How to open a Dispensary in Delaware

Delaware’s medical cannabis program has gone through considerable evolution since it was signed into law in 2011, including, at one point, being put on hold due to fears of Federal intervention. The law only allows for state-regulated, non-profits called “compassion centers” (aka dispensaries). Compassion centers are required to grow everything they sell themselves.

The legislation authorizes the operation of at least one dispensary for each of the three Delaware counties. More may be allowed if the patient count grows. Currently, all three of the state’s available licenses have been issued, and all dispensaries are in operation, so the state is not currently accepting applications for new businesses. However, it is possible that the application process will open again soon.

Opening a marijuana dispensary in Delaware is not cheap. Applicants are required to pay a bi-annual, non-refundable license application fee of $5,000. If certified, there is a license fee of $40,000 to be paid bi-annually.

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    The authorization of prescribed medical marijuana and the establishment of non-profit State-regulated medical marijuana dispensaries (compassion centers), was signed by Delaware’s governor on May 13th, 2011.

    The legislation authorizes the operation of at least one compassion center for each of the three Delaware counties. More will be allowed if the patient base grows.

    When was cannabis made legal
    When was cannabis made legal – Image powered by Wheresweed.com

    The first dispensary in Delaware opened in June 2015. The dispensary program recently came to a halt for fears of federal intervention, so do some checking to determine the current state of affairs.

    Compassion centers are required to grow everything they sell themselves (vertical integration). The slow rollout of the program has led to a lawsuit by a patient. It is possible that adult-use legalization will come via the state legislature in 2017.

    How many compassion centers are there in the state

    Marijuana retail businesses in Delaware are called compassion centers. Currently, all three available licenses have been issued, and all dispensaries are in operation. If the number of patients increases, more licenses for new compassion centers may be given out.

    How much money is there in the Delaware cannabis market

    Medical sales for 2016 reached $1,700,000. This number is projected to rise to $5,000,000 by 2021. Should adult-use legalization occur, projected adult use sales in 2021 are expected to reach $46,500,000.

    License requirements

    You cannot currently apply for a marijuana business license in Delaware. However, it is possible that the application process will open again soon.

    In order to be issued a license for a compassion center in Delaware, you must be reviewed by Delaware’s Office of Medical Marijuana, in the Division of Public Health, using the following criteria.

    A maximum of 90 points are available:

    License requirements
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    Points are awarded for safety, security and location suitability

    • Suitability of location, including zoning compliance and geographic convenience to patients
    • Sufficiency of safety, security, and prevention of diversion plans
    • Packaging and labeling plan
    • Quality assurance plan, including testing for contaminants and potency
    • Secure and safe recordkeeping plan for agents and product tracking

    More points are awarded for how well stores can respond to the scope of services including:

    • Staffing and training plan
    • Operations and services plan
    • Ability to provide adequate supply and variety of products, including paraphernalia
    • Packaging, labeling, and dispensing plan
    • Product line diversity
    • Record-keeping plan, including long-term storage
    • Ability to grow marijuana without pesticides
    • Compassionate need plan

    Points are also awarded for the stability, qualifications, and experience of vendor(s)

    • Quality assurance program details
    • Ability to work well in a larger program of multiple compassion centers
    • Demonstration of sufficient capitalization, including a financial business plan with sources of funding
    • Principal officer and board members’ character and relevant experience
    • By-laws and administrative oversight

    These considerations are Pass/Fail

    • Not-for-profit status
    • Submission format
    • Meets mandatory security, oversight, and recordkeeping requirements
    • Local zoning and suitability of proposed location
    • Suitability of prospective principal officers and board members

    Financial requirements

    Financial requirements
    Financial requirements – Image powered by Stockphoto.com

    Compassion centers are required to apply for a bi-annual certification fee that amounts to $40,000 as well as an initial non-refundable $5,000 application fee.

    Timeframe

    If applications open again, you’ll want to allow plenty of time to launch your Deleware dispensary. It typically can take up to a year to start any business, but due to the nature of the requirements listed below, it can often take even longer.

    Consulting firms that can help you open a Delaware marijuana dispensary

    Looking to start a marijuana dispensary in Delaware? The consulting companies listed below provide a wide range of services from helping with state licensing requirements and applications to running and stocking your business.

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