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HOW TO OPEN A DISPENSARY IN ALABAMA

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Overview

Want to learn how to open a dispensary in Alabama? This page is meant to be a beginning step for you to learn the knowledge, cost, and process for opening a cannabis business in the state of Alabama. 

 

In March 2021, Alabama proposed SB46 and the Darren 8 Wesley 'Ato' Hall Compassion Act to establish infrastructure for a medical marijuana program within the state, poising to become the 37th state to legalize a medical market. It will allow for multiple license types within the state however still prohibits raw cannabis, smoking, vaping, baked goods, and candies. The Alabama State Board of Medical Examiners issued regulations in March 2022 that dictate how physicians are able to recommend medical marijuana. 

 

The Alabama Department of Agriculture and Industries, tasked with issuing rules for cultivation activities, issued its proposed rules for cultivation of medical cannabis on May 17, 2022, outlining the requirements for cultivators and integrated facilities to be licensed and regulated by the AMCC. 

 

SB 46 establishes the Alabama Medical Cannabis Commission to regulate patient registration, as well as the research on the medicinal effect of marijuana. Commissioners were reportedly in discussions with legislators to allow cultivators to be licensed sooner, so that they will increase the supply for dispensaries to sell in 2023. 

 

Beginning on September 1, 2022, a person or business entity may apply for a cannabis business license as a dispensary, cultivator, processor, secure transporter, state testing laboratory, or as a fully vertically integrated facility according to current Alabama Rules -  (Ala. Code § 20-2A-53(a)). The Alabama Medical Cannabis Commission will hold a public hearing on the rules July 14. On August 11, 2022, the AMCC will meet again with the expectation of adopting the rules to be amended and include public comments. The rules will be published August 31, 2022.

Alabama Medical Cannabis Commission

The Alabama Medical Cannabis Commission (AMCC) was established by the Alabama legislature and Alabama Governor Kay Ivey when bill SB 46 was signed into law. The AMCC consists of fourteen board members and will work to implement and administer and enforce the laws in regards to medical cannabis. Making medical cannabis derived from cannabis grown in Alabama available to registered qualified patients and by licensing facilities that process, transport, test or dispense medical cannabis. ​

 

Available Medical Marijuana License Types 

According to updated SB 46 the commission will award licenses to a minimum of four cultivators, a maximum of four processors, and a maximum of four dispensaries (allowing up to three locations each). The bill also allows for up to five integrated facility licenses which may grow, process, transport, and dispense cannabis, and may have up to five separate dispensing sites as long as they are in different counties. 

 

  • Cultivation license

  • Processing license

  • Transporting license

  • Testing license

  • Dispensing license

  • Integrated facility license

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These licenses are subject to a non-refundable application fee of $2,500, as well as a license fee of $10,000-$50,000. Applicants business plans will be considered by the commission, including ability to conduct proposed activities, previous expertise and history in business, and planned location. ​

SB46 allows patients with the following conditions to qualify for medical marijuana:

  • Anxiety or panic disorder

  • Autism Spectrum Disorder (ASD)

  • Cancer-related cachexia, nausea or vomiting, weight loss, or chronic pain

  • Crohn's Disease

  • Epilepsy or a condition causing seizures

  • Fibromyalgia

  • HIV/AIDS-related nausea or weight loss

  • Persistent nausea 

  • Post Traumatic Stress Disorder (PTSD)

  • Sleep disorders

  • Amyotrophic Lateral Sclerosis and other spasticity disorders

  • Spasticity associated with Multiple Sclerosis or a spinal cord injury

  • Terminal illness 

  • Tourette's Syndrome

  • Chronic or intractable pain

 

How much does it cost to open a dispensary in Alabama?

To open a medical marijuana dispensary in Alabama, the non-refundable application fee is $2,500 and licensing application and development costs which could run between $35,000 up to $75,000, depending on size of the operation and what is involved. For capital costs to develop the business after licensing, this could range between $400,000 up to $1,000,000 or more depending on the size of the operation, types of furnishings, and other expenses such as properly stocking the shelves with adequate cannabis products. 

History  

The ADAI regulates the cultivation and processing of hemp under the Industrial Hemp Research Pilot Program. The registration period for hemp growers, processors, and universities seeking licensure in 2020 is now closed. The Alabama Medical Cannabis Commission convened in September of 2019 at the State House. The Legislature created this commission to study whether Alabama should join the other states in legalizing marijuana, amending a bill that would have simply legalized medical marijuana in its earlier draft. In February 2020, SB165, a bill authorizing medical marijuana passed through a legislative committee in the state senate.

In February 2020, SB165, a bill authorizing medical marijuana passed through a legislative committee in the state senate. The bill would allow for medical consumption through oral pills, transdermal patches, oils, nebulizers, inhalers, suppositories, and gummies. The bill would not allow for smoking or vaping raw plant material, or consumption of infused edible products.

Estimated market size

Alabama is projected to retail around $48 million in its first full year of medical sales, about $163 million in the second year, and approximately $387 million in the third year of legal medical cannabis sales. - Akerna

How to open a Marijuana Business in Alabama

If you are just starting your marijuana business, the next best step is to visit the Green Rush Store to help educate your team and be ready to apply for a marijuana/hemp business license. If you are ready to apply for a Marijuana/Hemp Business License in Alabama, please contact us or call our office to set an appointment to get started. You can also select another State Opportunity, or fill out our Contact Form to discuss potential strategies such as Investment or Partnership Opportunities