Drew Milburn

Drew Milburn speaks to the general membership meeting of the Needles Chamber of Commerce. Milburn said he was out to "demystify" the medical cannabis industry.

NEEDLES — Drew Milburn’s stated mission was “demystifying marijuana,” when the chief operating officer of Medical Investor Holdings LLC spoke before the Needles Chamber of Commerce on June 22.

The audience packed the meeting room of the Riverfront Cafe at Rainbo Beach Resort, overflowing into the main dining room. Judging from the quantity and volume of the applause Milburn’s report was well-received.

MIH, he explained, is involved in all things cannabis: dispensary, cultivation and extraction operations. In Needles, the company will concentrate on cultivation and extraction in buildings currently under construction at Interstate 40 and Needles Highway, the old KFC building and another in the 2100 block of Needles Highway for extraction only, and additional future development on 22 acres the company owns across Needles Highway from Rainbo Beach on both sides of National Old Trails Highway. All facilities will address concerns for security and aesthetics.

MIH, Milburn explained, looks at their production “not so much as an agricultural business as a manufacturing business.” Currently a non-profit per state government regulation, it appears a change to for-profit status will be allowed in California after Jan. 1, 2018. Business parameters, he said, are defined more by regulation than market forces; continuing that outside of waste management cannabis is one of the most regulated industries in the country.

In answer to a lengthy question and answer session:

• Employees - 25 to 40 at each facility including security and maintenance personnel. Someone will be in each building 24 hours a day even if it is in operation fewer hours. The company is hiring now; none of the available jobs require prior experience; MIH is working with Palo Verde College to develop a curriculum. Current starting wage is between $11 and $15; that goes up to $18 to $25 for employees with a skill set.

• Impacts on housing and shopping - Around 20 licensees in some stage of development here, “Can, in essence, employ the entire city,” Milburn said. “What we will see is an influx moving to this area, creating new housing, restaurants, and putting people back into business that were here before and the population couldn’t support.” His company’s first products from Needles were about ready for market at the time of his address, he said: “the first month we’ll cut a check to the city of Needles for some tax.” He advised city staff “are helpful, but they’re not giving us any breaks.” The company regularly looks at potential alternative energy strategies, such as solar and wind, “but only as secondary. We must have reliable power,” Milburn said; “the city of Needles is attractive for that.”

• The product - How a plant is grown dictates a predisposition for producing certain levels of cannabinoids. Those include THC - tetrahydrocannabinol, the compound that produces marijuana’s “high;” and CBD - cannabidiol, which doesn’t produce a “high” but has medical benefit. The most benefit seems to accrue with the “entourage” effect of combining the two. Varieties high in THC will be grown in Needles; CBD-rich plants are already being produced at MIH facilities in Colorado and Kentucky. The whole plant can be used but isn’t. Income is derived from the flower and “trim:” the tighter leaves around the bud or flower. Everything else is waste and must be rendered useless and disposed of according to city and state regulatory guidelines.

• Investment - MIH is not publicly traded at this point, though such companies exist, according to Milburn. There are investment opportunities, he continued, but not stock. The company’s estimated investment? “A few hundred million before all is said and done,” Milburn concluded. “Lots of money has to be spent before you can make any.”

Other publicly-available sources used for this article include wikipedia.org and projectcbd.org. - ed.

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