Dan Clearfield discusses regulatory obstacles facing the medical marijuana industry in PA (The Sentinel)

May 2, 2016

Dan Clearfield, a leading attorney in Eckert Seamans’ Regulated Substances Group, was quoted recently in a two-part series in The Sentinel about the future of the medical marijuana industry in Pennsylvania.

In the April 29 article “Medical marijuana: Building a legal industry,” Clearfield discussed potential underlying problems states face when making a legal industry out of what remains a schedule 1 drug, banned by the federal government.

“The industry that’s set up in these states … that’s all at risk if a new president comes in and decides to vigorously enforce (federal law),” Clearfield said. “…When you have an industry, that is a multi-million dollar industry, that’s an additional risk factor that you have to consider.”

“For tax purposes you have trouble declaring any income or expenses associated with (the business),” Clearfield said. “With respect to banks, most federally charted banks have decided they do not want to take revenue or income from marijuana sales.”

Clearfield said in Colorado, which legalized recreational use of marijuana, businesses were largely operating as cash only.

“My understanding is that other businesses have stepped in and are kind of working as shadow banks,” Clearfield said. “The difference is those banks are not federally guaranteed or insured and there are other limitations.”

In the May 1 article “Medical marijuana: What happens next in Pa.?” Clearfield said, “The high level headline is that Pennsylvania joined one of 23 other states and the District (of Columbia) in legalizing the use of marijuana for medical uses only.”

Doctors will be able to prescribe certain forms of marijuana to patients who meet some general requirement and are suffering from one of the approved medical conditions. However, while the law was enacted this month, it may be more than a year before patients can begin receiving medical marijuana.

“There’s a very detailed regulatory process that’s been created,” Clearfield said. “Medical marijuana that’s used in Pennsylvania, has to be from Pennsylvania. It has to be grown here. It has to be processed here and it will be tracked from cradle to grave, from seed to use.”

All of this regulation takes time.

“The process itself of creating regulations and dispensing licenses is probably going to take [–] we’re estimating a best case 12 to 13 months and probably 18 months before licenses are issued,” he said.

The full articles are available on The Sentinel website. (Access to content on third-party websites may require subscription.)

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