Medical marijuana in Pa.: Entrepreneurs position, prepare for new industry


If Pennsylvania legalizes medical marijuana, Tom Perko plans to go underground -- exactly 100 feet deep.

He's a partner in Keystone Organic Farms, which has an agreement to lease space to grow medical marijuana in an old limestone mine near Gibsonia in western Pennsylvania.

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Around the state, others are tweaking business plans and license applications, evaluating soil and lighting systems and lining up warehouse space. "Our business plan is ready ... We have positions filled and everything," said a Halifax-area man who is part of a group which plans to apply for a license, and who said he wasn't ready to be publicly identified.

Legalizing medical marijuana would trigger a new Pennsylvania industry worth an estimated $333 million to $665 million per year.

The chances of that appear stronger than ever. A Quinnipiac University poll in March concluded that 85 percent of state residents support allowing medical marijuana. The state Senate voted 40-7 to do so, and Gov. Tom Wolf says he would quickly sign the bill, now stuck in a state House committee.

The bill, authored by Republican state Sen. Mike Folmer of Lebanon County, establishes the framework for a medical marijuana industry that would include up to 65 growers, 65 processors and 130 dispensers. Each would pay $50,000 for a state license.

Only indoor growing would be allowed. Perko says his underground operation, in addition to meeting that requirement, could easily provide the high level of security called for in the bill. Other advantages include a stable year-round temperature and natural protection against insect pests.

The vast former mine is already occupied by commercial uses including storage of documents and other climate-sensitive items, Perko says.

He says his group has been evaluating soils and lighting for several years. Perko and a partner, Russ Cersosimo Jr., also have launched a trade group, the Pennsylvania Medical Cannabis Society, to lobby on behalf of the industry, and to connect and advise prospective players.

Cersosimo says the group has been contacted by several hundred people interested in having a role in the industry. It hosted two "meet ups" in the Pittsburgh area, with each drawing 50 or more people. They plan to launch a trade magazine by fall, and to soon have staff based in the Harrisburg and Philadelphia areas.

With Pennsylvania's legalization effort drawing national attention, it also is attracting attention from out-of-state firms seeking to advise and provide services to Pennsylvania firms looking to enter the medical marijuana business, according to Cersosimo. He says some lack the expertise they claim, so one of the roles of the association is to evaluate consultants and vendors and make sure they are legitimate.

Perko's background is in business and meat processing. Cersosimo, 35, says he spent the early part of his career working for his father's security company, and later founded a data services company.

Keystone Organic Farms intends to apply for licenses in all three categories -- growing, processing and dispensing. However, Perko says he expects most applicants will seek only one type of license.

He predicts many of the businesses will provide "20 to 50 family-sustaining jobs right out of the gate."

"The job opportunities that are going to open up in this industry are significant," says Nina Beedle, the CEO of Pennsylvania Medical Cannabis Society. Beedle says she previously spent 17 years in an assortment of administrative and management roles in the plastic surgery department of the University of Pittsburgh Medical Center.

Medical marijuana is already allowed, in varying forms, in 23 states and Washington, D.C. A sample of medical marijuana jobs includes: lawyers specializing in legal and regulatory aspects; cannabis trimmers and various production workers; security guards; administrators and marketers; and "bud specialists" to work in dispensaries and advise customers about doses, strains and forms of medical cannabis, which can involve liquid extracts and edibles. The current version of the Pennsylvania law wouldn't allow smokable forms.

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There would also be various jobs needed to support the industry, including packaging manufacturers, testing labs and lighting and solar panel suppliers. In addition, the industry is expected to lead to extensive medical marijuana research in the state.

The estimates regarding potential medical marijuana revenues come from an analysis by the state Senate appropriations committee.

They are based on medical marijuana use in Colorado, where annual sales total about $3,800 for each person with an access card. The committee estimates between about 100,000 to 200,000 Pennsylvania residents will obtain a state health department-issued card enabling them to buy medical marijuana. Some experts say it can take about four years to establish a medical marijuana program, but some Pennsylvania supporters including Perko say it can be running strong within two years.

Still, some states have had slow uptake and low sales, due to factors including reluctance of doctors to prescribe medical marijuana. Some of those states, however, have narrower lists of approved conditions for medical marijuana.

Folmer says his bill was drafted after considering what has worked and what hasn't worked in other states. He says he believes the bill can not only give Pennsylvania a well-regulated, well-functioning program, but serve as a "model" for other states.