Before The Government Oversight and Reform Committee - Interested Party Testimony Regarding House Bill No. 523 In View Of Other State Regulatory Approaches To Medicinal by Ted Bibart, Legislative Analyst Benesch, Friedlander, Coplan, & Aronoff LLP Introduction and Objectives • As a Legislative Analyst I am tasked with analyzing complex statutory and regulatory schemes to determine application, compliance, and public policy significance. • I am not yet licensed to practice law in the state of Ohio, and sit for the Ohio bar examination this July. • Benesch is not actively lobbying for anyone on the issue of medicinal cannabis in Ohio. • Instead, I offer “interested party” testimony regarding the House Bill No. 523 (HB 523) and comparative state statutory and regulatory approaches to the implementation of legalized medicinal cannabis.

2 Evaluation Criteria • Federal Harmony – The given state’s statutes and regulations are viewed in the light of federal prohibition and the corresponding tension presented by Department of Justice (“DOJ”) guidance, and historic trends. • Patient Access – The state’s statutory and regulatory scheme is then evaluated for its functional distribution of medicinal cannabis to patients in need. • Viability – The statutes and regulations are then appraised for their effective creation, implementation, and regulation of the long-term market infrastructure necessary to produce and sustain a workable program.

3 Federal Harmony • The relevant historical trend is evident in the trilogy of guidance issued by the DOJ, starting with the memorandum authored by Deputy Attorney General David W. Ogden on October 19, 2009 (the “Ogden Memo”). – Here, the Ogden Memo provides clarification and guidance to federal prosecutors in States that have some form of legalized cannabis use advising against enforcement of federal prohibition as an inefficient use of limited federal resources. • On June 29, 2011, Deputy Attorney General James M. Cole drafted a memorandum (the “Cole Memo I”) that effectively restricted the Ogden Memo’s scope, while not superseding its intent. – Here, the DOJ instructs federal prosecutors that while the Ogden Memo speaks primarily to protections of legitimate patients, large scale cannabis businesses in “legal” States should not be afforded blanket protections under state law, and broad discretion is granted by the DOJ for federal enforcement of the Controlled Substances Act (“CSA”).

4 Federal Harmony • The most recent DOJ federal guidance addressing the tension between state sovereignty in legalizing medicinal cannabis use and federal prohibition was issued by Deputy Attorney General Cole on August 29, 2013 (the “Cole Memo II”). – Here, the DOJ provides definitive guidance to the broader tensions illuminated by Cole Memo I relating to the proliferation of legal state markets and regulatory schemes supporting patients in need and a flourishing medicinal cannabis industry. – The DOJ professed its commitment “to using its limited investigative and prosecutorial resources to address the most significant threats in the most effective, consistent, and rational way.” – In acknowledgement of the traditional federal-state approach to drug enforcement, deference will be given to state regulatory schemes that “contain robust controls and procedures” which are “effective in practice.”

5 Federal Harmony • So, the Cole Memo II provided eight “enforcement priorities” affording notice to States in devising a proper robust regulatory scheme to ensure stability in administration of legal cannabis markets and federal harmony. 1. Preventing the distribution of marijuana to minors; 2. Preventing revenue from the sale of marijuana from going to criminal enterprises, gangs, and cartels; 3. Preventing the diversion of marijuana from States where it is legal under state law in some form to other States; 4. Preventing state-authorized marijuana activity from being used as a cover or pretext for the trafficking of other illegal drugs or other illegal activity; 5. Preventing violence and the use of firearms in the cultivation and distribution of marijuana; 6. Preventing drugged driving and the exacerbation of other adverse public health consequences associated with marijuana use; 7. Preventing the growing of marijuana on public lands and the attendant public safety and environmental dangers posed by marijuana production on public lands; and 8. Preventing marijuana possession or use on federal property.

6 Federal Harmony • Therefore, Federal Harmony analysis of state regulatory schemes focuses on compliance with the eight enforcement priorities manifesting robust controls and procedures which are effective in practice.

7 Patient Access • Effectiveness in practice must not only be measured in compliance with the eight enforcement priorities, but in fulfilling the legislative intent of ensuring qualifying patients have adequate access to approved treatments. • Factors include: (1) patient and provider protections; (2) physician autonomy and oversight; (3) qualifying conditions and approval; (4) therapeutic treatment options; (5) supply chain logistics and infrastructure; and (6) market data analytics. • Therefore, Patient Access analysis of a state regulatory scheme values proven solutions to legalized medicinal cannabis that are effective in practice, not just on paper.

8 Viability • A state’s robust regulatory scheme must not only promote Federal Harmony and Patient Access, but must also provide the clarity and security necessary to nurture industry investment in creation of a sustainable market infrastructure to meet adequate patient demand. • Factors include: (1) balance of Federal Harmony and Patient Access; (2) barriers to entry; (3) licensing structure and cost; (4) fixed limitations to supply and dispensation; (5) operating procedures; (6) laboratory testing; (7) product safety; and (8) market data analytics. • Therefore, Viability analysis of state regulatory schemes takes a holistic approach to ensuring legislative solutions to legalized medicinal cannabis create a stable environment for the growth of effective markets to serve qualifying patients in the delicate balance of federalism.

9 Some Particular Issues Presented In Substitute HB 523 • Impairment • Testing requirements and • Physician “written metabolite levels do not specify recommendation” vs. “de facto only those enzymes which prescription” produce intoxication • Department oversight • Accessibility for cardholders who • live in "opt-out" areas or in rural Commission inclusiveness and areas without participating expertise physicians • Physician reporting requirements • No regulation for safe disposal for • Physician registration vs. excess or contaminated product application • No regulation for security at • Confidentiality and privacy of cultivation, processing, or registry to protect patients and dispensary sites practitioner • Lack of administrative hearings • Specification of amount a for licensing denial or revocation cardholder may possess at one • Vaporization vs. Combustion time 10 Topics To Be Addressed • Impairment • Physician “written recommendation” vs. “de facto prescription” • Department oversight –Reporting redundancy

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Impairment • House Bill 523 does not address impairment directly, but does address the rebuttable presumption of impairment for Workers’ Compensation cases under O.R.C. 4123.54. • The statute maintains the terminology for qualified chemical testing for “” in the employee’s urine. See HB 523 page 48, line 1426 and 1442. • The term “” does not specify the psychoactive component in marijuana, THC (delta-9-), and therefore in no way measures impairment. • In fact, a urine screening also detects the non-psychoactive marijuana metabolite THC-COOH, which can linger in the body for days and weeks with no impairing effects.

12 Impairment • States have devised common sense, and scientifically based approaches to the impairment question. • Arizona provides, per A.R.S 36-2802, “Operating, navigating or being in actual physical control of any motor vehicle, aircraft or motorboat while under the influence of marijuana, except that a registered qualifying patient shall not be considered to be under the influence of marijuana solely because of the presence of metabolites or components of marijuana that appear in insufficient concentration to cause impairment.” • In State ex rel. Montgomery v. Harris, 234 Ariz. 343, 344, 322 P.3d 160, 161 (2014), the Arizona Supreme Court decided that the State’s regulatory scheme sought “to prevent and punish impaired driving, not simply driving while having a non-impairing metabolite in one's system.”

13 Impairment • The court, in keeping with the legislative intent, articulated the perverse result of holding otherwise: • “Because Carboxy–THC can remain in the body for as many as twenty-eight to thirty days after ingestion, the State's position suggests that a medical- marijuana user could face prosecution for driving any time nearly a month after they had legally ingested marijuana. Such a prohibition would apply even when the driver had no impairing substance in his or her body and notwithstanding the State's ability to test both for THC, the primary substance that causes impairment, and Hydroxy–THC, the metabolite capable of causing impairment.” • In Dobson v. McClennen, 238 Ariz. 389, 361 P.3d 374, 378 (2015), the Arizona Supreme Court decided it was the qualifying patient’s burden “to prove, by a preponderance, that the marijuana concentration in their bodies while they were driving was not sufficient to cause impairment.”

14 Physician “written recommendation” vs. “de facto prescription” • Presently, O.R.C. 3796.10 is drafted to require a “recommendation” that includes hallmarks of a prescription, including: – “forms of medical marijuana that may be dispensed” – “amount of tetrahydrocannabinol allowed in medical marijuana dispensed” – “methods by which the patient may use medical marijuana”

15 Physician “written recommendation” vs. “de facto prescription” • The existing language in O.R.C 3796.10 runs contrary to effective statutory construction proven effective in other states, and would run afoul of the DEA restrictions against writing “de facto prescription” for medical marijuana. • The basis of the concern was articulated in Conant v. Walters, 309 F.3d 629, 635 (9th Cir. 2002), the seminal case that established that physicians may discuss treatment options and even make written recommendations, but cannot “prescribe” medicinal cannabis. 16 Physician “written recommendation” vs. “de facto prescription” • The Conant decision does not delineate what a “de facto prescription” would entail, but makes clear the following: – “If, in making the recommendation, the physician intends for the patient to use it as the means for obtaining marijuana, as a prescription is used as a means for a patient to obtain a controlled substance, then a physician would be guilty of aiding and abetting the violation of federal law.” Id. at 635.

17 Physician “written recommendation” vs. “de facto prescription” • Instead, the following state statutes reflect the most effective construction: • In Arizona, per A.R.S. 36-2801, “Written certification” means a document dated and signed by a physician, stating that in the physician's professional opinion the patient is likely to receive therapeutic or palliative benefit from the medical use of marijuana to treat or alleviate the patient's debilitating medical condition or symptoms associated with the debilitating medical condition. • In Nevada, per N.R.S. 453A.170 in conjunction with N.A.C. 453A.100, the attending physician must provide “written documentation” in the form of a signed statement diagnosing the chronic and debilitating medical condition thereby allowing the qualifying patient to apply for a registry identification card. • In Maryland, per Md. Code Ann., Health-Gen. § 13-3301 and COMAR 10.62.01.01, a “’Written certification’ means a certification that is issued by a certifying physician for a qualifying patient with whom the physician has a bona fide physician-patient relationship.” 18

Department Oversight - State Survey • Department of Health • Department of Commerce • Board of Pharmacy • Alaska • Connecticut – None • Arizona • Oregon • Colorado • Vermont • Delaware • District of Columbia • Hawaii • Illinois • Maine • Maryland • Michigan • Montana • Nevada • New Hampshire • New Jersey • New Mexico • Pennsylvania • Rhode Island 19 Department Oversight • The initial version of HB 523 established the Marijuana Control Commission under the banner of the Ohio Department of Health. • Substitute HB 523 was then revised for the Marijuana Control Commission to fall under the Ohio Department of Commerce. • Under both versions, the legislature has effectively innovated granting significant oversight to the Ohio State Board of Pharmacy.

20 Department Oversight • “The Ohio Department of Commerce is the State’s chief regulatory agency[,]” regulating everything from banking institutions to liquor. See http://www.com.ohio.gov/. • The Marijuana Control Commission proposed by HB 523 is made up of: – (1) A member who is a practicing physician; – (2) A member who represents local law enforcement; – (3) A member who represents employers; – (4) A member who represents labor; – (5) A member who represents persons involved in the treatment of alcohol and drug addiction; – (6) A member who represents persons involved in mental health treatment; – (7) A member who is a pharmacist; – (8) A member who represents persons supporting the legalization of marijuana use for medical purposes; – (9) A member who represents patients. – (B) The governor shall appoint the members described in divisions (A)(1), (2), and (3) of this section. The president of the senate shall appoint the members described in divisions (A)(7) and (9) of this section. The minority leader of the senate shall appoint the member described in division (A)(4) of this section. The speaker of the house of representatives shall appoint the members described in divisions (A)(6) and (8) of this section. The minority leader of the house of representatives shall appoint the member described in division (A)(5) of this section. Not more than four members shall be of the same political party.

21 Department Oversight • The Ohio Department of Health Public Advisory Board is made up of: – (1) The following members appointed by the director of health from among individuals who are not employed by the state and are recommended by statewide trade or professional organizations that represent interests in public health: – (a) One individual authorized under Chapter 4731. of the Revised Code to practice medicine and surgery or osteopathic medicine and surgery; – (b) One individual authorized under Chapter 4723. of the Revised Code to practice nursing as a registered nurse; – (c) Three members of the public, two of whom are representatives of entities licensed by the department of health or boards of health. – (2) One representative of the association of Ohio health commissioners, appointed by the association; – (3) One representative of the Ohio public health association, appointed by the association; – (4) One representative of the Ohio environmental health association, appointed by the association, who is registered as a sanitarian under Chapter 4736. of the Revised Code; – (5) One representative of the Ohio association of boards of health, appointed by the association; – (6) One representative of the Ohio society for public health education, appointed by the society; – (7) One representative of the Ohio hospital association, appointed by the association. – See O.R.C. 3701.33 22

Department Oversight • The Ohio State Board of Pharmacy is made up of: – “nine members, eight of whom shall be pharmacists licensed under this chapter, representing to the extent practicable various phases of the practice of pharmacy, and – one of whom shall be a public member at least sixty years of age. – Members shall be appointed by the governor with the advice and consent of the senate.” See O.R.C. 4729.02.

23 Department Oversight • Successful state regulatory approaches have included oversight by governmental bodies which are inherently inclusive, reflexive, and to the fullest extent possible non-partisan. • The black-letter statutory construction of HB 523 has provided excellent pharmacy board oversight as an integral part of the administration of the program in conjunction with the more diverse Marijuana Control Commission. • Proposed O.R.C. 3796.03 assures robust pharmacy board participation as the Commission must “consult and cooperate with the state board of pharmacy” in rule-making for standards and procedures for retail dispensaries. • Moreover, revised O.R.C. 4729.81 and 4729.84 give sweeping monitoring and reporting powers to the pharmacy board in ensuring against abuse within the retail dispensary model to virtually the same level as a traditional pharmacy. 24

Department Oversight • In fact, HB 523 effectively expands O.R.C. 4729.75 to include reporting of medical marijuana in the board of pharmacy data base. • Further still, newly created O.R.C. 4729.771, pursuant to O.R.C. 4729.75, requires each medical marijuana dispensary to submit to the pharmacy board: – (1) Retail dispensary identification; – (2) Patient identification; – (3) Recommending physician identification; – (4) Date of physician recommendation; – (5) If provided to the retail dispensary, the "International Statistical Classification of Diseases and Related Health Problems" classification specified on the recommendation issued by the qualifying physician as described in section 3796.10 of the Revised Code; – (6) Date marijuana was dispensed; – (7) Form, quality, and clinical strength of marijuana – dispensed; – (8) Quantity of marijuana dispensed; – (9) Number of days' supply of marijuana dispensed; 25 – (10) Source of payment for the marijuana dispensed.

Department Oversight – Reporting Redundancy • The reporting requirements legislated above are an excellent means of program oversight, as the information is provided instantaneously at the point of sale, and could be seamlessly shared with the Marijuana Control Commission and the Ohio State Medical Board. • Instead, proposed O.R.C 3796.10 also requires physicians to submit separate reports, with virtually the exact same information, to the Commission and Medical Board at least every ninety days.

26 Department Oversight – Reporting Redundancy • To eliminate the redundancy the information could be easily shared between the departments directly, while not creating more bureaucratic impediments for physicians. • A similar dispensary level reporting method is utilized in many other states, including Maryland. See Md. Code Ann., Health-Gen. § 13-3307. • Additional physician reporting methods for desired information such as recommendation rationale and treatment efficacy could be devised in rule-making.

27 Department Oversight • Therefore, pharmacy board oversight has been effectively legislated within Substitute HB 523, and: – the appropriate state department to administer the program would either be the Department of Health or the Department of Commerce; – through the diverse and non-partisan Marijuana Control Commission; – in order to avoid coalescence of power within one executive agency that would not reflect the broad thought leadership necessary to meet the wide range of regulatory challenges presented in creating and administering an effective, robust regulatory scheme. 28 Thank You For Your Time And Consideration • Ohioans and their electorate have the advantage of applying the collective wisdom of the effective, robust regulatory schemes of our sister States who have carried the burden as laboratories of democracy. • We do not have to reinvent the wheel in devising our own solutions to legalized medicinal cannabis, but we would benefit from legislating that solution rather than having it thrust upon us at the ballot. • I am grateful for the opportunity to testify, and am available to answer any questions.

29 THANK YOU Ted Bibart Benesch, Friedlander, Coplan & Aronoff LLP 41 S. High Street, Suite 2600 Columbus, Ohio 43215 Telephone: (614) 223-9372 Facsimile: (614) 223-9330 http://www.beneschlaw.com/jbibart/ E-mail: [email protected]

The content of this presentation is for general information purposes only. It does not constitute legal advice or create an attorney-client relationship. ©2016 Benesch, Friedlander, Coplan & Aronoff LLP. All rights reserved. James Bibart: (614) 223-9372 – [email protected]

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