Medical Cannabis, Texas-Style: Conditions and Requirements for Use

By Ashley Simpson, Hoban Law Group

In 2015, the Texas legislature’s passage of the Texas Compassionate Use Act (Senate Bill 339) legalized medical cannabis in the Lone Star State, but only to the extent of “low-THC cannabis oil” for use by patients diagnosed with intractable epilepsy.

Widening further access to any patients respectively diagnosed with any other medical condition deemed treatable with low-THC cannabis requires further legislative action.

Currently, the state’s eligibility requirements for treatment using low-THC medical cannabis stipulate that a patient must be: a permanent resident of Texas; medically diagnosed with intractable epilepsy; and determined by two separate, qualified physicians to be of “reasonable” condition for potential benefit for the patient. Those standards being met, the law requires that a patient’s cannabis oil contain no more than 0.5% by weight of THC, and not less than 10% by weight of CBD.

The Texas Department of Public Safety (DPS) — the entity tasked with implementing the Compassionate Use Program (CUP) — enacted administrative rules to govern the program. Such rules initially required each authorized “dispensing organization” to pay a renewable, $6,000 licensing fee to the state, which had no cap on the number of licenses to be granted. However, DPS subsequently amended such regulations to require a $1.3 million licensing fee, which was ultimately reduced to $488,520 for a two-year period. At one point during the crafting of administrative rules, DPS proposed a mandate that each authorized dispensing organization’s location have a DPS officer onsite for 24 hours, 7 days per week. That rule being ultimately abandoned, in December 2017 (having received applications from 43 separate entities), DPS issued but three dispensing licenses within the entire state (an area as large as all of New England, New York, Pennsylvania, Ohio and North Carolina combined), those going to Cansortium Texas, Compassionate Cultivation, and Surterra Texas, respectively.

More recently, two other Texas cannabis-reform bills received attention: House Bill 81, and House Bill 2107. House Bill 81, authored by Rep. Joe Moody (D-El Paso), called for decriminalization for possessing less than an ounce of marijuana. The bill made it farther through the Texas legislative process than any major marijuana reform bill in the state’s history. House Bill 2107, which would have expanded the Compassionate Use Act and allow the use of medical marijuana for qualifying patients with other debilitating medical conditions, became the first comprehensive medical marijuana bill voted out of a Texas House committee. Though the bill died without being scheduled, a committee hearing featuring stories from veterans who rely on cannabis to navigate their lives attracted 72 additional co-authors for the bill, including 28 Republicans.

Currently, state lawmakers are due to reconvene on Jan, 8, 2019, for the 86th Legislative Session. Popular momentum has been gaining toward increasing patient access to medical cannabis, and to create an industrial hemp program akin to what was outlined in the 2014 Federal Farm Bill.

Advocates hope that 2019 will prove to see expansion of the CUP, along with establishment of an industrial hemp program in Texas. Until then, the CUP remains relatively very limited, both in terms of qualifying patients enjoying access to the products, and for the number of businesses which may yet enter the medical cannabis market within the nation’s second-most-populated state.

Hoban Law Group is an advisory partner to New Frontier Data.

Ashley Simpson

Ashley Simpson is Of Counsel to Hoban Law Group. She began working in the cannabis industry after the Texas Compassionate Use Act (SB 339) was passed in 2015. She has had a long-standing interest in the cannabis industry, and enjoys a unique position to advise clients on the emerging and rapidly changing landscape of cannabis law in Texas. She can be reached at ashley@hoban.law.