In June, a group of independent operators in Pennsylvania have proposed a change to the state budget that would prescribe new eligibility for additional dispensary permits for existing Grower/Processors. The state budget and proposed amendments are under review this week and will then be voted on by the legislature.
Through the proposed code bill, a legislative attachment to the state budget, existing grower/processors who do not currently have a dispensary license are eligible for two dispensary permits and those with one permit are eligible for one additional permit.
A letter signed by five individuals representing Hanging Gardens, Penn Health Group, Whole Plants, Calypso Enterprises, and INSA, states:
“The lack of dispensary permits issued to qualified independent grower/processors has made it difficult for many patients across the state to access much-needed medicines – and lack of enforcement of the original legislation has severely limited the ability of independents to compete and thrive.”
The Commonwealth currently has 33 licensed cultivators and 160 licensed and operational retailers. There are over 400,000 active patients in the program. The Pennsylvania Cannabis Coalition (PCanna) came out against the proposed code bill in a public letter.
“With respect to further expanding patient access, current license holders continue to work as expeditiously as practicable to open all of their authorized retail locations,” PCanna’s letter states. “In fact, due largely to administrative delays out of operators’ control, there are at least 40 more dispensary storefronts yet to be opened under permits issued in 2017 and 2018. We are also mindful that current operators won permits through a highly competitive and capital-intensive application process.”
Grown In obtained emails from a private source that indicate that at least one of the Independent Operators is considering selling their new dispensary permits to multi-state operators if the legislation passes.
“They need a deal quickly because several MSOs are circling”, one email states.
Meredith Buettner, Executive Director of the Pennsylvania Cannabis Coalition said the proposed changes would be unfair to all of those who applied through the competitive process.
“Issuing permits through a non-competitive process is just bad business. A competitive process makes sure that the most capable applicant wins and ensures patients are best served,” Meredith Buettner, Executive Director of the Pennsylvania Cannabis Coalition, said. “Current permit holders are working to increase patient access by continuing to operationalize existing retail permits and are committed to working with the legislature and regulatora to ensure the efficiency of Pennsylvania’s Medical Marijuana Program.”
Penn Health Group and INSA could not be reached for the story, but Calypso, Whole Plants, and Hanging Gardens sent a written response to Grown In through a representative.
“The massive consolidation of permits allowed by the Dept of Health has left patients with restricted access and true Pennsylvania businesses dying on the vine,” a representative of the group said. “Act 16 includes provisions that prevent this very thing, and lack of enforcement by the DOH leaves patients holding an empty bag. The just approach would be to unwind the mergers to break up the monopolies; the proposed language levels the playing field for non-vertical operators providing an opportunity for patient access across the board as well as equitable relief.”