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Pennsylvania Judge Halts State's Plans for Medical Cannabis Research

After Gov. Tom Wolf announced that eight universities would be receiving specialized cannabis research permits, several state-licensed cultivation and dispensary businesses cried foul.

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Earlier this year, Pennsylvania officials announced their plans to launch the country's first comprehensive medical cannabis research program, in which eight state universities would be licensed to conduct comprehensive marijuana studies. But those plans are now on hold, after a local judge issued a preliminary injunction preventing the state Department of Health (DOH) from awarding additional cannabis licenses to businesses wishing to partner with these research institutions.

In early May, Governor Tom Wolf announced that eight state schools would be receiving cannabis research permits, including the Lewis Katz School of Medicine at Temple University and the Perelman School of Medicine at the University of Pennsylvania. Wolf noted the great difficulties that researchers wishing to explore the benefits and risks of medical cannabis face, due to the federal prohibition of marijuana.

These new regulations would allow each of these universities to directly contract with a third party, known as a Clinical Registrant (CR), and each CR would also be allowed to open their own cultivation and processing facility, as well as six dispensaries, putting them in competition with the state's existing medical cannabis market. But unlike the state's current licensees, who have had to undergo a rigorous application process in order to get their licenses, the only requirement for these new businesses is that they have $15 million in capital and a contract with the school.

A group of 11 medical cannabis cultivation and dispensary licensees have mounted a legal challenge against this aspect of the law, arguing that the institutions that receive these new licenses should be restricted to exclusively doing research. These businesses also argued that their market value dropped after the state announced their new research plans "because it signaled to investors that the department would treat the act's statutory limit on permits as a suggestion rather than a mandate," the Associated Press reports.

"After they have spent tens of millions of dollars and actually hold a permit… the rules of the game have changed," Judith Cassel, attorney for the plaintiffs, said to the Tribune-Review. "The Department of Health is creating these eight super permits, and none of these CRs have to go through the very stringent vetting process the folks we represent went through."

Commonwealth Court Judge Patricia McCullough agreed, and issued a preliminary injunction against the state's licensing process. "The regulations appear to be inconsistent with the legislative intent of Chapter 20, which was to permit distribution of medical marijuana for purposes of and in conjunction with research studies conducted jointly" with the universities, McCullough wrote. The judge also noted that the regulations "require only a minimal commitment to research" from the CRs.

Cassel said that the plaintiffs were "thrilled" with the ruling in their favor, but added that the legal challenge would not necessarily delay the state's rollout of their research program. "We feel that by DOH taking another look at the regulations, they will find that having clinical registrants exclusively do research protects the integrity of the research process," she said to the Philadelphia Inquirer.

Health Department spokesperson April Hutcheson said that the state was considering its legal options in the case. "Research is a vital component of Pennsylvania's medical marijuana program to improve treatment options for patients suffering from serious medical conditions, including opioid-use disorder," Hutcheson said to the Associated Press. "The research program was rolled out in consultation with the sponsors of the original legislation and our approach was meant to ensure lower costs, more accessibility, and groundbreaking treatments."

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