Pennsylvania Archives - Page 2 of 2 - Green Market Report

StaffJuly 29, 2020
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4min1780

A new study is being conducted to measure the quality of life that medical cannabis patients in Pennsylvania report when using cannabis to address pain relief.  The University of the Sciences and Releaf App have partnered with the Pennsylvania dispensary Keystone Canna Remedies to conduct a second collaborative research study on the effectiveness of Pennsylvania’s medical cannabis program.

An original study by that group found that cannabis products with THC gave the greatest symptom relief in patients. The report said that on a 10-point scale, the pain relief seen in patients taking primarily THC products was nearly two points, a statistically significant difference from one point reduction seen in patients taking primarily CBD based products.

Dr. Andrew Peterson, Executive Director of the Substance Use Disorders Institute, and principal investigator notes that “the results of the first study showed that THC products used by PA patients had a beneficial effect on pain, but now we need to find out if a patient’s health-related quality of life is also improved as a result of the pain relief from cannabis use.”

“KCR has always prioritized the furthering of cannabis research in Pennsylvania, and dispensaries with established patient bases should be looked at as data-rich resources,” said Victor Guadagnino, Founder of Keystone Canna Remedies. “As part of our ongoing care, we equip our robust patient base with tools to self analyze which should prove very effective for this study.  Participation in this study also empowers patients to have an active role in their healthcare while engaging in a way that can shape the overall understanding of cannabis beyond state lines.”

“While Pennsylvania has a robust clinical research program designed specifically for pre-approved licensed operators and universities, one of our goals is to open up research opportunities beyond the pre-approved stakeholders to a wider group of universities, dispensaries, and cannabis brands who are commonly motivated to contribute to our growing body of cannabis research,” says Keenan Keeling, CEO of MoreBetter Ltd, the company behind Releaf App. “Focusing on the efficacy of Pennsylvania products, as reported by Pennsylvania patients, allows us to provide actionable insights to cannabis patients and regional stakeholders. Ultimately, we aim to improve the experience for both patients and healthcare professionals within the state.”

Certified medical cannabis patients in Pennsylvania medicating for pain relief who are interested in signing up to participate in this research study can reach out to medicalcannabis@usciences.edu. Healthcare professionals, dispensaries, and growers/processors in Pennsylvania who are interested in supporting or participating in this research study, or future study efforts, can reach out to tyler@releafapp.com.


StaffJune 22, 2020
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4min3240

Innovative Industrial Properties, Inc. (NYSE: IIPR) is making available $30 million for additional expansion of their cannabis cultivation and processing facilities at the Green Leaf Medical property in Saxton, Pennsylvania. The company’s lease was amended to reflect the new investment as well as an adjustment to the base rent to take into account the additional available funding and extended the term of the lease agreement. Assuming full payment of the additional funding, IIP’s total investment in the property will be $43.0 million.

“We are thrilled to expand our real estate partnership once again with Green Leaf, providing them the capital for this key expansion at their mission-critical facility in Saxton,” said Paul Smithers, President and Chief Executive Officer of IIP. “Green Leaf has always taken a thoughtful, long-term view toward expansion, and this second phase is expected to dramatically increase production capacity at the Saxton facility, with an eye toward meeting demand in one of the strongest medical cannabis markets in the United States.”

Green Leaf, which is known for its brand gLeaf, operates medical cannabis cultivation, extraction and retail operations in four contiguous states in the mid-Atlantic region, including Maryland, Pennsylvania, Ohio and Virginia, with pending vertical applications in New Jersey and West Virginia. According to Green Leaf, the company has raised approximately $27 million from the sale of equity to build its multi-state operation and has generated positive EBITDA since 2018.

In April of this year, Green Leaf announced a new debt financing transaction with Chicago Atlantic Group, raising $10 million to fund the acquisition of additional dispensaries in Virginia and Pennsylvania. Green Leaf has one of 25 medical cannabis cultivation/processor licenses issued by the state of Pennsylvania.

“We appreciate the continued strong support of IIP as our long-term real estate capital partner, and look forward to expanding capacity at our Saxton facility, which provides the enhanced infrastructure elements that are key to growing the highest quality, consistent cannabis products for our patients,” said Philip Goldberg, Chief Executive Officer of Green Leaf.

Innovative Acquired Property in 2019

IIP bought the property in a sale-leaseback transaction with Green Leaf in May of last year, which comprises two buildings totaling approximately 266,000 square feet of industrial space. Green Leaf previously redeveloped approximately 103,000 square feet of the industrial space for medical-use cannabis cultivation and processing, and this funding is expected to include the build-out of the remaining 163,000 square feet of industrial space.

IIP also owns and leases to Green Leaf an 82,000 square foot medical-use cannabis cultivation, processing, and dispensing facility in Richmond, Virginia, which the company acquired earlier this year.

Pennsylvania

With first sales in 2018, the Pennsylvania medical cannabis market has grown significantly with sales hitting $524 million. The Pennsylvania Department of Health’s report dated May 15, 2020, noted that over 300,000 patient certifications have been issued by approved practitioners since the program began.

Similar to other states, Pennsylvania has expanded its program over time, adding several new medical conditions eligible for treatment with medical cannabis, including, among others, anxiety disorders and Tourette Syndrome. In addition, according to an April 2020 study by Harper Polling, over 60% of Pennsylvanians support legalizing adult-use cannabis in the state, with strong levels of support throughout the political spectrum. Multiple bills to legalize adult-use cannabis are pending in Pennsylvania’s legislature.


Debra BorchardtJune 22, 2020
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4min1880

Jushi Holdings Inc. (OTCQX: JUSHF) is planning on buying Vireo Health’s (OTC:VREOF) Pennsylvania Medical Solutions, LLC as the company looks to strengthen its position in the state’s market. Jushi will pay Vireo $16.3 million in cash, a $3.8 million seller note, and assume a $17 million facility associated with a long-term lease obligation. The $37 million deal is expected to close by the end of August 20.

“This acquisition allows Jushi to expand its presence in one of the most attractive medical cannabis markets in the country,” said Jim Cacioppo, Chairman and Chief Executive Officer of Jushi. “Upon completion, Jushi will be able to provide high-quality, indoor flower and concentrates to our Pennsylvania patients who continue to experience constrained supply and high prices.  Furthermore, we will be well-positioned to support an increase in demand and maintain the ability to further scale up the facility if required.”

The acquisition operates a 90,000 sq. ft. facility with approximately 45,000 sq. ft. of high-quality, indoor cultivation when construction is complete. The property can also accommodate an additional 25,000 sq. ft. of indoor cultivation bringing the total to 70,000 sq. ft.

Pennsylvania has quickly shown its power in the cannabis industry with total sales of $524 million and 80 operational dispensaries. So far $215 million has been purchased by dispensaries from grower-processors and $309 million made by patients and caregivers at licensed dispensaries. Jushi says is has reaffirmed its revenue guidance for 2021 in the range of $200 and $250 million.

“This transaction secures Vireo’s capital position for the foreseeable future and will enable us to comfortably execute our fiscal year 2020 operating strategy and begin generating positive cash flow in the first half of next year without requiring any additional capital infusions,” said Founder & Chief Executive Officer, Kyle Kingsley, M.D.  Vireo said the money received from the sale will help it to increase scale in its core markets of New YorkMinnesotaMarylandArizona, and New Mexico. Vireo said that these projects are expected to significantly improve its near-term revenue and profitability outlook.

In addition to buying Pennsylvania Medical Solution, Jushi will have an option to buy  Pennsylvania Dispensary Solutions, a Pennsylvania medical marijuana dispensary permittee in the Commonwealth’s Northeast region.  PADS currently operates two medical marijuana dispensaries in Scranton and Bethlehem, with the right to operate one additional dispensary in the region. The option expires 18 months from the closing of the Agreement.

Financing

In order to help come up with the cash portion of the acquisition, Jushi announced it had received binding subscriptions totaling approximately $15.25 million for the issuance of 10% senior secured notes and warrants to acquire the subordinate voting share of which $12.35 million has been received. The company also said it received non-binding indications of interest for up to an additional $10 million of financing.  Jushi said it plans to use $15 million of the proceeds to fund the cash portion of the acquisition.

Jushi Chairman & CEO Jim Cacioppo subscribed for $1.5 million of the Notes with other insiders subscribing for $3.35 million of the Notes.


Debra BorchardtSeptember 17, 2019
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TerrAscend Corp. (CSE: TER)(OTCQX: TRSSF)  has closed on its previously announced acquisition of Pennsylvania-based Ilera Healthcare, one of five permitted vertically-integrated cannabis cultivator, processor, and dispensary operators in the state. The company also reaffirmed its 2019 guidance of revenue in excess of C$141 million, which includes a contribution from the Ilera transaction and pending disclosed transactions, as previously announced on August 22, 2019.

“As one of only 5 holders of Super Licenses in a limited license state with approximately 13 million people, Ilera is an ideal partner for TerrAscend to enter the Pennsylvania market with,” said Matthew Johnson, President of TerrAscend Corp., and TerrAscend USA, Inc. After the close of this acquisition, TerrAscend’s licensed cannabis footprint expands to four U.S. states, in addition to its global reach into Canada and Europe.

Greg Rochlin, CEO of Ilera, added, “By combining forces with TerrAscend, we see clear opportunities ahead for our stakeholders, employees, and patients. We look forward to accelerating the growth of Ilera’s brands and formulations by leveraging TerrAscend’s platform in other markets. I can’t wait to introduce our wholesale customers and patients to the California-born Valhalla and State Flower brands, as well as Haven Street, a leading premium Canadian brand.”

According to the company statement, Ilera currently operates a retail dispensary in Plymouth Meeting, PA, with plans to open two additional dispensary sites in the Philadelphia area within the next six months. The operations include a 67,000 square foot site for cultivation and processing in Waterfall, PA with planned expansion to over 120,000 square feet in 2020. In addition to selling its products in its own dispensary, Ilera distributes its dried flower, concentrates, tinctures, and topicals to over 60 dispensaries throughout Pennsylvania. Ilera’s current revenue run-rate is over US$43 million1, up from total sales in 2018 of less than US$8 million1.

Currently, the Pennsylvania medical marijuana program has more than 180,000 registered patients and 20,000 registered caregivers as of August 2019 and covers 23 qualifying medical conditions including anxiety disorders, cancer, and opioid use disorder.


Emerson BrownFebruary 12, 2018

6min2140

Pennsylvania seems to have forgotten its cannabis roots with the cautious approach the state is taking towards its medical marijuana program. William Penn, the man that American history states founded Pennsylvania, became a vital voice in Pennsylvania’s original outlook on cannabis.

Back in 1619, it was known as the “hemp state.” Yes, it was William Penn that gave way to the General Assembly passing the first law encouraging farmers to grow hemp and position the crop as a major commodity within the trade. It took over 300 years for cultivation to come back to the state.

On April 17, 2016, Governor Tom Wolf signed into law SB3, of the Pennsylvania Compassionate Medical Cannabis Act, which did not fully go into effect until May 17, 2016. The first medical marijuana dispensary in the state opened last month in Bethlehem, PA called Keystone Canna Remedies and Pittsburgh opened its first dispensary CY+ last week. Cure Pennsylvania is planned to open on March 7 in Lancaster County. A total of 12 companies will be able to grow and process medical marijuana with a vision of having a total of 25 in the near future. As of now, eight dispensaries have been approved and 10 growers/processors have begun operations.

“Each week, we are making great strides in expanding our network where patients will be able to get medical marijuana,” Governor Wolf said. “The approval of two more dispensaries is another positive step forward. Work continues to move patients one step closer to having medical marijuana as a tool to help with their medical condition.” According to Marijuana Business Daily estimates, the state’s dispensary sales could exceed $100 million annually a few years after the program launches.

Still, only 16,600 patients have registered to receive medical marijuana cards and 3,800 patients were certified by a physician. The physicians seem even less enthused. Take the process of registering qualified and actively licensed physicians for instinct, with a total of 57,670 active physicians statewide, to date, 701 have registered and of those, 355 have completed the training to become certified practitioners.

Now with Pennsylvania equipped to provide a service that not only helps the health of its residents but also creates a federal and state stream of taxable income that has yet to be matched by any other current commodity.

So the question that comes to mind, why are current northern American physicians so reluctant to jump into the medical lane of marijuana? Is there a cultural stigma holding these physicians back or is it a lack of education and marketing tools that can expose the future benefits of this sector of medicine? Will Pennsylvania have the same dilemma that New York had when it came to registering physicians or will the years ahead just show the solutions and strategies it took for Pennsylvania to overstep these current state structural and psychological barriers?

Back in 1683, Lancaster County in Pennsylvania was known to locals and most outsiders as the “hempest place to be” and with licenses being awarded for growers and processors to produce oil, pills, and tinctures. Counties like Lancaster seemed to have embraced those roots and is allowing out of state companies like Bay LLC to utilize and convert old 1970, brink and mortar stores like the Kmart on 890 Fruitville Pike in Manheim Township into 125,000 square feet of a modern-day dispensary.

I was thinking the process towards anything always has a beginning and an end. The thought of when and what to start and the notion of where and how to end it is a guarantee. So unlike many other states, Pennsylvania is a newcomer in this new booming cultural and economic class of cannabis, but with a commonly known and influential past.

Pennsylvania will slowly but surely makes its way into the headlines of the cannabis class going forward. I think its safe to say, that the state of Pennsylvania has a huge upside when it comes to the awareness and educational factors that help maximize the use and perception of cannabis within the framework of their local northeastern American economy. The medical sideline of Pennsylvania is leading the way back to making cannabis a common component in the wealth and health of its state.


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5min1132

The marijuana industry is still processing United States Attorney General Jeff Sessions’ recent decision to repeal the Cole Memo, which had directed federal prosecutors to refrain from prosecuting marijuana-related businesses that operated in accordance with a facilitative state law. The effect of Sessions’ policy change is presently unclear because, as of this date, the December 2014 Rohrabacher-Blumenauer amendment precludes the Department of Justice (DOJ) from spending any of its budget for the prosecution of entities that are lawfully participating in a state marijuana program. But, the Rohrabacher-Blumenauer amendment is part of continued, partisan, budgetary conflict, currently scheduled to resume in early February.

Under the recent policy change, United States Attorneys have been given additional discretion to prosecute marijuana businesses, even when they are operated in accordance with state law But no one knows what resources the DOJ will be permitted to direct to those prosecutions. Direct prosecution of state-legal cannabis businesses may be a cost-intensive endeavor. On January 4, 2018, Pennsylvania Governor Tom Wolf indicated that the Commonwealth will oppose efforts to prosecute businesses operating in accordance with the Pennsylvania Medical Marijuana Act. Pennsylvania is one of 29 states (and the District of Columbia) that have legalized medical or recreational cannabis, meaning there is as many as 30 state attorneys general who have an interest to opposing lawsuits that may directly impact legalized marijuana. Add to that the lawyers who may be hired to defend the estimated $10 billion legal marijuana industry, and prosecution becomes a potentially costly proposition.

But, what about less-expensive, indirect enforcement? There are several indirect or “sideways” avenues that the DOJ might explore to undermine medical and recreational marijuana:

  • Firearms. Under the Gun Control Act of 1968, persons who regularly use marijuana cannot legally own firearms. Pennsylvania has pledged not to release the names of patients holding medical marijuana ID Cards to federal authorities. But gun owners must disclose their marijuana use when reregistering their firearms or face charges for making misstatements to federal authorities. Historically, prosecution of firearm offenses has rarely occurred in the absence of another crime, but that could change.
  • Physician licensing. The federal Drug Enforcement Administration (DEA) issues prescribing licenses to physicians. Without a DEA license, a physician cannot prescribe prescription medicines. A physician who prescribes medical cannabis could potentially face difficulty renewing her federal license.Pennsylvania has sought to insulate doctors by having physicians certify that a patient suffers from one of 17 recognized conditions and allowing the dispensaries to counsel clients and suggest products. However, Pennsylvania’s law also allows certifying physicians to “recommend” cannabis products and amounts. Federal authorities may argue that “recommendations” by certifying physicians equates to “prescribing” cannabis. Although Pennsylvania does not permit a certifying physician to work for a dispensary, each dispensary must employ one physician to oversee counseling and dispensing. A physician employed by a licensed dispensary may face more difficulty in maintaining federal licensure based on their role in the actual delivery of medical marijuana directly to patients. A dispensing physician may retain a state-issued license to practice medicine, but be precluded under federal law from prescribing medications.
  • Real property forfeiture. Federal law allows the government to confiscate real estate that is used to advance drug sales and distribution. The Justice Department may seek to pressure landlords of state-legal cannabis businesses to terminate leases or face federal forfeiture actions.

We do not yet know how or if the federal government will seek to curtail state-legal marijuana businesses. There is no guarantee how government enforcement will proceed.


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