California Allows Cannabis Donations to Qualified Medical Patients & Caregivers

As of March 1, 2020, California has allowed qualified medical marijuana patients and primary caregivers to receive free cannabis, donated by retailers. This welcomed update arose after the passing of Senate Bill 34, which is also responsible for exempting donated cannabis items from cultivation, sales and use, and excise taxes.

The bill states licensed growers, distributors, manufacturers, retailers and micro-businesses may allocate any already available inventory of cannabis and related marijuana products, for donation. Products set aside for donation can only be given by licensed retailers either directly to a medical patient, or to their primary caregiver.

Donation Requirements
Our Los Angeles marijuana attorneys note that all cannabis and related products allocated for donation, are required to meet state marijuana regulations and provisions outlined in MAUCRSA. Those include:

• All donated marijuana products must travel within the licensed supply chain and meet all requirements surrounding cultivation, laboratory testing, distributing, manufacturing, and labeling and packaging, etc.
• Cannabis products that fail to meet regulatory testing and compliance standards are not permitted for donation.
• Donated marijuana products may only be made to qualified medicinal patients, and may only be donated by licensees permitted for retail sales, or non-profit organizations working directly with such licensed retailers.

Additionally, any licensee allocating items for donation must record each allocation within the Track-and-Trace system, as well as on sales receipts and invoices. Once a donation designation has been made, it cannot be changed. Any licensee that does try to change a donation allocation will have to pay sales and use taxes, and may also suffer disciplinary action. Manufacturers wishing to donate cannabis products must also label products “FOR MEDICINAL USE ONLY.”

Retailer Requirements
Section 11362.7 of the Health and Safety Code states that retailers can only donate cannabis and related products to medical marijuana patients, or their primary caregivers, who possess a valid medical marijuana  ID card, or recommendation from an attending physician.

Should a medicinal patient not hold a valid ID card, before donating any marijuana, the retailer must first:

• Verify the attending physician recommending the medical marijuana therapy is licensed, and in good standing, to practice osteopathy or medicine within the state of California. This must be verified with:
  • The Medical Board of California;
  • The Osteopathic Medical Board of California; and
  • The California Board of Podiatric Medicine.
• Take a copy of a government issued identification for the patient or primary caregiver; and
• Provide a written certificate stating the retailer has verified a physician’s medicinal marijuana recommendation, accordingly.

Daily Purchase and Possession Limits
The Bureau of Cannabis Control (BCC) has clearly outlined daily purchase (Section 5409) and possession limits (Section 11362.77) within the Health and Safety Code. It is important to note that these limits still apply, both to patients and caregivers who may be receiving, or carrying, donated medicinal marijuana.

Implications
Making marijuana donations to medical patients, and their caregivers, shows the industry’s compassion for those most in need. Offering cannabis business owners and operators tax incentives to get on board also helps to sweeten the act of donating. What will be interesting to watch is whether it will prove too cumbersome for retailers to jump through the hoops needed to get sign off to donate to those without a valid medical marijuana ID card, or whether they will do so gladly.

The Los Angeles CANNABIS LAW Group represents growers, dispensaries, ancillary companies, patients, doctors and those facing marijuana charges. Call us at 949-375-4734.

Additional Resources:
Senate Bill 34
The Medical and Adult-Use Cannabis Regulation and Safety Act
Bureau of Cannabis Control – Health & Safety Code