US Cannabis CEO Michael Patterson discusses federal and state cannabis laws and future policy developments.
Michael Patterson is the CEO and founder of US Cannabis Pharmaceutical Research and Development; and has more than 25 years’ experience in the healthcare sector.
Patterson tells MCN about the challenges posed by federal and state legislation in the USA and the future of American cannabis policy.
How can producers ensure they are compliant with state and federal regulations?
By employing people with experience in highly regulated industries – healthcare, banking, government, et cetera – and having dedicated compliance staff overseeing the entire operation. Because if you are not compliant, you are not in business.
How does the current system, where cannabis is illegal under federal law but wholly or partly decriminalised in a growing number of states, complicate the use of medical cannabis? Would a more standardised regulatory approach help patients and clinicians?
It complicates the business, especially if you are a multi-state operator (MSO). Your business must follow different rules in every single state which adds cost to the medicine and the consumer. Furthermore, the inconsistent regulation makes physicians unsure of the law, which decreases their willingness to prescribe or even recommend medical cannabis.
For example, in the state of Florida there are currently over 300,000 medical cannabis patients; but 90 physicians wrote almost 130,000 recommendations – even though over 2,500 physicians have the ability in principle to write cannabis recommendations. With consistent law and regulation, there will be more physicians willing to write medical cannabis recommendations and more patients able to receive this life saving medication.
As more states institute regulations permitting the use of medical cannabis, how do federal tax and banking policies hold the industry back? What changes should be implemented in this respect?
Currently, there are multiple bills in front of the US Congress to ‘open up’ legal banking. One bill called the ‘SAFE Banking Act’ has passed the House but is stuck in committee in the Senate because one Republican Senator (Mike Crapo of Idaho) refuses to ‘help the marijuana industry get bigger selling their poison’. If the bill could pass, it would allow financial institutions to work with cannabis companies without fear of any repercussions from the federal government.
The Republicans are stuck in a ‘prohibition hangover’ and feel they are somehow protecting the country from itself by keeping banking out of the cannabis system; even though 33 states have independently approved cannabis as a form of medicine. The only way that I see this changing is if the Democrats can win the majority in the Senate, which would allow them to control all the committees and get banking legislation approved.
What are the economic benefits of widening legalisation on medical and adult use?
The more states that legalise, the more normalised cannabis use becomes in everyday life. We are beginning to see social use being approved in Colorado, California, Alaska; and more states are yet to come. The more normalised cannabis use becomes, the more it will create a positive cycle of acceptance; which creates more consumer interest in using cannabis; which increases demand; and eventually decreases cost of the medicine – depending on the state.
How do you anticipate the industry evolving in the US over the next few years?
We will see more states approve recreational adult use cannabis. In 2020, we expect New York, Connecticut, New Jersey, Delaware, and Rhode Island to legalise adult use. This will put pressure on the federal government to legalise cannabis at the federal level because enforcement of federal cannabis laws will become impossible. Furthermore, we see the export of technology, knowledge and talent from the USA to other countries via partnerships, joint ventures, and consulting contracts.
Currently 90% of all legal cannabis sales occur in the USA. Since Americans cannot export product, we see the beginning of exporting knowledge to be able to help others internationally with advanced technology for cultivation, extraction, tracking and payments; and with compliance, operations, research and development, and university partnerships.
US Cannabis Pharmaceutical Research & Development