Massachusetts' medical cannabis market shrinks as patients call for reforms

Between the lines: It's the latest example of a flaw in state cannabis laws and rules that have gone untouched for years amid infighting and turnover at the Cannabis Control Commission.

• The landscape has only grown more challenging with declining cannabis prices and increasing operational costs, owners say.
• Freed, who takes cannabis for pain related to post-herpetic neuralgia, and other patients say they travel long distances for cannabis or rely on home-grown flower as medical dispensaries change hands or close.

Flashback: The Department of Public Health launched the medical program in 2014 with several requirements for medical dispensaries.

• These rules remain in place today, even though regulators who later stood up the legal adult-use cannabis market created less stringent requirements for recreational sales.

Zoom in: Medical cannabis operators can only obtain a license in Massachusetts if they open a dispensary, a cultivation center and a manufacturing facility, accomplishing vertical integration.

• They must pay an annual license fee of $50,000. (Adult-use operators pay $10,000 the first year, then $1,500 annually.)
• Applicants must also have at least $500,000 in the bank to prove they can afford to operate.

Threat level: Dispensaries have tightened their belts or closed shop since prices started dropping in 2022, including medical shops.

• At least a dozen medical dispensaries have closed in the past year.

What they're saying: "My frustration is that these issues have been at the forefront for years," Freed told Axios. "I have been testifying, emailing, for years, and there's still nothing happening."

The CCC held a hearing about the medical program in February, citing concerns about patient access, and the Cannabis Advisory Board formally recommended nixing the vertical integration requirement as Colorado has.

• Jeremiah MacKinnon, president and executive director of the Massachusetts Patient Advocacy Alliance, said he wants to see regulators make changes this year, but their efforts come as some commissioners' terms near an end.
• "This is their last chance to do it, or they are just going to kick it to the next set of commissioners," he said, "which is essentially what happened last time."
• After the hearing, commissioners approved the new executive director's "near-term goal" of creating a medical cannabis working group to look into declining patient numbers, patient access to medical shops and other concerns.

A shrinking medical market

Massachusetts regulators had greenlit nearly 100 medical dispensaries to open by 2021 and issued provisional licenses to another 42 operators.

• Forty-three operators had by then let their licenses expire.

Today, more than twice as many operators have let their licenses expire, per CCC data.

• Massachusetts is home to 94 active medical dispensaries across 72 communities.

The number of active patients has also declined from 100,000 in 2021 to under 83,000 in late 2024, per CCC data.

Commissioner Kim Roy told Axios regulators have to take a holistic review of the medical program, from vertical integration to regions that have become medical "deserts."

• "We've had a number of (medical treatment centers) close and, you know, we need to look at the maps … we need to look at that and outreach for more providers," Roy said.

Yes, but: She also acknowledged differing opinions on whether the CCC can take action alone or needs to wait for statutory changes.

• The CCC has often cited limitations in state law as reasons commissioners can't unilaterally make major regulatory changes.
• In those cases, commissioners rely on new laws to authorize them to take action.

Talks of reform

A medical cannabis reform bill is making its way through Beacon Hill, but it's up to a state legislature that's notorious for taking several years to pass industry reforms and a commission that's even slower to enforce statutory changes.

Case in point: The CCC's social consumption regulations, for example, still haven't been finalized, three years after the legislature legalized social consumption spaces and nearly a decade since voters approved the concept.

• Meanwhile, patients have urged regulators during every regulatory review period to address the flaws they see in the program.

What they're saying: "I think that everybody's very good at listening, but not very good at action," Freed, the patient from Swampscott, told Axios.

• "And now it's time for action."

Other patients urged lawmakers at a hearing last month to pass legislation eliminating the vertical integration requirement and reduce licensing fees to $1,000 for medical shops.

• One patient from Reading reported paying the 20% tax for recreational cannabis because of easier access as medical dispensaries close.
• Another patient wrote, "vertical integration and the insane fees that come along with it compared to what the recreational places are responsible for are the sole reason why the medical program is disappearing."
• Freed wrote to lawmakers, "Patients deserve access to their medicine at their convenience, not at the mercy of the CCC's insistence on an inappropriate regulatory construct. Please help us get the access to tax-free medicine we deserve."

Reality check: State lawmakers could pass reforms this legislative session, which ends next year, either through a budget proposal or a standalone bill.

• But even priority bills on Beacon Hill get shafted or put on hold amid emergency legislation and infighting between House and Senate Democrats.