The latest sales figures from the MA Cannabis Control Commission show a sharp decline in prices, to the point where adult use is competitive with the state’s medical market.

Massachusetts’ Cannabis Control Commission’s work to overhaul the state’s medical cannabis regulations remain underway, as they await January’s start of a new legislative session. While the agency waits for a fix to allow deverticalization among medical operators, the Commission and its Cannabis Advisory Board are currently working on other efforts to support its aging medical market. Simultaneously, average adult use prices finally dropped lower than average adult use prices for the first time last month. 

For now, efforts to support the medical market include easing access for patients, specifically veterans, and expanding the pool of medical practitioners authorized to issue patient licenses.

Medical cannabis sales in the state have been slowly dropping all year, from as high as $24.7 million last March to $20.8 million in October, along with incomplete November stats that indicate the trend will continue. As of Nov. 27, the monthly figure was $18.9 million, according to data from the CCC.

There were 102,122 certified patients in the state as of the last meeting of the CCC two weeks ago, on Nov. 10. Lately, there has been a slight drop in registered patients, but not at a significant rate. For example, there were just three fewer patient licenses in October, than in the previous month.

There are currently 100 Medical Treatment Center licenses with commence operation orders, with an additional 40 provisional license holders and two with final licenses. There are roughly enough medical dispensaries in the state for each one to serve 1,000 patients, but the majority of the data that the CCC offers publicly on their website covers the adult use market. That data shows a sharp decline in the cost of flower for adult use, but similar metrics for the medical market are unavailable, aside from the fact the total monthly have been dropping, while the monthly total amount of flower sold in ounces has remained somewhat steady in the 87,000-88,000 range.

In October alone, the price of medical cannabis averaged out at about $236 an ounce. Meanwhile, average prices on the adult use market dropped to $219.97 an ounce. 

The state’s current cannabis laws require that all medical operators function within a vertically-integrated operation. This means a single company must own every step of the supply chain, from cultivation to retail in order to exist within the medical cannabis market. This also means starting a medical cannabis company is extremely expensive in Massachusetts, considering the combined startup costs of cultivation, processing and retail.

Despite the CCC’s work, a change in the vertical integration rule would have to come from the legislature, which will likely have to wait until next session.

In its current form, HB 4546 would allow for the creation of separate medical licenses for cultivation and production. Dispensaries would be licensed as medical treatment centers, with a separate license for fully-integrated MTCs. Although the bill is a pretty clear-cut solution for deverticalizing the medical market, it currently resides in the House Committee on Ways and Means, as the two-year legislative session approaches its final weeks.

Meanwhile, the CCC’s Cannabis Advisory Board is continuing to look for ways to increase access to medical cannabis.

Most recently, the board’s subcommittee on Public Health voted on November 28, on a set of recommendations for the CCC to create a Compassion Fund, which would finance the creation of education materials to bring more medical practitioners into the market that are registered to prescribe medical licenses to patients.

A distinct fund of this sort would be particularly useful as municipalities cut down on the operating fees they charge to cannabis businesses. The CCC recently adopted new rules that allow the Commission to override host community agreements. This comes in light of reports of municipalities over-assessing impact fees. Most infamously, this occurred in Fall River when former mayor and current federal criminal Jasiel Correia attempted to extort aspiring cannabis operators. 

As a result, some communities, regardless of how onerous their fees may or may not have been, are bracing for the loss of revenue. 

“I think this is a very important issue,” said committee member Alan Balsam. “With the new regulations we just passed, many of the municipalities that were benefiting from the fees that were charged to marijuana providers, as excessive as some of them were, are going to go away in a large part. I think it’s really important to find a way to backfill when those funds go away to keep helping municipalities with continuing their efforts.”

Balsam referenced an education program operated in Brookline, which shares a border with the City of Boston. The program was funded through municipal licensing fees that may not be available next year due to changes in oversight for those fees.

At a previous meeting, Commissioner Roy said that she did not think CCC would be able to appropriately administer the compassion fund.

“We need to be mindful that even with the Social Equity Fund, the Commission doesn’t oversee the distribution of funds,” she said. “It would almost be a conflict of interest if we were distributing funds to people that we regulate. That’s why the administrative branch oversees the Social Equity Fund and the low interest grants.”

In order to ensure independence, the state could opt to use a third-party nonprofit to disperse funds, according to Balsam who previously worked for the state.

“When I was at the Department of Public Health, we used an organization called the Masshealth Research Institute whenever there was a possible conflict of interest,”he said. “If it’s not appropriate for the Commission to do, then I think a nonprofit would be the way to go.”

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Zack cut his journalistic teeth covering high school sports in the south before spending a decade covering local government, politics and the courts in the Boston, Massachusetts area. He's previously written...