New Jersey Expands Medical Cannabis Program

On July 2, New Jersey Governor Phil Murphy signed into law the Jake Honig Compassionate Use Medical Cannabis Act (the Act) which expands access and reduces taxes for medical cannabis in New Jersey. The Act includes an increase in the number of eligible medical conditions.

As of that date, there were 12 vertically integrated medical cannabis licenses in NJ -- licensed operators who could both grow and sell medical cannabis directly to patients. The Act creates individual licenses for cultivation, manufacturing, dispensary and home delivery. There is potential for up to 108 more licenses to be issued; the first round of applications is limited to 24 additional Alternative Treatment Center licenses. The Act will grant 15% of new licenses to minorities and 15% to women, veterans and the disabled. 

The chart below compares access to medical cannabis in NJ before and after enactment:

The Act has taken steps to lessen the taxation burden on the NJ medical cannabis industry and established a five-member Cannabis Regulatory Commission to oversee the program. Municipalities are precluded from imposing local sales taxes larger than 2% on cannabis purchases and there will be a three- year phase out of NJ’s 6.625% state sales tax on medical cannabis.