By: Menéndez S.B. No. 121               A BILL TO BE ENTITLED   AN ACT   relating to authorizing the possession, use, cultivation,   distribution, delivery, sale, and research of medical cannabis for   medical use by patients with certain medical conditions and the   licensing of medical cannabis organizations; authorizing fees.          BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:   ARTICLE 1. FINDINGS AND PURPOSE          SECTION 1.01.  LEGISLATIVE FINDINGS; PURPOSE. The   legislature finds that:                (1)  scientific evidence suggests that medical   cannabis is one potential therapy that may mitigate suffering,   enhance quality of life, and offer potential treatment of certain   medical conditions;                (2)  Texas patients should have reasonable statewide   access to medical cannabis subject to safeguards for public health   and safety;                (3)  a seriously ill patient who engages in medical use   of cannabis on a treating practitioner's advice should not be   arrested, incarcerated, or otherwise punished for violation of drug   laws;                (4)  where patients are suffering from certain medical   conditions, they and their physicians should have a right to try   medical cannabis as an alternative medicine through a safe and   regulated program; and                (5)  Texas has a wealth of esteemed research   institutions from medical to agricultural that can greatly   contribute to the advancement of research on the safe cultivation,   manufacturing, and use of medical cannabis.   ARTICLE 2. MEDICAL CANNABIS RESEARCH PROGRAM          SECTION 2.01.  Subtitle A, Title 6, Health and Safety Code,   is amended by adding Chapter 444 to read as follows:   CHAPTER 444. MEDICAL CANNABIS RESEARCH PROGRAM   SUBCHAPTER A. GENERAL PROVISIONS          Sec. 444.001.  SHORT TITLE. This chapter may be cited as the   Medical Cannabis Research Act.          Sec. 444.002.  DEFINITIONS. In this chapter:                (1)  "Advisory board" means the medical cannabis   research advisory board established under this chapter.                (2)  "License" means a medical cannabis research   license issued by the department under Subchapter C.                (3)  "License holder" means a person who holds a   medical cannabis research license.                (4)  "Medical cannabis" has the meaning assigned by   Section 169.001, Occupations Code.   SUBCHAPTER B. MEDICAL CANNABIS RESEARCH ADVISORY BOARD          Sec. 444.051.  ESTABLISHMENT OF ADVISORY BOARD. (a) A   medical cannabis research advisory board is established to perform   functions and duties under this chapter.          (b)  The executive commissioner shall assist the advisory   board as provided by this chapter.          Sec. 444.052.  MEMBERSHIP. (a) The advisory board members   are appointed by the governor and serve staggered six-year terms,   with the terms of one-third of the members expiring on August 31 of   each odd-numbered year.          (b)  The advisory board shall be composed of the following 12   members:                (1)  a licensed physician certified by the American   Board of Internal Medicine and certified in the subspecialty of   medical oncology;                (2)  a licensed physician certified by the American   Board of Psychiatry;                (3)  a licensed physician certified by the American   Board of Surgery;                (4)  a licensed physician certified by the American   Board of Psychiatry and Neurology;                (5)  a licensed physician certified by the American   Board of Family Medicine;                (6)  a licensed physician certified in neurology with a   special qualification in child neurology;                (7)  a licensed physician specializing in pain   management certified by the American Board of Anesthesiology, the   American Board of Neurology, or the American Board of Physical   Medicine and Rehabilitation;                (8)  a licensed pharmacist;                (9)  a licensed advanced practice registered nurse   specializing in palliative care certified by the Hospice and   Palliative Credentialing Center or a licensed physician   specializing in palliative care certified by a member board of the   American Board of Medical Specialties, the American Osteopathic   Association, or the Hospice Medical Director Certification Board;                (10)  a representative from a Texas medical specialty   organization;                (11)  a licensed attorney with experience in law   pertaining to the practice of medicine and cannabis regulation; and                (12)  a person who represents medical cannabis patient   interests.          (c)  At least two members of the advisory board must be   affiliated with an institution of higher education or private or   independent institution of higher education involved in relevant   research, such as a medical unit, general academic teaching   institution, or other agency of higher education, as defined by   Section 61.003, Education Code.          (d)  The governor shall select a presiding officer from the   membership of the advisory board.          (e)  The advisory board shall meet at least quarterly at the   call of the presiding officer.          (f)  The advisory board may create and appoint one or more   advisory committees composed of patients, law enforcement   officers, researchers, other medical professionals, and other   persons who are knowledgeable about the medical use of cannabis.          (g)  Members serve without compensation but are entitled to   reimbursement for actual and necessary expenses incurred in   performing official duties.          Sec. 444.053.  DUTIES OF ADVISORY BOARD; REPORT. (a) The   advisory board shall assist the department in evaluating proposals   submitted as part of a license application under Section 444.104.          (b)  The advisory board shall conduct a continuing study of   the laws relating to medical cannabis to facilitate statewide   access to safe and effective medical cannabis.          (c)  The advisory board shall prepare a report of the board's   findings and recommendations under Subsection (b) and submit the   report to the legislature not later than September 1 of each   even-numbered year.          (d)  The advisory board shall consult with the Department of   Public Safety under Section 487.0521(b) on rules monitoring the   safety and efficacy of medical cannabis or medical cannabis   products.   SUBCHAPTER C. MEDICAL CANNABIS RESEARCH LICENSE          Sec. 444.101.  ISSUANCE OF LICENSE. The department shall   issue a medical cannabis research license to a person that   authorizes the person to possess, manufacture, cultivate, or   dispense medical cannabis for the limited research purposes   described by Section 444.102.          Sec. 444.102.  PURPOSE OF LICENSE. A medical cannabis   research license may be issued for the following limited research   purposes:                (1)  conducting objective scientific research into the   safety and efficacy of medical cannabis or other public health   outcomes related to medical cannabis;                (2)  developing medical guidelines for the appropriate   administration of medical cannabis to assist physicians and   patients in evaluating the risks and benefits of medical cannabis   and to provide a scientific basis for future policies;                (3)  developing quality control, purity, and labeling   standards for medical cannabis;                (4)  developing best practices for the safe and   efficient cultivation of medical cannabis;                (5)  analyzing genetic and healing properties of   different varieties of cannabis;                (6)  conducting genomic, horticultural, or   agricultural research; and                (7)  conducting research on cannabis-affiliated   products or systems.          Sec. 444.103.  APPLICATION FOR LICENSE. (a) As part of the   application process for a license, an applicant shall submit to the   department and the advisory board a description of the research   that the applicant intends to conduct. The department shall grant   the license if:                (1)  the department determines that the application   meets the criteria described by Sections 444.102 and 487.102; and                (2)  the advisory board recommends the application for   approval under Section 444.104(b).          (b)  The department may not grant a license if the advisory   board does not recommend the application for approval.          Sec. 444.104.  REVIEW BY ADVISORY BOARD. (a) The advisory   board shall review each applicant's research project to assess the   following:                (1)  the quality, study design, value, or impact of the   project;                (2)  whether the research supports the purposes in   Section 444.102;                (3)  whether the applicant has the appropriate   personnel, expertise, facilities, infrastructure, funding, and   approvals in place to successfully conduct the project; and                (4)  whether the amount of cannabis to be grown by the   applicant is consistent with the scope and goals of the project.          (b)  If the advisory board determines that the research   project does meet the requirements of this subchapter and assesses   the criteria to be adequate, the advisory board may recommend that a   license be granted to the applicant for the project.          Sec. 444.105.  CONTRACTS. A license holder may contract to   perform research in conjunction with another license holder, a   medical school, as defined by Section 61.501, Education Code, a   hospital licensed under Chapter 241, or an institution of higher   education or private or independent institution of higher education   involved in relevant research, such as a general academic teaching   institution, medical unit, or other agency of higher education, as   defined by Section 61.003, Education Code.          Sec. 444.106.  TRANSFER OF CANNABIS TO OTHER LICENSE   HOLDERS. Unless otherwise authorized by the department, a license   holder may only transfer, by sale or donation, cannabis grown or   processed within the license holder's operation to other license   holders or program participants as authorized by department rule.          Sec. 444.107.  LIMITATION OF LIABILITY. The growing,   cultivating, possessing, or transferring, by sale or donation, of   cannabis in accordance with this subchapter and the rules adopted   under this subchapter, by a license holder may not be the basis of   criminal or civil liability.          Sec. 444.108.  FEES. The executive commissioner shall set   license and renewal fees in an amount sufficient to administer this   chapter.          Sec. 444.109.  RULES. The executive commissioner shall, in   consultation with the advisory board and the Public Safety   Commission, adopt rules to implement this chapter, including:                (1)  license application requirements;                (2)  license renewal requirements, including the   consideration or addition of additional projects by a license   holder;                (3)  conditions for license revocation;                (4)  security measures to ensure cannabis is not   diverted to purposes other than research;                (5)  license holder reporting requirements;                (6)  conditions under which cannabis grown by licensed   cannabis cultivators and other product types from licensed cannabis   processors may be donated to license holders; and                (7)  additional rules considered necessary by the   executive commissioner.   ARTICLE 3. CHANGES TO TEXAS COMPASSIONATE USE PROGRAM          SECTION 3.01.  Section 487.001, Health and Safety Code, is   amended to read as follows:          Sec. 487.001.  DEFINITIONS.  In this chapter:                (1)  "Caregiver" means a person who has a significant   responsibility for managing the well-being of a registered patient   whether a private party or employee of a long-term care facility,   other health care organization, or public institution.                (2)  "Department" means the Department of Public   Safety.                (3) [(2)]  "Director" means the public safety director   of the department.                [(3)  "Dispensing organization" means an organization   licensed by the department to cultivate, process, and dispense   low-THC cannabis to a patient for whom low-THC cannabis is   prescribed under Chapter 169, Occupations Code.]                (4)  "Medical [Low-THC] cannabis" has the meaning   assigned by Section 169.001, Occupations Code.                (5)  "Medical cannabis organization" means any   organization that cultivates, processes, manufactures,   distributes, researches, tests, dispenses, or conducts other   business regarding medical cannabis as authorized by a license   issued by the department under this chapter to provide medical   cannabis to patients for whom medical cannabis is recommended under   Chapter 169, Occupations Code.                (6)  "Medical cannabis product" means a product, other   than cannabis itself, which contains or is derived from cannabis.   The term does not include products derived from hemp as defined by   Section 121.001, Agriculture Code.                (7)  "Medical use" has the meaning assigned by Section   169.001, Occupations Code.          SECTION 3.02.  Subchapter A, Chapter 487, Health and Safety   Code, is amended by adding Section 487.002 to read as follows:          Sec. 487.002.  ALLOWABLE AMOUNT OF MEDICAL CANNABIS. (a)   The allowable amount of medical cannabis for a person for whom   medical use is recommended under Chapter 169, Occupations Code, is   an amount of cannabis in any form approved by the physician   possessed by a qualified patient or collectively possessed by a   qualified patient and the qualified patient's caregiver that is no   more than reasonably necessary to ensure the uninterrupted   availability of cannabis for a period of three months based on the   individual patient's recommended amount of medical cannabis and   that is obtained solely from a medical cannabis organization.          (b)  Medical cannabis and medical cannabis products must be   packaged and labeled in accordance with department rules before   sale to a medical cannabis dispensary to indicate the quantity of   each cannabinoid and terpene contained in the product for purposes   of determining compliance with this section and protecting patient   health and safety.          SECTION 3.03.  Chapter 487, Health and Safety Code, is   amended by adding Subchapter A-1 to read as follows:   SUBCHAPTER A-1. PROTECTIONS RELATED TO MEDICAL USE OF CANNABIS          Sec. 487.021.  PROTECTION FROM LEGAL ACTION. (a) This   section applies to a person who is:                (1)  a patient for whom medical use is recommended   under Chapter 169, Occupations Code, or the parent or caregiver of a   patient;                (2)  a medical cannabis organization;                (3)  a director, manager, or employee of a medical   cannabis organization who is registered with the department under   Section 487.053;                (4)  a medical cannabis research license holder under   Chapter 444; or                (5)  a person participating as a researcher or patient   in an approved research program under Subchapter G, Chapter 481.          (b)  Notwithstanding any other law, a person described by   Subsection (a) is not subject to arrest, prosecution, or penalty in   any manner, or denial of any right or privilege, including any civil   penalty or disciplinary action by a court or occupational or   professional licensing board or bureau, for conduct involving   medical use that is authorized under this chapter, Chapter 444,   Subchapter G, Chapter 481, Chapter 169, Occupations Code, or   department rule.          Sec. 487.022.  NO PRESUMPTION OF CHILD ABUSE, NEGLECT, OR   ENDANGERMENT. A person described by Section 487.021(a) may not be   presumed to have engaged in conduct constituting child abuse,   neglect, or endangerment solely because the person engaged in   conduct involving medical use that is authorized under this   chapter, Chapter 444, Subchapter G, Chapter 481, Chapter 169,   Occupations Code, or department rule.          Sec. 487.023.  NO DENIAL OF PARENTAL RIGHTS. The fact that a   person described by Section 487.021(a) engages in conduct   authorized under this chapter, Chapter 444, Subchapter G, Chapter   481, Chapter 169, Occupations Code, or department rule, does not in   itself constitute grounds for denying, limiting, or restricting   conservatorship or possession of or access to a child under Title 5,   Family Code.          Sec. 487.024.  NO SEIZURE OR FORFEITURE. Property used in   the cultivation, research, testing, processing, distribution,   transportation, and delivery of medical cannabis for medical use   that is authorized under this chapter, Chapter 444, Subchapter G,   Chapter 481, Chapter 169, Occupations Code, or department rule, is   not contraband for purposes of Chapter 59, Code of Criminal   Procedure, and is not subject to seizure or forfeiture under that   chapter or other law solely for the use of the property in those   authorized activities.          Sec. 487.025.  NO PROSECUTION FOR PROVISION OF   PARAPHERNALIA. A person is not subject to arrest, prosecution, or   the imposition of any sentence or penalty for the delivery,   possession with intent to deliver, or manufacture of any item that   meets the definition of drug paraphernalia, as defined by Section   481.002, if that item is delivered, possessed with intent to   deliver, or manufactured for the sole purpose of providing that   item to:                (1)  a patient for whom medical use is recommended   under Chapter 169, Occupations Code, or the parent or caregiver of a   patient;                (2)  a medical cannabis organization;                (3)  a director, manager, or employee of a medical   cannabis organization who is registered with the department under   Section 487.053;                (4)  a medical cannabis research license holder under   Chapter 444; or                (5)  a person participating as a researcher or patient   in an approved research program under Subchapter G, Chapter 481.          Sec. 487.026.  NO PUNISHMENT FOR STUDENT PATIENTS AND THEIR   CAREGIVERS. Notwithstanding any other law, a school or university   student for whom medical cannabis was recommended under Chapter   169, Occupations Code, may not be subject to suspension, expulsion,   placement in a disciplinary alternative education program, or any   other form of discipline solely because the student possessed,   used, or received a valid recommendation for medical cannabis, nor   may a school health care professional be subject to any discipline   solely for assisting a student in the administration of medical   cannabis.          SECTION 3.04.  Section 487.052, Health and Safety Code, is   amended to read as follows:          Sec. 487.052.  RULES; FEES. (a) The director shall adopt   any rules necessary for the administration and enforcement of this   chapter.          (b)  The director shall adopt [, including] rules imposing   reasonable fees under this chapter in amounts sufficient to cover   the cost of administering this chapter. The department shall also   use revenue from fees to establish a cannabis testing and quality   control fund for the purpose of assisting law enforcement,   including accredited crime laboratories, to purchase instruments,   establish methods, and obtain resources needed to conduct forensic   analysis necessary to enforce this subtitle and to protect the   health and safety of medical cannabis patients and the public.          (c)  The fees adopted under Subsection (b) may not exceed:                (1)  $5,000 for application fees;                (2)  $100 for registration fees under Subchapter D; and                (3)  reasonable amounts for the issuance or renewal of   each class of license.          (d)  The director may not adopt rules establishing a total   limit on the number of medical cannabis organization licenses by   class that may be granted nor set the price of or production   quantity of medical cannabis.          SECTION 3.05.  Subchapter B, Chapter 487, Health and Safety   Code, is amended by adding Sections 487.0521 and 487.0522 to read as   follows:          Sec. 487.0521.  SAFETY. (a) The director by rule shall   adopt packaging and labeling requirements for medical cannabis to   ensure patients are informed and protected. In adopting packaging   and labeling requirements, the director shall ensure that:                (1)  each medical cannabis package is labeled with the   cannabinoid potency and terpenoid profile of medical cannabis or   medical cannabis product as determined by an independent testing   laboratory;                (2)  each medical cannabis product and medical cannabis   package is labeled with the required warnings as determined by the   department; and                (3)  the packaging and label of medical cannabis or a   medical cannabis product do not contain any false or misleading   statements and are not designed to appeal to children.          (b)  In consultation with the medical cannabis research   advisory board under Chapter 444, the director shall adopt   necessary rules to allow the department to monitor the safety and   efficacy of medical cannabis or medical cannabis products,   including rules:                (1)  requiring accurate reporting to consumers   regarding the content of medical cannabis or medical cannabis   products;                (2)  providing for random testing by the department or   the department's designee to ensure compliance with labeling and   reporting requirements; and                (3)  providing for health and safety regulations and   standards for the manufacture and cultivation of medical cannabis   and medical cannabis products.          (c)  The director may collect data from medical cannabis   organizations and health care providers as necessary to enable the   department to monitor the safety and efficacy of medical cannabis.   The director may adopt rules for the data collection under this   subsection.          Sec. 487.0522.  INVENTORY TRACKING REQUIREMENTS. (a) The   department shall establish and maintain a medical cannabis   inventory system that oversees the tracking, tracing, testing, and   quality control and quality assurance certification of medical   cannabis and medical cannabis products.          (b)  The department may contract with other entities to   establish and maintain all or part of the medical cannabis   inventory system on behalf of the department.          (c)  A medical cannabis organization shall use the medical   cannabis inventory system approved by the department to keep   records throughout the cannabis supply chain, including for every   transaction between license holders and between license holders and   patients. A medical cannabis organization may use its own   recordkeeping system provided the medical cannabis organization's   system can integrate with the department's system as required under   this chapter and rules. The records shall include, at a minimum:                (1)  the name, license number, and assigned   identification number of the licensee that cultivated,   manufactured, tested, or sold the product;                (2)  the address and phone number of the licensee that   cultivated, manufactured, tested, or sold the product;                (3)  the type and weight of medical cannabis or medical   cannabis product transferred or received during the transaction;                (4)  the batch number of the medical cannabis or   medical cannabis product used;                (5)  the date of the transaction;                (6)  the total spent in dollars;                (7)  all point-of-sale records;                (8)  the amount of any medical cannabis waste, in   pounds; and                (9)  any additional information as may be reasonably   required by the department.          (d)  Until the department establishes the medical cannabis   inventory program, each licensee shall use its own inventory   program that meets the requirements of this section.          (e)  Each medical cannabis organization has a continuing   responsibility to maintain records on site that are readily   available to the department regardless of the functionality of the   statewide inventory program including, at a minimum, the criteria   established by this section and any requirements established by   rule.          (f)  The department shall adopt rules necessary for the   implementation and enforcement of this section, including rules   ensuring:                (1)  the department has 24-hour access to the inventory   program; and                (2)  all inventory tracking records containing patient   information comply with Chapter 181 and the Health Insurance   Portability and Accountability Act of 1996 (42 U.S.C. Section 1320d   et seq.).          SECTION 3.06.  The heading to Section 487.053, Health and   Safety Code, is amended to read as follows:          Sec. 487.053.  LICENSING OF CANNABIS [DISPENSING]   ORGANIZATIONS AND REGISTRATION OF CERTAIN ASSOCIATED INDIVIDUALS.          SECTION 3.07.  Section 487.053(a), Health and Safety Code,   is amended to read as follows:          (a)  The department shall:                (1)  issue or renew a license under Subchapter C to   operate as a medical cannabis [dispensing] organization to each   applicant who satisfies the requirements established under this   chapter for licensure under that class of medical cannabis   organization; [and]                (2)  register directors, managers, and employees under   Subchapter D of each medical cannabis [dispensing] organization;                (3)  issue a permit for additional locations to a   dispensing cannabis licensee on application if the licensee is in   compliance with all eligibility requirements and the proposed   location complies with any local zoning requirements and will   assist with ensuring reasonable statewide access;                (4)  to ensure reasonable statewide access, issue no   less than the following number of licenses or permits for each type   of medical cannabis organization provided the department receives   an adequate number of qualified applications:                      (A)  dispensing cannabis organization licenses   and permits, based on population within each of the 11 public health   regions established by the Health and Human Services Commission, as   follows:                            (i)  9 in public health region 1;                            (ii)  6 in public health region 2;                            (iii)  82 in public health region 3;                            (iv)  12 in public health region 4;                            (v)  8 in public health region 5;                            (vi)  75 in public health region 6;                            (vii)  37 in public health region 7;                            (viii)  31 in public health region 8;                            (ix)  7 in public health region 9;                            (x)  9 in public health region 10; and                            (xi)  24 in public health region 11;                      (B)  one cultivation cannabis organization   license for every four dispensing cannabis organization licenses;                      (C)  one processing cannabis organization license   for every three dispensing cannabis organization licenses; and                      (D)  the number of testing cannabis organization   licenses necessary to meet demand;                (5)  once the number of registered medical cannabis   patients reaches 100,000, issue no less than 24 additional   dispensing cannabis organization licenses and permits and other   medical cannabis organization license types under Subdivision (4);   and                (6)  for each additional 100,000 patients, issue no   less than 24 additional dispensing cannabis organization licenses   and permits and other medical cannabis organization license types   under Subdivision (4).          SECTION 3.08.  Section 487.054, Health and Safety Code, is   amended to read as follows:          Sec. 487.054.  COMPASSIONATE-USE REGISTRY. (a) The   department shall establish and maintain a secure online   compassionate-use registry that contains:                (1)  the name of each physician who registers as a   physician recommending medical cannabis and for each patient for   whom the physician has registered:                      (A)  [the prescriber for a patient under Section   169.004, Occupations Code,] the patient's name, and any caregivers'   names, if applicable;                      (B)  the patient's [and] date of birth;                      (C)  the nature of the patient's eligible medical   condition;                      (D)  [of the patient,] the dosage recommended;                      (E)  [prescribed,] the means of administration   ordered; [,] and                      (F)  the total amount of medical [low-THC]   cannabis required to fill the patient's recommendation   [prescription]; and                (2)  a record of each amount of medical [low-THC]   cannabis dispensed by a medical cannabis [dispensing] organization   to a patient under a recommendation [prescription].          (b)  The department shall ensure the registry:                (1)  is designed to prevent more than one qualified   physician from registering as the recommending physician   [prescriber] for a single patient;                (2)  is accessible to law enforcement agencies and   medical cannabis [dispensing] organizations licensed to dispense   medical cannabis for the purpose of verifying whether a patient is   one for whom medical [low-THC] cannabis is recommended [prescribed]   and whether the patient's recommendations [prescriptions] have   been filled; [and]                (3)  allows a physician [qualified to prescribe low-THC   cannabis under Section 169.002, Occupations Code,] to input safety   and efficacy data derived from the treatment of patients for whom   medical [low-THC] cannabis is recommended [prescribed] under   Chapter 169, Occupations Code, including any severe adverse effects   due to the medical use of medical cannabis; and                (4)  ensures that all application records and   information are sealed to protect the privacy of patients.          (c)  The handling of any records maintained in the registry   must comply with all relevant state and federal privacy laws,   including, but not limited to, Chapter 181.          SECTION 3.09.  Subchapter B, Chapter 487, Health and Safety   Code, is amended by adding Section 487.055 to read as follows:          Sec. 487.055.  DESIGNATION OF CAREGIVERS. (a) The   department shall develop a form for a patient listed in the registry   to designate caregivers whether an individual, health care   facility, or public institution. Caregivers may possess medical   cannabis and medical cannabis products up to the sum of the   possession limits for the patient or patients under the caregiver's   care.          (b)  The form must require the patient to provide the full   name, home address, and date of birth of the patient's caregiver or,   in the case of an organization, the organization's name and   address.          (c)  The director shall adopt rules necessary to implement   this section, including rules to provide identification cards for   registered caregivers.          SECTION 3.10.  The heading to Subchapter C, Chapter 487,   Health and Safety Code, is amended to read as follows:   SUBCHAPTER C. LICENSE TO OPERATE AS MEDICAL CANNABIS [DISPENSING]   ORGANIZATION          SECTION 3.11.  Section 487.101, Health and Safety Code, is   amended to read as follows:          Sec. 487.101.  LICENSE REQUIRED. (a) A license issued by   the department under this chapter is required to operate a medical   cannabis [dispensing] organization.          (b)  The director by rule shall adopt application and   licensing requirements and privileges of each medical cannabis   organization license type.          (c)  Medical cannabis organization license types shall   include the following:                (1)  cultivating cannabis organization that cultivates   medical cannabis for sale and distribution to other medical   cannabis organizations and may process and package cannabis for   individual sale so long as the cannabis is not subjected to any   chemical alteration;                (2)  processing cannabis organization that extracts   medical cannabis and manufactures, prepares, and packages medical   cannabis products for sale and distribution to other medical   cannabis organizations;                (3)  dispensing cannabis organization that sells   medical cannabis and medical cannabis products to patients;                (4)  independent testing cannabis organizations that   test medical cannabis and medical cannabis products for potency,   safety, and efficacy; and                (5)  any other class of medical cannabis organization   that the department finds warranted to safely and securely ensure   reasonable statewide access of medical cannabis for medical use.          SECTION 3.12.  Section 487.102, Health and Safety Code, is   amended to read as follows:          Sec. 487.102.  ELIGIBILITY FOR LICENSE. An applicant for a   license to operate as a medical cannabis [dispensing] organization   is eligible for the license if:                (1)  as determined by the department, the applicant   possesses:                      (A)  the technical and technological ability   appropriate for that class of license [to cultivate and produce   low-THC cannabis];                      (B)  the ability to secure:                            (i)  the resources and personnel necessary   to operate as a medical cannabis [dispensing] organization; and                            (ii)  for distribution or   dispensing premises reasonably located to allow patients listed on   the compassionate-use registry access to the organization through   existing infrastructure;                      (C)  the ability to maintain accountability for   the raw materials, the finished product, and any by-products used   or produced in the cultivation or production of medical [low-THC]   cannabis to prevent unlawful access to or unlawful diversion or   possession of those materials, products, or by-products; [and]                      (D)  the financial ability to maintain operations   for not less than two years from the date of application; and                      (E)  any specific qualifications for licensure   for each class of license the department promulgates by rule under   this chapter that are demonstrably related to the operations   authorized and duties imposed under that class of license to safely   and securely provide medical cannabis for medical use to patients;                (2)  each director, manager, or employee of the   applicant is registered under Subchapter D; [and]                (3)  the applicant satisfies any additional criteria   determined by the director to be necessary to safely implement this   chapter; and                (4)  each director, manager, employee, and any other   relevant individual, as determined by department rule, passes a   criminal history background check the department approves as   reliable and expedient to ensure applicants comply with eligibility   requirements established by the department by rule.          SECTION 3.13.  Subchapter C, Chapter 487, Health and Safety   Code, is amended by adding Section 487.1021 to read as follows:          Sec. 487.1021.  ELIGIBILITY FOR LICENSE TO OPERATE AS AN   INDEPENDENT CANNABIS TESTING ORGANIZATION. In addition to the   criteria described by Section 487.102, an applicant for a license   to operate as an independent cannabis testing organization is   eligible for the license if:                (1)  the applicant submits proof of accreditation by an   independent accreditation body in accordance with the   International Organization for Standardization ISO/IEC 17025 or a   comparable or successor standard;                (2)  the applicant submits proof that it does not share   ownership interest or joint management with any medical cannabis   organization whose product the applicant may test except for less   than 10 percent ownership in publicly traded companies; and                (3)  the applicant satisfies any additional criteria   determined by the director to be necessary for the operation of a   cannabis testing facility.          SECTION 3.14.  Section 487.103(a), Health and Safety Code,   is amended to read as follows:          (a)  A person may apply for an initial or renewal license to   operate as a medical cannabis [dispensing] organization by   submitting a form prescribed by the department along with the   application fee in an amount set by the director for that class of   license.          SECTION 3.15.  Section 487.104(a), Health and Safety Code,   is amended to read as follows:          (a)  The department shall issue or renew a license to operate   as a medical cannabis [dispensing] organization [only] if:                (1)  the department determines the applicant meets the   eligibility requirements described by Section 487.102 or 487.1021,   as applicable; and                (2)  issuance or renewal of the license would assist   [is necessary to ensure] reasonable statewide access to, and the   availability of, medical [low-THC] cannabis for patients   registered in the compassionate-use registry and for whom medical   [low-THC] cannabis is recommended [prescribed] under Chapter 169,   Occupations Code.          SECTION 3.16.  Sections 487.105(a) and (b), Health and   Safety Code, are amended to read as follows:          (a)  An applicant for the issuance or renewal of a license   under this subchapter [to operate as a dispensing organization]   shall provide the department with the applicant's name and the name   of each of the applicant's directors, managers, and employees.          (b)  Before a medical cannabis [dispensing] organization   licensee hires a manager or employee for the organization, the   licensee must provide the department with the name of the   prospective manager or employee. The licensee may not transfer the   license to another person before that prospective applicant and the   applicant's directors, managers, and employees pass a criminal   history background check and any other requirements established by   the department by rule, and are registered as required by   Subchapter D.          SECTION 3.17.  Section 487.106, Health and Safety Code, is   amended to read as follows:          Sec. 487.106.  DUTY TO MAINTAIN ELIGIBILITY. (a) Each   license holder under this subchapter [A dispensing organization]   must maintain compliance at all times with the eligibility   requirements described by Section 487.102 or 487.1021, as   applicable.          (b)  On request of the department, a license holder must   provide to the department a reasonably sized sample suitable for   testing of medical cannabis.          SECTION 3.18.  Section 487.107, Health and Safety Code, is   amended to read as follows:          Sec. 487.107.  DUTIES RELATING TO DISPENSING   [PRESCRIPTION]. (a) Before dispensing medical [low-THC] cannabis   to a person for whom the medical [low-THC] cannabis is recommended   [prescribed] under Chapter 169, Occupations Code, the medical   cannabis [dispensing] organization must verify that the   recommendation [prescription] presented:                (1)  is for a person listed as a patient in the   compassionate-use registry;                (2)  matches the entry in the compassionate-use   registry with respect to the total amount of medical [low-THC]   cannabis required to fill the recommendation [prescription]; and                (3)  has not previously been filled by a medical   cannabis [dispensing] organization as indicated by an entry in the   compassionate-use registry.          (b)  After dispensing medical [low-THC] cannabis to a   patient for whom the medical [low-THC] cannabis is recommended   [prescribed] under Chapter 169, Occupations Code, the medical   cannabis [dispensing] organization shall record in the   compassionate-use registry the form and quantity of medical   [low-THC] cannabis dispensed and the date and time of dispensation.          SECTION 3.19.  Sections 487.108(a), (b), and (c), Health and   Safety Code, are amended to read as follows:          (a)  The department may at any time suspend or revoke a   license issued under this subchapter [chapter] if the department   determines that the license holder [licensee] has not maintained   the eligibility requirements described by Section 487.102 or   487.1021, as applicable, or has failed to comply with a duty imposed   under this chapter.          (b)  The director shall give written notice to the license   holder [dispensing organization] of a license suspension or   revocation under this section and the grounds for the suspension or   revocation. The notice must be sent by certified mail, return   receipt requested.          (c)  After suspending or revoking a license issued under this   subchapter [chapter], the director may seize or place under seal   all medical [low-THC] cannabis and drug paraphernalia owned or   possessed by the license holder [dispensing organization]. If the   director orders the revocation of the license, a disposition may   not be made of the seized or sealed medical [low-THC] cannabis or   drug paraphernalia until the time for administrative appeal of the   order has elapsed or until all appeals have been concluded. When a   revocation order becomes final, all medical [low-THC] cannabis and   drug paraphernalia may be forfeited to the state as provided under   Subchapter E, Chapter 481.          SECTION 3.20.  Section 487.151(a), Health and Safety Code,   is amended to read as follows:          (a)  An individual who is a director, manager, or employee of   a license holder under Subchapter C [dispensing organization] must   apply for and obtain a registration under this section.          SECTION 3.21.  Section 487.201, Health and Safety Code, is   amended to read as follows:          Sec. 487.201.  COUNTIES AND MUNICIPALITIES MAY NOT PROHIBIT   MEDICAL [LOW-THC] CANNABIS. A municipality, county, or other   political subdivision may not enact, adopt, or enforce a rule,   ordinance, order, resolution, or other regulation that prohibits   the cultivation, production, dispensing, researching, testing, or   possession of medical [low-THC] cannabis, as authorized by this   chapter.   ARTICLE 4. PHYSICIAN RECOMMENDATIONS OF MEDICAL CANNABIS          SECTION 4.01.  The heading to Chapter 169, Occupations Code,   is amended to read as follows:   CHAPTER 169. AUTHORITY TO RECOMMEND [PRESCRIBE] MEDICAL [LOW-THC]   CANNABIS TO CERTAIN PATIENTS FOR COMPASSIONATE USE          SECTION 4.02.  Section 169.001, Occupations Code, is amended   to read as follows:          Sec. 169.001.  DEFINITIONS. In this chapter:                (1)  "Department" means the Department of Public   Safety.                [(1-a)  "Incurable neurodegenerative disease" means a   disease designated as an incurable neurodegenerative disease by   rule of the executive commissioner of the Health and Human Services   Commission, adopted in consultation with the National Institutes of   Health.]                (2) [(3)]  "Medical [Low-THC] cannabis" means the   plant Cannabis sativa L., and any part of that plant or any   compound, manufacture, salt, derivative, mixture, preparation,   resin, or oil of that plant. The term does not include hemp as   defined by Section 121.001, Agriculture Code [that contains not   more than 0.5 percent by weight of tetrahydrocannabinols].                (3) [(4)]  "Medical use" means the administration of   medical cannabis to a registered patient for treatment of an   eligible medical condition or symptoms as recommended by a   physician [ingestion by a means of administration other than by   smoking of a prescribed amount of low-THC cannabis by a person for   whom low-THC cannabis is prescribed] under this chapter.                (4)  "Serious adverse event" means an adverse event   that:                      (A)  results in death;                      (B)  results in an illness requiring   hospitalization;                      (C)  is considered life-threatening; or                      (D)  results in a persistent or significant   disability, incapacity, or medically important condition.                      [(5)  "Smoking" means burning or igniting a   substance and inhaling the smoke.                [(6)  "Terminal cancer" means cancer that meets the   criteria for a terminal illness, as defined by Section 1003.051,   Health and Safety Code.]          SECTION 4.03.  Chapter 169, Occupations Code, is amended by   adding Section 169.0012 to read as follows:          Sec. 169.0012.  BONA FIDE PHYSICIAN-PATIENT RELATIONSHIP.   For purposes of this chapter, a bona fide physician-patient   relationship exists when there is a treatment or counseling   relationship between a physician and patient in which all of the   following are present:                (1)  the physician has reviewed the patient's relevant   medical records and completed a full assessment of the patient's   medical history and current medical condition, including a relevant   medical evaluation of the patient;                (2)  the physician has created and continues to   maintain records of the patient's condition in accordance with   medically accepted standards;                (3)  the physician has a reasonable expectation that   the physician will provide follow-up care to the patient to monitor   the efficacy of the use of medical cannabis as a treatment of the   patient's medical condition; and                (4)  if the patient has given permission, the physician   has notified the patient's primary care physician of the patient's   medical condition and certification for the medical use of medical   cannabis to treat that condition.          SECTION 4.04.  Section 169.002, Occupations Code, is amended   to read as follows:          Sec. 169.002.  PHYSICIAN QUALIFIED TO RECOMMEND MEDICAL   [PRESCRIBE LOW-THC] CANNABIS [TO PATIENTS WITH CERTAIN MEDICAL   CONDITIONS]. (a) Only a physician qualified with respect to a   patient's particular medical condition [as provided by this   section] may recommend medical [prescribe low-THC] cannabis in   accordance with this chapter to treat the applicable medical   condition.          (b)  A physician is qualified to recommend medical   [prescribe low-THC] cannabis with respect to a patient's particular   medical condition if the physician:                (1)  is licensed under this subtitle;                (2)  has a bona fide physician-patient relationship   with the patient [is board certified in a medical specialty   relevant to the treatment of the patient's particular medical   condition by a specialty board approved by the American Board of   Medical Specialties or the Bureau of Osteopathic Specialists]; and                (3)  dedicates a significant portion of clinical   practice to the evaluation and treatment of the patient's   particular medical condition.          SECTION 4.05.  Section 169.003, Occupations Code, is amended   to read as follows:          Sec. 169.003.  RECOMMENDATION [PRESCRIPTION] OF MEDICAL   [LOW-THC] CANNABIS. A physician described by Section 169.002 may   recommend medical [prescribe low-THC] cannabis to a patient if:                (1)  the patient is a permanent resident of the state;                (2)  the physician complies with the registration   requirements of Section 169.004; and                (3)  the physician certifies to the department that:                      (A)  there is a bona fide physician-patient   relationship;                      (B)  the patient has a diagnosis or symptoms such   that, in the physician's professional judgment and review of past   treatments, the patient is likely to receive therapeutic or   palliative benefit from medical cannabis [is diagnosed with:                            [(i)  epilepsy;                            [(ii)  a seizure disorder;                            [(iii)  multiple sclerosis;                            [(iv)  spasticity;                            [(v)  amyotrophic lateral sclerosis;                            [(vi)  autism;                            [(vii)  terminal cancer; or                            [(viii)  an incurable neurodegenerative   disease]; and                      (C) [(B)]  the physician determines the risk of   the medical use of medical [low-THC] cannabis by the patient is   reasonable in light of the potential benefit for the patient.          SECTION 4.06.  The heading to Section 169.004, Occupations   Code, is amended to read as follows:          Sec. 169.004.  MEDICAL [LOW-THC] CANNABIS RECOMMENDATION   [PRESCRIBER] REGISTRATION.          SECTION 4.07.  Section 169.004(a), Occupations Code, is   amended to read as follows:          (a)  Before a physician [qualified to prescribe low-THC   cannabis under Section 169.002] may recommend [prescribe] or renew   a recommendation [prescription] for medical [low-THC] cannabis for   a patient under this chapter, the physician must register [as the   prescriber for that patient] in the compassionate-use registry   maintained by the department under Section 487.054, Health and   Safety Code. The physician's registration must indicate:                (1)  the physician's name; and                (2)  for each patient:                      (A)  the patient's name and date of birth;                      (B)  the nature of the patient's diagnosis or   symptom being treated by medical cannabis;                      (C) [(3)]  the dosage prescribed to the patient;                      (D) [(4)]  the means of administration ordered   for the patient;                      (E)  [and                      [(5)]  the total amount of medical [low-THC]   cannabis required to fill the patient's recommendation; and                      (F)  any severe adverse events the patient may   experience due to the medical use of medical cannabis   [prescription].          SECTION 4.08.  Section 169.005, Occupations Code, is amended   to read as follows:          Sec. 169.005.  PATIENT TREATMENT PLAN. A physician   described by Section 169.002 who recommends medical [prescribes   low-THC] cannabis for a patient's medical use under this chapter   must maintain a patient treatment plan that indicates:                (1)  the dosage, means of administration, and planned   duration of treatment for the medical [low-THC] cannabis;                (2)  a plan for monitoring the patient's symptoms; and                (3)  a plan for monitoring indicators of tolerance or   reaction to medical [low-THC] cannabis.          SECTION 4.09.  Section 169.0011, Occupations Code, is   repealed.   ARTICLE 5. CONFORMING AMENDMENTS          SECTION 5.01.  Section 161.001(c), Family Code, is amended   to read as follows:          (c)  A court may not make a finding under Subsection (b) and   order termination of the parent-child relationship based on   evidence that the parent:                (1)  homeschooled the child;                (2)  is economically disadvantaged;                (3)  has been charged with a nonviolent misdemeanor   offense other than:                      (A)  an offense under Title 5, Penal Code;                      (B)  an offense under Title 6, Penal Code; or                      (C)  an offense that involves family violence, as   defined by Section 71.004 of this code;                (4)  provided or administered medical [low-THC]   cannabis to a child for whom the medical [low-THC] cannabis was   prescribed under Chapter 169, Occupations Code; or                (5)  declined immunization for the child for reasons of   conscience, including a religious belief.          SECTION 5.02.  Section 262.116(a), Family Code, is amended   to read as follows:          (a)  The Department of Family and Protective Services may not   take possession of a child under this subchapter based on evidence   that the parent:                (1)  homeschooled the child;                (2)  is economically disadvantaged;                (3)  has been charged with a nonviolent misdemeanor   offense other than:                      (A)  an offense under Title 5, Penal Code;                      (B)  an offense under Title 6, Penal Code; or                      (C)  an offense that involves family violence, as   defined by Section 71.004 of this code;                (4)  provided or administered medical [low-THC]   cannabis to a child for whom the medical [low-THC] cannabis was   recommended [prescribed] under Chapter 169, Occupations Code; or                (5)  declined immunization for the child for reasons of   conscience, including a religious belief.          SECTION 5.03.  Section 411.0891(a), Government Code, is   amended to read as follows:          (a)  Subject to Section 411.087, the department is   authorized to obtain and use criminal history record information   maintained by the Federal Bureau of Investigation or the department   that relates to a person who:                (1)  is an applicant for or holds a registration issued   by the director under Subchapter C, Chapter 481, Health and Safety   Code, that authorizes the person to manufacture, distribute,   analyze, or conduct research with a controlled substance;                (2)  is an applicant for or holds a registration issued   by the department under Chapter 487, Health and Safety Code, to be a   director, manager, or employee of a medical cannabis [dispensing]   organization, as defined by Section 487.001, Health and Safety   Code;                (3)  is an applicant for or holds an authorization   issued by the department under Section 521.2476, Transportation   Code, to do business in this state as a vendor of ignition interlock   devices;                (4)  is an applicant for or holds certification by the   department as an inspection station or an inspector under   Subchapter G, Chapter 548, Transportation Code, holds an inspection   station or inspector certificate issued under that subchapter, or   is the owner of an inspection station operating under that chapter;   or                (5)  is an applicant for or holds a certificate of   registration issued by the department under Chapter 1956,   Occupations Code, to act as a metal recycling entity.          SECTION 5.04.  Section 443.202(a), Health and Safety Code,   is amended to read as follows:          (a)  This section does not apply to medical [low-THC]   cannabis regulated under Chapter 487.          SECTION 5.05.  Section 443.2025(a), Health and Safety Code,   is amended to read as follows:          (a)  This section does not apply to medical [low-THC]   cannabis regulated under Chapter 487.          SECTION 5.06.  Section 481.062(a), Health and Safety Code,   is amended to read as follows:          (a)  The following persons may possess a controlled   substance under this chapter without registering with the Federal   Drug Enforcement Administration:                (1)  an agent or employee of a manufacturer,   distributor, analyzer, or dispenser of the controlled substance who   is registered with the Federal Drug Enforcement Administration and   acting in the usual course of business or employment;                (2)  a common or contract carrier, a warehouseman, or   an employee of a carrier or warehouseman whose possession of the   controlled substance is in the usual course of business or   employment;                (3)  an ultimate user or a person in possession of the   controlled substance under a lawful order of a practitioner or in   lawful possession of the controlled substance if it is listed in   Schedule V;                (4)  an officer or employee of this state, another   state, a political subdivision of this state or another state, or   the United States who is lawfully engaged in the enforcement of a   law relating to a controlled substance or drug or to a customs law   and authorized to possess the controlled substance in the discharge   of the person's official duties;                (5)  if the substance is tetrahydrocannabinol or one of   its derivatives:                      (A)  a Department of State Health Services   official, a medical school researcher, or a research program   participant possessing the substance as authorized under   Subchapter G; or                      (B)  a practitioner or an ultimate user possessing   the substance as a participant in a federally approved therapeutic   research program that the commissioner has reviewed and found, in   writing, to contain a medically responsible research protocol; or                (6)  a medical cannabis [dispensing] organization   licensed under Subchapter C, Chapter 487, or a medical cannabis   research organization licensed under Chapter 444, that possesses   medical [low-THC] cannabis.          SECTION 5.07.  Sections 481.111(e) and (f), Health and   Safety Code, are amended to read as follows:          (e)  Sections 481.120, 481.121, 481.122, and 481.125 do not   apply to a person who engages in the acquisition, possession,   production, cultivation, delivery, or disposal of a raw material   used in or by-product created by the production or cultivation of   medical [low-THC] cannabis if the person:                (1)  for an offense involving possession only of   marihuana or drug paraphernalia:                      (A)  [,] is a patient for whom medical [low-THC]   cannabis is prescribed under Chapter 169, Occupations Code, or the   patient's legal guardian or caregiver; [,] and                      (B)  [the person] possesses medical [low-THC]   cannabis obtained under a valid recommendation [prescription] from   a medical cannabis [dispensing] organization; or                (2)  is a director, manager, or employee of a medical   cannabis [dispensing] organization and the person, solely in   performing the person's regular duties at the organization,   acquires, possesses, produces, cultivates, dispenses, or disposes   of:                      (A)  in reasonable quantities, any medical   [low-THC] cannabis or raw materials used in or by-products created   by the production or cultivation of medical [low-THC] cannabis; or                      (B)  any drug paraphernalia used in the   acquisition, possession, production, cultivation, delivery, or   disposal of medical [low-THC] cannabis.          (f)  For purposes of Subsection (e):                (1)  ["Dispensing organization" has the meaning   assigned by Section 487.001.                [(2)]  "Medical [Low-THC] cannabis" has the meaning   assigned by Section 169.001, Occupations Code.                (2)  "Medical cannabis organization" has the meaning   assigned by Section 487.001.                (3)  "Medical use" has the meaning assigned by Section   169.001, Occupations Code.          SECTION 5.08.  Section 551.004(a), Occupations Code, is   amended to read as follows:          (a)  This subtitle does not apply to:                (1)  a practitioner licensed by the appropriate state   board who supplies a patient of the practitioner with a drug in a   manner authorized by state or federal law and who does not operate a   pharmacy for the retailing of prescription drugs;                (2)  a member of the faculty of a college of pharmacy   recognized by the board who is a pharmacist and who performs the   pharmacist's services only for the benefit of the college;                (3)  a person who procures prescription drugs for   lawful research, teaching, or testing and not for resale;                (4)  a home and community support services agency that   possesses a dangerous drug as authorized by Section 142.0061,   142.0062, or 142.0063, Health and Safety Code; [or]                (5)  a medical cannabis [dispensing] organization, as   defined by Section 487.001, Health and Safety Code, that   cultivates, processes, tests, and dispenses medical [low-THC]   cannabis, as authorized by a license issued under Subchapter C,   Chapter 487, Health and Safety Code, to a patient listed in the   compassionate-use registry established under that chapter; or                (6)  a medical cannabis research organization licensed   under Chapter 444, Health and Safety Code, that cultivates,   processes, researches, tests, and dispenses medical cannabis as   authorized by the license.   ARTICLE 6. TRANSITIONS AND EFFECTIVE DATE          SECTION 6.01.  Not later than December 31, 2023, the   Department of Public Safety and the executive commissioner of the   Health and Human Services Commission shall adopt rules as required   to implement, administer, and enforce this Act.          SECTION 6.02.  (a) A license to operate as a dispensing   organization issued under Chapter 487, Health and Safety Code,   before the effective date of this Act continues to be valid after   the effective date of this Act until that license expires.          (b)  The registration of a director, manager, or employee of   a dispensing organization under Subchapter D, Chapter 487, Health   and Safety Code, continues to be valid after the effective date of   this Act until that registration expires.          SECTION 6.03.  (a) Not later than April 1, 2022, the   Department of Public Safety shall license cannabis cultivation   organizations in accordance with Subchapter C, Chapter 487, Health   and Safety Code, as amended by this Act, provided that the   applicants for a license have met all requirements for approval   under that subchapter.          (b)  Not later than June 1, 2022, the Department of Public   Safety shall license other classes of medical cannabis   organizations in accordance with Subchapter C, Chapter 487, Health   and Safety Code, as amended by this Act, provided that the   applicants for a license have met all requirements for approval   under that subchapter.          (c)  The governor shall appoint members to the medical   cannabis research advisory board as required under Chapter 444,   Health and Safety Code, as added by this Act, as soon as practicable   and not later than September 1, 2023.          SECTION 6.04.  This Act takes effect September 1, 2023.