The CDPH Re-Adopts Cannabis Emergency Regulations

Just this month, California Department of Public Health (CDPH) approved the re-adoption of emergency regulations for cannabis manufacturers for an additional 180 days. What does this mean, and how does it impact your cannabis business?

What are California’s cannabis emergency regulations?

Just a quick refresher: the emergency regulations cover the policy known as MAUCRSA, the Medicinal and Adult-Use Cannabis Regulation and Safety Act. These regulations outline California’s standards and licensing requirements for commercial cannabis manufacturers. They were originally passed in December 2017, and as is the standard for “emergency regulations,” valid for a period of 180 days. They were renewed for another 180 days just recently – with a few key changes.

What are the changes to California’s re-adopted emergency regulations?

The biggest change is the removal of restrictions created by the adult use (“A”) and medicinal (“M”) license designations. Originally, MAUCRSA regulations required cannabis plants be designated for either the A or M market at the cultivation stage. Plan material and cannabis products resulting from cultivation had to maintain that A or M designation while moving through the supply chain – complicating logistics and operations for cannabis businesses across the market.

In the newly re-adopted cannabis emergency regulations, the CDPH is attempting to resolve some of the A and M confusion. They have removed restrictions of A and M license designations, meaning businesses can complete one license application for use in both the adult-use and medicinal markets. Starting June 6, 2018, cannabis and cannabis products will only be labeled as adult-use or medicinal at the time of retail sale (with one exception for higher-THC products that are only allowed in the medicinal market).

To review the re-adopted emergency regulations in detail, click this link.

What does that mean for cannabis cultivators?
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There are a couple scenarios where you might have questions, especially if you’re still waiting to hear about your cannabis cultivation license. If you submitted two applications, one for an A license and one for an M license, here are a few points of clarification:

• CDPH will use your A license application as the primary application and aggregate the total gross revenue of your A & M license to determine your license fee.
• If you have paid two application fees, the balance of the funds will be applied to your license fee. These fees, as mentioned above, are due upon approval of your application by the Department and determined by the aggregate total gross revenue of your two license applications.
• The label, “FOR MEDICINAL USE ONLY” is still required on products with more than 1,000 milligrams of THC. These products can only be sold in the medicinal market and must be labeled by the manufacturer.
  • Other products – those that can be sold in either the M or A market – will be labeled with this phrase by retailers at the time of sale to a medicinal consumer.

If you have any specific questions about the MAUCRSA emergency regulations or any of these changes, please get in touch with the experts at California Cannabis CPA.

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