New plant cap regulation continues to be arbitrary and capricious, violates previous court order 

(Santa Fe) – Ultra Health, New Mexico’s #1 Cannabis Company, and two other medical cannabis producers filed a lawsuit against the New Mexico Department of Health (NMDOH) on Thursday over the newly-promulgated plant count regulation. The case has been assigned to Santa Fe District Court Judge Francis J. Mathew.

NMDOH promulgated the new plant cap, a maximum of 1,750 plants each for 34 producers, earlier this year after a court order struck the former limit of 450 plants per producer. The former cap was found to be arbitrary, capricious, and frustrated the purpose of the Lynn and Erin Compassionate Use Act. 

“Further any plant count, and certainly the 450 plant count, it may not be simply based on outdated and unrelated data in such a manner and means as to violate the Legislature’s directive to provide an adequate supply,” Santa Fe District Court Judge David K. Thomson said in his November 2018 ruling.

The court order required NMDOH to create a plant count regulation that complies with the definition of adequate supply. 

“While it may be true that DOH was delegated the authority to regulate the system of distribution of medical marijuana in this State, it may not create its own arbitrary production number that does not have reasonable nexus in law or fact to adequate supply for patients in the program,” Judge Thompson stated. 

NMDOH failed to conduct the rulemaking according to the standards set out in Thomson’s order and did not provide any factual calculations, reports, or data tables to explain how the 1,750 cap would provide an adequate supply for patients. The only materials NMDOH claimed to support 1,750 plants per producer are riddled with logical holes, unrepresentative data, inferential leaps, contradictions, and poor math. 

The department also failed to promulgate a plant cap regulation that provides for an adequate supply in light of the changes made to the medical cannabis legislation that was signed into law in April. Changes to the law that will require more plant material for patients include nonresident participation in the program, reciprocity, the elimination of the 70% potency cap on concentrates, telemedicine, and the extension to three-year cards. 

Other burgeoning issues that will limit an adequate supply of cannabis statewide include; rapid, year over year growth in enrollment; the need for higher patient purchase limits; the diversification of new cannabis medicines; new qualifying conditions such as opioid use disorder; and the legalization of cannabis for adult-use, an initiative assigned to the 2020 Legislative agenda by Governor Michelle Lujan Grisham. 

Under the 1,750 cap, New Mexico has the most-strict cannabis production regulations of any other state with legalized medical cannabis. Neighboring states such as Arizona, Nevada, Colorado, and Oklahoma do not limit the number of plants a producer may cultivate for medical patients. 

Since the initial plant count lawsuit was filed in August 2016, enrollment in New Mexico’s Medical Cannabis Program has nearly tripled growing from 26,658 patients as of June 30, 2016, to 77,144 patients as of August 31, 2019.

After a recent ruling allowing nonresidents to receive three-year patient registry cards, enrollment is expected to be anywhere from 100,000 to 150,000 total cardholders in the next year. 

The program currently has a robust distribution network of 100 stores statewide, yet the available medicine at each dispensary location is more limited now than when the plant cap lawsuit was originally filed in August 2016.