Ted Simons: Good evening, and welcome to "Horizon." I'm Ted Simons. It's official -- Arizona voters have approved prop 203, which allows for the use of marijuana for certain medical conditions. The citizens' initiative was approved by 4300 votes. Now the state health department that's come up with rules governing medical marijuana in Arizona. Earlier today I talked about that to state health director, Will Humble. Thanks for joining us. We appreciate it.
Will Humble: Thanks for the opportunity.
Ted Simons: Let's get to some basics. Basic questions -- how will be able to dispense the marijuana?
Will Humble: Okay. Well, eventually by April of 2011, we'll have an application online that people can apply to become a dispensary in Arizona. We have a period of time, a little over a month, to evaluate those dispensary applications, and those that are successful get through the application process would get a license from the department to become a dispensary. We're the only state to have a limit on that number, in an Arizona we'll be limited to 124 dispensaries.
Ted Simons: Where can those dispensaries be located?
Will Humble: That kind of depends on local government. One of the things the initiative says is that with that application to become a dispensary in Arizona, the applicant needs to show that they're in accordance with local zoning. So one of the things that is happening across the state right now, and I was at the league of cities and towns last week to talk about this issue, is cities are starting to get together and decide what it is they want to do in terms of zoning. Some of them play want, for example, to make sure you don't have a dispensary located right next to their public pool. That kind of thing. Those are the things that cities need to decide. If they don't put anything in place, then we're obligated to approve a license for a dispensary even though it may be right next to something that they really don't want to have happen.
Ted Simons: OK. What kind of dose are we talking about here?
Will Humble: Dose you mean how much can they buy?
Ted Simons: Yes.
Will Humble: OK. So the initiative says that a qualifying patient can buy 2½ ounces of marijuana every two weeks. So 2 1/2 ounces every two weeks. Interesting, one of the things we have to do in this initiative, our I.T. system. We've got to build an infrastructure within our computer system to track patients. In other words, for example, we don't want somebody buying 2½ ounces of marijuana at dispensary A, getting in their car, driving down to dispensary B that afternoon and buying 2002½ ounces. The computer system has to track that. And make sure that a person is only buying that amount.
Ted Simons: And that person has to be a qualified patient. What constitutes a qualified patient?
Will Humble: There's a whole host of qualifying conditions that are in the initiative that the folks voted on. One of those qualifying conditions is chronic pain. That's one of the things that I was most concerned about when prop 203 was in that debate phase. This issue that in many states that have medical marijuana law, the vast majority and the card holders get cards for chronic pain. Which is difficult to measure and manage in terms of the doctor-patient relationship. One of the things that I want to get after as we develop the regulations in the next 120 days is to make sure that we put some criteria on what that doctor-patient relationship really is. Because in the states that have a big problem with people walking in and getting recommendation after a 15-minute appointment, the reason they're having those problems is because they haven't identified what that relationship exactly is between the physician and the patient. In other words, what kind of criteria did the doctor use before they wrote that recommendation?
Ted Simons: And it is a recommendation, not a prescription. Correct?
Will Humble: It's not a prescription. This is a recommendation. So it's not a script that would you -- you think you normally prescriptions you go to the drugstore, it's not like that. It's a recommendation that goes on to a form that the physician would send in to the department, we merge that with the application, the patient sends in, and then that person would get a qualifying patient card.
Ted Simons: For those 2½ ounces, what's the price here? What are you talking about here?
Will Humble: You stumped me. I've done a lot of interviews today and I don't know the answer to that question.
Ted Simons: Fair enough. How does this law and how will the implementation differ from what's going on over in California?
Will Humble: Well, California's a really an extremely loose initiative. Or law, I don't know exactly how it run there's. The closest analogy for Arizona is Colorado. Colorado has a medical marijuana law that's similar to the Arizona law that the voters vote order a couple weeks ago. There's some things we can improve on from Colorado, in terms of we talked about the doctor-patient relationship. Colorado also has no limitation on the number of dispensaries. So we are in a better position than California -- in Colorado in terms of managing those numbers of dispensaries, so I think we have some advantages that some of the other states don't have.
Ted Simons: How much is all of this going to cost the state in terms of regulation, oversight, the whole nine yards?
Will Humble: Well, over the long run we're going to be able to pay for this full program with the fees we collect for the qualifying patient cards and the dispensary licenses. That's over the long run. Our challenge in the short run is that we have no revenue right now, in other words, we're doing the prep work for the next 120 days to get this program up and running, but we are not selling cards. So we've got no revenue coming in to the system yet. So we're keeping track of all the staff time that we're using to write the computer program, and those -- the regulatory code called the administrative code, we're keeping track of all that so that as we progress and as we begin to sell qualifying patient cards, we're going to recoup those monies in the future and pay back the state for the about $600-800,000 that we expect to spend in staff time between now and late March.
Ted Simons: OK. Last question -- what concerns you most about implementing this law?
Will Humble: There's really two things that I want to make sure we do a good job managing. That we'll make -- that will make us better than the other states. Number one is that qualifying patient criteria to become a qualifying patient in terms of what happens during that doctor-patient relationship. That's absolutely critical. Because if we don't have good criteria there, then we could have these mills open up where doctors are giving out recommendations all day long. We've got -- we've lost our -- we lost the whole battle there. Here's the other thing. I want to make sure that we have some control over the inventory. By inventory I mean the marijuana that's going to be sold in the dispensaries is supposed to be grown in Arizona, cultivation facilities. I want to be able to track what they're cultivating so we know the marijuana they're cultivating in the facility makes it to the dispensary, right, and that the dispensary is accounting for all that inventory through qualified patient cards through sales. So you don't have the cultivation facility creating much more marijuana than they need for their dispensaries, and then selling it out the back door for a profit that ends up on the street. So I want to make sure that we do a good job there, and with the qualifying patients, but having said that, there's about 150 decisions we have to make in the next 120 days, and it will all be a challenge, but we’re up to the task.
Ted Simons: Good luck to you and thank you so much for joining us. We appreciate it.
Will Humble: Thanks.