Justice Grown Wasn’t ‘Slapped’ for Selling $1 Cannabis, It Was How They Did It
Edwardsville dispensary Justice Grown was forced to wait a week while other dispensaries around the state got the chance to sell the first legal flower in Pennsylvania. But when they got the green light this past week, Justice Grown did it in style.
For one day on August 8, the company ran what it called the ‘Flower Power Party,’ an event where select Terrapin-grown strains of ‘small buds’ were offered for $1 a gram. These buds were offered at other dispensaries for $10 per gram or $25 an eighth, part of a special offer from the Pennsylvania grower-processor.
Terrapin told PA Cannabis Report that while the future of small buds were “uncertain,” the effort was part of “a measure we took to ensure that the demand of the patient population was met.” While wholesale prices were cheaper than standard offerings, it was definitely more than $1.
That didn’t stop Justice Grown, though. The company was selling these grams as a loss, perhaps in the hopes that patients would buy other products with positive profit margins (known as a “loss leader” in retail). The Department of Health was none too pleased, and contacted company officials.
While the dispensary itself said in a Facebook post that the event was “not a discount, it’s just how it is priced,” the DOH considered it a sale in the way it was promoted.
“It’s in the law,” Department of Health spokeswoman April Hutcheson told the Philadelphia Inquirer this week. “The law prohibits discounts. You can’t run a promotional sale on medical marijuana. We let them know that they were in violation.”
More than 100 patients took advantage of the pricing, even after the dispensary was apparently told the event was not permitted. Justice Grown itself defended the practice, with CEO Abbe Kruger reiterating what company representatives had already said on Facebook.
“It didn’t even fit the definition of a discount because it had never been priced before,” Kruger told the Inquirer. “We just priced it that low.” So is the DOH mandating some type of pricing? Not at all, it says.
“The medical marijuana program is set up on the free market, allowing patients to visit which ever dispensary they feel offers the best product for the best price,” a DOH spokesperson told PA Cannabis Report when asked whether dispensaries could choose to sell product at a net loss. “Dispensaries do not need to have their prices approved by the state.”
This likely means that a dispensary in theory could do what Justice Grown did, but any type of promotion around it would be prohibited. The DOH did reiterate that dispensaries are allowed to offer discounts “to certain groups.”
Interestingly enough, another one-day promotion popped up on Wednesday from Pittsburgh-based Solevo Wellness. There, select Terrapin carts and Moxie badder and shatter was promotionally priced, and it isn’t clear how this was any different from what Justice Grown had done.
“The state has recently relaxed some rules and we’re testing it out today as a thank-you,” it said, noting that its pricing on menus would reflect normal pricing.
So far, it appears that the DOH has not reached out to Solevo, although they may have cleared it with the Department first — perhaps as a way to clear out slow-moving stock.
