Medical Cannabis Manufacturer Selection Questions and Answers - Minnesota Dept. of Health

Medical Cannabis Manufacturer Selection Questions and Answers

Notice for Prospective Manufacturers:
For purposes of the RFA and, specifically, the Section entitled Communications With the Department on page 6, MDH considers “any employee of the Department” to include evaluation panel members and any technical experts retained by MDH to assist in the evaluation process.

NOTE: All answers provided only apply to how MDH will administer its role the Minnesota Medical Cannabis program. MDH is making no claims about federal law or about enforcement by other with authority under federal or state law.

NOTE: The answers provided on this page are intended to provide basic information and guidance. The final version of the Request for Application should be considered the official document.

On this page:
Conditions Questions
Distribution Questions
Employee Questions
Facility Questions
Financial Questions
Health Care Practitioners Questions
Laboratory Questions
Manufacturers Questions
Manufacturer Application Fee Questions
Manufacturer Application Questions
Operations Questions
Patient Questions
Pharmacist/Pharmacy Questions
Product Questions
Statute and Rule Questions

Conditions Questions

Distribution Questions

Employee Questions

Facility Questions

Financial Questions

Health Care Practitioner Questions

Laboratory Questions

Manufacturer Questions

Manufacturer Application Fee Questions

Manufacturer Application Questions

Operations Questions

Patient Questions

Pharmacist/Pharmacy Questions

Product Questions

Statute and Rules Questions


Conditions Questions

C1: Do you have any information why the legislature excluded chronic pain and if they have plans to consider it as an approved condition in the future? This has a significant effect on sizing the market and planning for future.

We are not aware of any specific reason(s) chronic pain was not included in the legislation. Please note the legislation provides the Commissioner of Health the ability to add new conditions in the future, and the legislation requires that intractable pain be the first condition considered. (9/12/2014)

Distribution Questions

D3: Will each manufacturer have four distribution sites or will there be a total four across Minnesota?

Each manufacturer will need to have four distribution locations by July 1, 2016 which will result in a total of eight locations across the state. (8/11/14)

D2: Is MDH open to additional or different distribution methods or strategies beyond a tradition “retail” location? If so is that something that should be included in the application?

MDH is interested in hearing the ideas applicants have regarding creating convenient methods to get medical cannabis to registered patients that align with the requirements stated in the statute. MDH encourages any ideas to be included in the application. (8/11/14)

D1: Will telemedicine or automated dispensing be allowed with the medical cannabis program?

MDH is interested in collecting ideas on approaches that would allow telemedicine and be consistent with the Minnesota statute. Section 152.29 subsection 9.3(a) states “A manufacturer shall require that employees licensed as pharmacists pursuant to chapter 151 be the only employees to distribute the medical cannabis to a patient.” (8/11/14)

Employee Questions

E2: Is MDH planning worker protections and training on regulatory issues?

The statute does not require specific protections or training, but in the Request for Applications (RFA) MDH will be requesting each manufacturer to describe how they will protect workers and what training they expect to provide. (8/11/14)

E1: Does the law require or prevent patients from working for a manufacturer?

The law does not prevent patients from being workers nor require workers to be patients. (8/11/14)

Facility Questions

F25: Our production facility has three separate blocks of greenhouse. Each of them are on separate legal property parcels. The buildings are separated by over 800 feet from each other.

The block of greenhouse we would propose using for Cannabis is located on a PID that is over 1,000 feet from a school, but the other buildings that are owned by our corporation on separate PIDs and are not more than 1,000 feet from the school. The buildings are owned by one LLC and leased to an operating company. Both the operating company and the LLC are owned by one owner.

The statute includes the following language in 152.29, subdivision 1, paragraph (j), "A manufacturer may not operate in any location, whether for distribution or cultivation, harvesting, manufacturing, packaging, or processing, within 1,000 feet of a public or private school existing before the date of the manufacturer's registration with the commissioner."

We interpret this to mean the property and facilities involved with medical cannabis operations must be more than 1,000 feet from a school, as measured from property line to property line.  One item not clear in the question is the location of the refining operations relative to other facilities and buildings.  The statute requires that the manufacturer have a "single location for cultivation, harvesting, manufacturing, packaging and processing".  If these operations are included in the greenhouse that is more than 1,000 feet from the school, then the location may be valid. (9/12/2014)

F24: Included below are several related questions regarding what documentation is required to be provided to confirm the manufacturing and distribution locations.

  • For the dispensary locations in each congressional district is a Letter of Intent to purchase a qualified building acceptable to meet the application requirement? The next step would be to put the building under contract with a purchase agreement. Please confirm for a leased location a letter of intent and a letter from the Landlord supporting the use meets the application requirement.
  • The RFA states in Section B(2)(l) that the application must contain “The location of all proposed distribution facilities”. In addition, the section of the website entitled “Medical Cannabis Manufacturer Application Clarifications” indicates that, if an applicant is applying for both Service Areas, “they will need to identify all eight potential distribution sites”.
    It seems pretty clear from the RFA that the cultivation facility needs to be identified with a specific piece of real estate or building. My first question is: Is it necessary that a contingent lease be entered into with the landlord if the cultivation facility is to be leased? Is a Letter of Intent with the landlord indicating that a lease agreement has been reached but will be contingent upon the applicant being awarded a license sufficient?
  • Assuming that the cultivation facility will be integrated with a distribution facility, what does the term “identify” in the RFA mean as to the other three distribution locations in the Service Area? Must those locations be specifically located and put under contingent leaseholds? Or is it sufficient to identify the geographic areas that the applicant will seek to locate the distribution facilities in without identifying specific pieces of real estate or buildings? As the other three distribution facilities do not need to come on line until July 2016, it seems unnecessarily premature and contrary to the intent of the law to require specific pieces of real estate or buildings to be locked up for distribution facilities at this time. Would it not be better to have successful applicants identify the specific real estate and/or buildings for the other three distribution locations later in the process after the number and location of medical cannabis patients becomes more clear?

The RFA does not require any specific documentation to support ownership or lease rights for property. However, an applicant’s ability to demonstrate readiness to conduct operations at identified locations will be considered in the evaluation.

Regarding the suggestion of delaying the identification of three distribution sites until after patients start enrolling, the statute requires that the proposed distribution locations be disclosed during the registration process in section 152.29, subdivision 1, paragraph (a).

“… The distribution facilities shall be located based on geographical need throughout the state to improve patient access. A manufacturer shall disclose the proposed locations for the distribution facilities to the commissioner during the registration process. ...”

F23: Does the definition of public and private schools include day care facilities, any pre-kindergarten or post high school facilities?

The definition of a school for the Minnesota Medical Cannabis Program does not include day care, pre-kindergarten or post high school facilities.  The definition of a school will be as follows:
“public or private school” means any property owned, leased, or controlled by a school district, charter school, or accredited nonpublic school where an elementary, middle, secondary school, secondary vocation center, or other school providing educational services in kindergarten through grade 12 is located, or   used for educational purposes and "accredited nonpublic school" means any nonpublic school accredited by an accrediting agency recognized by the Minnesota nonpublic education council under section 123B.445, excluding home schools. (9/12/14)

F22: Can a manufacturing facility share a building with another tenant if the only thing they share is a roof and there are no mutual entrances and the manufacturing facility is secured for entrance of only allowed person?

There is nothing in the statute that would prevent a manufacturing facility from sharing a roof with other operations.  It would be beneficial in the application to be clear about whether there are any doors or entryways between the operations exist and if so what security measures exist to control access to the cannabis cultivation, manufacturing and/or distribution facilities. (9/4/14)

F21: Does the manufacturing facility require perimeter fencing if it's a concrete structure?

Based on the current statute, DRAFT Manufacturer Rules and Request for Application (RFA) perimeter fencing is not required.  Manufacturers may choose to have fencing if desired.  We do suggest consulting the versions of the Manufacturer Rules and Request for Application published on September 5, 2014 to verify that it is not required. (9/4/14)

F20: If the city is willing to provide written approval of use for a grow and dispense center are they still required to issue a Conditional Use Permit?

The RFA does not specifically require a Conditional Use Permit (CUP) in order to be selected as a vendor.  The need for a CUP may vary by municipality and zoning of the property in question.  One of many considerations MDH will take into account is the certainty of an applicant’s ability to operate at the locations identified in their application. (9/4/14)

F19: If a conditional use permit (CUP) is required would a public hearing be sufficient in lieu of a CUP?

As noted in the previous response, the RFA does not specifically require a CUP.  The need for a CUP or public hearing may vary by municipality and zoning of the property in question.  One of many considerations MDH will take into account is the certainty of an applicant’s ability to operate at the locations identified in their application. (9/4/14)

F18: What are the minimum requirements of dispensary locations, CUP approvals and plans by Oct 3, 2014 and Nov 14, 2014?

As noted in the Request for Application (RFA) document, published on August 1, 2014, in Section B.2.b. (below), the following information should be provide in the RFA:
“Documents sufficient to establish that the applicant is authorized to conduct business in Minnesota; and that state and local building, fire and zoning requirements and all applicable local ordinances are met for the proposed location of the production facility.  If documents to this effect do not exist yet, please indicate this but provide the information that does exist and the plan and timeline to finalize the documentation.  All documentation must be provided to the Department by November 14, 2014 in order to be a registered manufacturer;” (9/4/14)

F17: Do the dispensaries require a man trap?

Based on the current statute, DRAFT Manufacturer Rules and Request for Application a man trap is not required.  We do suggest consulting the versions of the Manufacturer Rules and Request for Application published on September 5, 2014 to verify that it is not required. (9/4/14)

F16: Do the dispensaries require bullet proof glass?

Based on the current statute, DRAFT Manufacturer Rules and Request for Application bullet proof glass is not required.  We do suggest consulting the versions of the Manufacturer Rules and Request for Application published on September 5, 2014 to verify that it is not required. (9/4/14)

F15: Do the dispensaries require restroom facilities and are there specific handicap and gender requirements?

Normal federal, state and local building codes should be consulted regarding this question.  Outside of normal building codes the current statute, DRAFT Manufacturer Rules and Request for Application no restroom, handicap or gender requirements exist.  The program will be serving patients so accommodating patient needs and accessibility should be thoroughly considered.  We do suggest consulting the versions of the Manufacturer Rules and Request for Application published on September 5, 2014 to verify that it is not required. (9/4/14)

F14: Are there specific parking requirements at each of the dispensary?

Normal local zoning and building codes should be consulted regarding this question.  Outside of normal zoning and building codes the current statute, DRAFT Manufacturer Rules and Request for Application no specific parking requirements exist.  We do suggest consulting the versions of the Manufacturer Rules and Request for Application published on September 5, 2014 to verify that it is not required. (9/4/14)

F13: Is legal street parking allowed at dispensary locations? 

Local parking regulations should be consulted regarding this question.  Outside of local regulations the current statute, DRAFT Manufacturer Rules and Request for Application no specific parking requirements exist.  We do suggest consulting the versions of the Manufacturer Rules and Request for Application published on September 5, 2014 to verify that it is not required. (9/4/14)

F12: How must the 1,000 foot set back from schools be measured? And can any exceptions to this distance be made?

The 1,000 feet must be measured property line to property line. No exceptions to this distance or requirement can be made. (8/26/14)

F11: From the timeline it looks like the State will not know the number of patients or their locations until the manufacturers have been chosen. Do you have any estimates, or are the service areas strictly based on equitable distribution of congressional districts?

We are working to collect and generate more data, MDH does not have specific counts of patients with each of the conditions available by Service Area.  The current Service Area design provides geographic variety and a roughly equal population split for the distribution sites. (8/26/14)

F10: Is the 30-mile restriction between distribution sites necessary? This requirement makes it difficult to plan distribution site locations since we do not know where the other manufacturer will have their distribution sites.

Based on feedback and the uncertainty this requirement creates we are eliminating this restriction. The final version of the Request for Application (RFA) will not contain any requirements regarding the distance between distribution sites. (8/26/14)

F9: Why do there need to be two separate manufacturers with separate facilities? It is expensive to set up these operations.

The statute requires two manufacturers. Having two independent manufacturers prevents a natural disaster, pest or fungal outbreak from eliminating the entire crop of cannabis and thus threatening the supply of cannabis to patients. (8/11/14)

F8: Explain how having two manufacturers is in the best interest of the business and patients? This structure would seem to provide no competition.

The law requires that MDH register two manufacturers to produce medical cannabis in Minnesota. MDH is focused on identifying the two best manufacturers to provide medication to patients. Inquiries regarding the rationale of the structure created should be directed to the legislature. (8/11/14)

F7: Is there a cap on square footage of facilities?

No. (8/11/14)

F6: Are there any alternative energy requirements?

No. (8/11/14)

F5: Is the Congressional District approach to services areas the best approach given the potential density of patients in the Twin Cities?

The statute directs that “distribution facilities shall be located based on geographical need throughout the state to improve patient access.” (MS152.29 subdivision 1). MDH is open to other ideas and suggestions. The congressional district approach to service areas provides population balance between the two manufacturers and also ensures geographic dispersion. (8/11/14)

F4: How will MDH determine which manufacturer will be allowed to have a distribution site if each manufacturer proposes sites within the 30-mile radius limit?

This will require some discussion and negotiation between the two manufacturers and MDH. (8/11/14)

F3: How will the zoning and local approvals occur? Once a manufacturer is registered will they then need to get approval from their local municipality?

MDH understands that applicants need to manage their investments prior to receiving a registration and so official zoning or other local approvals may not be in place prior to applying. That said, any approvals or recognition of support from local government entities that an applicant has obtained will be considered as part of the evaluation. (8/11/14)

F2: Does the manufacturing facility need to be in the service area assigned to the manufacturer?

No, the manufacturing facility can be located anywhere in Minnesota. The distribution sites must reside in the service area assigned. (8/11/14)

F1: How does this business legislation apply to Indian reservations?

American Indian reservations are sovereign nations. Any questions regarding Minnesota’s medical cannabis program and how or if it applies to American Indian reservations should be directed to each tribe. (8/11/14)

Financial Questions

FI3: At the Aug 8th meeting there was discussion about MDH working with the MN banking community to assist in those issues. Can you update us on the efforts that MDH is pursuing in this area? Is there any helpful information that can be provided?

MDH has had no additional conversations on this matter with the banking community since the August 8th meeting. (9/12/2014)

FI2: Is there going to be funding for the actual site/greenhouse?

The State of Minnesota will not provide funding for manufacturers. (9/12/2014)

FI1: Where can we find information about business-related tax questions (sales, property, business tax deductions, etc.)?

The Minnesota Department of Revenue (DOR) has analyzed the tax implications and exemptions that may apply to manufacturers. DOR provided information in the presentation delivered during the Manufacturer Interested Party Meeting on August 8, 2014.  This presentation and associated handout can be found at:

Health Care Practitioner Questions

HC2: Can you clarify what the law means when it says there should be no financial relationship between a manufacturer and a health care practitioner?

If a health care practitioner is NOT certifying patient conditions then MDH will permit the health care practitioner to have a financial relationship with a medical cannabis manufacturer. (8/11/14)

HC1: How does the program deal with doctors who decline to participate or refuse to certify a patient’s condition?

The statute states that physicians are not required to participate in the program (MS152.28, subdivision 1, paragraph (b)). (8/11/14)

Laboratory Questions

L5: Had a question in regards to testing of Cannabis.

“A medical cannabis manufacturer shall contract with a laboratory, subject to the commissioner's approval of the laboratory and any additional requirements set by the commissioner, for purposes of testing medical cannabis manufactured by the medical cannabis manufacturer as to content, contamination, and consistency to verify the medical cannabis meets the requirements of section 152.22, subdivision 6. The cost of laboratory testing shall be paid by the manufacturer.”

Where can we find the requirement’s that the commissioner is looking for in regards to being an approved laboratory? If we decide to apply to become an approved testing site what are the steps we will have to take?

While guidance is provided in the current manufacturer’s rules, this is an area to will continue to be developed. (9/25/2014)

L4: Has the department approved specific third party testing companies for manufacturers to use?

The Minnesota Department of Health has not approved any third party testing companies at this time. Our initial focus will be on selecting the two manufacturers. Once the manufacturers are identified then we will be moving forward with identifying laboratory testing companies that can meet the needs of the manufacturers. (8/26/14)

L3: What is the timeline for the lab approval by the Commissioner?

A final timeline has not been established, but we would expect Commissioner approval of the laboratories to occur in the winter or spring of 2015. (8/11/14)

L2: MDH stated that labs will need to be certified by 2016 but medical cannabis needs to be available in July 2015. How will that work for the labs/product testing?

The process of becoming fully certified according to international standards can take up to 18 months. The statute allows the Commissioner to provisionally approve a laboratory that has not had time to become certified. The laboratory approval process will be covered in the manufacturer expedited rules. (8/11/14)

L1: Will the labs own the data that they collect when testing the products?

That will be an issue that manufacturers and laboratories should address as they establish their contract. The statute only requires that lab test data be shared with the State. (8/11/14)

Manufacturer Questions

M9: Assuming two manufacturers are chosen; do manufacturers have to begin distributing at the same time? Meaning, if one is not ready to go by July 1st, 2015 and choses to use their six month extension, must the other wait to distribute as well?

Both manufacturers selected will be expected to begin providing medical cannabis to patients on July 1, 2015. However, if a manufacturer notifies the Commissioner it will be unable to begin distribution on July 1, 2015, Minnesota Statutes section 152.25, subdivision 3(c) allows the Commissioner to notify the task force and the task force will extend the deadline by six months. (9/19/2014)

M8:
The Department has received two questions regarding marketing and logos relative to “medical symbols”:

1. We had a question regarding how you will define “medical symbols” for the purposes of the draft rules on Advertising and Marketing under 4770.0800. Medical symbols is an extremely broad term that could encompass a variety of different things. Would something as simple as a green cross in a logo be constituted to fall within the “medical symbols” prohibition. Further clarity on this point would be greatly appreciated.

2. Would the use of a cross in the logo below be considered a medical symbol?

The language in the manufacturer rules will be adjusted to better reflect the intent to minimize any potential confusion between medical cannabis manufacturers and established medical organizations.

We intend to add an approval by the Commissioner of any medical symbols used.

Companies should complete due diligence on any logo or graphics used to ensure they do not violate copyright or trademarks of existing organizations. (9/19/2014)

M7: May individuals apply to manufacture marijuana?

Individuals can apply to be manufacturers. (9/12/2014)

M6: We have heard that some pharmacists and CPAs may not want to be involved for fear of risking licensures. Are manufacturers going to be able to get service providers and pharmacists to work with or for them?

We have not surveyed pharmacists or other service providers on this issue so we have no data to validate that concern. (8/11/14)

M5: Why is the word manufacture used for both growing and manufacturing?

The statute defines “Medical cannabis manufacturer” or “manufacturer” to mean an entity registered by the commissioner to cultivate, acquire, manufacture, possess, prepare, transfer, transport, supply, or dispense medical cannabis, delivery devices, or related supplies and educational materials. (8/11/14)

M4: Does the manufacturer have to be a non-profit organization or have a specific corporate structure?

No, the statute does not require any specific corporate structure. (8/11/14)

M3: What if the department cancels or revokes a manufacturer’s registration?

We hope that will not happen but we will define rules on that process in either the expedited or full rules. (8/11/14)

M2: What will be the re-registration process?

We are in the process of defining re-registration. (8/11/14)

M1: What if one manufacturer goes out of business?

MDH does plan to develop rules for a scenario where one of the two manufacturers goes out of business. Detailed rules in this area are not likely in the expedited rules but rather these will be included in the formal rulemaking that occurs during 2015. (8/11/14)

Manufacturer Application Fee Questions

MF4: What is the manufacturer application fee going to be used for?

The manufacturer application fee will be used to address the cost of the manufacturer evaluation and selection process and other related activities. (8/26/14)

MF3: Comment on the $20,000 application fee. How many people are you aware of that are going to apply? Big players? Hospitals, pharmaceutical companies, etc?

MDH is not aware of any hospitals, pharmaceutical companies or health care providers interested in becoming medical cannabis manufacturers. (8/11/14)

MF2: Who pays the $20,000 application fee? Only the winning manufacturers, or all parties who apply?

All that apply pay the non-refundable application fee. (8/11/14)

MF1: Is the $20,000 application fee refunded to those who are not registered as manufacturers?

No, the fee is non-refundable. This is contained in the law. (8/11/14)

Manufacturer Application Questions

MA32: Does Security Information include all financial information such as bank accounts, tax returns and income & asset information, as well as proprietary information concerning production methods and security protocols?

Minnesota statutes section 13.37, Subdivision 1(a) defines security information as government data the disclosure of which would be likely to substantially jeopardize the security of information, possessions, individuals or property against theft, tampering, improper use, attempted escape, illegal disclosure, trespass, or physical injury.

Items such as security protocols and security system design would appear to fit this definition while financial information would be less likely to do so. However, classification of specific data will be fact dependent and applicants are free to explain why specific data should be classified as security data. (9/25/2014)

MA31: Are all health care practitioners disqualified from participation or only those that recommend medical cannabis?

As noted in the Question & Answer section of the Medical Cannabis website in question #HC2 health care practitioners who issue certifications are not allowed to have a financial interest in a manufacturer. A health care practitioner who does not certify patient conditions is able to own or have a financial stake in a manufacturer. (9/25/2014)

MA30: Does the RFA process evaluate and weight the ability of an applicant that can display knowledge and experience in procurement of appropriate packaging materials and if so, how?

The Department has requested information about product packaging is requested in the RFA in section C (Operations), subsection 3 (Refining), item c, sub-item vi. (9/25/2014)

MA29: Does the RFA process give weight to applicants that can display an understanding and ability to implement GMP guidelines, through demonstrated experience in such matters, not just through their other bona fides such as theoretical knowledge gained through other fields, and if so, how?

Section C, subsection 3, item c (pp.22 – 23) requires applicants to provide their operational protocols. Experience in implementing those protocols will be rated higher versus theoretical knowledge.

Whether or not those protocols adhere to “Good Manufacturing Practices” (GMP) standards will not be weighed in the selection process as there are no GMP regulations applicable to the production of medical cannabis (nor is it clear which GMP regulations are most on point ; e.g. Drugs, Dietary Supplements, Food Processing, etc.) (9/25/2014)

MA28: Does the RFA process address the ability of a manufacturer to develop and produce all medicinal aspects of cannabis and to educate patients as to all aspects of medical cannabis, and if so, how?

Section C of the RFA addresses Operations of the Medical Cannabis manufacturer applicants. An applicant’s response should contain all information an applicant can share regarding their ability to develop and produce medical cannabis.

In addition, section B, subsection 3, item c requests applicants provide information about their expected outreach, media, events or promotional activities to communicate medical cannabis to patients and caregivers. (9/25/2014)

MA27: If a city or municipality wants to provide a letter of support for a medical cannabis facility, how should that be communicated with the Department?

If the letter of support is in regards to a specific prospective manufacturer’s application then that should be included in their RFA response. If a city or municipality is providing a general indication of their interest in hosting any prospective manufacturer they may send the letter to health.cannabis@state.mn.us.

MA26: On page 12 of the final RFA there is a Notice Of Proper Manufacturing Facility Zoning Form. Can this form also be used for Distribution location approvals? If yes, can the description of manufacturing be notated for distribution?

The Manufacturing Facility Zoning Form is not required for distribution locations. (9/25/2014)

MA25: In your Request for Application for the Registration of Medical Cannabis Manufacturers (page 28 of 36), you require that a financial commitment by an owner/investor or potential owner/investor be accompanied by a letter certified by a CPA verifying that the commitment by each owner/potential owner does not exceed 50% of their net wealth.

What level of service are you requiring of the owner/potential owner? Is it necessary that the CPA audit or review the net worth of the investor? Will a personal financial statement compiled by a CPA (not audited or reviewed with no assurance as to the accuracy or completeness) be an acceptable letter? Can you provide a sample or example of a letter that other CPAs have provided that satisfies your requirement?

A compilation conducted consistent with the standards of SSAE No. 10 is sufficient, see AICPA's Section 101: Attest Engagements (PDF: 31 pages) (9/25/2014)

MA24: For the application, would the MDH like the applicant to identify third party vendors or remain vendor neutral? Example: Manufacturer ABC will be using the seed to sale tracking platform XYZ in order to maintain inventory.

Identifying 3rd party vendors is not required by the RFA but doing so would assist the Department of Health in evaluating the applicant’s ability and readiness to begin operations in a timely manner. (9/19/2014)

MA23: For complete criminal history we have used a reputable national firm to perform a comprehensive national search for any and all criminal history for our investors/owners and officers. We have also asked that they disclose any civil litigation history or certify that they have never been a party to a lawsuit. This was in response to an answer we received a few weeks back (below). Because the New Draft Rules state that employees must submit to BCA criminal history checks we want to make sure the disclosures recommended by MDH a few weeks back are sufficient for the requirement that we provide all criminal and civil litigation history? Thank you for your time and assistance with this question.

For the purposes of the RFA, utilizing a reputable national search firm for criminal history is sufficient. (9/19/2014)

MA22: Are the page limits enforced more strictly on the "Operations section" or are we able to utilize attachments there too (such as in the bonus materials). Does the same standard as stated below apply to all page-limited sections?:

“2. Employee Working Standards (no longer than three pages): Describe any plans you have to provide a quality working environment for your employees, including, but not limited to, environmental standards, codes of conduct, healthcare benefits, educational benefits, retirement benefits, and wage standards.”

For the Bonus Point items the text contained in the plan must be within the page limits provided next to each item. If additional exhibits, attachments or documentation are relevant they can be included without concern for the space limitations. (9/12/2014)

Wondering if the above applies to the entire application?

The Department encourages all applicants to be thorough yet concise in all sections of the RFA. The RFA does contain some exemptions to the page limits stated.

If an applicant feels that they must extend beyond a page limit to completely respond to a RFA request and it is directly because of attachments or exhibits, an applicant may send an email to the Department seeking a page limit exception (health.cannabis@state.mn.us).

In the email the applicant must provide a description of the attachment or exhibit and a rationale for why it will cause the overall section contents to extend beyond the page limits.

All requests for page limit exceptions must be received no later than September 30, 2014 at 3 PM CDT. (9/19/2014)

MA21: What does the Letter of Intent entail and where should that be sent?

As noted in the RFA (on pages 3 and 4), the Letter of Intent should contain the following:

  • Manufacturer's Name
  • Names of the owner(s) and managing director(s) for the organization
  • A name, telephone number and email address for responding to questions that arise during the evaluation process
  • Indication of whether the Manufacturer requests a presentation

The Intent to Apply letter must be sent to health.cannabis@state.mn.us by 3 p.m. Central Daylight Time on September 19, 2014. (9/12/2014)

MA20: As stated in the RFA below, you indicate no longer than 3 pages under the Employee Working Standards section.  Is this page limitation intended for the narrative alone? Some applicants have labor neutrality agreements and collective bargaining documents that I'm sure they will want to include in their application.  Would an addendum for those documents be permissible?

“2. Employee Working Standards (no longer than three pages): Describe any plans you have to provide a quality working environment for your employees, including, but not limited to, environmental standards, codes of conduct, healthcare benefits, educational benefits, retirement benefits, and wage standards.” 

For the Bonus Point items the text contained in the plan must be within the page limits provided next to each item.  If additional exhibits, attachments or documentation are relevant they can be included without concern for the space limitations. (9/12/2014)

MA19: Is it public knowledge on what companies are applying for the medical cannabis manufacturer application?

The Minnesota Department of Health will not know who intends to apply until September 19, 2014 when a Letter of Intent to Apply must be submitted.  This information will not be public data until December 1, 2014 when the registration process is complete.

The statute, Chapter 311 (152.25, subdivision 1) states that “Data submitted during the application process are private data on individuals or nonpublic data as defined in section 13.02 until the manufacturer is registered under this section.” (9/4/14)

MA18: If  an investor is married or files jointly with his/her spouse, do we need to submit a background check for their spouse as well?

A background check on an investors spouse is not necessary unless the spouse will be an investor as well. (9/4/14)

MA17: The request for investor individual income tax returns is burdensome and intrusive.  Is there a different method to collect the information you need?

After thorough consideration of the concerns  expressed about Section F, Item 9 that requests Income tax returns for all investors, MDH is planning to remove this from the RFA and replace it with other items that will assist us in better assessing the financial stability of each applicant. 

The exact request (to replace the income tax returns) has not yet been finalized and will be published either in the final version of the RFA on September 5, 2014 or via a RFA Clarification that will be published on the website prior to September 5, 2014. (9/4/14)

MA16: Are the selected manufacturers required to pay a registration fee, in addition to the application fee, upon being selected?  It is further understood that Manufacturers will pay a fee to re-register each year.

The manufacturer's will not pay a registration fee, rather they will be responsible to pay the state an annual fee to cover the cost of regulating and inspecting the manufacturer, as outlined in the statute (chapter 311, Section 15, subsection (c)).  This fee will first be payable for the 2016 Fiscal Year (July1, 2015 - June 30, 2016) and be assessed annually. (9/4/14)

MA15: What is the anticipated amount of the annual manufacturer fee?

The annual manufacturer's fee is anticipated to be $ 75,000 - 100,000 per manufacturer. (9/4/14)

MA14: After the ability to execute, will the State also consider Minnesota job creation as part of the scoring process?

Our primary focus in the evaluation of vendors will be to identify two manufacturers that can produce the best product for medical cannabis patients. Beyond that, a number of other factors will be evaluated. Given that the manufacturing and distribution facilities are all required to be in Minnesota we do not expect wide differences in job creation from one application to the next. (8/26/14)

MA13: Have you established how much you are requiring applicants to show in liquid assets?

No, there is no set minimum amount of liquid assets that will be required to apply. (8/26/14)

MA12: How can you ensure you get the two best manufacturers if applicants will be applying for only one service area?  What happens if the best two apply to the same service area?

To address this concern MDH will modify the RFA to allow a manufacturer to apply for both service areas in the same application. This should reduce some of the burden for manufacturers to apply to both and require a manufacturer to pay only one manufacturer application fee. For additional information on this change please see Manufacturer Application Clarifications. (8/26/14)

MA11: The RFA requests identifying employees. How is an applicant supposed to have employees if they haven’t been registered?

The RFA does not require employees to be identified. If an applicant does know who some of the employees will be including that information would be helpful. In the absence of specific people being identified the expected qualifications of various positions can be provided. (8/11/14)

MA10: Is all of the data in the application going to be public? Including any financial information provided?

All of the information in the application will become public once two manufacturers have been registered with the exception of any data that has been identified as Trade Secret. (8/11/14)

MA9: Should an applicant let you know if we want to give a presentation with our application?

Yes, let us know if you want a presentation. MDH reserves the right to request an applicant provide a presentation even if they select not to give one. (8/11/14)

MA8: Is MDH willing to travel out of state to conduct a site visit?

Yes, MDH is willing to travel out of state or anywhere in-state to conduct the site visits. (8/11/14)

MA7: Does the applicant need to pay for the site visit?

No, the State will pay the cost for the site visits. (8/11/14)

MA6: Will bonus points be awarded for residents of Minnesota?

No, not directly. (8/11/14)

MA5: Will there be any special considerations for Minnesota ownership of a manufacturer?

No, not directly. (8/11/14)

MA4: MDH has noted the importance of experience in growing. When you evaluate applications will you only evaluate experience growing in legal settings?

All information provided in a RFA response will be considered. Claims made in the RFA should be able to be substantiated. (8/11/14)

MA3: What will happen if no one is capable and/or no one applies?

In the event no suitable manufacturer is registered the statute allows the Commissioner to initiate a new registration process. (8/11/14)

MA2: After the RFA submission due date passes will you communicate how many applications were received?

MDH will plan to provide some general information to the public regarding the progress of the evaluation and selection process. (8/11/14)

MA1: How would you handle having four high scores and two low scores in different service areas?

If one service area does not have any applicants that meet the minimum scoring requirements MDH may solicit new applications for just that service area. (8/11/14)

Operations Questions

O9: In Section B, subsection 2(h)(7), the RFA references the "location of any approved safes or approved vaults that are to be used to store Medical Cannabis".  At what point are you requiring the cannabis to be stored in a vault or safe?

This requirement has been moved to Section B subsection 4 (Distribution facilities).  The requirement that medical cannabis stored unattended at a distribution facility must be stored in a safe or vault will be added to the Manufacturer Rules.

In the next version of the manufacturer rules the scenarios where a safe or vault is required will be clarified.  Within the RFA we are planning to move this item to Section B subsection 4 (Distribution facilities).  Please consult the manufacturer rules and final version of the RFA which will be published on September 5, 2015. (9/4/14)

O8: How will it be determined, that the two manufacturers are keeping up with patient demand?

If manufacturers are unable to fulfill patient requests for product that are on their established product list then the manufacturer(s) will be viewed as not keeping up with patient demand. (9/4/14)

O7: At some point, will the Department consider adding additional manufacturers?

The Department is not able to add manufacturers to the program.  The addition of manufacturers would require new legislation. (9/4/14)

O6: What will the initial demand for medical cannabis be?

Exact demand for July 1 will not be known until patients begin to register. In addition specific dosage and forms will not be known until pharmacists consult with patients about their condition and preferences. (8/11/14)

O5: How will unused medical cannabis be collected and disposed of?

The statute is silent on the issue but we expect that manufacturers will provide information in their RFA on how they will solicit, collect, handle and dispose of unused medical cannabis. (8/11/14)

O4: Is there anything that would prohibit the manufacturer from billing a patient?

No. (8/11/14)

O3: Are there different meanings for the words “batch” and “lot” in the Manufacturer Medical Cannabis Rules?

The manufacturers rules defines the word batch and uses it extensively. (8/11/14)

O2: Will the State define how the active ingredients should be extracted? Will there be rules about what methods can or cannot be used?

MDH will not define what methods can or cannot be used to extract active ingredients from cannabis plants. Rules or guidance may be provided regarding tolerance limits for various chemicals, metals and other contaminates. (8/11/14)

O1: Is there a system in place if there needs to be a recall?

The expedited manufacturer rules will contain some requirements associated with how adverse events should be handled. (8/11/14)

Patient Questions

P8: Each manufacturer will have a service area but do the patients have a choice with which manufacturer they purchase from or are they limited to what area they are registered in?

A final decision on this has not yet been made. (8/26/14)

P7: Does the past felony rule apply to patients, to parents, to caregivers?

A felony offense disqualification applies to registered designated caregivers and manufacturer employees. A patient or parent or legal guardian of a patient with a felony offense is still eligible to participate in the program. (8/11/14)

P6: Will there be a pilot program that would allow an expedited start date for catastrophically ill children?

The statute does not allow for a pilot program and MDH does not have authority to initiate one on its own. (8/11/14)

P5: Do patients need to buy within their districts?

No rules currently exist. It is an issue that MDH will consider and evaluate. (8/11/14)

P4: Is there an option for patients to try the products first? Testing them out in small doses?

The statute only specifies that a maximum 30 day supply be distributed. Due to this a manufacturer would not be prohibited from distributing a 5 day supply for a patient. (8/11/14)

P3: What is the timeline for patient recommendations for conditions?

The statute requires that the Commissioner publish a report on the existing medical and scientific literature regarding the range of recommended dosages for each qualifying condition and the range of chemical compositions …” (MS152.25, subdivision 2) by December 1, 2014. (8/11/14)

P2: What portion of the 5000 patients are employed vs unemployed?

MDH does not have detailed metrics on this but for our internal budgeting purposes we assume ~ 50% of patients would be enrolled in medical assistance or MinnesotaCare. (8/11/14)

P1: How many patients will there be?

While the bill was being written MDH estimated that 5,000 patients will register. Actual enrollment will be impacted by a wide variety of factors. The trend in other states has been low enrollment in the first few years followed by increases. (8/11/14)

Pharmacist/Pharmacy Questions

PP2: Does a pharmacist need to be present at each location at time of distribution?

Yes. (8/11/14)

PP1: Can a pharmacy distribute medical cannabis?

There is nothing in the Minnesota statute that precludes this. Pharmacies considering distributing medical cannabis would need to evaluate if doing so would violate any federal laws or regulations. (8/11/14)

Product Questions

PD14: We would like to address a few concerns prior to the submitting application and fees:

1. Because of federal laws prohibition of the production of oil and waxes anyone in possession is subject to arrest and faces jail time as a result. This includes the manufacturer, transportation and patients

2. It is very easy to Google marijuana oil production to see the dangers involved.

3. The cost of production of oil and waxes versus flowers is a great deal more expensive. We need to understand how the patients are who in many cases will be very ill and unable to work will be able to afford the product

Before we are comfortable submitting an application along with the fees involved we request a meeting to address these concerns prior to the October 3rd deadline

The statute, Chapter 311 (152.22, Subdivision 6) allows for three specific forms: liquid, pill or vaporized use of liquid.

As noted in the RFA on page 6, direct contact, other than via the health.cannabis@state.mn.us email address, is prohibited.

“To ensure the proper and fair evaluation of all applications, other communications regarding this RFA including verbal, telephone, written or internet initiated by or on behalf of any applicant to any employee of the Department, other than questions submitted to health.cannabis@state.mn.us, are prohibited. Any violation of this prohibition may result in the disqualification of the applicant.”

Due to this, we are unable to meet with any prospective manufacturers. (9/25/2014)

PD13: The Department has received several questions related to the chemical composition (CBD, THC, etc.) of the Medical Cannabis products:

1. Minnesota should ensure that the broadest possible range of cannabinoids is available to seriously ill Minnesotans.

2. Minnesota should give serious consideration to mandating a minimum buffer of ten percent of available cannabinoids in all medical cannabis products consist of CBD or other non-psychoactive cannabinoids capable of reducing the adverse effect profile presented by THC-only products.

3. … we suggest that the final regulations incorporate an upper limit on THC percentage/concentration in cannabis products provided to patients.

4. I'm looking through chapter 311 and the "manufacturer rules" to find out about any rules regarding the level of THC content in the product. I can't find a precise answer about THC.

The Department has no ability to direct manufacturers to make specific cannabinoids. However, the Department does concur that the ability to prepare medication for the range of conditions contained in the statute is an important part of the manufacturers’ duties.

Therefore, the Department will instruct the selection panel to favor applicants who have demonstrated ability to provide a wide range of various cannabinoids in the form of medication. (9/25/2014)

PD12: The Department has received two questions regarding the source of initial plants and seeds:

1. After reviewing the RFA, manufacturer rules, and clarifications listed on your website, I'm still trying to figure out how/where a manufacture will get their Cannabis seeds. Can you provide clarification on this aspect of the program? I'm worried there could be a major hurdle for manufacturers if they can't import seeds from outside MN.

2. Regarding sourcing a manufacturer’s initial cannabis crop, what are the state’s expectations about from where manufacturers are to obtain their initial genetics, seeds, clones, starts, and plants?

More specifically, may manufacturers obtain their initial crop from essentially anywhere? Or does the state expect manufacturers to obtain their initial crops only from other states where cannabis (recreational or medical) is legal?

The Minnesota statute does not address the sourcing of plants and seeds. (9/25/2014)

PD11: Will pricing for each manufacturer be set at the same price for similar products or will there be competition?

Each manufacturer is allowed to determine their own pricing. (8/26/14)

PD10: Will only certain cannabis chemical composition be required?

The statute does not specify any strains or chemical compositions that are required. However, the commissioner shall review and publicly report the existing medical and scientific literature regarding the range of recommended dosages for each qualifying condition and the range of chemical compositions of any plant of the genus cannabis that will likely be medically beneficial for each of the qualifying medical conditions. This report must be published by December 1, 2014 and updated annually. (8/11/14)

PD9: How can we ensure the product is safe and tested prior to July 1, given the number of activities that must be completed: growing, extracting, creating and testing the dosages and compositions?

MDH acknowledges that the timeline is tight. Based on our conversations with those in the industry the timeline, while challenging, is achievable. Should it be necessary the Commissioner can request a six month extension of the July 1, 2015 starting date. MDH does not want to have to use this if at all possible, but patient safety will be the first priority. (8/11/14)

PD8: Will tincture or other medication that can be taken sublingually be allowed?

Yes, a tincture is a liquid and is allowed. (8/11/14)

PD7: Can the oils be used in edibles and sold at the dispensary?

No, edibles are not allowed in the statute. (8/11/14)

PD6: What is a pill?

The standard definition of a pill is ”a usually medicinal or dietary preparation in a small rounded mass to be swallowed whole” (Merriam-Webster.com). If there are questions about a formulation or design MDH would want to engage in a conversation. (8/11/14)

PD5: Do you envision validation of the claims made by manufacturers?

Claims made by a manufacturer should be substantiated with data. The State Health Lab does not intend to validate or substantiate claims unless there is a patient safety issue. (8/11/14)

PD4: Are there restrictions on the method of ingesting the oil, liquid or pill? For example would a nasal spray be allowed?

We are researching whether or not a spray is contemplated. (8/11/14)

PD3: Will testing the product both at growing and after processing be necessary?

It is standard practice for a manufacturer to test product throughout the growing and manufacturing process to ensure the end product meets quality standards and specifications. (8/11/14)

PD2: Would you estimate a 6, 9, or 12 month shelf life?

We expect manufacturers to establish their shelf life claims. (8/11/14)

PD1: Can the manufacturers act as a research facility? Can new products be developed? For example, could a manufacturer produce a topical cream as an alternative method for ingestion?

This question is currently under review. (8/11/14)

Statute and Rules Questions

S5: Are there protections in the law for corporate officers and directors of licensed companies that may have other professional licenses etc.?

While providing some criminal and civil protections in 152.32, subdivision 2, the statute does not provide any specific protections for corporate officers and directors of licensed companies with any professional licensing entities other than the Minnesota Boards of Medical Practice, Nursing and Pharmacy as noted in 152.32, subdivision 2, paragraph 2, subpart (c).

Corporate officers and directors concerned about potential licensing issues should consult directly with an attorney and the licensing entities in question. (9/12/2014)

S4: At the Aug 8th meeting there was discussion on how MN law offers some protection for the companies granted licenses. Can you comment on that protection and how it may apply specifically to protect the licensed pharmacist's from sanctions from their licensing entities?

As noted in the statute (152.32, subdivision 2, paragraph 2, subpart (c)), a pharmacist operating within the provisions of the state’s medical cannabis program is protected from civil or disciplinary penalties within the authority of the Minnesota Board of Pharmacy.

"A pharmacist licensed under chapter 151 is not subject to any civil or disciplinary penalties by the Board of Pharmacy when acting in accordance with the provisions of sections 152.22 to 152.37. Nothing in this section affects a professional licensing board from taking action in response to violations of any other section of law."

Please note the protections for pharmacists cited in the statute are limited to the Minnesota Board of Pharmacy and do not extend beyond them.  Employers or pharmacists concerned about potential licensing issues should consult directly with licensing entities and an attorney. (9/12/2014)

S3: Are the expedited rules the law?

They become law once the expedited rules are accepted by the Office of Administrative Hearings and the Governor does not veto the rules. (8/11/14)

S2: What protections would there be for investors against any federal violations?

The State of Minnesota cannot grant protection for investors or employees of the manufacturer against any federal charges. (8/11/14)

S1: Is there an easy way for industry to know if a requested change is a legislative change or a rule change?

If the statute does not include a necessary topic, MDH lacks authority and must seek a legislative change. If a topic is included in the statute, MDH has flexibility to address it via rules. (8/11/14)

 

Updated Monday, August 15, 2016 at 03:06PM