Ohio’s seed to sale process for producing medical marijuana. Michael Nyerges, Cincinnati Enquirer
COLUMBUS – State regulators have fined a medical marijuana company $300,000 for failing to get approval for a change in ownership.
Greenleaf Apothecaries, which owns five dispensaries, will have to pay that penalty, repay $12.5 million in loans issued by international cannabis company Acreage Holdings and abide by additional restrictions in order to transfer ownership to Acreage in the future.
The agreement allows the company to open dispensaries in Akron, Cleveland and Columbus in the coming weeks, after they clear final inspections.
The Ohio State Board of Pharmacy claimed Greenleaf Apothecaries was really under the control of Acreage Holdings, one of the industry’s largest multi-state operators. Greenleaf Apothecaries opened one dispensary in Canton and one in Wickliffe, both under Acreage brand name The Botanist.
In July 2018, Acreage entered into a “management services contract” with Greenleaf Apothecaries, and agreed to loan the company up to $10.5 million, according to investor filings with the U.S. Securities Exchange Commission. It had similar agreements with related companies Greenleaf Gardens, a cultivator, and Greenleaf Therapeutics, a marijuana product manufacturer.
Ohio rules prohibit dispensaries from changing hands until after they’ve been in operation for one year.
In the settlement agreement, Greenleaf Apothecaries stated it had a “good faith basis to believe it was in compliance” with state rules but it acknowledged its agreements with Acreage are “contrary” to the pharmacy board’s interpretation of the rules. The company has modified its management services agreement to comply.
The company is also barred from applying to transfer ownership of any of its five locations until 18 months after the last dispensary becomes operational. Greenleaf Apothecaries must also repay $3 million advanced by