards and proof of debilitating conditions will be able to purchase medical cannabis without a Kentucky-issued card.
  10. The initial list of qualifying conditions include:
    • Any type or form of cancer regardless of stage;
    • Chronic, severe, intractable, or debilitating pain;
    • Epilepsy or any other intractable seizure disorder;
    • Multiple sclerosis, muscle spasms, or spasticity;
    • Chronic nausea or cyclical vomiting syndrome that has proven resistant to other conventional medical treatments; and
    • Post-traumatic stress disorder
  11. The initial visit with a practitioner must be in-person, then follow-up visits can be via telehealth.
  12. Kentucky’s program allows local governments to opt out of allowing all medical cannabis business operations, but they must do so before licenses are awarded in their jurisdiction (before January 1, 2025). Local governments can reverse course and opt back into the program, and voters in the particular jurisdiction can follow procedures to hold an election to require the local government to permit medical cannabis businesses.
  13. Patients can purchase up to a 30-day supply, calculated as 112 grams of raw plant material, 28 grams of concentrate, or 3,900 milligrams of THC infused into a medical cannabis product such as an edible. An uninterrupted 10-day supply of medical cannabis for cardholders consists of 37.5 grams of raw plant material, 9.5 grams of concentrate, or 1,300 milligrams of THC infused into a medicinal cannabis product.​​
  14. There is a THC cap: Raw plant material cannot test over 35% THC potency, concentrates cannot test over 70% THC potency, and concentrates intended for oral consumption cannot exceed 10mg of THC per serving.​​​
  15. Kentucky will exempt medical cannabis from sales and excise taxes.

This weekend, the mint juleps will be flowing and hats will be adorning Derby goers’ noggins. But, once the dust and hangovers subside, attention needs to be directed to preparing those medical cannabis applications. Stay tuned for further developments.