How recreational Is Oklahoma's medical marijuana market?

Welcome to the wild west of weed.

Eighteen months after Oklahoma voters approved medical marijuana, the state is awash in cannabis retail shops. One in 13 adult Oklahomans has a patient card. With no qualifying medical conditions required, patients are finding it easy to get approval, with consultations sometimes just a video call away.

A price war has broken out on the retail side, with intense competition among more than 2,200 licensed dispensaries across the state. Some sit on the same block of a city street. Oklahoma leads the nation in per-capita dispensaries in medical marijuana states, with 56 per 100,000 residents. Retail sales topped $345 million in 2019, and state tax revenue was $55 million, according to the Oklahoma Tax Commission.

"The licenses were so cheap in the state that everybody and their dog got in," said Jake Chilcoat, executive vice president of CBD Plus USA, which owns and franchises dozens of retail stores in the state.

All of this raises the question: Is Oklahoma a medical marijuana state in name only?

It depends on whom you talk to. On the one hand, all of the signs point to a thriving, consumer-driven market. Cars pack the parking lots of some dispensaries into the night. The brand names of the flower, edible and vape products, and the stores, are catchy and ads are everywhere. Some patients talk of how easy it was to get their license.

On the other hand, the marijuana economy is not entirely freewheeling. Unlike in states with recreational marijuana, anyone age 21 or over can't legally pop into an Oklahoma dispensary, show an ID and buy marijuana in various forms, plus grow marijuana plants for non-medical consumption at home.

A Robust Model

The state's experiment with medical marijuana reflects both the spirit of a bare-bones State Question 788, passed in June 2018, and the state's longstanding aversion to strict government regulation.

While tens of thousands of patients are looking for medical relief from cannabis, the state's fledgling model has opened up a quasi-recreational market for thousands more. Customers with a patient card who previously relied on the illicit market can now get legal marijuana from dispensaries in nearly every county in the state.

"We've passed a law by our citizens who didn't really understand it. We have a government that sees it as a cash cow. And nobody's really looking out for the health of Oklahoma," said Dr. Larry Bookman, president of the Oklahoma State Medical Association, which opposed SQ 788. "The whole setup needs to be re-evaluated, but our legislature does not really want to tackle it." The state question passed with 57% of the vote.

With more than 220,000 patient licenses approved so far, the demand for medical marijuana is there.

It's now illegal for doctors to see patients inside retail dispensaries, but dispensaries still conduct off-site or nearby patient drives with doctors to help prospective patients fill out applications and see a doctor for recommendations. One dispensary brought in a doctor on a bus to its parking lot where patients could apply for a card. Video consultations via smartphone or computer are also available from services like PrestoDoctor or NuggMD. There are no laws prohibiting doctors from owning their own dispensaries or other marijuana businesses.

Other states with medical marijuana typically require qualifying conditions. Oklahoma leaves the decision solely to the doctor. The rules require they follow "accepted standards a reasonable and prudent physician would follow when recommending any medication to a patient." The doctor recommendation form contains a section for doctors to list medical conditions and diagnostic codes, but it's optional.

With a two-year patient license, there's little incentive for the recommending doctor and a patient to meet weeks or months later to talk about whether the marijuana is helping. Few of the patients interviewed by Oklahoma Watch said they had met with their recommending doctor after the first consultation.

The Oklahoma Board of Medical Licensure and Supervision adopted guidelines from the Federation of State Medical Boards recommending, among other things, "a documented in-person medical evaluation" before a doctor recommends marijuana use. The physician should regularly assess the person's response to marijuana use, the guidelines say.

"I haven't seen him again since I got my license," said Ashlie, of Oklahoma City, who is in her 30s and asked that only her first name be used. "But I do go to my primary care doctor mostly for my (regular) medications and he knows I'm a medical marijuana patient and is supportive of my treatment."

She added that it was "super easy" to get her patient card in July. "I got on Weedmaps and looked at reviews of doctors and chose one in Classen Tower. It cost $100, and you could pay $25 more for them to fill out the application and take your photo and submit everything.

"I did speak with the doctor for around 30 minutes talking about my symptoms, which I mainly thought was just anxiety."

Traci Wolfe, owner of Classen Apothecare, a dispensary near downtown Oklahoma City, said concerns about how easy it is to get a patient card are overblown.

"Everybody had to see their doctor or a doctor to get their card," said Wolfe, who obtained a patient card herself, as did her husband. She got into the business after seeing a family member suffer from brain cancer. "The doctor I saw, he gave us an exam. He checked us out to make sure we were in need and he wasn't just going to hand you a card."

Bookman said the state medical association worked with lawmakers last year on a so-called "unity bill" to get a short-term, 60-day patient license in addition to the regular, two-year license. That allowed doctors more flexibility, but there's still a lot of gray area around how doctors recommending cannabis are supposed to follow up with their patients, he said.

"The unity bill stated that no physician would be subject to arrest or prosecution for providing patients with a recommendation for a license," Bookman said. "But it also allowed a physician to withdraw their recommendation for a medical marijuana card if they found that a patient was either abusing it or they felt that they no longer warranted that recommendation."

The state marijuana authority said just one doctor has rescinded a patient recommendation since the law changed.

More than 220 doctors have voluntarily registered with the authority to see medical marijuana patients, although doctors don't have to be on the list to give patient recommendations.

Becoming a Seller

For those seeking to sell medical marijuana, the entry costs are low and the demand for business licenses is high. State regulators have been playing catch-up on everything from lab testing and labeling regulations to dispensary license renewals.

Business owners are chafing at what many say is inconsistent direction from the Oklahoma Medical Marijuana Authority and local officials about updates to the law, which took effect in August.

The authority has been swamped with open records requests - more than 650 in the past 18 months - and it re-opened a call center in December to handle questions from patients and business owners.

The authority has focused on fulfilling its licensing role, but it's hamstrung when it comes to traditional public health surveillance. Officials said they can't gather patient demographics or track doctors making marijuana recommendations because the law makes that information confidential.

"It's our understanding from the Legislature and the authors of the state question that we do not have that authority," said Terri Watkins, the authority's communication manager.

Authority officials said they are now transitioning into stronger compliance efforts and the results may take months. New licenses established by the authority include waste disposal and lab testing.

So far, the marijuana authority has received more than 1,050 complaints and issued 231 notices of violations. It has yet to fulfill a records request made by Oklahoma Watch in October to provide details of violations.

New Opportunities

For Wolfe, owner of Classen Apothecare, opening her dispensary was a radical shift.

"We were in the oil and gas business and it kind of tanked on us," Wolfe said. "So we just switched into this field and it's been a complete challenge because every time we thought we knew what the game plan was, they would change it and the rules would change."

Wolfe said customers are finding her on social media, but she also gets foot traffic arriving on electric scooters. The competition among dispensaries is intense, she said.

"To me it makes me think that a lot of them are thinking more recreational than they are medical, and I think they just need to slow down to take a step back," Wolfe said.

Dispensaries now must have a certificate of compliance from a city or county, although not all local governments have zoning regulations. That caused some confusion when the law went into effect. Wolfe said she already had a certificate of occupancy from Oklahoma City to operate a business, but she also needed a compliance certificate to operate as a dispensary. That meant another round of inspections and fees.

"We didn't think they'd be regulating us like we were a doctor's office," Wolfe said.

On the larger retail side, CBD Plus and Lotus Gold stores have blanketed the state. Their Oklahoma-based parent company was among the first to franchise its business. It started with stores selling CBD, a non-intoxicating form of cannabis, after the law changed in 2017. When SQ 788 came along, the company expanded rapidly.

"We just had this franchise concept that allowed us to move really quickly," Chilcoat said. "Everybody thought that we were these corporate guys from out-of-state because our brand is Colorado Cures ... We started it with half a display case in a vape store in January of 2018. And from January to December, we opened up 50 stores."

State Regulations

Chilcoat said he's sympathetic to state regulators, who've been in a tough position regulating a brand new medical market. They can only do so much, he said.

"They need to start outsourcing to the guys who have the resources, like the (Oklahoma State Bureau of Investigation) and the (Drug Enforcement Administration) to block some of the black market stuff coming in because it's hurting the businesses that want to do it the right way," Chilcoat said.

More than half dozen state agencies or boards have responsibilities over medical marijuana, from the Department of Agriculture, which has growing rules, to the Department of Environment Quality, which regulates cannabis disposal. That's added to the confusion among patients and businesses.

By some measures, though, a shakeout in the number of businesses has already started. Some dispensary owners got a license but never opened a store. Others shut down after deciding it wasn't a good opportunity.

"The guys that pay attention and have a game plan, I think they're gonna win, as opposed to the guys whose goal is just to open a store," said Chilcoat. "Just because you love marijuana doesn't mean you should be in the industry."

Marijuana businesses also have to register with the Oklahoma Bureau of Narcotics and Dangerous Drugs. The bureau has licensed 4,757 growers, processors and dispensaries, but 770 businesses opted not to renew their license for a second year, said spokesman Mark Woodward.

The market could accelerate further. Efforts are underway to gather signatures for state questions on recreational, adult-use marijuana.

One petition was filed in December but quickly withdrawn. A second petition, SQ 807, was filed Dec. 27 and is in the early stages of the initiative petition process. It would open up recreational sales to adults 21 and older and impose a 15 percent excise tax. It would also create a process for those convicted of nonviolent crimes involving marijuana to apply for resentencing. Another petition, SQ 808, would also legalize marijuana.

Meanwhile, some medical marijuana bills filed for the legislative session would add curbs to the market, including a dispensary setback of 1,000 feet from a place of worship and banning medical marijuana advertising on billboards.

For Tulsa patient Joe Roberson, the state's medical marijuana market came at just the right time.

Roberson, 41, has struggled with epilepsy since he was eight and was tired of dealing with the expense and hassle of constantly changing medications to deal with his seizures. He got his patient card a month ago and now treats his epilepsy with microdoses of cannabis-infused oil three times a day. His seizures have gone down dramatically, he said.

"I told the doctor that I need help with my epilepsy and seizures to where it least it was manageable," said Roberson, a personal trainer. "He said, 'Don't take this the wrong way, but you are the reason we really got this (law) going.'"

Oklahoma Watch is a nonprofit organization that produces in-depth and investigative journalism on important public-policy issues facing the state. The organization's website is at http://www.oklahomawatch.org.