Would you like to open a psilocybin business in Colorado? Learn how our Colorado psilocybin consultants can help you be one of the first to win a state-authorized psilocybin license. It’s exciting new territory! The Colorado business license application period is due to open in 2024.
In the article below, you’ll find a step-by-step guide of the application process. If you’d like to discuss Colorado’s natural plant medicine program and get a head start on your application, schedule a free consultation today.
Laws and Regulations
First, to prepare to apply for a psilocybin business in Colorado, read the initiatives for the potential laws and rules that will govern this emerging industry. By doing so, you’ll understand the context for the upcoming requirements as well as the application process itself.
I recommend that you familiarize yourself with at least the following to start:
- Title 12, Article 170 (“Natural Medicine Health Act of 2022”).
Also, Colorado Department of Regulatory Affairs (DORA) will oversee Colorado’s psilocybin program and is required to establish its final rules within a year. DORA is mandated by state statute to begin accepting facilitator license applications by no later than Sept. 30, 2024.
Read further below for the specific deadlines.
Timeline
The development of rules and requirements are still in process.
By January 31, 2023 Colorado Governor Jared Polis appoints the Natural Medicine Advisory Board (NMAB), which is required by Prop 122 to consist of experts from various fields including:
- mycology,
- medicine,
- public health,
- insurance,
- religion, and
- criminal justice reform.
Similarly, the department plans to begin accepting applications for colorado Psilocybin business licenses by September 30, 2024. I will update this article in the coming months as the Advisory Board and DORA define and clarify the rules.
Learn how our psilocybin business consultants can help you be one of the first to win a psilocybin healing center license in Colorado. While awaiting DORA’s release of the rules, follow our step-by-step guide to Colorado psilocybin licensing and be fully prepared.
Types of Psilocybin Licenses in Colorado
The department will issue two types of colorado psilocybin licenses:
- Psilocybin Healing Center License – Allows establishments to cultivate, manufacture, and dispense psilocybin. It also allows you to provide a location where psilocybin sessions occur.
- Psilocybin Facilitator License – Allows a facilitator to provide natural medicine services to participants in preparation, administrative and integrative sessions. The facilitator is essentially the person who will give you the psilocybin and guide you during your experience.
Now that you have an overview of the potential types of psilocybin licenses in Colorado, let’s examine the application requirements.
Application Requirements for Psilocybin Business Licenses
The application of a Colorado psilocybin business license will likely require:
- Environmental, social, and governance criteria,
- Safe provision,
- Refusal of service,
- Transportation,
- Testing standards,
- Advertising and marketing standards,
- Health and safety warnings,
- Educational materials,
- Consent,
- Record keeping, including of session completions,
- Patient data privacy,
- Training programs,
- Permissible financial relationships between licensees and other entities, and
- Further requirements as determined.
Social Equity / Preferred Applicant Status
We don’t expect as strong of an emphasis on social equity or a legacy approach as has been the case with cannabis licenses, because the use of psychedelics has not been prosecuted to the extent that cannabis use has been, historically.
However, 12-170-104(6)(d) stipulates that all procedures and policies must ensure that the program is equitable and inclusive and must promote the licensing and provision of natural medicine services to:
- Persons from communities that have been disproportionately harmed by high rates of controlled substances arrests,
- Persons who face barriers to health care access,
- Persons who have traditional or indigenous history with natural medicines, and/or
- Persons who are veterans.
In addition, while decriminalizing psychedelic plants and fungi, Colorado has also made past psychedelic offenses expungable.
Also, 12-170-104(6)(d) states that there must be equitable and inclusive fee structures for these qualifying persons, including reduced fees for licensure and facilitator training. In addition, the final program must incentivize:
- The provision of natural medicine services at a reduced cost to low income individuals, and
- Geographic and cultural diversity licensing, provision, and availability of natural medicine services.
I’ll update this article when the final rules are released.
Local Municipality Control
For those in more rural areas, transportation across county lines constitutes a hardship and limits access for people in hospice or palliative care. Therefore, Colorado’s Proposition 122 takes a more proactive and equitable approach than did Oregon. Colorado’s law does not allow municipalities to “opt-out.”
In other words, Colorado prohibits municipalities and counties from banning psychedelic healing centers and from prohibiting state legal transport across county lines.
However, Colorado does allow local officials control of locations and the hours that the healing centers can be open and also enables existing healthcare centers such as hospital and hospice providers to integrate psilocybin service within those jurisdictions.
Now that we’ve covered the basics of the Colorado psilocybin license application process, read further for our step-by-step guide on how to prepare to win a psilocybin business license.
Tips for Winning Licenses (Steps 1-10)
Below is a step-by-step guide on how to obtain a psilocybin business license in Colorado. Start preparing now to improve your chances of winning a license in this emerging industry.
Step 1: Read the Laws and Regulations
The first step to winning a license in Colorado is to read its Laws and Regulations.
This will give you a good idea of the overall framework Colorado is building for its psilocybin and natural plant medicine market. Also, it will familiarize you with what types of business licenses will be needed for your proposed psilocybin activities.
Step 2: Choose a license type
Next, review the types of licenses. As mentioned above, there will most likely be several types of psilocybin licenses made available in Colorado, with the first being the facilitator licenses and the healing center licenses.
Also, the proposed rules allow for vertically integrated psilocybin license, allowing you to both produce psilocybin and administer the sessions, individual and group, through your licensed healing center.
While you explore these options, move to the next step and engage a Colorado psilocybin business consultant. We can help you clarify the license type appropriate for your business goals and intended activities.
Step 3: Engage Colorado psilocybin consultants
Allow us to manage your project from pre-licensure to fully approved and operational. Our psilocybin business license consultants in Colorado can manage all aspects of your application writing, including:
- Team recruitment,
- Facility design,
- Operational support, and
- Employee training.
Step 4: Form a business entity
At this beginning stage, you should form a business entity, such as an LLC or an S-corp. If you are unsure what type of business entity would work best for your proposed operations, engage our consultants or work with an attorney to choose the best structure for your business plans.
Step 5: Build a team
DORA will scrutinize the background and qualifications of each member of your team in order to ensure proper safety and compliance. With our talent acquisition services, our Colorado psilocybin consultants can help you put together the ideal team for the approval of your business license. Reach out today for more information about our personalized business applications and consulting services.
Step 6: Develop a business plan
A viable business plan is critical for you to raise capital for your psilocybin business.
Although significant business costs differ from a cannabis business model, expect to incur similar costs pre-licensure and post-licensure. During pre-licensure, you can reasonably expect costs associated with any of the following:
- Acquiring or leasing real estate,
- Architectural designs for your facility, including security systems,
- Marketing,
- Attorneys,
- Consultants,
- Lobbyists,
- License application fees,
- and more.
Once you obtain your license, you can expect costs to arise from:
- Construction and/or renovations
- Equipment and supplies,
- Security installation and maintenance,
- Inventory,
- Wages and payroll,
- Marketing, outreach, and public education,
- and more.
Make sure you have created a viable business model. It shows the Department that your business is well-planned and sustainable. Plus, it will help you to raise capital.
Step 7: Raise capital
First, keep in mind that initial psilocybin business costs are expected to be more expensive than the current cannabis models, due to the nature of the business being more therapeutic service-related than is typical for medical cannabis dispensaries or adult-use retail.
Additional costs and considerations accompany the handling and specifics of psychedelic therapy. These costs include developing the processes in preparation for, during, and after a session.
So, in addition to the cost considerations noted above, keep in mind that a licensed psilocybin business must provide proper supervision during administrative sessions, during the integrative sessions, as well as assurance of safe transportation of participant(s) afterwards.
Step 8: Choose a location
Although Colorado does not allow municipalities to “opt-out” from allowing psilocybin businesses within their jurisdictions, they are allowed control over hours of operations.
You will most likely need a letter of consent from the property owner if you intend to lease the property, as well as a letter of support from the municipality’s governing body.
Since Colorado law enables existing healthcare centers such as hospital and hospice providers to integrate psilocybin service within those jurisdictions, you might want to check out your options for joining with existing entities to provide licensed psilocybin services.
Give us a call to discuss the variety of options depending on your business plans and desired locations. We can help you develop the best options to pursue tailored to your business goals.
Step 9: Garner local support
As stated above, once you’ve identified property for your psilocybin business(es), a letter of support from your city or county government helps tremendously to build strength for your license application to DORA.
In addition, begin building relationships with other local businesses, state and community non-profits. Show how you intend to positively impact your community and how your psilocybin business will support their efforts. Show how you will be a good neighbor.
Step 10: Write and submit an application
Finally, it’s time to write and submit your Colorado psilocybin application. Although the application instructions have not been released yet, trust in our psilocybin consultants who have previously won cannabis licenses in more than 6 countries and over 27 states in the United States.
The application process is a lengthy and technical writing project that requires a great amount of attention to detail. However, we’re here to save you time and money, and increase your chances of success.
We will ensure you submit the paperwork correctly and within the deadlines, as well as writing you the most precise and convincing plans that will most likely need to be included in your application to DORA, including:
- Business Plan
- Financial Plan
- Psilocybin Manufacturing Plan
- Social Equity Plan
- Security Plan
- Operating Plan
- Inventory Tracking Plan
- Quality Assurance and Control Plan
- Education and Outreach Plan
- Community Impact Plan
- Standard Operating Procedures (SOPs)
- and more
Summary from our Colorado psilocybin consultants
In summary, our Colorado psilocybin business consultants have decades of expertise with state licensing of federally scheduled I drugs such as cannabis.
Having won cannabis business licenses for clients in more than 6 countries and over 27 states in the United States, we are doing the same for businesses wanting to offer the benefits of psilocybin mushrooms.
We can provide professional resources, advice, support, and more throughout your entire application process. Our Colorado psilocybin consultants can help you navigate the regulations and logistics to acquire the end result – providing safe, equitable health access for appropriate therapies derived from natural plant medicines.
Start one of the first state-licensed psilocybin businesses in America! In Colorado.
Reach out today to learn more.
Additional Resources
Ballotpedia: Overview and Measure Design of Colorado Proposition 122
Multidisciplinary Association for Psychedelic Studies (MAPS)
