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Economy & Business

A Pennsylvania company becomes the first in the US to raise marijuana legally for medical research

marijuana.jpg
Gosia Wozniacka
/
AP
Federal law stops most marijuana growers from selling the Schedule I drug for medical research.

For more than half a century, federal law stopped all private-sector companies from selling the Schedule I drug for medical research. But York County-based Groff North America said it became the first business in the country last month to bring a cannabis crop to market legally for scientific study.

Originally a hemp company, the Pennsylvania firm was 1 of just 4 nationally to win approval from the U.S. Drug Enforcement Agency last spring to sell their product for medical and scientific purposes. Before, researchers had been restricted since 1968 to using only cannabis from a center at the University of Mississippi.

Groff North America founder and chief medical officer, Dr. Steven Groff, called the liberalization of DEA policy “a huge catalyst to unleashing the American scientific community.”

“For the first time, real-world marijuana will be available to researchers throughout the country,” he said. “We're working with some of the top institutions in America in providing new types of material that heretofore wasn't available from Mississippi.”

Groff said those items include the vaping and oil products that patients can already obtain in the 37 states where medical marijuana is legal.

“Medical cannabis has really exploded in America over the last 25 years,” Groff said. “The horse has left the barn, and America has decided it wants access to cannabis in one way or another. The [federal] government needs to really catch up as does the scientific community.”

Marijuana remains a Schedule I drug under federal law, meaning it belongs to the class of controlled substances most tightly regulated by the federal government. The designation restricts scientific research into cannabis’ potential uses.

Following its first federally-sanctioned harvest, Groff North America was required to turn the crop over to the DEA before buying it back and selling it. That transfer took place Feb. 2, according to the company, which said it was the first such transaction between a for-profit business and the federal government. Groff said the process is a formality required under a United Nations treaty that aims to prevent drug abuse.

Groff noted that the DEA spent nearly 20 months running background checks, conducting inspections, and sifting through paperwork before permitting his company to grow cannabis for research purposes. The company is required to maintain extensive security measures and administrative safeguards to prevent the theft of its product, Groff said.

But despite the cost of compliance, he said the new line of business comes with a lot of upside.

“We see a number of opportunities to provide revenue, and then ultimately our long-term play is to be a pharmaceutical manufacturer of a number of cannabis-based drugs,” he said.

So far, Groff North America has roughly 10 customers, ranging from major universities to large chemical companies, according to Groff.

“We expect that number to expand significantly, both among the research community and then [with] medical care in other countries,” he said.

Groff North America’s 15-member staff, meanwhile, is on track to double or triple in the next three years, Groff said.

Beyond supplying marijuana to other entities, the company plans to develop treatments in collaboration with other firms, Groff said. An early project will explore the possibility of using certain cannabinoids as antibiotics to treat MRSA, a type of bacteria that causes severe skin and soft-tissue infections. In addition, Groff said he sees potential to create medications for anxiety, sleep problems, post-traumatic stress disorder, and depression.

“It's a powerful plant. It's an amazing plant,” he said of marijuana. “But there's so much more we can do with it once we begin to really look at the data and maximize its potential.”

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