Harvest’s deal with Pa. cannabis regulators wasn’t just about dispensary licenses, documents show

While it lost two licenses, it is also barred from any new “management services agreements” and must fund $400,000 to a new cannabis discount program

The headlines surrounding Friday’s deal with Arizona-based cannabis retailer Harvest centered around the loss of two dispensary permits. However, documents obtained late Friday by Pennsylvania Cannabis Report indicate the agreement is far-reaching and in the Department of Health’s favor.

Perhaps of most importance to Pennsylvania patients is an agreement to set up a new product discount program. The remaining five entities must contribute $40,000 yearly to a “restricted account” for the next two years. The funds would be used to offer discounts to eligible patients, and Harvest would be required to exhaust all funds and provide quarterly reports to the DOH.

Under the agreement, patients participating in SNAP, WIC, CHIP, Medicaid, PACE, and PACENET would be eligible. Harvest was ordered to start the program by March 1, 2020, the settlement read.

Harvest also cannot pursue any new “management services agreements,” a strategy it used to take control of AgriMed and Franklin Labs earlier this year, for two years.

The Arizona company was also ordered to either continue with its current MSA with AgriMed, or establish one with Franklin Labs, but it could not hold both.

Harvest has also agreed to supply any documentation initially requested in April as part of the DOH’s investigation. The company had earlier argued that the state had no right to request the information under Pa. law.

Not all was bad news for Harvest. The DOH agreed to refund Harvest the application fees totaling $60,000 for the two relinquished permits. Its permit renewal for the initial dispensary license it held would be renewed, which had been held up by the DOH action.

The DOH will also schedule inspections for four Harvest locations across the state by September 4. Those locations weren’t specified in the settlement agreement. However, a statement from the company indicates this refers to the second Reading location on Lancaster Avenue, as well as dispensaries in Scranton, Johnstown, and Harrisburg.

Planned dispensaries in New Castle and Shamokin would no longer open due to the loss of the permits in the North Central and Northwest regions of the state.

PCR did not reach out to Harvest nor the DOH as the settlement agreement specifically stated that both sides were barred from commenting on the settlement to the media.