SAFE Banking Act Reintroduced in U.S. Senate – Cannabis Dispensary

Following news of Harvest Health & Recreation’s latest acquisition, officials at the Pennsylvania Department of Health issued a response to the company, calling the press release’s contents a “blatant misrepresentation.” Philadelphia Inquirer reporter Sam Wood III first reported this exchange.

On April 9, Harvest Health & Recreation announced that it had entered into a binding, definitive agreement to acquire CannaPharmacy Inc., which holds a grower-processor license in Pennsylvania along with other cannabis business licenses in Delaware, New Jersey and Maryland. The move, once approved and closed, would place Harvest operations in 213 cannabis facilities, 130 dispensaries and 17 U.S. states. But whether those assets mean that Harvest holds those business licenses is a matter that the Pennsylvania Department of Health is calling out. 

The health department threatened to revoke Harvest’s existing licenses because of how the company’s management was communicating its holdings in Pennsylvania.

CannaPharmacy is the owner of Franklin Labs LLC in Pennsylvania, which owns a 46,800-square-foot cultivation facility in Reading, Pa. Harvest’s management team touted this expansion of its Mid-Atlantic footprint in a press release announcing the M&A news.

John Collins, the department’s director of the Office of Medical Marijuana, wrote in his April 10 letter to Harvest Health & Recreation CEO Steve White that “permits are nontransferable [in Pennsylvania]. … Accordingly, even after completion of the acquisition, Franklin Labs LLC will retain ownership of the permit and Harvest Health & Recreation Inc. may not represent that it owns the permit issued to Franklin Labs LLC.”

Harvest’s transaction is “subject to satisfaction of customary closing conditions, including receipt of regulatory approvals in the relevant states,” according to the press release accompanying the news. It’s a standard provision of M&A transaction announcements, but this response from Pennsylvania authorities opens up a discussion about how licenses, as assets, are transferred

Read More Here...

Leave a comment

Your email address will not be published. Required fields are marked *