Oregon Prepares to Expand Early Adult Cannabis Sales to More Than Just Flower

Chelsea Hopkins of  The Greener Side (OR) writes……

Rolling out guidelines for adult cannabis sales has proven to be one of the most challenging issues facing the Oregon cannabis industry.  Since October 1, 2015, adults 21 and older can legally purchase up to 7 grams of cannabis flower or leaf per day, up to 4 clones and unlimited seeds from medical cannabis dispensaries, while law makers create a legal adult use industry in Oregon.  Although this has generated more business for medical dispensaries and cultivators alike, processors faced some heat from the rules and regulations promulgated from the Oregon Health Authority (OHA) and Oregon Liquor Control Commission (OLCC).

In March the OHA effectively shut down all medical processors when they were tasked with creating a regulatory system for processors to apply and operate with an OHA processor license per House Bill 3400.  With the new law, any processor without a license still operating is subject to a class B felony.  On top of legal repercussions, dispensaries are no longer authorized to purchase any edibles or concentrates until temporary licenses are issued by OHA.  That process opened on April 1.  Oregon’s hyper competitive cannabis market saw hundreds of companies laying off employees, and even more severe: closing for good. By late April, the OHA pre-approved several temporary processor licenses, and by the end of May nearly 80 processors hold temporary licenses, which are publicly posted on the OHA website.

Starting June 2, thanks to HB 3400, early adult sales in Oregon will expand to include a limit of one concentrate receptacle containing no more than 1000MG and one edible containing no more than 15MG, and any amount of non-psychoactive topicals and body products containing up to 6% THC.  With the high cost of packaging, testing and processing, most edibles found in the medical market are currently a much higher dose than the 15MG limit for adult sales.  The edible industry is hard at work creating specific edibles for the adult use market, as well as complying with labelling and packaging requirements approved by the OLCC.

The OLCC pre-approval will make sure packages “1.     Meet the standards for child-resistance; 2.     Not be attractive to minors; and 3.     Not contain any untruthful or misleading information.” OLCC Website.  They will also be approving labels that “Use no smaller than 8 point Times New Roman, Helvetica or Arial font; Be in English, although it can include text in additional languages; Be unobstructed and conspicuous; Contain a principal display panel; Not contain any untruthful or misleading statements; and Contain the universal symbol (see image), which must be at least 0.48 inches wide by 0.35 inches high.” OLCC Website

With the added regulations on producers, Oregon has seen a rise in cost of products like edibles and topicals. All products going on a dispensary’s sale floor must go through a pre-approval process with the OLCC, to confirm the labels and packaging are compliant.  They must also be tested by an OHA approved lab, and since April 1, the producer must pay for a temporary license.  Few cities have even imposed their own fees on cannabis businesses, adding to the rising cost. Fortunately, these challenges have not curtailed the creativity and innovation of products that continue to hit the market.

For the last five months, Oregon’s thriving cannabis market has brought in an average of 3.5 million dollars per month on cannabis flower, clones and seeds alone, with a 25% sales tax. Oregon public schools receive 40%, state mental health and drug abuse account services take in 20%, state police receive 15%, city law enforcement acquire 10%, county law enforcement also 10%, and finally Oregon Health and drug abuse programs receive 5% of total revenue collected from cannabis sales.  With the expansion of early sales including topicals, edibles and concentrates, Oregon should expect to see that revenue grow.

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