An Overview of KY’s Medical Marijuana Bill
As Kentucky moves forward with its medical marijuana program, entrepreneurs may be wondering how to get involved in this burgeoning industry. This blog post breaks down the types of licenses, requirements, and challenges you may face when starting a medical marijuana business in Kentucky.
A Legal Overview for Entrepreneurs
Kentucky's medical marijuana legislation outlines five types of licenses for businesses:
Cultivators
Processors
Producers
Safety Testing Facilities
Dispensaries
Cultivator License
Cultivator licenses are divided into four tiers based on the square footage of the cultivation area. A cultivator license holder may also own a processor license. This license allows businesses to grow and sell raw cannabis, which must be tested by a safety testing facility and processed/packaged by a processor or producer.
Processor License
This license allows businesses to process raw cannabis into edibles or vapes. Additionally, processors can package these products and raw cannabis for vaping. It is currently unclear if the final products will need to be retested by a safety testing facility after the extraction process.
Producer License
A producer license combines a Tier 4 Cultivator License with a Processor License, essentially creating a full-stack operation excluding the lab and dispensary components. With up to 50,000 sq. ft. of indoor grow space, this license is likely to be relatively expensive.
Safety Testing Facility License
Safety testing facilities will be required to test one-half of one percent of all medical marijuana products for cannabinoid content, pesticides, mold, contamination, vitamin E acetate, and other prohibited additives. The cost of setting up a viable lab can range from $300,000 to over $1.5 million, potentially creating a significant barrier to entry.
Dispensary License
Dispensaries can purchase marijuana products from processors and producers and sell them to card-holding customers in retail stores. Dispensaries must be located at least 1,000 feet away from elementary or secondary schools or daycares.
Challenges and Timeline
Starting a medical marijuana business in Kentucky will come with several challenges, such as local ordinances, banking restrictions, and limitations on the number of licenses available. The deadline for final regulations is July 1, 2024, with licensees beginning to operate on January 1, 2025.
How We Can Help
Our team can assist with various aspects of starting your medical marijuana business, including entity selection, licensing, zoning laws, and regulatory compliance. We also provide business consulting services and ongoing support to ensure your business thrives in this growing industry.
For more information or assistance, please feel free to reach out to us at (859) 474-0001 with your questions.
