Key Minnesota health official to become CEO of medical marijuana company

Published 10:00 am Friday, June 12, 2015

ST. PAUL — A Minnesota health official who was instrumental in getting the state’s medical marijuana program off the ground is leaving to become chief executive of a company that grows the cannabis — a move that may expose him and the Department of Health to questions about prior regulatory decisions and the appearance of cashing in.

LeafLine Labs named Manny Munson-Regala as chief executive officer on Thursday, giving them a leader with intimate knowledge of the program and its regulations — having helped write some of them himself. He also brings deep connections in state government from more than six years of experience scattered across different agencies.

But Munson-Regala was also involved as the state selected its two manufacturers and set the ground rules for a company that’s now his employer. While it may not be illegal, Sen. Branden Petersen said, it’s troubling given Munson-Regala’s influence on the state’s small medical marijuana market.

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“It’s pretty incestuous,” said Petersen, an Andover Republican and member of a state task force overseeing the program’s rollout. “I can’t think of a closer relationship that has sort of become a two-way street.”

Munson-Regala acknowledged the cause for concern in an interview Thursday. He stressed that he wasn’t contacted by LeafLine until last Wednesday or making decisions that would impact the industry as he weighed a possible offer. He accepted the job on Tuesday, notified the state Wednesday and will join the company July 6.

Minnesota Department of Health spokesman Michael Schommer said Munson-Regala was immediately recused from his responsibilities with the program; his last day with the state is Wednesday. Schommer said his departure won’t impact the state’s July 1 goal of launching the program.

Neither the company nor Munson-Regala would disclose his new salary at LeafLine. As an assistant commissioner at the Department of Health, he made $115,000 in 2014, according to state salary information.

“I’m not doing it for compensation. It’s a startup,” he said. “The one thing I really like doing is building things.”

Munson-Regala was intimately involved in setting up Minnesota’s medical marijuana law from the day it passed last spring, up to and including selecting two manufacturers. He went on site visits and fielded presentations from 12 companies who applied for a contract, but Munson-Regala said he wasn’t involved in the final decision — that was left to a review panel and the Department of Health commissioner.

As an assistant commissioner, Munson-Regala said medical marijuana occupied just a quarter of his workload — the day-to-day operations were left to a director at the Office of Medical Cannabis, a position he managed. But he had a major hand in crafting the rules his new company has to play by, he said.

“I’m pretty sure I’m going to rue some of the decisions I made as a regulator in a couple of months,” he said.