COLUMBUS, Ohio – Read like the HGTV show why unopened medical marijuana dispensaries in Ohio aren’t ready to accept patients past the Feb. 11 deadline.
While remodeling a retail space, pharmacy owners say they found black mold, asbestos, and large concrete slabs connected to ceiling joists. They had to replace the roof and do partial demolition to check the work of the ducts. bottom.
City permits proved to be a pain. It was difficult to secure personnel and materials. Some described problems with real estate partners.
An expansion of Ohio’s medical marijuana program aimed at making it easier for patients to access has opened its doors almost a year after it was granted an interim dispensing license. less than a quarter.
After the General Assembly legalized medical marijuana in 2016, the Ohio Board of Pharmaceutical Affairs issued a number of licenses statewide, including about 56 licenses it initially awarded and several additional licenses that were added as a result of lawsuits. We started the program with about 60 dispensing licenses.
However, a 2020 survey found that 43% of patients in Ohio traveled 10 to 30 miles to get to a clinic. This prompted the board to consider more than doubling her existing number of clinics. We settled on 73 new licenses.
The commission divided the state into geographical regions and designated several licenses in each, based on population. For example, Cuyahoga County has its own clinic district. We have 6 clinics from the first round of accreditation and will get 6 more clinics from the second round for a total of 12 clinics.
In early 2022, the Ohio Lottery has drawn a new round of license winners from a pool of 1,465 total applications from companies. The Pharmaceutical Affairs Board announced the majority of provisional dispensing license holders last May, and the clock started ticking.
Provisional dispensing license holders had 270 days to pass a final inspection and receive a business certificate authorizing them to practice.
Most of them missed their deadlines.
In fact, the Pharmacy Commission has licensed only 22 of the 73 dispensing pharmacies.
A committee within the Regulatory Affairs Board recently met to review the progress of license holders who have not received operating certificates. The Board has granted extensions to projects that have shown progress towards opening or that may exhibit delays beyond their control. The board’s director of policy and communications, Cameron McNamee, said he issued a warning to companies that haven’t made enough progress to open.
The board also signed settlement agreements with a number of businesses, outlining when they will open and the fines they will pay if they do not open by the newly specified deadlines.
Patients are subject to delay. They are waiting for a pharmacy near their home that can offer a wider variety of products.
“That’s very bad news,” she said. “It’s wrong. It’s not fair to the patient.”
A request for records from The Plain Dealer/cleveland.com shows the trouble the pharmacy was having in trying to get the store ready to open before the deadline.
The Shangri-La Dispensary is yet to open on Cleveland’s St. Clair Avenue due to pandemic-related delays in furniture arrivals and struggles to find key personnel. The weather also delayed construction, Neville Patel, the company’s Columbia, Missouri owner, wrote in a letter to the Regulatory Affairs Board on Jan. 26.
Posting photos showing the construction of the building, Patel said other parts of the business required by the pharmacy commission were underway. A POS vendor has been identified. I bought a security system.
Patel asked for an exemption until May 31st. The board gave him an extra 90 days until May 12th.
Bliss Ohio on Main Street in Kent received its certificate of operation on April 19th.
On January 26, the clinic’s owner, Next Level Operators LLC, sought an additional 60 days beyond the February 11 deadline, and due to its location in Kent’s historic district, the clinic will be closed before a building review. You mentioned that an additional approval step is required. board.
The company’s Pamela Seekman also said that additional foundations would need to be poured underground, the old concrete removed, and additional foundations installed. The pharmacy board extended the deadline for him to April 12 and issued a certificate of operation seven days later.
The Chicago firm’s doubling wellness facility on Chagrin Boulevard in Woodmere chose an existing building to save money and streamline costs, writes the firm’s Hudson Bailey.
However, there were no utility lines or other mechanical equipment built for this space, so the contractor had to perform selective demolition to examine the existing ducting above the ceiling and devise a mechanical equipment plan. bottom. A 5-foot-by-12-foot concrete slab was later discovered in the ceiling. This is probably from the existing structure of the previous tenant. This created a safety hazard and the concrete had to be removed.
A photo of the slab was enclosed with the variance request.
The pharmacy board has given pharmacies until May 13 to pass the final inspection.
The settlement agreements the board struck with the companies were elaborate and designed to increase penalties over time to encourage completion.
For CREAM Apothecaries LLC, which is owned by a company in Mequon, Wisconsin and is scheduled to open on Cleveland Avenue in Elyria, the board has granted a 90-day extension through May 13th. according to the settlement.
– If you do not pass the final inspection by May 13th, you will have to pay a $5,000 fine by May 14th.
-Then, if the company does not pass the final inspection by June 12th, it will have to pay a fine of $10,000 by June 13th.
-The fine will increase to $15,000 by July 12th.
-The fine will increase to $30,000 by August 12th.
– If the company does not pass the final inspection by September 10th, the matter will be assigned to the Administrative Hearing Officer.
It’s unclear if CREAM Apothecaries will make it in time for that timeline. It provided the state with a construction schedule that indicated construction would not be completed until December 28.
CREAM Apothecaries explained that they were being held by a company called CannDev, a former landlord based in Sonoma County, California.
CREAM Apothecaries said the space required removal of asbestos and black mold, dismantling and rebuilding of the solarium with black mold and a new roof. We couldn’t start building the indoor space until the new roof was installed.
CannDev requested a personal guarantor from CREAM Apothecaries. But CREAM Apothecaries’ Diane Strauss said she couldn’t get a guarantor for the lease unless she had an approved consent from the pharmacy’s board.
CannDev is a real estate acquisition company focused on retail cannabis, said CannDev co-founder Keenan Soares.
It works in Ohio, New York, California, Florida and Michigan. Purchasing or leasing building space that meets each state’s specifications and leasing or subleasing that space to future pharmacies in accordance with the law. For example, Ohio law states that businesses may not be allowed within 500 feet of schools, churches, public libraries, public playgrounds, or public parks.
When the Pharmacy Board announced its second round of dispensing license awards, CannDev began looking for a space that complies with Ohio laws and regulations.
“The state has allowed something called ‘stacking,’ which allows multiple applicants to apply for licenses at one location,” Soares said.
Several companies that applied for interim dispensing licenses were in the same space until the Ohio Lottery picked up applicants. We then entered into a lease or sublease with the winner based on whether CannDev owned or leased the space. That process required a review of the pharmacy’s financials to ensure it was a strong company.
“For us to agree to a lease with CREAM, they have to have some way of demonstrating credibility,” Soares said. We will accept a corporate guarantee if it is a reputable company with a solid financial track record and meets our standards, but if it is not, and it was not in this particular situation, it is a new company. -We do what we call personal guarantees, not corporate guarantees.We ask for personal finances.We also had poor personal finances.We are working with them now. .”
CannDev is no longer involved in the building where CREAM Apothecaries stores, Soares said.
Greg May, a Columbus attorney who specializes in cannabis, cannabidiol or CBD and hemp, said a number of consultants and firms were involved as intermediaries ahead of the second round of interim dispensing licenses. With so many clinics owned by businesses out of state, intermediaries helped them navigate the rules and laws.
“A lot of the heavy lifting associated with the application was site-specific, which meant it had to do with real estate,” says May. “We needed a site plan, a floor plan and had requirements to comply with. We had a hard money deposit to pay the landlord. We had a facility map that had to be made by a licensed engineer. Plans and site plans had to be stamped by a licensed architect.”
Stacking allows cannabis real estate companies to charge or rent out anyone in the space until they conclude a lease or sublease with a licensee who ultimately decides to do business with them. said May.
Ultimately, CannDev says on its website that it helped develop successful retail stores in locations such as Cleveland, Columbus, Dayton and Akron. Danielo, a patient advocate and marijuana educator, said CannDev was partially responsible for the delay in opening clinics.
“Patients haven’t gotten their drugs yet, and out-of-state people could have come in and made millions of dollars,” she said.
CannDev and Soares co-founder Julian Aaron disagrees with characterizing the company as being too opportunistic. The black mold and asbestos found in CREAM Apothecaries can affect any business if contractors start working, and most pharmacies are well on their way to opening.
“We bought six properties at the end of last year, three are open now, two are about to open and the last one is about to open,” he said. “So we’re all moving forward. We did a good job there in doing our job.”
Laura Hancock covers state government and politics at The Plain Dealer and cleveland.com.