BATON ROUGE — Louisiana State University has completed its contract with the company that will grow medical marijuana for the school and said Monday the drug is expected to reach patients by the middle of next year.
Las Vegas-based GB Sciences is the first of only two producers of medical marijuana planned in Louisiana, through a deal with the LSU AgCenter. The company will start renovating its planned production facility immediately, according to a statement from the AgCenter.
Lawmakers agreed to a framework for dispensing medical marijuana in 2015, but only allowed the agricultural centers at LSU and Southern University to grow the product. Southern is expected to choose a vendor to run its program Friday.
The law will eventually get medicinal-grade marijuana to people with cancer, a severe form of cerebral palsy, seizure disorders, epilepsy, muscular dystrophy and other diseases. Under the law, marijuana can be available in medicinal oils, pills, sprays, topical applications and other forms, but cannot be sold in a form that can be smoked.
“It is extremely important that we can provide patients with safe and consistent options to help improve their quality of life,” Bill Richardson, LSU vice president for agriculture, said in a statement announcing the contract’s completion.
Another company that bid for the contract, CB Medical Inc., suggested GB Sciences — a penny-stock firm with millions in losses — doesn’t have the resources to make the upfront investment in the production facility and meet its financial promises to LSU.
In a five-page letter sent earlier this month to the LSU Board of Supervisors chairman, a law firm for CB Medical outlined what it described as “red flags which litter” GB’s financial documents filed with the U.S. Securities and Exchange Commission.
GB Sciences CEO John Poss has dismissed the concerns, expressing confidence his company will continue to draw money from investors. GB Sciences has agreed to pay LSU $3.4 million over five years or 10 percent of gross receipts, whichever is higher.
The company also has agreed to contribute money toward research, and the AgCenter said it’s talking with other LSU research facilities, including the university’s medical schools about research opportunities.
Richardson said AgCenter representatives visited the GB Sciences marijuana growing site in Las Vegas and found it to be a “first-class production and research facility.” Both Richardson and Poss said they are excited about research possibilities available through the LSU contract.
“This is another major step in taking cannabis out of the shadows and into the university research labs, where it has always rightfully belonged,” Poss said in a statement Monday. “This is a historic event, and we can’t wait to get started.”
The LSU Board of Supervisors approved the deal in June, after the AgCenter selected GB Sciences from seven potential vendors.
No state tax dollars are involved in producing medical marijuana. LSU chose a contractor to cover start-up costs estimated to be as much as $11 million. Richardson said the medicinal-grade pot won’t be grown on campus and the operation won’t involve students. He said security will be high, and scrutiny intense.