Five Iowa medical marijuana stores gain state approval

Iowans looking to buy medical marijuana products could have options across the state, starting in December.

The Iowa Department of Public Health announced Tuesday that it has offered cannabis dispensary licenses to proposed stores in Council Bluffs, Davenport, Sioux City, Waterloo and Windsor Heights.

The stores are planned by MedPharm Iowa in Windsor Heights and Sioux City; Have a Heart Compassion Care in Council Bluffs and Davenport; and Iowa Cannabis Company in Waterloo. MedPharm is based in Des Moines. The other two companies are based in Washington state, which has allowed medical uses of marijuana since 1998.

More: Iowa approved five marijuana stores. Does that mean you can soon get legal pot?

The dispensaries are to be set up under Iowa’s new medical marijuana law, which will allow sales of some types of marijuana-derived medications to people suffering from maladies such as epilepsy, cancer, multiple sclerosis, Lou Gehrig's disease or intractable pain.

New stores will look like a pharmacy, doctor's office

MedPharm executive Lucas Nelson said Tuesday that his company’s Windsor Heights store will be in the Apple Valley shopping center, which is south of University Avenue and east of 73rd Street. MedPharm’s Sioux City store will be in a strip mall on Sunnybrook Drive, he said.

Nelson said the dispensaries will be modern and secure. “It’s going to probably remind you of a combination pharmacy and doctor’s office,” he said.

Customers will enter via a vestibule staffed by a security guard, he said. The guard will check to ensure each customer has a state-issued card allowing them to purchase medical cannabis products. If they do, they will be let into a waiting room. From there, they will be called into a back area, where they will meet with staff members who can help them choose a product, such as an oil, cream or gel capsule. The stores will not be allowed to sell smokeable marijuana.

MedPharm is the only company that has been granted a permit to grow marijuana and process it into medications. The company is setting up a $10 million facility in a converted warehouse in southeast Des Moines.

Its leaders are pressing the Legislature to expand the medical marijuana law to allow the products use for more medical conditions. MedPharm also wants Iowa to allow products with higher levels of THC. The chemical is what makes recreational marijuana users high, but proponents say it is also critical for treatment of pain and some other conditions.

Nelson estimated each dispensary represents an investment of $300,000 to $1 million. That includes the annual cost of a state permit, which is expected to be $75,000 to $125,000. The setup costs also will include store rent, modifications and furnishings, plus the hiring and training of staff and the purchase of medications.

“We believe in what the medicine does, and we believe in where this is headed for the state,” Nelson said.

The companies have shown their commitment, as has the Iowa Department of Public Health, which is overseeing implementation of the new system, he said. “We want the Legislature to do the same,” he said of pending proposals to expand the state’s medical-marijuana program.

Seven companies filed a total of 21 applications for dispensary licenses by the March 9 deadline. Some medical marijuana proponents had feared there would be little interest in the licenses because of the law’s limits on the types of products allowed and the ailments for which they could be purchased.

The state did not accept proposals to place stores in Cedar Rapids, the state’s second-largest city, or for either of two proposed stores in the Iowa City area, which is known as the most politically liberal urban area in the state.

Iowa Department of Public Health Deputy Director Sarah Reisetter said the law requires the new dispensaries be spread across the state. The committee that judged the applications decided the best way to locate stores in eastern Iowa was to offer licenses in Waterloo to the north and Davenport to the east, she said.

If the committee had approved a license in the Cedar Rapids/Iowa City region instead of in Waterloo, all of the dispensaries except the one in Sioux City would have been along the Interstate Highway 80 corridor, she said.

No dispensaries were proposed in southern Iowa, which has no large cities.

The permit committee included representatives of the Iowa health and economic development departments, plus two officials from other states that have medical-marijuana programs, Reisetter said. The criteria included the strength of the applicants’ plans for security, record-keeping and storage, plus their finances and staff.

Reisetter said the companies that were offered licenses have until Wednesday morning to decide whether to accept them.

A representative of the Have A Heart Compassion Care company said the Seattle-based firm has six stores in Washington state. The shops sell marijuana products for medical and recreational purposes, which are both legal there.

Marcello Ramirez, who is executive assistant to the company's chief executive officer, said Have A Heart also has licenses for dispensaries in California, Oregon and Hawaii, and is looking to expand into several other states.

Ramirez said his company respects that Iowa is launching a limited medical-marijuana program. "Our narrative is we're at the pace of Iowa," he said. "We don't want to have people thinking we're here to push the legal adult-use agenda." The company is settling details on its new shops in Council Bluffs and Davenport and is looking forward to helping Iowans get their program started, he said.