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Demand for medical pot rises in North Dakota as annual sales top $20M

The number of residents with medical marijuana cards has more than doubled in the last two years with about 8,300 qualifying to buy pot products at the state’s eight dispensaries.

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Pure Health Dakota, one of eight medical marijuana dispensaries in North Dakota, is located at 4302 13th Ave. S. in Fargo.
David Samson/The Forum
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BISMARCK — Demand for medical marijuana in North Dakota is higher than it’s ever been, but a leader in the effort to create the state’s program says steep prices and limited selection at dispensaries has turned off some would-be patients.

North Dakota voters approved the legalization of medical marijuana in 2016, and the remedy has become increasingly popular since the first dispensary opened in 2019.

The number of residents with medical marijuana cards has more than doubled in the last two years with about 8,300 qualifying to buy pot products at the state’s eight dispensaries.

Division of Medical Marijuana Director Jason Wahl presented a report to lawmakers last week that publicly revealed medical pot sales figures for the first time since the program’s inception.

Dispensaries sold about $20 million in cannabis products during the 2022 fiscal year, which ended in June. That’s up from $15.3 million in 2021 and $6.4 million in 2020.

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Last fiscal year, medical pot purchases generated about $1 million in state sales tax revenue and nearly $475,000 in local sales tax collections, according to the State Tax Commissioner’s office.

The Division of Medical Marijuana, which collects fees from growers, dispensaries and cardholders, brought in a net-positive return of $170,000 to the state last fiscal year.

The report Wahl released also shared demographic insights into the state’s medical pot patients.

Almost half of all cardholders come from Cass, Burleigh and Ward counties, while about 37% of cardholders live outside of the state’s five largest counties. Nearly half of registered patients are in their 30s and 40s.

Anxiety disorder was by far the most common debilitating condition that afflicted medical marijuana patients, but many others suffered from post-traumatic stress disorder, chronic back pain, migraines and fibromyalgia.

Medical cannabis is legal in 37 states, including Minnesota and South Dakota.

Challenges in the weeds

Rilie Ray Morgan led the charge to get medical marijuana on the ballot in 2016, but the Fargo resident with chronic back pain told Forum News Service he gave up his medical card just a year after he got it.

Morgan said he prefers to ingest marijuana by eating edible gummies rather than smoking, but North Dakota dispensaries are prohibited from offering the products he wants. State legislators have twice rejected proposals to allow the sale of edibles, citing safety concerns for children.

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Wahl noted that dispensaries do offer some ingestible cannabis products, including pills and liquid extracts. He declined to say whether allowing edibles would benefit the program, noting that it’s a legislative decision.

With North Dakota’s dispensaries failing to meet his needs, Morgan has resorted to buying edibles in other states during his travels and bringing them back home illegally. Morgan added that the recent legalization of edibles in Minnesota might incline some North Dakotans to buy their products across the Red River.

Morgan said he knows other former medical pot cardholders who were priced out of North Dakota’s market by the “outrageous” cost of buying in dispensaries.

An ounce of pot at the state’s dispensaries often costs more than $400, according to prices listed online. That’s about twice what buyers generally pay in Colorado.

The state should lower the licensing and growing fees for dispensaries and manufacturers to bring down the price of the products, Morgan said.

Wahl said prices in North Dakota have come down as the medical program grows, which is good for cardholders. He added that dispensaries in the state frequently have promotions that lower the cost of pot.

If the problems with pricing and inventory were fixed, Morgan said there would be even more demand for medical pot, but he thinks administrators like Wahl have done “a credible job” running the program. Morgan added that he’s grateful the program has helped others even though he is no longer enrolled.

During his presentation to lawmakers, Wahl said the biggest risk facing medical marijuana is the industry’s lack of access to banking.

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Since marijuana is still federally illegal, most banks fear that backing pot businesses puts them in jeopardy. As a result, dispensaries can only accept cash and limited forms of electronic payment.

Wahl added that demand for medical pot could take a big hit if voters pass a measure to legalize recreational marijuana in November. However, if lawmakers were to impose a hefty excise tax on recreational sales, it could have the opposite effect and drive up medical marijuana sales, he noted.

State Rep. Craig Headland, a Montpelier Republican who leads the House Finance and Taxation Committee, said legislators would likely tack on an excise tax to recreational pot if the measure passes, but it’s too soon to say.

Pot Report by Jeremy Turley on Scribd

Jeremy Turley is a Bismarck-based reporter for Forum News Service, which provides news coverage to publications owned by Forum Communications Company.
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