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Louisiana Marijuana Pharmacy Surety Bond
What is a Louisiana Marijuana Pharmacy Bond?
A Louisiana Marijuana Pharmacy Bond is a $100,000 surety bond that is required to be posted by marijuana pharmacies before they are issued a permit to conduct business in the State of Louisiana.
Applicants are required to provide documentation of their financial capacity to properly operate a marijuana pharmacy during the application process. A surety bond is the best way to demonstrate financial capacity. Unfortunately, the application window was very brief, August 31, 2017 through September 29, 2017, and the state did not provide a bond form. Therefore, most applicants weren't able to acquire a surety bond to submit with their application and instead used an escrow account or a letter of credit.
Rather than continuing to lock up your capital in escrow or a LoC, we suggest replacing that instrument with a surety bond, and keep your much-needed cash accessible.
The State intends to issue nine (9) marijuana pharmacy permits, one to each of the nine regions, by early January 2018. A tenth marijuana pharmacy permit may be issued at a future date, as to be determined by the Louisiana Board of Pharmacy.
A Marijuana Pharmacy is defined as an area within a facility where marijuana is stored, dispensed, and sold. If a facility does not offer any products or services other than marijuana for therapeutic use and/or related supplies, then the entire facility is considered a marijuana pharmacy. Pharmacies are authorized to sell medical marijuana only to qualifying patients and primary caregivers.
If you need a Louisiana marijuana surety bond but don’t see it above, please give us a call on our toll free number, 1-800-480-3883. Legislation is always changing, so we may not have had the chance to update our website yet. Most bonds are required at the state level, but some may be required at the parish and/or city level. Regardless if it is listed or not, we can write your bond!
Louisiana Marijuana Pharmacy Surety Bondscan be written for a small percentage, usually between 1% and 5% of the bond amount when applicants meet certain underwriting criteria such as excellent credit, excellent personal and business financials, and excellent industry experience.
Due to the risk from the perspective of the bonding company, Marijuana Bonds are very carefully underwritten and priced accordingly. Part of the cost of this bond will be the time and effort needed to provide documentation and information the bonding company will need. In all cases, personal credit, personal financials, and corporate financials will be required. A business plan and proof of industry knowledge and experience is also required. Of course, we can typically handle all credit types and financial situations - from excellent to poor - as such those terms vary.
The ProSure Group has multiple markets willing and able to write marijuana/cannabis surety bonds. These companies are all A.M Best Rated and Treasury Listed.
Louisiana Medical Marijuana Pharmacy Surety Bonds are in place to ensure the Principal (Marijuana Pharmacy) successfully completes the construction of the pharmacy in a timely manner. The surety bond also ensures the Principal operates the pharmacy in compliance with the provisions of Subchapter E. Marijuana Pharmacy, of the Louisiana Administrative Code.
Act 261 of the 2015 Louisiana Legislature and Act 96 of the 2016 Louisiana Legislature directed the Louisiana Board of Pharmacy to develop a nontransferable specialty license for pharmacies to dispense recommended marijuana for therapeutic use and to adopt rules relating to the dispensing of recommended marijuana for therapeutic use.
Louisiana Administrative Code, Chapter 24 §2447.A.10 stipulates the need for applicants to supplement their application form with sufficient documentation of their financial capacity to properly operate a marijuana pharmacy. Sufficient documentation of financial capacity includes a surety bond, an escrow account, or a letter of credit of at least $100,000.
The Obligee on the Louisiana Marijuana Pharmacy Surety Bond is the Louisiana Board of Pharmacy.
Louisiana Marijuana Pharmacy Surety Bonds remain in full force and effect from the effective date until they are cancelled. Therefore, they will renew every year and the bonding company will bill for the bond on an annual basis. The bond may be cancelled with thirty (30) days written notice to the Obligee (Louisiana Board of Pharmacy).
However, according to Louisiana Administrative Code 46:LIII.Chapter 24E.§2447.A.10.b, the board shall permit a reduction of the surety bond penalty by $25,000 upon the successful achievement of certain milestones.
The board determines that the pharmacy is fully operational and able to commence and has begun dispensing of marijuana.
The pharmacy remained operational and without substantial interruption and without any violation of law or regulation for a one year period.
The pharmacy remained operational and without substantial interruption and without any violation of law or regulation for a second one year period. Of course, this determination must be made by the Louisiana Board of Pharmacy.
Contact The ProSure Group! As surety bond experts in business since 1993, The ProSure Group has experience handling bonds of this type and has partnerships with more than 30 different surety companies, most of which are A.M. Best Rated and Treasury Listed. This ensures that we get you the best, most competitive pricing and terms available in the marketplace. You just need to complete our simple application and one of our specialists will quickly contact you.