Location near Park City among 14 pharmacy sites for Utah’s medical cannabis program
A location near Park City north of Quinn’s Junction has been selected by the state as a potential spot for a medical cannabis dispensary, one of 14 sites in Utah and the only one in the Wasatch Back.
The Utah Department of Health has not issued the final medical cannabis pharmacy licenses, but it announced Friday it was intending to award Deseret Wellness a license to operate at 4554 Forestdale Drive.
Richard Oborn, director of the Center for Medical Cannabis at the Department of Health, said the department still has to conduct background checks on the owners of the pharmacies, visit the sites and approve the operating plans.
The dispensary could open as soon as March.
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The medical cannabis program is the result of Proposition 2, a ballot initiative passed in 2018. Later that year, Gov. Gary Herbert signed H.B. 3001 into law, a compromise that deviated in many ways from the referendum approved by voters. The Legislature further refined the program in a special session last fall.
Not much is known about Deseret Wellness, which was also selected to operate a site in Provo. Oborn said it is a national company and that some of its owners are from Utah. He said that the owners requested the Department of Health not share contact information so they could concentrate on setting up the business.
A lot of work remains to be done. The site is part of a mixed-use business development still under construction east of Old Hwy. 40. The state anticipates eight pharmacies will open in March, with the remaining six scheduled to open in July. Most of the sites are near population centers on the Wasatch Front, with two in the southwestern part of the state and one in the east in Vernal. There is one site that is still undetermined and is anticipated for a highly populated area in Rich, Morgan or Box Elder counties.
Oborn said the Department of Health has not decided which sites will open at what times, but he said the businesses will need to have secured the medical cannabis pharmacy license to transport and store the plant. That means the first wave of pharmacies have about six weeks to finalize their plans to gain approval and receive the license.
As of Tuesday, four days after the announcement, Deseret Wellness had not submitted an application for a business license to the county, according to the Summit County Clerk’s Office, and had not reached out to the Summit County Sheriff’s Office to coordinate a security plan, according to Sheriff’s Lt. Andrew Wright.
Wright said the Sheriff’s Office is treating the pharmacy as it would any other business, that it doesn’t anticipate being involved in securing the premises and that it doesn’t have any immediate concerns about the business or its transactions.
Oborn said security is one of the major components the Department of Health will look at when reviewing the pharmacies’ operating plans. Marijuana remains classified as a Schedule I substance by the federal Drug Enforcement Agency, though it is legal for medical and recreational use in many states.
Large banking institutions have shied away from the industry, which has largely been forced to operate using cash.
Oborn said he is aware that some banking institutions in Utah have expressed an interest in serving cannabis-related businesses, but that those talks are ongoing.
“There’s, I think, some substance to some of the plans that are being made by some of the banks that think they can contract with some of these pharmacies to make it so they don’t have to carry cash around everywhere,” he said. “Regardless, there is this possibility of a lot of cash being stored, and so that’s a major concern. Whenever there’s a lot of cash, there’s a lot of risk for theft.”
The pharmacies will be supplied by eight growers. The pharmacy license costs between $50,000 and $69,500 annually, depending on the pharmacy’s location. Summit County has been designated a rural area, so the license will be on the lower end of that spectrum, Oborn said.
The cannabis itself will not be taxed, Oborn said, but the Department of Health will collect a $3 transaction fee on each product that is sold.
An initial estimate from the Department of Health indicates that fee will generate about $840,000 in its first full year, 2021, and the medical cannabis program will yield a total revenue of about $2.2 million annually.
Proposition 2 called for 40 distribution points, rather than the 14 approved by the Legislature, and medical cannabis advocates have expressed concern about patients’ ability to access cannabis.
The law initially called for local health departments to distribute the drug, but that was scrapped after pushback from county health officials who claimed it would imperil their federal funding.
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The task force includes representatives from Park City, Summit County and several business entities.