Proposition 122 (Prop 122) is the name of Colorado’s psychedelics legislation, which legalizes the possession and use of certain psychedelic substances in the state.
The bill was passed in November 2022, creating a regulatory framework under which persons 21 and older can receive “natural medicine services” provided by a licensed healing center.
The establishment of a regulated natural medicine access program was not only good news for sufferers of mental health problems like PTSD, depression and anxiety, for whom other treatments have not worked. It was also good news for researchers, entrepreneurs, business owners, clinicians, manufacturers, processors and retailers looking to set up psychedelics-based businesses.
The Natural Medicine Health Act
Proposition 122 is the commonly used name for the Natural Medicine Health Act (NMHA) of 2022. This was initiated by Colorado citizens to legalize the personal use, possession, growth, storage and transport of certain plants or fungi for people of 21 years or older — and was voted in as part of the November 2022 Colorado General Election.
When Prop 122 was passed, it authorized Colorado’s Department of Regulatory Agencies (DORA) to begin the first steps for the implementation of the regulatory framework of psychedelics.
Effectively, the legislation immediately decriminalizes and legalizes the possession and use of psilocybin and psilocin until June 2026. Furthermore, it authorizes more “natural medicines,” such as DMT and mescaline (except peyote), to be added after June 2026.
Similar to the state’s cannabis laws, anyone over the age of 21 can give away (without remuneration) natural medicine to another person over 21.
Adults in Colorado can also grow and process natural medicine for personal use, provided the plants/fungi are kept at a private residence and individuals under the age of 21 cannot access them.
To summarize, the regulated natural medicine access program covered by the new Act sets out to cover the following issues:
- Develop and promote accurate public education campaigns
- Study and deliver recommendations to the legislature
- Collect and annually publish data on the implementation and outcomes of the program
- Establish a Natural Medicine Advisory Board and a Regulated Natural Medicine Access Program Fund
- Provide guidelines for localities and protections regarding natural medicine
- Outline the rules for the personal use of natural medicine and personal use penalties
- Establish limitations related to natural medicine
The consequences for businesses in Colorado
Under Prop 122, the sale of psychedelics will be strictly limited to licensed businesses only.
The license application and award process will be managed by the Natural Medicine Advisory Board (NMBA).
Applications for the licensure of healing centers and other permitted entities will start to be accepted by Sept. 30th, 2024 — with decisions made within 60 days of the application.
This is an exciting time for entrepreneurs, business owners and clinicians who want to become involved in the development, commercialization and medical treatments involving psychedelics.
While the license deadline may seem a little far away, it will come around soon enough and provides time to prepare for the application process. Entitles seeking a license will need to meet stringent requirements in terms of training and qualifications — because Colorado is well aware that the rest of the country is watching and will closely observe the outcomes of the new legislation.
Any business owner seeking a license will need the right advice from a Colorado psychedelic attorney from the start to ensure compliance with the requirements for new businesses.
As part of the legislation, a commitment was made toward an equitable and inclusive program. As such, persons from communities that have been disproportionally harmed by high rates of controlled substance arrests, faced difficulties accessing health care or traditionally used natural medicines will be viewed favorably during license applications.
The Natural Medicine Advisory Board
Under Proposition 122, Colorado’s process for legalizing the possession and use of natural medicines will be overseen by the Natural Medicine Advisory Board.
This Board consists of 15 members (appointed by the Governor), who advise regulators on the implementation of the program. The Board advises on public health and safety, research, qualifications and educational requirements for program applicants, responsible and affordable access to natural medicines and the relevant rules under the Natural Medicine Health Act.
The deadline for making rules for the manufacture, cultivation and sale of legal psychedelics was set at 1st Jan 2024.
Similarities with Colorado’s cannabis legislation
Colorado was the first state in the nation to legalize adult-use cannabis and it seems determined to lead the way with natural psychedelics too.
The passage toward cannabis legalization in Colorado began in 2000 with Amendment 20 and ended in 2013 with Amendment 64, which finally legalized and regulated the adult use of cannabis for persons 21 years or older.
Many states followed Colorado in decriminalizing and legalizing cannabis when they realized that Colorado state benefitted rather than suffered from the legislation.
The main issue is that, unlike with cannabis legalization, there is currently very little congressional support to legalize psilocybin or any other psychedelic drugs at the federal level.
Nevertheless, Colorado’s psychedelics legislation presents an exciting opportunity for the research, development, commercialization and medical practice of psychedelics.
The psychedelics attorneys at Cannabis Law Solutions have the specialist legal insight required to help Colorado psychedelics businesses become established in the state. Call 866-329-0729 for an initial consultation with a knowledgeable psychedelics attorney.
How will our cannabis and psychedelic business services help you
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Whether you are looking to form a limited liability company (LLC) or a corporation, our experienced business lawyers can discuss the pros and cons of both and help you incorporate your business with the optimal structure to achieve your goals.
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State authorities watch licensed and unlicensed cannabis and psychedelics businesses closely. If you violate regulations, you could face an administrative penalty. Our attorneys can provide representation or help you prepare for an administrative hearing, settlement conference or appeal.
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As the cannabis and psychedelics industries emerge in states around the U.S., they are more heavily regulated than most other industries. We can help your business navigate the red tape and plan to stay on the right side of the regulatory authorities in whichever state you are based.
