Hashing Out An Industry


They differ by age, background, experience and many other factors, but a handful of Jews in Maryland have one aspect of their lives in common — they are currently playing a waiting game while the state determines who will be allowed to grow, produce and sell medical cannabis among almost 900 applicants.

Clarksville’s Cary Millstein has spent the past year navigating a complex system of practicalities and legalities that come with entry into the cannabis industry.

Hashing Out An Industry

“Everything in this initial stage must be carefully done,” he said. “I’m not allowed to solicit publicly for any investments so I couldn’t advertise. I could make calls to people I knew, but I couldn’t put anything in the paper.”

Millstein’s company, Freestate Wellness LLC, has applied for all three types of licenses in Howard County. He has assembled a team of 23 people who include horticulturalists, doctors and former McCormick and Pepsi corporate officers.

“We’re really trying to make sure this not a small casual business we’re going into lightly,” he said.

Millstein said it was not terribly difficult to put the team together, but if he is awarded licenses, the cost of producing the marijuana strains and extracting the chemicals is likely to cost between $5 million and $10 million.

Millstein said his operation would involve a carbon dioxide extraction process that would remove all organic plant material. He plans to sell both dry flowers and ointments, one third of which will contain minimal THC, marijuana’s primary hallucinogenic compound, in order to accommodate patients with no previous exposure to the drug.

“We want to be able to do it in a very methodical way so that they don’t have any adverse effects,” he said.

He has brought on a few large investors and said he would be in a position to produce if he wins a license, but he still has concerns about the business infrastructure. Because cannabis remains illegal at the federal level, many banks are hesitant to get involved.

“Banking — and the risks surrounding an all-cash business — makes this one of the riskiest aspects and attracts it to crime and theft,” Millstein said. “How do you have a business that’s supposed to be legal to operate [yet] illegal to have a bank account or a checking account?”

While there are federal guidlines for banking in the cannabis industry, there is still much uncertainty regarding the feasibility of banks working within this emerging field.

Millstein is also concerned that only a handful a patients will be approved for marijuana use due to a remaining social stigma that has persisted for several years, making doctors hesitant to prescribe the drug.

“If you have three people who come to your business every month, that’s not going to pay the water bill,” he said.

Millstein has served as a board member of the Jewish Federation of Howard County for 12 years and said he has received a good amount of support, including from his rabbi, Craig Axler at Temple Isaiah.

“He understands our passion and why we’re getting involved,” he said. “What we’ve found is that cannabis has a terrific following of supporters seeing the medical benefits that are coming to life, and I believe that the benefits have not been fully understood.”

Robin Katcoff, a retired pharmacist who is now a health and wellness coach, said she was on the fence initially about becoming involved in the industry. Katcoff lives in Owings Mills and attends Beth Am Synagogue in Baltimore. She is part of the Cannavations MD team that is applying for licenses in four legislative districts, led by Jessica White of Pikesville. (She was profiled in the JT’s “Kosher Kush” on Nov. 20.)

“When Jessica mentioned this whole thing, I thought, ‘You know that’s kind of weird for me,’” Katcoff said, “because I was always the person who would go out and talk about drugs and how you shouldn’t do them. And a few months ago, she asks, ‘What are you thinking about this?’ And I said, ‘You know what, I think I’ll do it.’ It’s a great way to help people, especially people who are in pain. And nothing else is working.”

[pullquote]Banking — and the risks surrounding an all-cash business — makes this one of the riskiest aspects and attracts it to crime and theft. How do you have a business that’s supposed to be legal to operate [yet] illegal to have a bank account or a checking account?[/pullquote]Katcoff said her role will be ever-changing, but it will include maintaining a dialogue with patients, keeping records and determining appropriate dosage levels.

“There’s not a whole lot of human research that has been done,” she said. “It’s mostly based on animal testing to try to figure out what to even recommend our patients. So we’re going to be starting low and going higher with the dosage as needed.”

Also on the Cannavations team is Eric Rubin, a pediatrician at Johns Hopkins University who will serve as a medical adviser but not prescribe the drug. He said his role will mainly involve providing patients with an objective voice.

“Coming from it with very little pre-knowledge also means no money in the game,” he said. “Conflict of interest would be a big no-no in this, and so someone who doesn’t prescribe, who’s coming in with a fresh perspective, who doesn’t have a lot of prejudices on the issue is probably a good person to have in the role of medical advisory board.”

Rubin said that generally speaking, the medical community in the United States has had cautious optimism about the use of cannabis for medical purposes. He noted that Israel is also in the process of creating a medical cannabis program and has developed a strain that is non-intoxicating. He said that the plant is a “blunt instrument,” in that it has numerous active agents that can cause negative side effects but that this does not make it worse than drugs such as OxyContin.

“There’s no such thing as a free lunch,” he said. “Anything that’s going to be pain relieving and anxiety altering will have some abuse potential, and so we’ve got to be cautious going in with our eyes open, but the stuff that we have [on the market now] ain’t that great either.”

Green Leaf Medical LLC already has a lease signed on a 42,000-square-foot facility in Frederick County, where CEO Philip Goldberg hopes his company will grow and process medical cannabis in two separate spaces.

Goldberg, a Montgomery County native and member of Temple Beth Ami in Rockville, runs an ad agency and marketing firm. He initially got interested in Maryland’s medical cannabis program as a money-making opportunity a couple of years ago.

“It sounded really good, and at that point I knew that there was going to be a big profit potential, and that’s honestly what first attracted me to this. I’m an entrepreneur; I’m looking out for opportunities,” he said. “After many commission hearings and being involved in the industry, I began to meet a lot of patients and … once you talk to all these patients, especially those parents of kids who are really sick, you learn it’s about a lot more than money. You can really help people.”

Goldberg, president-elect of the Maryland Cannabis Industry Association, has testified at hearings in Annapolis, brought out-of-state experts to testify and, as part of the MDCIA, is working to educate physicians on cannabis as a medicine.

He hopes to grow cannabis strains that are high in CBD, a non-psycho-active component in cannabis that has been shown to be therapeutic in a variety of ailments, including epilepsy. Green Leaf would also process and manufacture capsules, patches, creams, oils “and a variety of other administrations that look more like medicine,” Goldberg said.

While Green Leaf is one of 146 applicants vying for 15 grower licenses, Goldberg feels that his company has gone above and beyond and is hopeful they will be selected. A major selling point of his company, Goldberg believes, is its board of directors, which includes Thomas Chase, a retired lieutenant of the Frederick County Police who will review security plans, perform background checks and be a liaison to the community; Dr. Vincent Njar, a University of Maryland School of Medicine professor who works to develop cancer treatment drugs; Sarah Robinson, the mother of a child who has severe epilepsy; Dr. Paul Lyons, a neurologist who has obtained DEA and FDA approval to use cannabis in human trial, with which he has been studying its effects on children with epilepsy for two years; and two horticulturalists, Meagan Zaffaroni and Steven Schug.

“We’ve got a really nice team that brings a lot to the table from the time we put the plant in the ground to the time we turn it into medicine,” he said.

Green Leaf has more than $1 million raised from 30 investors and has commitments for an additional $6 million to begin operations.

He thinks Maryland has so many applicants because the state put together “the gold standard of cannabis laws.”

“I feel good about our chances,” he said. “We all put in so much time in that week before the applications were due because we care about the industry and we really believe in it.”

Many Jews around the country have fallen into the industry in places where cannabis is already legal, including Denver’s Julie Berliner, who needed a steady income after graduating from the University of Colorado Boulder with a degree in elementary education in 2009.

“It was tough,” she said. “I was
substituting wherever I could and trying to find my place just as medical marijuana was becoming a reality in Colorado.”

The country was still in recession, and a Berliner’s friend had opened a dispensary near where she lived, prompting her to re-evaluate her career options.

“I didn’t have a lot of money, I had just graduated,” she said. “And in April 2010 the regulations began to tighten up. So it was around that time when I had to take the plunge and go for it or teach and go on as I had.”

Without telling her parents the whole truth, Berliner started Sweet Grass Kitchen, a bakery that sells cannabis-infused baked goods in both medicinal and recreational varieties.

“There were certain omissions like, I was starting a bakery. I didn’t say it was a weed bakery,” she said.

Berliner said her parents did eventually come around to support her endeavor.

“They were understandably concerned back then,” she said. “I think it took them visiting and understanding the industry itself.”

Berliner’s friend, Josh Genderson, opened two dispensaries in Washington, D.C., three years ago after working for his family liquor business, Schneider’s of Capitol Hill.

Genderson has several ties to Washington’s Jewish community. His fiancée, Morgan Greenhouse, sits on the board of the Jewish Federation of Greater Washington, and he and his family are longtime members of Congregation B’nai Tzedek in Potomac, where his uncle is part of the leadership.

He said being part of the wine and spirits industry was the key to sparking his interest in the drug.

“We were pretty passionate about the medical side of cannabis,” he said. “We’ve seen the positive effects it’s had with kids with epilepsy, with pain management, and we’ve been in a controlled-substance business [alcohol] for a long time.”

Genderson’s two businesses sell products that include flowers, waxes, oils and glycol-based cartridges. He has been following Maryland’s application process closely and said he is excited about cannabis’ entry into the state.

“It’s the biggest response to the application yet in the medical world,” he said. “In my opinion, it’s a good program. It’s very pro-patient rights and pro-business. The turnout far surpassed what I imagined.”

Millstein said he thinks the cannabis program will be financially successful in the long run, but more importantly it will improve quality of life.

“For Maryland, I think it’s a wonderful opportunity to stop suffering, to help people have better lives, to generate business and hopefully down the road to generate a nice tax revenue for expanded adult use,” he said. “Not for teen use or underage use, but for adult use to help Maryland increase its revenues without overburdening the population on taxes.”

Marc Shapiro contributed to this report.


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