Medical marijuana advocates have faced tough opposition in conservative Utah.
A ballot initiative, known as Proposition 2, was passed by voters last year. Not before a compromise deal was reached among lawmakers and The Church of Jesus Christ of Latter-Day Saints.
That compromise deal limited the number of grower licenses to 10, and laid out very strict distribution guidelines.
Last month, the state announced it had decided to award only eight of the allowed licenses to avoid an oversupply of cannabis.
Several applicants who were denied licenses appealed these decisions, claiming, among other things, many of the awardees were not qualified.
The state unilaterally dismissed those complaints.
Caddy Cadwell, CEO of Tintic United BioScience, says the issue may now end up in litigation, which could delay the rollout of medical marijuana.
Cadwell said his problem with the process used to hand out the license is lack of fairness.
“We filed a complaint with the state of Utah because we feel that the license applications were scored unfairly,” he said.
His company has experience with distributing over 3 million pounds of cannabis around the country but scored 4th in the experience category of Utah's awarding process.
In addition, his company had already secured zoning for a rental space but other companies that had neither the zoning nor a location scored higher in that category.
Cadwell said what could happen is a company that was denied an application and an appeal and it's compliant goes nowhere could file an injunction, which could stop the whole process.
A similar situation played out in Arkansas, and that delayed the rollout of medical cannabis for more than a year.
Besides the issue over how the licenses were distributed, Cadwell has a problem with the number issued.
“We feel that Utah really undervalued their patient count estimates,” he said.
Cadwell said Utah is estimating 15,000 patients, but he believes it will be much higher. In Colorado, for example, in its first year that medical marijuana was allowed, there were over 100,000 patients.
“Really what’s going to happen is they’re setting themselves up for failure because the people that are not qualified to grow are going to fail," he said. "There will be a couple of growers then that are going to succeed but they are going to be responsible for picking up the slack. And it’s not going to happen and the patients are the ones that are going to suffer.”
He said the state will be undersupplied, which will drive up the price and push patients into the black market.
Editor's note: KNPR reached out to both the Utah Department of Agriculture and the Division of Purchasing, both of which declined to join us for this conversation. In an email, an analyst with the Division of Purchasing said they have a policy not to conduct debriefings of vendor outcomes or specifics on the selection process
Caddy Cadwell, CEO, Tintic United BioScience