NY State Senate Bill 2019-S1025

Senate Bill S1025

2019-2020 Legislative Session

Relates to organizations registered to sell, deliver, distribute or dispense medical marihuana

download bill text pdf

Archive: Last Bill Status - Stricken

Introduced
- In Committee Assembly
- In Committee Senate
- On Floor Calendar Assembly
- On Floor Calendar Senate
- Passed Assembly
- Passed Senate
Delivered to Governor
Signed By Governor

Please enter your contact information

First Name

Last Name

Email Address

A valid email address is required.

Home address is used to determine the senate district in which you reside. Your support or opposition to this bill is then shared immediately with the senator who represents you.

Optional services from the NY State Senate:

Create an account. An account allows you to officially support or oppose key legislation, sign petitions with a single click, and follow issues, committees, and bills that matter to you. When you create an account, you agree to this platform's terms of participation.

Include a custom message for your Senator? (Optional)

Enter a message to your senator. Many New Yorkers use this to share the reasoning behind their support or opposition to the bill. Others might share a personal anecdote about how the bill would affect them or people they care about.

Actions

View Actions

	Assembly Actions - Lowercase Senate Actions - UPPERCASE
Jan 09, 2020	recommit, enacting clause stricken
Jan 08, 2020	referred to health
Jan 10, 2019	referred to health

2019-S1025 (ACTIVE) - Details

Law Section:: Public Health Law
Laws Affected:: Amd §§3364 & 3365, Pub Health L
Versions Introduced in Other Legislative Sessions:: 2015-2016: S7250
2017-2018: S1088

2019-S1025 (ACTIVE) - Summary

Relates to permitting registered organizations to sell, deliver, distribute or receive medical marihuana to or from another registered organization.

2019-S1025 (ACTIVE) - Sponsor Memo

                                
 
BILL NUMBER: S1025

SPONSOR: RIVERA
 
TITLE OF BILL:

An act to amend the public health law, in relation to organizations
registered to sell, deliver, distribute or dispense medical marihuana

 
PURPOSE:

To allow registered organizations to contract for facilities, equipment,
or services; and repeal the requirement that registered organizations be
vertically integrated.

 
SUMMARY OF PROVISIONS:

Section 1: Amends subdivisions 4, 6, and 13 and adds new subdivisions 14
and 15 to section 3364 of Public Health Law. Allows a registered organ-
ization to contract with persons or entities to provide facilities,
equipment, or services related to the registered organization's func-
tions or activities. All laws applicable to the registered organization

shall apply to the contractor. Allows a registered organization to sell,
deliver, distribute, or receive medical marihuana to or from another
registered organization.

Section 2: Amends Subdivisions 1, 3, 6 and 9 of section 3365 of Public
Health Law to remove references capping the number of registered organ-
izations at five and dispensaries per organization at four.

Section 3: Effective date.

 
JUSTIFICATION:

The Department of Health has authorized just five registered organiza-
tions (ROs) , with four dispensaries each, to provide medical marihuana.
Nor are the registered organizations allowed to contract out any part of
the production and distribution processes. They must own every part of
the operation from growing to dispensing, a system of mandatory vertical
integration that the State would normally discourage. Almost every
element of the manufacturing/retailing economy operates through compa-
nies that are not vertically integrated and includes contracting out
segments of operations.

This places significant burdens on the RO business model. For example,
ROs produce medical marihuana in one location and distributes it else-
where to be dispensed, but cannot simply ship its product with a shipper
(no matter how secure) like any other manufacturer. Instead, the RO must
own the delivery trucks itself and directly employ the drivers. This
bill allows the RO to contract out some of its functions while ensuring
that all laws applicable to the RO apply to the contractors as well.

The bill removes both the limit on the numbers of ROs and dispensaries
and the requirement that ROs be vertically integrated.

In order to allow non-integration, the bill allows a registered organ-
ization to sell, deliver, distribute, or receive medical marihuana to or
from another registered organization. There are many strains of medical
marihuana targeting different diseases and age groups. A patient in a
rural area may be certified for a particular strain only to discover
that no dispensary in the region carries it.  Allowing ROs to sell,
deliver, or distribute to, or receive medical marihuana from other ROs
will help get critically important medicine to patients who would other-
wise struggle with long-distance travel and geographic disparities.

This bill is a significant step towards expanding patient access by
ensuring adequate supply and statewide availability of medical marihua-
na.

 
LEGISLATIVE HISTORY:

2016: S7250

 
FISCAL IMPLICATIONS:

None.

 
EFFECTIVE DATE:
Immediately.

2019-S1025 (ACTIVE) - Bill Text download pdf

                            
 
                     S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   1025
 
                        2019-2020 Regular Sessions
 
                             I N  S E N A T E
 
                             January 10, 2019
                                ___________
 
 Introduced  by  Sen.  RIVERA -- read twice and ordered printed, and when
   printed to be committed to the Committee on Health
 
 AN ACT to amend the public health  law,  in  relation  to  organizations
   registered to sell, deliver, distribute or dispense medical marihuana
 
   THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section 1. Subdivisions 4, 6 and 13 of  section  3364  of  the  public
 health  law, as added by chapter 90 of the laws of 2014, are amended and
 two new subdivisions 14 and 15 are added to read as follows:
   4. (a) A registered organization may lawfully, in  good  faith,  sell,
 deliver, distribute or dispense medical marihuana to a certified patient
 or designated caregiver upon presentation to the registered organization
 of  a  valid  registry identification card for that certified patient or
 designated caregiver. When presented with  the  registry  identification
 card, the registered organization shall provide to the certified patient
 or designated caregiver a receipt, which shall state: the name, address,
 and  registry  identification number of the registered organization; the
 name and registry identification number of the certified patient and the
 designated caregiver (if any); the date  the  marihuana  was  sold;  any
 recommendation or limitation by the practitioner as to the form or forms
 of  medical  marihuana or dosage for the certified patient; and the form
 and the quantity of medical marihuana sold. The registered  organization
 shall  retain a copy of the registry identification card and the receipt
 for six years.
   (b) The [proprietor of a] registered organization shall file or  cause
 to  be  filed any receipt and certification information with the depart-
 ment by electronic means on a real time basis as the commissioner  shall
 require by regulation. When filing receipt and certification information
 electronically  pursuant to this paragraph, the proprietor of the regis-
 tered  organization  shall  dispose  of  any   electronically   recorded
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
                                                            LBD06534-01-9

 S. 1025                             2
 
 prescription  information  in  such  manner as the commissioner shall by
 regulation require.
   6.  When  a  registered  organization  sells, delivers, distributes or
 dispenses medical marihuana to a certified patient or  designated  care-
 giver,  it  shall provide to that individual a safety insert, which will
 be developed and approved by the commissioner and include,  but  not  be
 limited to, information on:
   (a) methods for administering medical marihuana in individual doses,
   (b) any potential dangers stemming from the use of medical marihuana,
   (c) how to recognize what may be problematic usage of medical marihua-
 na  and  obtain appropriate services or treatment for problematic usage,
 and
   (d)  other  information  as  determined   by   the   commissioner   IN
 REGULATIONS.
   13.  The  commissioner  is  authorized to make [rules and] regulations
 restricting the advertising and marketing of  medical  marihuana,  which
 shall  be consistent with the federal regulations governing prescription
 drug advertising and marketing.
   14. A REGISTERED ORGANIZATION MAY CONTRACT WITH A PERSON OR ENTITY  TO
 PROVIDE FACILITIES, EQUIPMENT OR SERVICES THAT ARE PART OF OR INCIDENTAL
 TO  THE  REGISTERED  ORGANIZATION'S  FUNCTIONS  OR ACTIVITIES UNDER THIS
 SECTION. ALL LAWS AND REGULATIONS APPLICABLE TO THE REGISTERED ORGANIZA-
 TION SHALL APPLY TO THE CONTRACT. THE REGISTERED ORGANIZATION AND  OTHER
 PARTIES  TO  THE  CONTRACT SHALL EACH BE RESPONSIBLE AND ACCOUNTABLE FOR
 COMPLIANCE WITH SUCH  LAWS  AND  REGULATIONS  UNDER  THE  CONTRACT.  THE
 COMMISSIONER MAY MAKE REGULATIONS CONSISTENT WITH THIS TITLE RELATING TO
 CONTRACTS AND PARTIES TO CONTRACTS UNDER THIS SUBDIVISION.
   15.  A  REGISTERED  ORGANIZATION  MAY  LAWFULLY,  IN GOOD FAITH, SELL,
 DELIVER, OR DISTRIBUTE MEDICAL MARIHUANA TO  A  REGISTERED  ORGANIZATION
 AND  MAY  ACQUIRE  MEDICAL  MARIHUANA FROM A REGISTERED ORGANIZATION, IN
 ACCORDANCE WITH THE REGISTRATION OF BOTH REGISTERED ORGANIZATIONS.
   § 2. Subdivisions 1, 3, 8 and 9 of section 3365 of the  public  health
 law,  as added by chapter 90 of the laws of 2014, are amended to read as
 follows:
   1. Application for initial registration. (a) An applicant  for  regis-
 tration  as a registered organization under section thirty-three hundred
 sixty-four of this title shall include such information prepared in such
 manner and detail as the commissioner may  require,  including  but  not
 limited to:
   (i) a description of the activities in which it intends to engage as a
 registered organization;
   (ii) that the applicant:
   (A) is of good moral character;
   (B)  possesses or has the right to use sufficient land, buildings, and
 other premises (which shall be specified in the application) and  equip-
 ment  to  properly  carry on the activity OR ACTIVITIES described in the
 application, or in the alternative posts a bond of  not  less  than  two
 million dollars;
   (C)  is  able  to  maintain  effective security and control to prevent
 diversion, abuse, and other illegal conduct relating to the marihuana;
   (D) is able to comply with all applicable state laws  and  regulations
 relating  to  the  activities  in  which  it intends to engage under the
 registration;
   (iii) that the applicant has entered into a labor peace agreement with
 a bona-fide labor organization that is actively engaged in  representing
 or attempting to represent the applicant's employees. The maintenance of

 S. 1025                             3
 
 such  a  labor peace agreement shall be an ongoing material condition of
 certification.
   (iv)  the  applicant's status under subdivision one of section thirty-
 three hundred sixty-four of this title; and
   (v) the application shall include  the  name,  residence  address  and
 title  of  each of the officers and directors and the name and residence
 address of any person or entity that is a member of the applicant.  Each
 such person, if an individual, or lawful representative if a legal enti-
 ty, shall submit an affidavit with the application setting forth:
   (A)  any  position of management or ownership during the preceding ten
 years of a ten per centum or greater interest  in  any  other  business,
 located in or outside this state, manufacturing or distributing drugs;
   (B)  whether  such person or any such business has been convicted of a
 felony or had a registration or license  suspended  or  revoked  in  any
 administrative or judicial proceeding; and
   (C) such other information as the commissioner may reasonably require.
   3. Granting of registration. (a) The commissioner shall grant a regis-
 tration  or  amendment to a registration under this section if he or she
 is satisfied that:
   (i) the applicant will be able to maintain effective  control  against
 diversion of marihuana;
   (ii)  the  applicant  will be able to comply with all applicable state
 laws;
   (iii) the applicant and its officers are ready, willing  and  able  to
 properly carry on the manufacturing or distributing activity for which a
 registration is sought;
   (iv)  the applicant possesses or has the right to use sufficient land,
 buildings and equipment to properly carry on the activity OR  ACTIVITIES
 described in the application;
   (v)  it  is  in the public interest that such registration be granted;
 the commissioner may consider whether the number of registered organiza-
 tions in an area will be adequate or excessive to reasonably  serve  the
 area;
   (vi) the applicant and its managing officers are of good moral charac-
 ter;
   (vii)  the  applicant  has entered into a labor peace agreement with a
 bona-fide labor organization that is actively engaged in representing or
 attempting to represent the applicant's employees; and
   (viii) the applicant satisfies any other conditions as  determined  by
 the commissioner.
   (b)  If the commissioner is not satisfied that the applicant should be
 issued a registration, he or she shall notify the applicant  in  writing
 of  those factors upon which further evidence is required. Within thirty
 days of the receipt of such notification, the applicant may submit addi-
 tional material to the commissioner or demand a hearing, or both.
   (c) The fee for a registration under this section shall be  a  reason-
 able  amount  determined  by  the  department  in regulations; provided,
 however, if the registration is issued for a  period  greater  than  two
 years the fee shall be increased, pro rata, for each additional month of
 validity.
   (d)  Registrations  issued  under this section shall be effective only
 for the registered organization and shall specify:
   (i) the name and address of the registered organization;
   (ii) which activities of a registered organization  are  permitted  by
 the registration;

 S. 1025                             4
 
   (iii)  the  land,  buildings  and  facilities that may be used for the
 permitted activities of the registered organization; and
   (iv)  such  other  information  as  the  commissioner shall reasonably
 provide to assure compliance with this title.
   (e) Upon application of a registered organization, a registration  may
 be  amended  to allow the registered organization to relocate within the
 state or to add or delete permitted registered  organization  activities
 or  facilities.  The  fee  for such amendment shall be two hundred fifty
 dollars.
   8. The department shall begin  issuing  registrations  for  registered
 organizations  as soon as practicable after the [certifications] CERTIF-
 ICATION required by section thirty-three hundred  sixty-nine-b  of  this
 title [are] IS given.
   9.  The  commissioner  shall  register  [no more than five] registered
 organizations [that manufacture medical marihuana with no more than four
 dispensing sites wholly owned and operated by such registered  organiza-
 tion]  AND  FACILITIES TO PROMOTE REASONABLE ACCESS TO MEDICAL MARIHUANA
 IN THE INTEREST OF CERTIFIED PATIENTS AND THE PUBLIC.  The  commissioner
 shall  ensure  that [such] registered organizations and dispensing sites
 are geographically distributed across the state AND  SHALL  NOT  REQUIRE
 THAT  DISPENSING  SITES BE OWNED OR OPERATED BY THE REGISTERED ORGANIZA-
 TION LICENSED TO MANUFACTURE  MEDICAL  MARIHUANA.  [The  commission  may
 register additional registered organizations.]
   §  3. This act shall take effect immediately; provided that the amend-
 ments to title 5-A of article 33 of the public health law made  by  this
 act  shall  not affect the expiration and repeal of such title and shall
 expire and be deemed repealed therewith.

Comments

Open Legislation is a forum for New York State legislation. All comments are subject to review and community moderation is encouraged.

Comments deemed off-topic, commercial, campaign-related, self-promotional; or that contain profanity, hate or toxic speech; or that link to sites outside of the nysenate.gov domain are not permitted, and will not be published. Attempts to intimidate and silence contributors or deliberately deceive the public, including excessive or extraneous posting/posts, or coordinated activity, are prohibited and may result in the temporary or permanent banning of the user. Comment moderation is generally performed Monday through Friday. By contributing or voting you agree to the Terms of Participation and verify you are over 13.

Create an account. An account allows you to sign petitions with a single click, officially support or oppose key legislation, and follow issues, committees, and bills that matter to you. When you create an account, you agree to this platform's terms of participation.