HOUSE AMENDED
PRIOR PRINTER'S NOS. 860, 1105, 1191 PRINTER'S NO. 1229
THE GENERAL ASSEMBLY OF PENNSYLVANIA
SENATE BILL
No. 773
Session of
2023
INTRODUCED BY GEBHARD, STEFANO, BARTOLOTTA, ROBINSON, COSTA,
CULVER, LAUGHLIN AND LANGERHOLC, JUNE 8, 2023
AS AMENDED ON SECOND CONSIDERATION, HOUSE OF REPRESENTATIVES,
NOVEMBER 14, 2023
AN ACT
1 Amending the act of April 17, 2016 (P.L.84, No.16), entitled "An <--
2 act establishing a medical marijuana program; providing for
3 patient and caregiver certification and for medical marijuana
4 organization registration; imposing duties on the Department
5 of Health; providing for a tax on medical marijuana
6 organization gross receipts; establishing the Medical
7 Marijuana Program Fund; establishing the Medical Marijuana
8 Advisory Board; establishing a medical marijuana research
9 program; imposing duties on the Department of Corrections,
10 the Department of Education and the Department of Human
11 Services; and providing for academic clinical research
12 centers and for penalties and enforcement," in preliminary
13 provisions, further providing for definitions; in medical
14 marijuana organizations, further providing for APPLICATION <--
15 AND ISSUANCE, FOR limitations on permits and providing for
16 additional dispensary AND GROWER/PROCESSOR permits <--
17 authorized, for application and issuance of additional
18 dispensary permits and for limitations on other additional <--
19 permits or licenses; and, in academic clinical research
20 centers and clinical registrants, further providing for
21 definitions.
22 AMENDING THE ACT OF APRIL 17, 2016 (P.L.84, NO.16), ENTITLED "AN <--
23 ACT ESTABLISHING A MEDICAL MARIJUANA PROGRAM; PROVIDING FOR
24 PATIENT AND CAREGIVER CERTIFICATION AND FOR MEDICAL MARIJUANA
25 ORGANIZATION REGISTRATION; IMPOSING DUTIES ON THE DEPARTMENT
26 OF HEALTH; PROVIDING FOR A TAX ON MEDICAL MARIJUANA
27 ORGANIZATION GROSS RECEIPTS; ESTABLISHING THE MEDICAL
28 MARIJUANA PROGRAM FUND; ESTABLISHING THE MEDICAL MARIJUANA
29 ADVISORY BOARD; ESTABLISHING A MEDICAL MARIJUANA RESEARCH
30 PROGRAM; IMPOSING DUTIES ON THE DEPARTMENT OF CORRECTIONS,
31 THE DEPARTMENT OF EDUCATION AND THE DEPARTMENT OF HUMAN
32 SERVICES; AND PROVIDING FOR ACADEMIC CLINICAL RESEARCH
 1 CENTERS AND FOR PENALTIES AND ENFORCEMENT," IN PRELIMINARY
2 PROVISIONS, FURTHER PROVIDING FOR DEFINITIONS; IN MEDICAL
3 MARIJUANA ORGANIZATIONS, FURTHER PROVIDING FOR APPLICATION
4 AND ISSUANCE, FOR LIMITATIONS ON PERMITS AND PROVIDING FOR
5 ADDITIONAL DISPENSARY AND GROWER/PROCESSOR PERMITS
6 AUTHORIZED, FOR APPLICATION AND ISSUANCE OF ADDITIONAL
7 PERMITS AND FOR LIMITATIONS ON OTHER ADDITIONAL PERMITS OR
8 LICENSES; AND, IN ACADEMIC CLINICAL RESEARCH CENTERS AND
9 CLINICAL REGISTRANTS, FURTHER PROVIDING FOR DEFINITIONS.
10 The General Assembly of the Commonwealth of Pennsylvania
11 hereby enacts as follows:
12 Section 1. Section 103 of the act of April 17, 2016 (P.L.84, <--
13 No.16), known as the Medical Marijuana Act, is amended by adding
14 definitions to read:
15 Section 103. Definitions.
16 The following words and phrases when used in this act shall
17 have the meanings given to them in this section unless the
18 context clearly indicates otherwise:
19 * * *
20 "Change of control transaction." The consolidation, merger
21 or acquisition by a person or group of persons acting in concert
22 of more than 20% of:
23 (1) a medical marijuana organization's securities or
24 other ownership interests, with the exception of any
25 ownership interest of the person that existed at the time of
26 the issuance of the initial medical marijuana organization's
27 permit and payment of the initial permit; or
28 (2) the securities or other ownership interests of a
29 corporation or other form of business entity which owns
30 directly or indirectly 20% of the securities or other
31 ownership interests of the medical marijuana organization.
32 * * *
33 "DIVERSE GROUP." THE TERM SHALL MEAN THE SAME AS UNDER <--
34 SECTION 615(D).
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 1 * * *
2 "INDEPENDENT DISPENSARY." A DISPENSARY ISSUED A PERMIT TO
3 OPERATE IN THIS COMMONWEALTH AND THAT MEETS ALL OF THE
4 FOLLOWING:
5 (1) HAS NOT HAD THE DISPENSARY'S PERMIT REVOKED.
6 (2) HAS NOT ENTERED INTO A CHANGE OF CONTROL TRANSACTION
7 WITH ANY OTHER PERSON.
8 (3) IS NOT MATERIALLY THE SAME AS A MEDICAL MARIJUANA
9 ORGANIZATION IN THIS COMMONWEALTH THROUGH A PARENT COMPANY,
10 SUBSIDIARY OR SHARED AFFILIATION WITH ANOTHER ENTITY THAT
11 HOLDS A PERMIT FROM THE DEPARTMENT UNDER THIS ACT OR THROUGH
12 THE SHARING OF PRINCIPALS, OFFICERS OR DIRECTORS, EMPLOYEES,
13 FACILITIES, EQUIPMENT, FINANCES OR CAPITAL.
14 "Independent grower/processor." A grower/processor awarded a
15 permit to operate in this Commonwealth that meets all of the
16 following criteria as of the effective date of this definition:
17 (1) Has not had its permit revoked.
18 (2) Has not entered into a merger, acquisition or other <--
19 change of control transaction with any other entity that was
20 awarded a grower/processor permit, a dispensary permit or a
21 clinical registrant permit in this Commonwealth. CHANGE OF <--
22 CONTROL TRANSACTION WITH ANY OTHER PERSON.
23 (3) Is not otherwise associated with or materially the <--
24 same as another MATERIALLY THE SAME AS A medical marijuana <--
25 organization in this Commonwealth through a parent company or
26 subsidiary of another entity that holds a permit from the
27 department under this act or through the sharing of
28 PRINCIPALS, officers or directors, employees, facilities, <--
29 equipment, finances or capital.
30 * * *
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 1 "Materially the same." A person who shares any of the
2 following with another person:
3 (1) Profits or losses.
4 (2) Common valuation, in the case of a publicly traded
5 company.
6 (3) Common ownership of 5% or greater, including <--
7 subsidiaries. MORE THAN 5%, INCLUDING SUBSIDIARIES. <--
8 (4) COMMON OWNERSHIP OF 5% OR LESS IF THE PERSONS WITH
9 VOTING RIGHTS TO ELECT OR APPOINT ONE OR MORE MEMBERS OF THE
10 BOARD OF DIRECTORS OR OTHER GOVERNING BOARD.
11 (5) COMMON MANAGEMENT, POLICIES, PRINCIPALS, OFFICERS,
12 DIRECTORS, EMPLOYEES, EQUIPMENT, FINANCES OR CAPITAL.
13 * * *
14 "Parent company." A company which directly or indirectly
15 controls any other permittee under this act.
16 * * *
17 "Person." A natural person, corporation, foundation,
18 organization, business trust, estate, limited liability company,
19 licensed corporation, trust, partnership, limited liability
20 partnership, association or other form of legal business entity.
21 * * *
22 Section 2. Section 616(5) of the act is amended to read: <--
23 SECTION 2. SECTIONS 606(A)(1) AND 616(5) OF THE ACT ARE <--
24 AMENDED TO READ:
25 SECTION 606. APPLICATION AND ISSUANCE.
26 (A) DUTY TO REPORT.--AN APPLICANT TO BE A GROWER/PROCESSOR
27 OR TO OPERATE A DISPENSARY IS UNDER A CONTINUING DUTY TO:
28 (1) REPORT TO THE DEPARTMENT ANY CHANGE IN FACTS OR
29 CIRCUMSTANCES REFLECTED IN THE APPLICATION OR ANY NEWLY
30 DISCOVERED OR OCCURRING FACT OR CIRCUMSTANCE WHICH IS
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 1 REQUIRED TO BE INCLUDED IN THE APPLICATION, INCLUDING A
2 CHANGE IN CONTROL OR CHANGE OF CONTROL TRANSACTION OF THE
3 MEDICAL MARIJUANA ORGANIZATION.
4 * * *
5 Section 616. Limitations on permits.
6 The following limitations apply to approval of permits for
7 grower/processors and dispensaries:
8 * * *
9 (5) [No] Except as provided under section 617, no more
10 than five grower/processors may be issued permits as
11 dispensaries. [If the number of growers/processors is <--
12 increased under section 1202, no more than 20% of the total
13 number of growers/processors may also be issued permits as
14 dispensaries.] <--
15 * * *
16 Section 3. The act is amended by adding sections to read:
17 Section 617. Additional dispensary permits authorized. <--
18 (a) Authorization.--An independent grower/processor that
19 applies and meets the requirements under section 618 shall be
20 issued two dispensary permits.
21 SECTION 617. ADDITIONAL DISPENSARY AND GROWER/PROCESSOR PERMITS <--
22 AUTHORIZED.
23 (A) AUTHORIZATION.--
24 (1) AN INDEPENDENT GROWER/PROCESSOR THAT APPLIES AND
25 MEETS THE REQUIREMENTS UNDER SECTION 618 SHALL BE ISSUED ONE
26 DISPENSARY PERMIT.
27 (2) AN INDEPENDENT DISPENSARY THAT APPLIES AND MEETS THE
28 REQUIREMENTS UNDER SECTION 618 SHALL BE ISSUED ONE
29 GROWER/PROCESSOR PERMIT.
30 (b) Rights and privileges.--The dispensary permits issued <--
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 1 under this section shall carry the same rights, privileges and
2 obligations as dispensary permits issued under this chapter. <--
3 (c) Dispensing and facility requirements.--The dispensary <--
4 permits issued under this section shall be subject to the
5 requirements in Chapter 8.
6 (d) (C) Suspension or revocation prohibited.--The department <--
7 may not suspend, revoke or withdraw a permit or fail to renew OR <--
8 REVOKE the permit of an entity that receives a dispensary permit <--
9 under this section due to the entity ceasing to qualify as an <--
10 independent grower/processor ENTERING INTO A CHANGE OF CONTROL <--
11 TRANSACTION WITH ANY PERSON AT LEAST TWO YEARS after the holder
12 of the dispensary permit becomes operational in this
13 Commonwealth. Nothing in this section shall prohibit the
14 department from taking action for a violation of section 618(a)
15 (4).
16 Section 618. Application and issuance of additional dispensary <--
17 permits.
18 (a) Applications.--
19 (1) The department shall develop a standard application
20 form and make the form available to independent
21 grower/processors that apply for dispensary permits
22 authorized under section 617.
23 (2) The department shall, within 30 days of the
24 effective date of this paragraph, accept applications from
25 independent grower/processors for dispensary permits
26 authorized under section 617.
27 (3) The department shall review applications for
28 dispensary permits authorized under section 617 within 30
29 days of receipt of an application under paragraph (1) from an
30 eligible independent grower/processor.
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 1 (4) The department shall require an applicant for a
2 dispensary permit authorized under section 617 to certify to
3 the department in the application that the applicant will not
4 enter into a merger, acquisition, change of control
5 transaction or otherwise become associated with or materially
6 the same as another medical marijuana organization, entity or
7 person that holds a permit from the department for a duration
8 of one year from the date on which the independent
9 grower/processor receives an operational certificate from the
10 department.
11 (b) Issuance.--
12 (1) The department shall issue dispensary permits within
13 15 days of review of applications received under this section
14 to all applicants that meet the minimum requirements for
15 permitting under this chapter. The department shall notify an
16 applicant for dispensary permits authorized under section 617
17 of the approval of an application by certified mail or email.
18 (2) If an applicant under this section does not meet the
19 minimum criteria for permitting, the department shall notify
20 the applicant by certified mail or email within 15 days of
21 review of the application which shall include deficiencies in
22 the application and unmet requirements.
23 (3) If the department denies an application for
24 dispensary permits authorized under section 617, no later
25 than 15 days after completing the review under subsection (a)
26 (2), the department shall notify the applicant of the denial
27 by certified mail or email. The notice shall include each
28 deficiency in the application that does not meet the
29 requirements to be issued a permit under this act.
30 (4) If the department determines that an application is
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 1 complete but lacks sufficient information upon which to make
2 a determination, the department shall notify the applicant in
3 writing of the factors that require additional information
4 and documentation. The following apply:
5 (i) Except as provided under subparagraph (iv), an
6 applicant has 30 days from the mailing date of the notice
7 under this paragraph to provide the requested information
8 and documentation to the department.
9 (ii) An applicant's failure to provide the requested
10 information to the department by the deadline may be
11 grounds for denial of the issuance of the dispensary
12 permit.
13 (iii) Nothing in this paragraph requires the
14 department to request additional or supplemental
15 information from an applicant if the application is
16 deemed complete under paragraph (1).
17 (iv) Upon showing of good cause, the department may
18 extend the deadline in subparagraph (i) one time for up
19 to an additional 15 days.
20 (v) The department shall make a determination on the
21 issuance of the dispensary permit within 15 days of
22 receipt of the requested information or documentation
23 required to make a determination.
24 (5) Upon request for inspection or reinspection for an
25 operational certificate, the department shall inspect the
26 dispensary location within 30 days of request by certified
27 mail or email.
28 (6) Appeals to the issuance or denials of dispensary
29 permits under this section must be responded to by the
30 department within 30 days of submittal.
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 1 (D) PERMIT FOR CLINICAL REGISTRANT.--NOTWITHSTANDING <--
2 SUBSECTION (C) OR SECTION 619, AN INDEPENDENT GROWER/PROCESSOR
3 OR INDEPENDENT DISPENSARY THAT APPLIES FOR A PERMIT TO CONVERT
4 TO A CLINICAL REGISTRANT UNDER SECTION 2002 SHALL SURRENDER A
5 GROWER/PROCESSOR PERMIT OR DISPENSARY PERMIT, OR BOTH,
6 PREVIOUSLY ISSUED TO THE INDEPENDENT GROWER/PROCESSOR OR
7 INDEPENDENT DISPENSARY.
8 SECTION 618. APPLICATION AND ISSUANCE OF ADDITIONAL PERMITS.
9 (A) APPLICATIONS.--
10 (1) THE DEPARTMENT SHALL DEVELOP A STANDARD APPLICATION
11 FORM AND OPEN APPLICATIONS FOR PERMITS AUTHORIZED UNDER
12 SECTION 617 WITHIN 30 DAYS OF THE EFFECTIVE DATE OF THIS
13 PARAGRAPH.
14 (2) APPLICANTS UNDER THIS SECTION SHALL, WITHIN 60 DAYS
15 AFTER APPLICATIONS ARE POSTED, SUBMIT APPLICATIONS FOR
16 PERMITS AUTHORIZED UNDER SECTION 617.
17 (3) THE DEPARTMENT SHALL REVIEW APPLICATIONS FOR PERMITS
18 AUTHORIZED UNDER SECTION 617 WITHIN 45 DAYS OF RECEIPT OF AN
19 APPLICATION UNDER PARAGRAPH (1) FROM AN ELIGIBLE INDEPENDENT
20 GROWER/PROCESSOR OR INDEPENDENT DISPENSARY.
21 (4) AN APPLICATION FOR A PERMIT AUTHORIZED UNDER SECTION
22 617 SHALL REQUIRE:
23 (I) SUPPORTING DOCUMENTATION AND CERTIFICATION TO
24 THE DEPARTMENT THAT THE APPLICANT QUALIFIES AS AN
25 INDEPENDENT GROWER/PROCESSOR OR INDEPENDENT DISPENSARY.
26 (II) CERTIFICATION TO THE DEPARTMENT THAT THE
27 APPLICANT WILL NOT ENTER INTO A CHANGE OF CONTROL
28 TRANSACTION WITH ANY OTHER PERSON FOR A DURATION OF TWO
29 YEARS FROM THE DATE THE FIRST DISPENSARY LOCATION OR
30 GROWER/PROCESSOR LOCATION IS DEEMED OPERATIONAL BY THE
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 1 DEPARTMENT, UNLESS THE CHANGE OF CONTROL TRANSACTION
2 OCCURS AT LEAST ONE YEAR AFTER THE HOLDER OF THE PERMIT
3 BECOMES OPERATIONAL AND IS BETWEEN THE APPLICANT AND A
4 DIVERSE GROUP.
5 (III) ANY INFORMATION REQUIRED UNDER SECTION 602
6 THAT HAS SIGNIFICANTLY CHANGED SINCE THE APPLICANT
7 RECEIVED AN INITIAL PERMIT.
8 (B) ISSUANCE.--
9 (1) EXCEPT AS PROVIDED UNDER PARAGRAPH (3), THE
10 DEPARTMENT SHALL ISSUE PERMITS UNDER SECTION 617 WITHIN 60
11 DAYS OF THE APPLICATION SUBMISSION DEADLINE UNDER SUBSECTION
12 (A)(2) TO ALL APPLICANTS THAT MEET THE MINIMUM REQUIREMENTS
13 FOR PERMITTING UNDER THIS CHAPT