Cannabis Investment Report – Overview of U.S. Medical Cannabis Laws (Dec 2017)

> = Po cor > Qa LA Cannabis Investment Report | December 2017 An exhaustive review of each jurisdiction's laws is beyond the scope of this report; instead we discuss issues commonly addressed by each category of cannabis laws. Medical Cannabis Laws In 1996, California enacted the first medical cannabis law of any U.S. state, followed in the late 1990s by Alaska, Maine, Oregon and Washington. Since the beginning of 2000, 24 more states and the District of Columbia have passed medical cannabis laws that permit the production and possession of cannabis or concentrates for use in treating a broad range of qualifying medical conditions. A state medical cannabis law permits a patient, with a doctor's recommendation, to use cannabis to treat any qualifying medical condition designated by the law. It is illegal for a doctor to “prescribe” a Schedule I controlled substance under the U.S. Controlled Substances Act (CSA), so medical cannabis laws typically require a doctor’s “recommendation” rather than a prescription. Some medical cannabis laws require a written recommendation, while others allow an oral recommendation. States may impose a variety of other requirements or restrictions on a doctor or patient relating to medical cannabis access, such as patient registration with a state medical cannabis registry, submission of a patient's fingerprints or prohibition of use by convicted felons or certain government employees (for example, firefighters). The number and nature of qualifying conditions included in medical cannabis laws vary widely. Some laws designate relatively few or highly specific medical conditions, while other laws include many conditions or highly subjective conditions, such as chronic pain. Some medical cannabis laws also give doctors discretion to recommend cannabis for conditions not specifically designated. In aggre- gate, across all medical cannabis laws in the United States, cannabis is legally recognized as a form of therapy or medicine for more than 50 qualifying conditions. Common qualifying conditions include Alzheimer’s disease, amyotrophic lateral sclerosis (ALS), anorexia, arthritis, cachexia, cancer, chronic pain, Crohn’s disease, epilepsy, glaucoma, hepatitis C, HIV/AIDS, inflammation, migraine, multiple sclerosis (MS), nausea, nervous system degeneration, Parkinson’s disease, post-traumatic stress disorder (PTSD) and spasms. Some medical cannabis laws restrict the form of cannabis or the means of consumption. For example, Pennsylvania's medical cannabis law, enacted in 2016, prohibits smoking or vaporizing cannabis flower, prohibits the incorporation of cannabis into foods by anyone other than the patient or the patient’s caregiver, and authorizes cannabis to be dispensed only in certain concentrated forms. Medical cannabis laws generally permit cannabis cultivation and distribution by a state-licensed cultivator or dispensary, by a qualified patient or by a designated caregiver of the patient. A qualified patient or the patient’s designated caregiver generally may grow only an amount of cannabis deemed sufficient for the patient’s personal use. Some medical cannabis laws permit patients or caregivers to grow cannabis only if they cannot practically obtain it by other means. For example, certain states permit patients to grow cannabis only if they reside more than a specified distance from the nearest licensed dispensary. Some states allow qualified patients and designated caregivers to collectively or cooperatively aggregate their cultivation activities. State-licensed cultivators and dispensaries must satisfy various licensing requirements related to health, safety and security. In states that permit or require vertical integration, a licensee may be part 64 © 2017 Ackrell Capital, LLC | Member FINRA/SIPC HOUSE_OVERSIGHT_024700