Kentucky awarded another batch of medical cannabis dispensary licenses Monday through a lottery drawing, during which Gov. Andy Beshear defended the process against criticism that out-of-state companies have dominated the new program.
The state selected 12 dispensary operators for the Louisville and Lexington regions during a televised lottery at the Kentucky Lottery Corp. headquarters.
“This is a major step forward to ensuring that Kentuckians that are out there that are suffering have access to safe and affordable treatment,” Beshear said during the lottery announcement.
In the Bluegrass region surrounding Lexington, Kentucky Ventures LLC won a license for Franklin County, while Gary Court and Roger Hugindi K secured permits for Madison County locations, though only one can ultimately operate there under state rules that limit dispensaries to one per county. Thrive Blue LLC won approval for Scott County.
For Lexington proper, DHK KYLLC and Zinleaf received the two allocated Fayette County licenses. In the Louisville area, three companies – DNP Dhky LLC, Kentucky Pristine Vistas LLC, and Pinnacle Path LLC – initially were selected for Bullitt County, but two must relocate due to the restriction.DJS KYLLC won approval for Shelby County, while Chung Woo Kim LLC and Upward Innovations secured the two Jefferson County permits.
The selections came from a pool of 1,235 applications for these regions, with about 81% qualifying for the lottery after review, according to Sam Flynn, executive director of the Office of Medical Cannabis. Winners have 15 days to pay licensing fees or forfeit their permits.
The lottery system has drawn scrutiny after previous rounds resulted in most of the available licenses going to out-of-state interests. For example, of the 36 dispensary licenses awarded in earlier lotteries, only one went to a business comprised solely of Kentucky residents, according to a Kentucky Public Radio analysis.
When pressed about companies potentially circumventing regulations through multiple applications, Beshear maintained that all licensees met the predetermined rules.
“If we change the rules late in the game, then you get the lawsuits to delay and the patients don’t get the product that they need,” he said during Monday’s press conference.
Concerns were also raised about application “stacking” by well-funded operators. One Arkansas-based company, Dark Horse Cannabis, organized approximately 350 businesses that submitted more than 100 applications at costs ranging from $3,000 to $30,000 each, which resulted in it winning several licenses across different categories, according to KPR.
The governor defended the approach, pointing to at least one state enjoined from proceeding for over two years. He suggested Kentucky hemp farmers who were shut out of cultivation licenses despite their agricultural experience could participate when the program expands.
Kentucky’s medical cannabis program launches Jan. 1, when patients with qualifying conditions such as chronic pain, cancer, PTSD and multiple sclerosis can begin applying for cards. Health care practitioners have already written more than 1,500 certifications since Dec. 1, according to Flynn.
While Beshear expressed optimism about product availability in early 2025, he said that safety would take precedence over speed.
“Our commitment was to do this safely and to set up a system that will operate safely,” he said. “We’re just making sure we get it right and that each and every one of these facilities, when they open, is legitimate.”
The state will also launch a dedicated call center on Jan. 1 to guide patients through the application process.
“We’ll walk them through the process from beginning to end on how to become a medical cannabis cardholder in Kentucky,” Flynn said.
The governor also addressed broader questions about market dynamics and ownership restrictions. When asked about companies marketing their management service agreements to investors, Beshear acknowledged the practice while pointing to regulatory oversight.
“These are now a Kentucky company that has to operate here. Their employees are going to be here. Their cultivation is going to be here. The dispensaries are going to be here. The processing is going to be here,” Beshear said.
Questions about potential ownership changes after licensing also persisted. State regulations allow license transfers with regulatory approval, which Beshear said was intentional: “I believe that there are legal means to ultimately change the ownership. Again, that was within the law and within the regulations ahead of time.”
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