Judge affirms patients’ lawful right to increased purchase limits, free of additional taxes

(Albuquerque) – A New Mexico medical cannabis patient has successfully obtained an Alternative Writ of Mandamus, issued by a New Mexico District Court, that will allow him and the other 120,957 cannabis patients in the state to purchase two ounces of cannabis flower, 16 grams of cannabis extract and 800 milligrams of edible cannabis at any one time, precisely as the Cannabis Regulation Act describes. 

Although the Cannabis Regulation Act sets specific purchase limitations, the New Mexico Regulation & Licensing Department (RLD) has been enforcing outdated regulations that limit patient purchases to just over eight ounces in a 90 day period, far below the aforementioned statutory purchase limitations that went into effect on June 29, 2021. The issuance of the Writ will increase patient purchase limitations by 22 times the current allowance. 

Judge Benjamin Chavez of New Mexico’s 2nd Judicial District Court signed the Alternative Writ of Mandamus on Friday, instructing RLD to comply with the Writ by doing the following:

1. “Cease enforcement of the purchase and possession limitations on medical cannabis… on or after June 29, 2021 on grounds that these provisions irreconcilably conflict with the Cannabis Regulation Act…”
2. “Comply with the clear, indisputable, and non-discretionary duty imposed upon them by the Cannabis Regulation Act and allow qualified patients, qualified caregivers, and reciprocal patients to purchase, tax free, two ounces of cannabis, sixteen grams of extract, and eight hundred milligrams of edible cannabis at any one time beginning on or after June 29, 2021,” (emphasis added).
3. “Modify the BioTrack system to allow medical cannabis sales to be completed as described herein as of June 29, 2021.”

If RLD chooses not to comply with the Court’s instructions, it must provide a written responsive pleading by September 20, 2021, and appear before the Court. 

WRIT OF MANDAMUS IMPLICATIONS

The issuance of the Writ will effectively raise patient purchase limitations 22 times and will trigger even more demand in New Mexico’s Medical Cannabis Program. Currently, medical licensees are still operating under cultivation regulations that were promulgated when just 75,000 patients were in the program. 

Although RLD expects to release updated cultivation regulations on August 24, 2021, operators may not be permitted to increase their cultivation capacity until as late as December 1, 2021. Per the Cannabis Regulation Act, RLD must begin accepting applications for licensed cannabis producers on September 1, 2021, and has 90 days to approve or deny an application. 

Furthermore, it takes five months for cannabis to mature from seed to shelf, indicating the first harvests under the new regulations could occur after April 2021. Even under ideal harvest conditions, many operators will only be harvesting a fraction of their total plant count allotment given the nature of a fixed plant count and perpetual harvest systems.

RLD officials have publicly stated the entire industry will run out of cannabis once adult-use sales begin, which must occur no later than April 1, 2021, per the Cannabis Regulation Act. Despite the acknowledgment of an impending interruption in cannabis supply for patients, RLD officials continue to downplay patient access by equating the commencement of adult-use sales to the “Krispy Kreme syndrome” or a “new restaurant” coming to town.

RLD has stated demand for legal cannabis will diminish over time, which is contrary to the experience in every other state that has legalized cannabis for adult use. 

Given Judge Chavez’s signing of the Alternative Writ of Mandamus and the history of marginalized patient access in New Mexico, the new cultivation regulations are expected to help absorb patient demand. It is unclear whether the regulations will be enough to allow operators to produce the volume needed to support adult-use sales. 

The state’s cannabis cultivators must rapidly deploy all possible cultivation resources in order to ensure that patients can obtain sufficient quantities of cannabis once adult-use sales begin. Ultra Health has committed to ambitious goals of increased production so that it can continue to serve its dedicated patient customers and simultaneously serve the emerging adult-use market.