Government

Cedar Rapids to be site of medical marijuana manufacturing facility

State intends to award license to Iowa Relief, part of national firm with medical marijuana operations in 12 states

(File photo) Flowering marijuana plants grow at the Smokey Point Productions facility in Arlington, Washington, on Jan. 12, 2017. (Bloomberg photo by David Ryder.)
(File photo) Flowering marijuana plants grow at the Smokey Point Productions facility in Arlington, Washington, on Jan. 12, 2017. (Bloomberg photo by David Ryder.)

CEDAR RAPIDS — Cedar Rapids will be the site of Iowa’s second medical marijuana manufacturing facility, officials confirmed Friday.

The Iowa Department of Public Health announced it intends to award the license to Iowa Relief LLC. The company is a subsidiary of New Jersey-based Acreage Holdings, which already grows, processes or dispenses medical marijuana in 12 states, according to its website.

Jasmine Almoayed, economic development manager for Cedar Rapids, who helped with the application, confirmed the license is for a new manufacturing plant in Cedar Rapids. The plan calls for about 20 “high quality jobs,” such as chemists and researchers, in a new facility at 1420 26th Ave. Court SW, off Wilson Avenue and 12th Street SW.

“It’s 21 new jobs, manufacturing in Cedar Rapids, it will be good for the people of Iowa, and it makes sense for Iowa’s second-largest city to have a plant,” City Manager Jeff Pomeranz said.

Iowa Relief joins MedPharm Iowa, of Des Moines, as the two state licensed manufacturers of medical marijuana.

MedPharm, which got its license in December, must have products including cannabis oil, cream, gels and suppositories ready to sell by Dec. 1. Iowa Relief has until July 1, 2019.

Products will be sold at five licensed dispensaries in Waterloo, Davenport, Council Bluffs, Windsor Heights and Sioux City.

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Iowa Relief was one of two companies that expressed interest in opening a manufacturing plant in Cedar Rapids, officials said.

Iowa Cannabis Company had asked for and received the city’s endorsement for a facility here, but that firm was not chosen by the state.

Almoayed said Friday she expected work would begin shortly with a quick turnaround to meet the state’s deadline to be operational. She noted an email had circulated among City Council members sharing the news Friday.

“This is great news, and I am happy for the jobs it will create, but it would be great to also have a dispensary here,” said Dale Todd, legislative co-chair of the Iowa Epilepsy Foundation and Cedar Rapids City Council member. “We don’t have any access.”

He said the law needs to be expanded to allow medical marijuana to be used for more conditions so there is an adequate marketplace for the growers to sustain their operations.

Iowa’s recently expanded medical cannabis law allows two manufacturers and five dispensaries. The first manufacturer chosen was MedPharm, the only company to apply last fall. Although there was initial interest from other firms, the annual fee of $150,000 to $200,000 may have been a deterrent, state officials said.

MedPharm has spent more than $10 million rehabbing 15,000 square feet in an old warehouse east of the Capitol into a state-of-the-art facility to cultivate, grow and dry medical marijuana and manufacture products.

The state opened the bid process again this spring for second manufacturer. The Public Health Department received four applications by the May 31 deadline.

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The department will make the applications public Monday, after the license officially is awarded, spokeswoman Polly Carver-Kimm said.

Acreage Holdings, formerly High Street Capitol Partners, says on its website it has licenses to cultivate marijuana in states that include California, New York, Pennsylvania, Oregon, Illinois and Florida. John Boehner, the Republican former Speaker of the House, recently joined Acreage Holdings’ board of directors and says he will promote legalizing marijuana to help veterans and people addicted to opioids, according to the Pittsburgh Post-Gazette.

MedPharm leaders have expressed concern Iowa’s expanded yet still restrictive law will make it tough for them to see a return on investment.

Iowa caps at 3 percent the tetrahydrocannabinol, or THC, allowed in medical marijuana products and has only a narrow list of medical conditions for which use of the products is allowed.

The state health department has approved only 539 registration cards as of Thursday.

l Comments: (319) 339-3157; erin.jordan@thegazette.com

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