State regulators this month released temporary rules for growing and processing medical marijuana, giving cannabis industry entrepreneurs their first peak at what will be required of them under the new Pennsylvania law – but questions remain.
For instance, the law specifies that state regulators can only approve one permit for growing and processing medical marijuana per corporation so that there is room for competition.
But what if one person is financially backing more than one corporation? Is each corporation still able to get a permit? Those were questions posed by attorney William G. Roark of Montgomery County-based Hamburg, Rubin, Mullin, Maxwell & Lupin PC.
Also, the word “greenhouse” does not appear anywhere in the law, although many prospective medical marijuana growers are interested in using greenhouse technology. Does that mean that since lawmakers didn’t include greenhouses in the text, it is illegal to use a greenhouse to grow medical marijuana?
In original drafts of the legislation, greenhouses were listed specifically as an approved method of growing medical marijuana, but at some point it was removed, Roark said.
Despite lingering questions, Roark says the recent regulations are a testament to how well the Pennsylvania Department of Health is overseeing the medical marijuana program so far.
The department is leaving the temporary regulations open for public comment through Aug. 28, so that the additional questions can be addressed before regulations are finalized.
“This is all good news, that they are moving as expeditious as they are,” Roark said of the department.
Rules for operating plans
The temporary regulations outline in detail what entrepreneurs applying for a permit to grow and process medical marijuana will need to do.
First, they will need plans for how their businesses will operate.
The plan should cover everything about a facility’s operations: What kind of security it will have, as well as what the protocol will be for receiving, processing, packaging, labeling, handling, tracking, transporting, storing, disposing of and recalling medical marijuana.
The regulations also detail how growers and processors should access seeds, what types of pesticides to use on the marijuana plants, how and where cannabis should be grown, and what type of security is required to protect the facility.
When it comes to getting seeds, growers and processors have 30 days from when their plans are approved to operate to import seed from out of state. After that window, they are not allowed to transport marijuana over state lines.
Medical marijuana has to be grown inside, and growers will have to follow the Pennsylvania Pesticide Control Act. They should use natural oils and organic materials to control pests, insects and fungi on the plants.
Growers and processors must install a monitored alarm system that covers all entrances and exits of the building, including windows. The system should have features such as an automatic voice dialer that can be programmed to send a prerecorded voice message to request dispatch from law enforcement agencies.
Rules for geographic dispersal
The regulations also spell out how growing and processing facilities should be spaced out across the state.
The department divided the state into three regions, and will regulate how many growers and processers are located in each region based on factors such as population, access to transportation and how many people have qualifying conditions that make them eligible to use medical marijuana.
The rules raised another question for Roark – what does transportation have to do with growing and processing facilities? Patients will not be going to growing facilities, but to dispensaries, to get their medicine.
“The language that we see here will be more applicable to dispensaries,” Roark said.
In the midstate, Cumberland, Dauphin, Lebanon and York counties are in the central region, composed of the department’s North Central and South Central health districts. Lancaster County is grouped in the eastern region, made up the department’s Northeastern and Southeastern districts, which includes Philadelphia.
There are 25 licenses available for growers and processors, and some of them will be part of vertical licenses, meaning the entity could grow, process and dispense medical marijuana.
Academic research centers could secure up to eight grower/processor licenses and eight dispensary licenses, limiting the number available to private investors.
To become a grower or processor, businesses are required to submit a nonrefundable, initial application fee of $10,000 to the state, and they must prove they have at least $2 million in capital, with at least $500,000 on deposit with a financial institution.
Medical marijuana has been legal in Pennsylvania since May, and the department is currently developing a program with the hope that it is operational by 2018.