As Louisiana's pharmacy board Tuesday started awarding the licenses to dispense medical cannabis, a handful of state lawmakers slammed the process as unfair to small, locally-owned pharmacists.
Three Democrats on the House health committee — Reps. Marcus Hunter, Katrina Jackson and Dustin Miller — raised concerns that the application and evaluation method used to award the potentially lucrative permits wasn't truly competitive.
The lawmakers grilled Joe Fontenot, assistant executive director of the Louisiana Board of Pharmacy, saying the panel whose members are appointed by the governor should have stalled its selection while the Legislature considered changing some rules governing the dispensing pharmacies.
"We're very concerned that this process was done unfairly," said Miller, from Opelousas. "And I think we have valid reasons to be concerned."
He told Fontenot: "It's got corruption written all over it with a capital C."
Louisiana's medical cannabis program is just getting organized, with plans to have the product available to patients by the summer, under laws passed in 2015 and 2016.
When they created the program, lawmakers capped the number of dispensing pharmacies at 10. Local media outlets reported that five pharmacies were selected Tuesday, including in the New Orleans, Baton Rouge, Houma, Lake Charles and Lafayette regions. Four more pharmacies were slated to be chosen Wednesday in the Alexandria, Shreveport, Monroe and St. Tammany Parish regions.
"The position of the board throughout the process was they didn't want to be the stumbling block to the public getting their medication," Fontenot said. "I can assure you it was no disrespect to the committee whatsoever."
As selections were underway, Hunter had pending legislation that called for a proportion of the licenses to be given to minority-owned business. He rewrote the bill Tuesday so it would lift the cap on the number of medical cannabis dispensing pharmacies, require licensed pharmacists to hold the permits and tweak financial requirements to be eligible.
Hunter's rewritten proposal, backed by the House Health and Welfare Committee without objection, moves next to the full House for debate.
Hunter, of Monroe, said the current law capping marijuana dispending pharmacies at 10 creates a monopoly. He said the pharmacy board favored "big business" in its selection process to the detriment of local pharmacists "who will be directly impacted by their inability to be in this market."
Forty-four applicants sought the permits. Fontenot said 23 eventually withdrew, leaving 21 to compete. He said rules governing the selection were published in August 2017 after two public hearings and a regulatory process over which lawmakers have oversight.
Hunter questioned financial requirements for applicants. Miller questioned how the board judged an applicant's "character and fitness" without defining those terms. Jackson, of Monroe, questioned why letters were sent to applicants making them aware that denial of a permit would be reported to a national board that regulates licensed pharmacists.
"You guys open up a competitive bid process and then you sent letters out that discouraged people," Jackson said.
Louisiana's medical cannabis program is tightly-regulated with a limited list of medical conditions eligible to receive medicinal pot, though lawmakers are considering broadening that list this session. Marijuana cannot be sold in a form that can be smoked. Only the agricultural centers at LSU and Southern University are allowed to grow the drug.