Tag Archives: PA

PA Cannabis Banking Committee Announces Formation

By Aaron G. Biros
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The Hoban Law Group announced today the formation of a committee to address banking access issues for the Pennsylvania cannabis market. Steve Schain, Esq., nationally recognized consumer finance litigation, banking law and cannabis law expert practicing with national cannabis law firm Hoban Law Group, is the committee’s spokesman and chair.

Steve Schain, Esq. practicing at Hoban law Group and chairperson of the committee.
Steve Schain, Esq. chair and spokesperson of the committee.

Limited access to banking is an ongoing issue plaguing cannabis businesses due to its federally illegal status. According to Steve Schain, cannabis businesses across the country are forced to pay their vendors, utility bills, payroll, taxes and insurance in cash. “At any time, a dispensary or cultivation operation could have up to $200,000 in cash on site- not having a place to bank opens opportunities for criminal activity,” says Schain. It also presents operational issues for business owners like record keeping or even personal bank accounts getting shut down.

“All of those issues could mean less jobs, less economic activity and less tax revenue for the state,” says Schain. “Fully compliant operations should not have to deal with this.”

Schain formed the committee for a number of reasons, including “Setting the table and starting a dialogue. We want this to be scalable. In the past, the great flaws in banking efforts for cannabis were a lack of cohesion and operating credibility- we hope to approach it from a multi-disciplinary angle and change that,” says Schain.

State Senator Daylin Leach introduced the bill
State Senator Daylin Leach

The committee’s members include three PA politicians: Daylin Leach, State Senator of the 17th District, who introduced the bill that legalized medical cannabis in Pennsylvania, Derek Green, Philadelphia City Councilman and Mary Jo Daley, Representative of the 148th District. Tom Fleming, former assistant director of the Office of Compliance at the Treasury Department’s Financial Crimes Enforcement Network, is also a member of the committee.

A number of committee members are actively involved in the legal cannabis industry and cannabis banking initiatives. Sundie Seefried, a member of the committee, is the chief executive officer of Partner Colorado Credit Union, which is

Lindy Snider, advisor at Greenhouse Ventures and KIND Financial
Lindy Snider, advisor at Greenhouse Ventures and KIND Financial

currently handling over half of Colorado’s estimated billion-dollar cannabis banking market, according to Schain. Lindy Snider, founder and chief executive officer of LindiSkin, advisory board member of KIND Financial and Greenhouse Ventures, is also listed as a member of the committee.

“According to the treasury department, only 301 financial institutions have reported banking cannabis cash,” says Schain. “Few federally chartered banks or credit unions will work with cannabis businesses, but two states-Washington and Maine- have banking regulators sensitive to cannabis banking and we have found 36 banks and credit unions providing financial services to cannabis enterprises.”

The goal with forming this committee is to change that and create an environment where banking for cannabis businesses is much easier. “We plan on drafting a white paper with best practices on compliant and profitable banking on behalf of cannabis-related businesses and financial institutions,” says Schain.

Working from a banker’s perspective is the key here, says Schain. They want to create a working, compliant and profitable system for banks to do business with cannabis cash. One of the problems in the meantime is the high-risk nature of dealing with cannabis companies, leading to an inability to get insurance on those accounts. In the eyes of the federal government currently, conducting cannabis-related transactions may be deemed money laundering and highly illegal. “The real issue is with the federal government and I strongly suspect this is not an issue at the top of the Trump White House agenda.”

Pennsylvania Opens Cannabis Licensing Applications

By Aaron G. Biros
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PA Secretary of Health Dr. Karen Murphy last week announced applications for growers and processors, while dispensary license applications will be available January 17, 2017. License applications will be accepted from February 20 through March 20, 2017. Governor Wolf signed the medical cannabis bill into law back in April of this year.

Philadelphia City Hall Photo: Michael Righi, Flickr
Philadelphia City Hall
Photo: Michael Righi, Flickr

“We’ve reached an important milestone in the program with the release of permit applications on January 17, 2017,” says Secretary Murphy. The PA Department of Health will issue 12 licenses for growers and processors and 27 dispensary licenses, according to Secretary Murphy’s statement. “The decision for which counties will be issued permits in this first phase was determined by using the department’s medical data, as well as comments from more than 5,000 patients and nearly 900 potential grower/processors and dispensary applicants.”

PA Capitol building in Harrisburg Photo: Harvey Barrison, Flickr
State Capitol building in Harrisburg
Photo: Harvey Barrison, Flickr

According to the Philly Voice, the highly populated Southeast region of Pennsylvania will get ten dispensary permits, including three in Philadelphia, two in Montgomery County and one in Bucks, Chester, Berks, Delaware and Lancaster counties each. The state will fully implement its medical cannabis program by 2018, but a temporary program with ‘Safe Harbor guidelines’ was effective in May of 2016, essentially allowing access for patients in the mean time, while establishing preliminary regulatory compliance guidelines.

In last week’s statement, Secretary Murphy also stressed the importance of their Physician Workgroup in developing the regulations. “We cannot underestimate the role of physicians in making sure that patients can access medical marijuana,” says Secretary Murphy. “That’s why the involvement of physicians and health care professionals through our Physician Workgroup is vital to the successful development and implementation of Pennsylvania’s Medical Marijuana Program.” The Workgroup’s recommendations include establishing quality monitoring, training for dosage recommendations while addressing rural and urban access, education and delivery.

Pennsylvania Temporary Rules for Growers & Processors Released

By Aaron G. Biros
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Last week, Pennsylvania Department of Health Secretary Dr. Karen Murphy announced the formation of temporary regulations for cannabis growers and processors in the state, according to a press release. Those temporary rules were published on Saturday, October 29. Secretary Murphy asked for public comment on developing regulations for dispensaries as well.padeptofhealthlogo-768x186

The PA Department of Health published the new set of temporary regulations this past Saturday, outlining “the financial, legal and operational requirements needed by an individual to be considered for a grower/processor permit, as well as where the facilities can be located.” The regulations also discuss tracking systems, equipment maintenance, safety issues, disposal of cannabis, tax reporting, pesticides, recalls and insurance requirements. “One of our biggest accomplishments to date is the development of temporary regulations for marijuana growers and processors,” says Secretary Murphy. “We received nearly 1,000 comments from members of the community, the industry and our legislative partners.”

The general provisions published on Saturday outline the details of the application process, fees, inspections, reporting, advertising and issues surrounding locations and zoning. The temporary regulations for growers and processors delve into the minutia of regulatory compliance for a variety of issues: including security, storage, maintenance, transportation, tracking, disposal, recall, pesticides and packaging and safety requirements. A list of pesticides permitted for use can also be found at the bottom of the rules.

PA Department of Health Secretary Dr. Karen Murphy
PA Department of Health Secretary Dr. Karen Murphy

The document discusses the regulations for performing voluntary and mandatory recalls in great detail. It requires thorough documentation and standard operating procedures for the disposal of contaminated products, cooperation with the Department of Health and appropriate communications with those affected by the recall.

The department has yet to release temporary regulations for laboratories and dispensaries, but hopes to do so before the end of the year. “I am encouraging the public – and specifically the dispensary community – to review the temporary regulations and provide us with their feedback,” says Secretary Murphy. “The final temporary regulations for dispensaries will be published in the Pennsylvania Bulletin by the end of the year.”

Since Governor Tom Wolf signed the medical cannabis program bill into law in April 2016, the state has made considerable progress to develop the program, including setting up a physician workgroup, public surveys for developing temporary rules and a request for information for electronic tracking IT solutions. The PA Department of Health expects to implement the program fully in the next 18 to 24 months.

Steep Hill Labs Expands to Pennsylvania, Washington, D.C.

By Aaron G. Biros
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Last week, Steep Hill Labs, Inc. announced plans to expand on the East Coast, including licensing for laboratories in Washington, D.C. and Pennsylvania. The cannabis testing company now is operating or developing in seven states, the District of Columbia along with an official arrangement with a research university in Jamaica, according to Cathie Bennett Warner, director of public relations at Steep Hill.

The same team of physicians that oversees the Steep Hill laboratory in Maryland will operate the Pennsylvania and D.C. labs. Heading that team is chief executive officer Dr. Andrew Rosenstein, chief of the division of Gastroenterology at University of Maryland Saint Joseph Medical Center and assistant clinical professor of Gastroenterology and Hepatology at the University of Maryland Medical Center. Dr. Rosenstein has been recognized by Baltimore Magazine as a top doctor in the Baltimore area, according to a press release.

Dr. Andrew Rosenstein, CEO of Steep Hill Maryland, PA and D.C.
Dr. Andrew Rosenstein, CEO of Steep Hill Maryland, PA and D.C.

According to Dr. Rosenstein, they want to provide accurate clinical results for trials with patients using cannabis. “All clinical trials will require a competent, credible and reliable lab partner and that is what we are bringing to the field- and that is why we are working with Steep Hill,” says Dr. Rosenstein. With team members having backgrounds in pathology, molecular diagnostics, clinical chemistry, microbiology and genetics, it should come as no surprise that they plan to participate in clinical research.

Dr. Rosenstein’s vested interest in cannabis safety stems from prior experience with his patients using cannabis. “Over the past five years, we have seen an increased number of patients using cannabis, particularly for managing the side effects of Crohn’s disease and cancer treatment,” says Dr. Rosenstein. “They would bring it up to us and at the time I didn’t know much about it, but anecdotally it’s really clear that a lot of patients have great responses to it.” Not knowing much about the preparation or safety of cannabis at the time led Dr. Rosenstein to advise patients to be very careful if they are immunocompromised.

Examination of cannabis prior to testing- credit Steep Hill Labs, Inc.
Examination of cannabis prior to testing- credit: Steep Hill Labs, Inc.

“When a patient is immunocompromised, a bacterial or fungal infection can be lethal, so because we had patients using cannabis, we wanted to make sure it was safe,” says Dr. Rosenstein. So when Maryland legalized medical cannabis, Dr. Rosenstein and his team saw the need to protect patient safety and Steep Hill was a perfect fit. “We really didn’t want to reinvent the wheel so we looked for someone to partner with,” says Dr. Rosenstein. “Steep Hill has the best technology and the best credibility and we didn’t want to compromise on quality and safety issues. They felt the same way so we partnered with them and culturally it has been a great fit.”

Steep Hill Express in Berkeley, CA- MD,PA and D.C. will have a similar offering of instant potency analysis
Steep Hill Express in Berkeley, CA- MD,PA and D.C. will have a similar offering of instant potency analysis

The new laboratories plan to offer a similar range of services that are offered at other Steep Hill labs, such as rapid potency testing for THC-A, ∆-9-THC, CBD, CBD-A and moisture. But Dr. Rosenstein sees clinical opportunities in the East Coast medical hubs. “We want to provide the testing component for studies, providing clinical reproducibility and consistency, and those are the things as a top-notch lab that we are interested in doing.”

A petri dish of mold growth from tested cannabis- Photo credit: Steep Hill-
A petri dish of mold growth from tested cannabis- Photo credit: Steep Hill Labs, Inc.

With a physician-led group that has experience in molecular diagnostics, partnering with Steep Hill is about being medically focused, according to Dr. Rosenstein. “First and foremost, this is about patient safety.” Because of that, he emphasizes the need for required microbiological contaminant testing, particularly because of his experience with patients. “If you’re a cancer patient and you get a toxic dose of salmonella or E. coli, that can kill you, so testing for microbiologic  contamination is of the highest priority.”

According to Warner, bridging the medical cannabis science gap with Steep Hill’s professionalism and experienced doctors practicing medicine is a big deal. “We are working very closely with their medical team to make sure these standards are medically superior,” says Warner. “To have these doctors with such a high level of knowledge in medicine working with us in cannabis analytics is a breakthrough.”