Iowa medical marijuana program grows in 2022

DES MOINES — Iowa’s medical marijuana program saw growth in 2022 as the number of registered patients increased and as sales rose at the state’s licensed dispensaries.

As of November, the number of cardholders in Iowa’s program stood at 14,466, close to double the 7,865 enrolled patients in December 2021, according to a new report from the Iowa Medical Cannabidiol Board, which administers the program.

More health care providers are certifying patients for the program. As of November, 1,920 practitioners had certified a patient at least once, compared with 1,603 nearly a year ago.

Lucas Nelson, the president of Bud & Mary’s — formerly known as MedPharm — said the growth in patients shows an increased need for access in the state, both in the number of dispensaries and the types of products available. Bud & Mary’s is one of two licensed marijuana manufacturers in Iowa and operates dispensaries in Windsor Heights and Sioux City.

“It demonstrates that there is a need for these products in the state, and there is a need for more access for people,” he said.

Sales at the state’s five dispensaries in the last year were $10.2 million, compared with $6.1 million in 2021. August was the first month in the program’s history to bring in more than $1 million in sales.

Nelson said the Bud & Mary’s Sioux City location sees about 50 transactions a day, while the Windsor Heights location handles about 300 transactions a day.

Another company, Iowa Cannabis Company, operates dispensaries in Council Bluffs, Waterloo and Iowa City. The Iowa Cannabis Company received a license from the state to begin producing marijuana for the program in 2021 in Cedar Rapids, before relocating its planned facility to Iowa City. The timeline for that facility to be operational is May 2023, according to the board’s report.

Bud & Mary’s began work on a $10 million expansion of its production operations this year because of the increased demand, and Nelson said the new facility would be operational in the first quarter of 2023. The new operation will triple the company’s production, Nelson said.

“That’s in preparation for where we believe this program is going to head and where we believe it should head,” he said. “As more people get access, as more people learn about it, hopefully as the Legislature helps with assisting us in getting more dispensaries, more product availability, et cetera, we’ll be well set up and ready for it.”

Nelson said the company will continue to lobby lawmakers to allow the sale of vaporized flower, which is available in several other states’ medical marijuana programs. The change would allow dispensaries to sell whole cannabis flower that patients can vaporize.

Iowa’s program allows only for the sales of oral, topical, nebulizers, oil vaporizers and suppository products. Vape products were the most popular of the forms sold at dispensaries in 2022, accounting for 66 percent of sales.

Since flower is cheaper than the other products to produce, Nelson said the change would lower costs for cardholders and attract more patients to the program.

“We believe it’s a safe, effective method for delivering the molecules, but, most importantly, it’s going to be more cost-effective,” he said.

While the board has not recommended that change, Nelson and the board agrees that the state needs more licensed dispensaries. State law currently allows for five.

“It’s very, very frustrating for us when we get calls and hear from people who would like to join the program but can’t make the trip,” Nelson said. “They’re simply boxed out of it because we’ve chosen to only allow for five dispensaries.”

The Medical Cannabidiol Board’s report recommended removing the number of dispensary licenses from the state law and allowing the department to issue more licenses “based on evidenced-based demand analysis.”

When it comes to taxes, the board recommended exempting medical marijuana products from sales tax to ease the cost burden on patients. It also advocated a tax tweak that would allow cannabis companies to take business expense deductions for state income taxes.

In a technical change, the board recommended changing the state law, and by extension the program, to the “Iowa Medical Cannabis Act” from the “Iowa Medical Cannabidiol Act.”

Cannabidiol, commonly known as CBD, was the main product available when the program started, but a 2020 law removed a THC cap on products and allowed for the sale of high-THC products — but with a limit of 4.5 grams of THC per 90-day purchase in most cases. THC is the primary chemical in a marijuana plant that causes the “high.”

The name creates confusion around the program, the report said, as some law enforcement officers and others don’t know that high-THC medical marijuana products are legally available in Iowa. High THC products also made up the bulk of sales with 78 percent, compared to 13.2 percent balanced THC and CBD, and 8.9 percent high CBD.

Nelson said the high sales of THC can be attributed to its effectiveness in treating chronic pain, as well as the availability of CBD online and over the counter in Iowa. With CBD easily available without a medical card, people joining the program are generally seeking higher THC formulas.

The name change would “reflect scientific reality via inclusion of all cannabinoids, mitigate confusion with program stakeholders, and improve program education,” according to the report.