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STATE OF OKLAHOMA
1st Session of the 58th Legislature (2021)
COMMITTEE SUBSTITUTE
FOR
HOUSE BILL NO. 2660 By: Echols
COMMITTEE SUBSTITUTE
An Act relating to medical marijuana; amending
Section 4, State Question No. 788, Initiative
Petition No. 412 (63 O.S. Supp. 2020, Section 423),
which relates to medical marijuana processor
licensing requirements; providing for the issuance of
volatile and nonvolatile processor licenses; updating
language; amending Section 17, Chapter 11, O.S.L.
2019, as amended by Section 4, Chapter 312, O.S.L.
2019 (63 O.S. Supp. 2020, Section 427.17), which
relates to the Oklahoma Medical Marijuana and Patient
Protection Act; modifying test batch requirements for
licensed medical marijuana commercial growers and
processors; defining certain term; and providing an
effective date.
BE IT ENACTED BY THE PEOPLE OF THE STATE OF OKLAHOMA:
SECTION 1. AMENDATORY Section 4, State Question No. 788,
Initiative Petition No. 412 (63 O.S. Supp. 2020, Section 423), is
amended to read as follows:
Section 423. A. The Oklahoma State Department of Health shall
within thirty (30) days of passage of this initiative, make
available, on their its website, in an easy-to-find location, an
application for a medi cal marijuana processing processor license.
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The Department shall be authorized to issue two types of medical
marijuana processor licenses:
1. Nonvolatile, which involves using any solvent in the
extraction process that is not a volatile solvent, includin g carbon
dioxide; and
2. Volatile, which involves using any solvent that is or
produces a flammable gas or vapor that, when present in the air in
sufficient quantities, will create explosive or ignitable mixtures
and may also include extraction using nonv olatile solvents or no
solvents.
The application fee for a nonvolatile or volatile medical marijuana
processor license shall be Two Thousand Five Hundred Dollars
($2,500.00) and methods. Methods of payment will shall be provided
on the website. The Oklahoma State Department of Health shall have
two (2) weeks to review the application, approve or reject the
application, and mail the approval/rejection letter (if rejected,
stating reasons for rejection) to the applicant.
B. The Oklahoma State Department of Health must shall approve
all applications which meet the following criteria:
1. Applicant must be age twenty -five (25) or older;
2. Any applicant, applying as an individual, must show
residency in the State of Oklahoma;
3. All applying entities must s how that all members, managers,
and board members are Oklahoma residents;
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4. An applying entity may show ownership of non -Oklahoma
residents, but that percentage ownership may not exceed twenty -five
percent (25%);
5. All applying individuals or entities must be registered to
conduct business in the State of Oklahoma; and
6. All applicants must disclose all ownership ;.
7. Applicant(s) An applicant with only a nonviolent felony
conviction(s) in the last two (2) years , or any other felony
conviction in five (5) years, inmates, or any person currently
incarcerated may not qualify for a medical marijuana processing
processor license.
C. A licensed medical marijuana processor may take marijuana
plants and distill or process these plants into concentrates,
edibles, and other forms for consumption. As required by subsection
D of this section, the Oklahoma State Department of Health will
shall, within sixty (60) days of passage of this initiative, make
available a set of standards which will be used by licensed medical
marijuana processors in the preparation of edible marijuana
products. This should be in line with current food preparation
guidelines and no excessive or punitive rules may be established by
the Oklahoma State Department of Health. Once a year, the Oklahoma
State Department of Health may inspect a processing operation and
determine its compliance with the preparation standards. If
deficiencies are found, a written report of deficiency will the
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deficiencies shall be issued to the licensed medical marijuana
processor. The licensed medical marijuana processor will shall have
one (1) month to correct the deficiency or be subject to a fine of
Five Hundred Dollars ($500.00) for each deficiency. A licensed
medical marijuana processor may sell marijuana products it creates
to a licensed retailer, or any other licensed medical marijuana
processor. Further, these sales will shall be considered wholesale
sales and not subject to taxation. Under no circumstances may a
licensed medical marijuana processor sell marijuana, or any
marijuana product, directly to a medical marijuana license holder
patient licensee or caregiver licensee . However, a licensed medical
marijuana processor may process cannabis into a concentrated form ,
for a medical license holder, marijuana patient licensee for a fee.
Processors will Licensed medical marijuana processors shall be
required to complete a monthly yield and sales report to the
Oklahoma State Department of Health. This report will be due on the
15th fifteenth of each month and provide reporting on the previous
month. This report will shall detail the amount of marijuana
purchased in pounds, the amount of marijuana cooked or processed in
pounds, and the amount of waste in pounds. Additionally, this
report will shall show total wholesale sales in dollars. The
Oklahoma State Department of Health will shall have oversight and
auditing responsibilities to ensure that all marijuana being grown
is accounted for. A licensed medical marijuana processor will shall
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only be subject to a penalty if a gross discrepancy exists and
cannot be explained. Penalties for fraudulent reporting occurring
within any 2 year two-year time period will shall be an initial fine
of Five Thousand Dollars ($5,000.00) (first) for a first offense and
revocation of licensing (second) the medial marijuana processor
license for a second offense .
D. The Department shall oversee inspection and compliance of
licensed medical marijuana processors producing products with
marijuana as an additive. The Oklahoma State Department of Health
will shall be compelled to, within thirty (30) days of passage of
this initiative, appoint a board of twelve (12) Oklahoma residents,
who are marijuana industry experts, to create a list of food safety
standards for processing an d handling medical marijuana in Oklahoma.
These standards will shall be adopted by the agency Department and
the agency Department can enforce these standards for licensed
medical marijuana processors. The agency will Department shall
develop a standards review procedure and these standards can may be
altered by calling another board of twelve (12) Oklahoma marijuana
industry experts. A signed letter of twenty (20) operating licensed
medical marijuana processors would constitute a need for a new board
and standard standards review.
E. If it becomes permissible , under federal law, marijuana may
be moved across state lines.
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F. Any device used for the consumption of medical marijuana
shall be considered legal to be sold, manufactured, distributed, and
possessed. No merchant, wholesaler, manufacturer, or individual may
unduly be harassed or prosecuted for selling, manufacturing, or
possession of medical marijuana paraphernalia.
SECTION 2. AMENDATORY Section 17, Chapter 11, O.S.L.
2019, as amended by Section 4, Chapter 312, O.S.L. 2019 (63 O.S.
Supp. 2020, Section 427.17), is amended to read as follows:
Section 427.17 A. There is hereby created a medical marijuana
testing laboratory license as a category of the medical marijuana
business license. The Authority is hereby enabled to monitor,
inspect and audit a licensed testing laboratory under this act.
B. The Authority is hereby authorized to contract with a
private laboratory for the purpose of conducting compliance testing
of medical marijuana testing laboratories licensed in this state.
Any such laboratory under contract for compliance testing shall be
prohibited from conducting any other commercial medical marijuana
testing in this state.
C. The Authority shall have the autho rity to develop acceptable
testing and research practices, including but not limited to
testing, standards, quality control analysis, equipment
certification and calibration, and chemical identification and
substances used in bona fide research methods so long as it complies
with this act.
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D. A person who is a direct beneficial owner or an indirect
beneficial owner of a medical marijuana dispensary, medical
marijuana commercial grower, or medical marijuana processor shall
not be an owner of a laboratory.
E. A laboratory and a laboratory applicant shall comply with
all applicable local ordinances, including but not limited to
zoning, occupancy, licensing and building codes.
F. A separate license shall be required for each specific
laboratory.
G. A medical marijuana testing laboratory license may be issued
to a person who performs testing and research on medical marijuana
and medical marijuana products for medical marijuana businesses,
medical marijuana research facilities, medical marijuana education
facilities, and testing and research on marijuana and marijuana
products grown or produced by a patient or caregiver on behalf of a
patient, upon verification of registration. No state -approved
medical marijuana testing facility shall operate unless a medical
laboratory director is on site during operational hours.
H. A laboratory applicant shall comply with the application
requirements of this section and shall submit such other information
as required for a medical marijuana business applicant, in addition
to any information the Authority may request for initial approval
and periodic evaluations during the approval period.
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I. A medical marijuana testing laboratory may accept samples of
medical marijuana, medical marijuana concentrate or medical
marijuana product from a medical marijuana business for testing and
research purposes only, which purposes may include the provision of
testing services for samples submitted by a medical marijuana
business for product development. The Department may require a
medical marijuana business to submit a sample of medical marijuana,
medical marijuana concentrate or medical marijuana product to a
medical marijuana testing laboratory upon demand.
J. A medical marijuana testing laboratory may accept samples of
medical marijuana, medical marijuana concentrate or medical
marijuana product from an individual person for testing only under
the following conditions:
1. The individual person is a patient or caregiver pursuant to
this act or is a participant in an approved clinical or
observational study conducted by a research facility; and
2. The medical marijuana testing laboratory shall require the
patient or caregiver to produce a valid patient license and current
and valid photo identification.
K. A medical marijuana testing la boratory may transfer samples
to another medical marijuana testing laboratory for testing. All
laboratory reports provided to or by a medical marijuana business or
to a patient or caregiver shall identify the medical marijuana
testing laboratory that actu ally conducted the test.
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L. A medical marijuana testing laboratory may utilize a
licensed medical marijuana transporter to transport samples of
medical marijuana, medical marijuana concentrate and medical
marijuana product for testing, in accordance with this act and the
rules adopted pursuant thereto, between the originating medical
marijuana business requesting testing services and the destination
laboratory performing testing services.
M. The medical marijuana testing laboratory shall establish
policies to prevent the existence of or appearance of undue
commercial, financial or other influences that may diminish the
competency, impartiality and integrity of the testing processes or
results of the laboratory, or that may diminish public confidence in
the competency, impartiality and integrity of the testing processes
or results of the laboratory. At a minimum, employees, owners or
agents of a medical marijuana testing laboratory who participate in
any aspect of the analysis and results of a sample are pr ohibited
from improperly influencing the testing process, improperly
manipulating data, or improperly benefiting from any ongoing
financial, employment, personal or business relationship with the
medical marijuana business that provided the sample.
N. The Department, pursuant to rules promulgated by the State
Commissioner of Health, shall develop standards, policies and
procedures as necessary for:
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1. The cleanliness and orderliness of a laboratory premises and
the location of the laboratory in a secure l ocation, and inspection,
cleaning and maintenance of any equipment or utensils used for the
analysis of test samples;
2. Testing procedures, testing standards for cannabinoid and
terpenoid potency and safe levels of contaminants, and remediation
procedures;
3. Controlled access areas for storage of medical marijuana and
medical marijuana product test samples, waste and reference
standards;
4. Records to be retained and computer systems to be utilized
by the laboratory;
5. The possession, storage and use by the laboratory of
reagents, solutions and reference standards;
6. A certificate of analysis (COA) for each lot of reference
standard;
7. The transport and disposal of unused marijuana, marijuana
products and waste;
8. The mandatory use by a laborato ry of an inventory tracking
system to ensure all test batches or samples containing medical
marijuana, medical marijuana concentrate or medical marijuana
products are identified and tracked from the point they are
transferred from a medical marijuana busin ess, a patient or a
caregiver through the point of transfer, destruction or disposal.
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The inventory tracking system reporting shall include the results of
any tests that are conducted on medical marijuana, medical marijuana
concentrate or medical marijuan a product;
9. Standards of performance;
10. The employment of laboratory personnel;
11. A written standard operating procedure manual to be
maintained and updated by the laboratory;
12. The successful participation in a Department -approved
proficiency testing program for each testing category listed in this
section, in order to obtain and maintain certification;
13. The establishment of and adherence to a quality assurance
and quality control program to ensure sufficient monitoring of
laboratory processes and quality of results reported;
14. The establishment by the laboratory of a system to document
the complete chain of custody for samples from receipt through
disposal;
15. The establishment by the laboratory of a system to retain
and maintain all required records, including business records, and
processes to ensure results are reported in a timely and accurate
manner; and
16. Any other aspect of laboratory testing of medical marijuana
or medical marijuana product deemed necessary by the Department.
O. A medical marijuana testing laboratory shall promptly
provide the Department or designee of the Department access to a
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report of a test and any underlying data that is conducted on a
sample at the request of a medical marijuana business or qualified
patient. A medical marijuana testing laboratory shall also provide
access to the Department or designee of the Department to laboratory
premises and to any material or information requested by the
Department to determine compliance with the requirements of this
section.
P. A medical marijuana testing laboratory shall retain all
results of laboratory tests conducted on marijuana or products for a
period of at least two (2) years and shall make them available to
the Department upon request.
Q. A medical marijuana testing laboratory shall test samples
from each harvest batch or product batch, as appropriate, of medical
marijuana, medical marijuana concentrate and medical marijuana
product for each of the following categories of testing, consistent
with standards developed by the Commissioner:
1. Microbials;
2. Mycotoxins;
3. Residual solvents;
4. Pesticides;
5. Tetrahydrocannabinol (THC) and other cannabinoid potency;
6. Terpenoid potency; and
7. Heavy metals.
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R. A test batch shall not exceed ten (10) pounds of usable
marijuana or medical marijuana product, as appropriate. A grower
shall separate each harvest lot of usable marijuana into harvest
batches containing no more than ten (10) twenty-five (25) pounds. A
processor shall separate each medical m arijuana production lot into
production batches containing no more than ten (10) pounds four (4)
liters of distillate and for final products, the Oklahoma Medical
Marijuana Authority shall be authorized to promulgate rules on final
products as necessary. Provided, however, the Authority shall not
require testing of final products more often than every two hundred
(200) grams of THC, unless the batch size processed is less than two
hundred (200) grams of THC. As used in this subsection, "final
products" shall include, but not be limited to, cookies, brownies,
candies, gummies and chocolates .
S. Medical marijuana testing laboratory licensure shall be
contingent upon successful on -site inspection, successful
participation in proficiency testing and ongoing c ompliance with the
applicable requirements in this section.
T. A medical marijuana testing laboratory shall be inspected
prior to initial licensure and annually thereafter by an inspector
approved by the Authority.
U. Beginning on a date determined by th e Commissioner, not
later than January 1, 2020, medical marijuana testing laboratory
licensure shall be contingent upon accreditation by the NELAC
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Institute (TNI), ANSI/ASQ National Accreditation Board or another
accrediting body approved by the Commission er, and any applicable
standards as determined by the Department.
V. A commercial grower shall not transfer or sell medical
marijuana and a processor shall not transfer, sell or process into a
concentrate or product any medical marijuana, medical marijuan a
concentrate or medical marijuana product unless samples from each
harvest batch or production batch from which that medical marijuana,
medical marijuana concentrate or medical marijuana product was
derived has been tested by a medical marijuana testing f acility for
contaminants and passed all contaminant tests required by this act.
SECTION 3. This act shall become effective November 1, 2021.
58-1-7807 JL 02/25/21