Philly hospitals, medical schools jockey for marijuana partners

The University of the Sciences this week became the latest academic player to announce it was getting into marijuana research.

The school is pairing with Franklin BioScience, a large grower out of Denver, to create more consistent marijuana products and develop a cannabis education program for pharmacists, physicians, and students planning on entering the health professions.

Big marijuana is banking on Pennsylvania to become a major hub of the burgeoning legal cannabis sector, which last year was valued at $6.7 billion nationwide and is expected to balloon to over $21 billion by 2021, according to estimates by the Arcview Group.

When the commonwealth legalized medical marijuana last year, it was the first in the United States to include provisions for the academic study of the plant and its derivatives.

The law carves out eight permits for medical schools, which are called Academic Clinical Research Centers (ACRCs). But the interest for those slots among hospitals and universities has outpaced the number of permits. A green rush of companies is courting a wide range of health institutions in hopes of forging partnerships that each could be worth tens of millions of dollars.

These partnerships are also being assembled before the regulations are complete, so some deals could be made moot. The regulations to govern the academic permits are expected to be released in early January.

If the Pennsylvania Department of Health approves the partnerships, each cannabis company can operate a marijuana grow house, a processing facility that will turn plant materials into legal oils, and six dispensaries.

The prospect of the "Godzilla licenses" has irked the smaller 12 grower/processors and dozens of dispensaries that won permits in July after a grueling and highly competitive process. Under the current draft regulations governing ACRCs, there is no requirement for growers to be competitively scored by the state. Rumors have swirled for months about schools accepting millions of dollars from high-bidding cannabis companies in exchange for the use of their names.

Six Pennsylvania medical schools have struck deals to partner with marijuana growers, according to industry insiders. Those include Drexel, Temple, and Thomas Jefferson Universities, the University of Pennsylvania, the University of Pittsburgh Medical Center (UPMC) and Lake Erie College of Osteopathic Medicine (LECOM).

Of those half-dozen large institutions, only the arrangements between Temple and Laurel Harvest Labs and LECOM and grower Franklin Labs have been made public. Franklin Labs, which is not related to Franklin BioScience, is a Reading-based company headed by John Hanger, a former adviser to Gov. Wolf.

The potential revenues, and opportunities for research, have spurred smaller schools and independent hospitals to jockey for arrangements of their own. Last week, Children's Hospital of Philadelphia said it had joined with an Australian biopharmaceutical company to investigate the effectiveness of marijuana-derived medicines for autistic children.

Philadelphia College of Osteopathic Medicine said Friday it was "negotiating with several companies." A PCOM spokeswoman said she could not provide any additional details due to non-disclosure agreements.

Franklin BioScience, the USciences partner, won permits in July to open three medical marijuana dispensaries in Southeastern Pennsylvania. The first of those is set to open in Bristol in early 2018. Two additional sites are pending state approval. It also operates grow houses in Colorado and Nevada and markets the cannabis brands Lucky Edibles and Altus Labs.

The collaboration will also include "significant" research to create medical marijuana products "with more consistency and reliability," said Helena Yardley, Franklin BioScience's head of scientific research operations. "Pennsylvania, with their educational facilities, is in a powerful position to be one of the R&D capitals of this industry."

The partnership will build on the work of the school's Substance Use Disorders Institute, said Andrew Peterson, a USciences dean. USciences already offers the certification courses for health-care providers who want to recommend medical marijuana to their patients.

For more information about medical marijuana in Pennsylvania, including information on how to enroll in the program, visit medicalmarijuana.pa.gov. For complete cannabis coverage in Pa. and New Jersey, go to philly.com/cannabis.