State picks five winners to cultivate medical marijuana

Within seven days, the top five must pay a fee of $100,000 and file a $500,000 performance bond. If not, the permit will go to applicants with the next highest scores. The application fee was $15,000. Industry insiders have estimated that applicants may have spent $100,000 to $150,000 in preparation.

The applicant ranked sixth was River Valley Relief, associated with Storm Nolan, the head of the Arkansas Cannabis Industry Association.

It doesn’t mean no lawsuits will be filed, but the expectation is that a recent state Supreme Court ruling makes it impossible to sue the state to challenge the commission’s decisions.

An image of the players involved in the industry is emerging. Natural State Wellness is led by Hank Wilkins V, son of Jefferson County Judge Hank Wilkins. Former Attorney General Dustin McDaniel says he’s a part owner, consultant and lawyer for the group, which was started by the Ross Group, headquartered in Tulsa.

“We appreciate that it is a public trust that has been placed upon our company to produce quality, safe and legal medicine to Arkansas patients. We will make a location decision shortly and will promptly begin construction. For the last year, my partner Bart Calhoun and I have served as legal counsel and lobbyists for this effort, and we are both investors in the company, along with a number of fellow Arkansans,” McDaniel said in a statement.

Natural State Medicinals, incorporator Joseph Courtright, will grow in Jefferson County. Osage, incorporator Jay Trulove, will set up in Carroll County. Delta Medical Cannabis, incorporator Jason Willet, will operate in Jackson County. Bold Team LCC, Danny Brown incorporator, will grow in Cotton Plant (Woodruff County).

Donna Terrell, anchor on Fox 16, disclosed on Tuesday night’s news broadcast that she was one of the members of a group seeking a medical marijuana cultivation permit. She’s reportedly a part of the top-ranked application from Natural States Medicinal Cultivation, but she didn’t reveal that on-air.

Terrell said she’d decided to get involved because of the death of her daughter seven years ago from colon cancer. She said the availability of medical marijuana then would have made her last days “much more tolerable.”

Joseph Courtright is listed as the owner of Natural State Medicinals LLC. A man by the same name became president and CEO of USA Drugstores in 2006. He led the company when the primary owners, the LaFrance family of Arkansas, sold the company to Walgreens for $550 million. They’ve been rumored to be involved n this application. Courtright now is with Dale Capital Partners. It and a variety of businesses with connections to the LaFrance family operate from the same offices in Little Rock.

Willett, who just worked as a consultant not owner to the Delta group, put the Arkansas Times in touch with its leader, Don Parker, a Jonesboro lawyer. He said the entire ownership group is from Arkansas, mostly in the Jonesboro area, but also Mississippi, Woodruff and Pulaski counties.

“We’re just elated,” Parker said. He said he’d wait until the release of applications by the commission to specifically identify other owners. He said the group’s Jackson County site qualified for points as a depressed area and he said the group’s 51 percent female ownership also lifted its score.

He said the group has an option to buy up to 10 acres near ASU-Newport from John Conner, a major Newport farmer, and they plan to build a 25,000-square-foot facility for the controlled indoor cultivation required. He said the group had consulted people in the business from California and Colorado to prepare. Parker acknowledged there are many unknowns to be overcome, including questions about demand. But he noted medical marijuana, though it requires certification to obtain, isn’t the same thing as a prescription drug in terms of dispensation. Buyers will be offered a range of different strains of product at different prices and potency and be able to buy from any dispensary within limits. He said his group expected about six months of construction time. Once the facility is in place and seeds are planted, it will take another 60 days to reach harvesting stage, he expects.

“We want to make sure we do it right and do it well,” he said.

Commissioners scored redacted applications individually and provided their scores to staff, which aggregated the scores. Bonus points were awarded to applicants that were affiliated with a doctor (2.5 points), demonstrated a plan to benefit the community (2.5 points), delivered economic impact (2.5 points) and included minority ownership (2.5 points). Four of the five successful applicants — Carroll County was the exception — were in counties designated as being in the lowest tier of prosperity by the Arkansas Economic Development Commission.

The Times talked with Angela Ryland, liaison for Bold Team and president of the Cotton Plant Chamber of Commerce, as she waited around 2 p.m. in a long line of more than 100 people hoping to attend the commission’s meeting.

“We believe this is going to be the hero of Cotton Plant. We have no industry,” Ryland said. “We have no Dollar General store. We have no service station, no grocery store, no bank … we need this.”

Of Bold Team, she said: “They found us. But I’m not at liberty to go further [about investors]. But they found us.” Ryland noted that musician Sister Rosetta Tharpe was from Cotton Plant, and “outside of [Tharpe], this is about the best we’ve got. … We have music and marijuana: M&M.”

Ryland was too far back in line to make it into the meeting room.

The commission will next consider 228 applications for medical marijuana dispensaries. Commissioners will award 32 licenses, four in eight geographic zones. There is no deadline, but commission staff said they expected the process to take several months. The amendment to the state Constitution allowing the growing of marijuana was passed in November 2016.

The meeting room was packed. Those outside who couldn’t get in watched a live stream on their phones. As the 3:30 p.m. meeting time approached, “Well,” said one man, “seven more minutes until we learn who won the lottery.”