Lawyers for the Oklahoma Medical Marijuana Authority took a seat at one of two tables before a judge as the morning sun splashed through the hexagon-shaped windows of a first-floor makeshift courtroom inside the state agency’s building near the state Capitol.
The second table was empty, reserved for the owners of a Muskogee marijuana dispensary that recently had been shut down by the state agency over numerous violations. The hearing was a chance for the dispensary owners to appeal the shutdown order, but after 15 minutes of no one showing up, the judge ruled in favor of the authority.
The actual hearing lasted less than two minutes, but it represented the dramatic shift taking place within the state’s once largely unchecked marijuana industry, which many believe has led to an explosion of illegal cannabis flowing to other states.
Last year, the Oklahoma Medical Marijuana Authority issued just one shutdown order against a marijuana business. But in the first five months of 2023, the agency has issued nearly 100 shutdown orders, according to records obtained by The Oklahoman.
Originally a division within the Oklahoma State Department of Health, the Oklahoma Medical Marijuana Authority officially became a standalone state agency last year.
“I feel like that was a moment that really helped change the trajectory because we have much more flexibility (since becoming a state agency),” said Adria Berry, executive director of the authority. “Last year we focused on hiring staff and training that staff, and that takes time. 2023 came around, and it’s like, we’re ready to really get going.”
Since 2021, the authority has nearly tripled its size to about 280 employees, which allows for nearly 400 inspections each week of dispensaries, grow facilities and labs across the state.
The new ‘seed-to-sale’ system is authority’s ‘biggest tool’
The aggressive regulatory push has brought challenges. Some inspectors have reported a rise in disgruntled business owners not used to the higher standards, which include a new “seed-to-sale” tracking system and tags for every plant. The agency has begun sending some inspectors in pairs to increase safety. The agency also has attracted lawsuits, including from one attorney who admits his goal is to shut down the authority.
But some see it as a necessary correction to an industry that had largely operated free of the types of requirements common in other states with legalized marijuana programs.
“Our ‘seed-to-sale’ tracking system has become one of our biggest tools,” said Barrett Brown, the agency’s deputy director. “Most of the (emergency shutdown) cases are because of untagged products. If we look at a product and it’s not in the system, then we have no idea who grew it, who has transferred it, whether or not it’s even been tested, whether or not pesticides have been applied, all of that stuff.”
When Oklahoma voters legalized medical marijuana in 2018 it resulted in a wave of new dispensaries in nearly every community across the state, along with thousands of grow facilities and farms. Nearly 10% of Oklahomans currently have a relatively easy-to-obtain medical marijuana license.
The state’s conservative Legislature largely frowned on the new industry, and both the governor and attorney general have said the state needs to drastically reduce its number of dispensaries and grow operations.
Some have accused politicians of being overly prudish toward an industry that is now legalized in some form in most states.
But Oklahoma’s marijuana sector does appear to be overproducing the product, according to a recent study commissioned by the authority.
Sixty-four grams of cannabis is being produced in Oklahoma for every one gram of demand from the legal medical market, according to a study released by the agency this week. The study was based on a survey of more than 1,300 medical marijuana users and the state’s new marijuana tracking system.
“They said they’ve never seen any state like this,” Berry said about the firm hired to conduct the study.
Business leaders hope new regulations will halt illegal products
Ronald Durbin glanced at the road in front of him every few seconds while speaking into the camera phone mounted on his car’s dashboard. The Tulsa attorney was driving to Ottawa County last month for a hearing in Miami on one of the multiple lawsuits he’s filed against the Oklahoma Medical Marijuana Authority.
“We are about to go kick OMMA’s butt, or at least try our darndest,” said Durbin, who regularly uses live Facebook videos to decry the state agency he believes is illegally shutting down marijuana businesses.
The Facebook comments, many from business owners in the industry, praised Durbin for his work. “You’re our hero,” one viewer wrote.
Durbin said his clients have had businesses shut down over minor infractions or impossible-to-follow rules, including tagging requirements for plants too young to support a tag’s weight.
The Oklahoma Medical Marijuana Authority declined to comment on pending lawsuits, but staff said the agency works with business owners, and there are exceptions to some rules, such as allowing tags to be placed in the dirt when a plant is too young.
The authority held a series of town hall meetings earlier this year where marijuana business owners shared concerns and asked questions. Berry said the feedback was helpful and some comments would shape the agency’s work.
But when some complained that business licensing applications were taking longer than in the past, Berry was proud to take the blame.
“I’m the reason things have gotten worse,” Berry told the crowd, addressing the slower turnaround time. “The first year every single license application … they were going out the door quickly. Now we are slowing down, we are making sure that every single thing is done properly.”
Blake Cantrell, who is president of the Oklahoma Cannabis Association and operates The Peak dispensary, said many businesses like his welcomed the enhanced regulatory oversight from the authority.
“The reality is this industry has been largely unpoliced,” Cantrell said. “But it’s a brand-new industry, and one that will continually be subject to change, which is what we’ve all signed up for.”
Cantrell said stricter enforcement, especially if it reduces illegal products that go out of state, will help businesses that currently have to fight against deflated prices.
“For example, if a business manufactures 1,000 (cannabis) vape cartridges and sells 700 of those to (someone in) Texas on the black market at a 500% markup, we then see the remaining 300 units entering into the Oklahoma legal market at wholesale price points that we know for a fact are below the cost of the packaging that that product is in,” Cantrell said. “The reason they’re able to do that is they’ve already made more than their margin in the black market but then turn around and undercut the legal market, which is the only market that we and others in our same position play in.”
Now a business that processes marijuana that hasn’t been sold legally should be flagged by the state’s new tracking system.
Berry said the authority’s ability to regulate the industry will reduce illegal marijuana production, but she also believes it will make the product safer for the more than 400,000 Oklahomans who have a license to use medical marijuana.
“I’m thinking of those patients who walk into a dispensary that we license. They are trusting that the product they’re purchasing has been through the legal process, it has been tested,” Berry said. “We take that seriously. I want people to know they can walk into a dispensary and trust what they’re purchasing. And it’s the enforcement of our regulations, that’s how we will get there.” (Full Story)