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How much will patients pay for medical marijuana in Alabama?

MONTGOMERY, Ala. – While the state of Alabama has been delayed a second time from issuing licenses to companies to grow and sell medical marijuana, industry experts anticipate that once products are available, patients can expect to shell out an average of $4,200 a year.

Sam Blakemore, a pharmacist in Birmingham and vice-chair of the Alabama Medical Cannabis Commission, the appointed body tasked with managing the state’s roll out of medical marijuana, said product prices down to the individual capsule could be reasonably predicted by looking at data from states with similar programs.

“The states that you can really look at are Minnesota and Louisiana,” Blakemore told Alabama Daily News on Tuesday. “Their roll out as far as the dosage forms used was very similar; capsules, tablets, etc.”

Despite marijuana being labeled as a Schedule I drug since 1970, 38 states have allowed varying forms of medical marijuana usage. Minnesota’s and Louisiana’s medical marijuana programs, Blakemore said, are most similar to Alabama’s in terms of what products are permissible, and thus, so are their prices.

Currently allowed products include tablets, capsules, gels and oils, and liquids for use in inhalers, among others. Raw plant material, products that can be vaped or smoked, and food products are not allowed, though could be permitted in the future at the discretion of the Alabama Legislature.

Based on data from Minnesota that was compiled by a state-hired accounting firm, Blakemore estimated that Alabamians would likely pay between $1 – $1.50 per capsule, $1 – $1.50 per milliliter of liquids, and $3 – $4 per milliliter of sublingual spray. Monthly supplies of capsules, liquids and sublingual spray, Blakemore estimates, would come out to around $45, $35 and $50, respectively.

Cost estimates for various medical marijuana products in Alabama, per a report produced by Sam Blakemore  based on data from Minnesota.

The number of qualified patients, Blakemore said, will also be a determining factor in both cost to patients and revenue for the state.

“Typically what you see is 0.3% to 0.6% of the population becomes a qualified patient, so for the state of Alabama, you’re looking at 15,000 to 30,000 qualified patients upon roll out,” he said. “If the average patient spends $350 a month, you’re looking at about $4,200 a year spent.”

With an estimated 15,000 to 30,000 patients spending an average of $4,200 a year on medical marijuana, that would generate between $63 million and $126 million a year, which, taxed at 9%, per the law, could generate between $5.7 million and $11.3 million in sales tax revenue for the state.

Patient population sizes could also be a factor in both costs and state revenue, with PTSD, cancer and seizure disorder — all impacting large numbers of people — topping the list of allowable illnesses to receive medical marijuana under the law.

Chey Lindsey Garrigan, a lobbyist with Alabama Cannabis Industry Association, told Alabama Daily News that getting patients qualified for medical marijuana would be crucial for growers to be able to succeed.

“It’s going to be about three years before (medical marijuana companies) pull any kind of profit, and that three years is going to be heavily weighed on the patient count,” Garrigan said.

A steady supply of patients will be key to companies being profitable, Garrigan said.

“They can have the best facility in the world, but if (patients) don’t have a card and can’t get access to it, they’re not going to make any money at all,” she said.

Another factor that will determine the price of medical marijuana in Alabama, Blakemore said, was Alabama’s relatively high standards for cannabis production.

“Some states allow for food-grade versus pharmaceutical grade, and that’s probably where you’re going to see the pricing affected,” he said. “For example, a state like Nevada, they allow food-grade, whereas the higher standard for us will be pharmaceutical grade, and therefore, the price per unit is going to jump up a little bit.”

Those costs, Blakemore said, were unlikely to be covered by health insurance providers, something he attributed to medical marijuana still being illegal on the federal level. 

Sam Blakemore (left) participates in a meeting of the Alabama Medical Cannabis Commission.

Some, however, such as former State Rep. Mike Ball, a key player in legalizing medical marijuana in Alabama, said he believed that as more states legalize and normalize medical marijuana, the closer the federal government will get to decriminalizing it, something that could also reduce prices over time.

“The research component of this is, I think, the most important, because as time goes on, and people take it and smart people figure out how to use this, the stigma becomes less,” Ball told Alabama Daily news. 

“As that stigma goes away and as it becomes more common to use it in a sensible, rational manner, I think whatever the price is, the price will go down. I hope that eventually it gets to the point that once it comes off Schedule I and they start using it in the proper way, long term, eventually the market will take care of it.”

Marijuana has been labeled as a Schedule I drug since 1970 as part of then-President Richard Nixon’s war on drugs campaign, which one of his top advisors admitted was part of an effort to target “hippies” and “Blacks.” State lawmakers, however, have reassessed marijuana in recent years, with 38 states allowing for medical use, and 23 states allowing for recreational use.

Ultimately, Blakemore said his greatest wish for the roll out of medical marijuana is that patients who need the product have access to it, something he argued could be helped with greater transparency.

“The thing that I want from the companies, personally, is transparency; that means publishing price data on your company’s website,” Blakemore said.

“The commission will have access to the data, but if you can get as transparent to the patient as possible so that they know what they’re purchasing, what you have on the shelf before they even get there, I think the better off the patient experience is going to be.”

Companies that were issued licenses to grow and sell medical marijuana have already taken Blakemore’s transparency wishes to heart, Blakemore said, having included transparency initiatives in their business plans presented to the AMCC.

“I think what you’ll see is that a lot of the companies that got licensed, that’s going to be one of their major focus points,” Blakemore said.

“I don’t want patients calling me up at the pharmacy telling me they can’t get access and now they’re going back to the black market. That’s what I see in the pharmacy every day… we all hear the stories about patients not having their insulin and things of that nature. I don’t want to see that happen in this market.”

Rex Vaughn, chairman of the Alabama Medical Cannabis Commission, maintains that patients may still be able to purchase medical marijuana by the end of 2023, despite the ongoing legal delays.

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