When the Pennsylvania Department of Health awarded the first 12 permits to companies to grow and process medical marijuana in 2017, Berks County got a bumper crop. Two companies, Prime Wellness of Pennsylvania in South Heidelberg Township and Franklin Labs LLC in Reading, were top scorers in the first phase of the state’s medical marijuana program.
Lehigh Valley Business talked to Sharon Ali, CEO of Prime Wellness of Pennsylvania, a subsidiary of Acreage Holdings, a New York-based firm that is one of the country’s largest owners and operators of cannabis growers, processors and dispensaries.
The company’s board of directors includes former Canadian Prime Minister Brian Mulroney and former U.S. Speaker of the House John Boehner, who was formerly opposed to legalizing medical marijuana.
Ali came to Prime Wellness with more than 25 years of experience in the consumer packaged goods industry, including more than a decade in health care. She has worked with Fortune 100 companies, including Procter & Gamble, Johnson & Johnson and PepsiCo/Quaker Foods & Beverages. Ali earned a bachelor’s degree from Dartmouth College and an MB from Columbia University.
Prime Wellness built a 30,000-square-foot indoor growing facility in a former cornfield in South Heidelberg Township for nearly $10 million. Ali said the company is in the midst of planning for 2019 and is considering its options to expand if projected demand for its products warrant it. The company was approved by the state in its initial application to build an additional 25,000-square-foot greenhouse if necessary.
“We want to be in a position where we capture more than our fair share and consider how best to maximize the growth potential of our current facility,” she said. She declined to share revenue.
Prime Wellness sells products under the Prime label in nearly 40 dispensaries across the state. The company focused production on dry leaf or flower form of marijuana when the state approved it for sale in dispensaries late last summer.
The plants are grown in a pesticide-free facility so as not to interfere with marijuana’s chemical profile.
“The response to our Prime line of products has been exceptional, especially our flower. We’re seeing excellent results in terms of potency,” Ali said.
The following interview has been edited for length and clarity.
Lehigh Valley Business: Prime Wellness was among the first 12 companies to be awarded grower permits from the state. How long did it take from the time Prime Wellness first planted medical marijuana seeds to when you had it ready for market?
Sharon Ali: We literally broke ground just over a year ago in September. It’s been a whirlwind. We purposefully started with 100 percent seed stock and started planting in February. We harvested in late May and when we launched the Prime brand in July we were off and running.
LVB: Did it go as expected?
ALI: There is a whole cultivation process from seed to sale. We are leveraging the expertise of Brandon Miller, who is our director of production. Brandon comes to the Pennsylvania market with a tremendous amount of knowledge and expertise in the industry in other states. We are very fortunate we had someone to guide us through the process. There were no major hiccups timing-wise. We launched when we planned.
LVB: How did you determine what kind of marijuana you wanted to sell? There are so many varieties and so many different kinds of forms it can take, from oils to vaporized products.
ALI: You can do seeds and clones, but in the spirit of the kind of product we wanted to bring to market, we used 100 percent seeds. That defines the essence of Prime. From our standpoint, we want to provide the best medical marijuana in the market.
We planted in February. It’s a fairly involved process. It is planting them with various nutrients and certain lighting conditions. It’s kind of a multi-layered process. There’s the cultivation piece, the vegetation piece.
There is a list of approved forms. But it’s such a young market. There’s not a lot of information in terms of forms from a patient’s standpoint, or what patients in Pennsylvania are looking for. From our standpoint, we realized that supply was a major challenge in the market. We wanted to ensure we were positioned to supply deeply. We purposely elected that rather than supply ‘a mile wide and an inch deep.’ We were going to focus on vape cartridges, which is one of the preferred forms. The other was capsules. With the state’s decision in April to allow medical marijuana in flower, which is vaporized, we launched that in August.
LVB: Did you have customers, i.e. dispensaries, lined up before you went to market?
ALI: Yes. We had to really start to engage with dispensary owners dating back to last fall. We wanted to start building relationships and get a basic understanding, before the industry launched, what they were looking for. That evolved how we were going to shape and model what we would bring to market. We built further upon that now that the industry is up and running.
We are currently selling to almost 40 dispensaries. It seems like a new one opens on a weekly basis. We have Rise in York, Cure in Philadelphia and a new one is opening in Cranberry Township outside Pittsburgh
LVB: How many employees do you have?
ALI: We are closing in on 40 people. The positions are across the board, from seed to sale – cultivation technicians, processing technicians, packaging, logistics. We’ve obviously got a crackerjack security team, HR. We’re building quickly. It’s hard to believe that a year ago it was basically myself, Natasha Strother Lassiter, the chief operating officer, and Benjamin Brooks, our director of security.
LVB: Why did Prime Wellness choose to locate in Berks County?
ALI: We looked around and we thought that Berks County was well-positioned in terms of our ability to supply across the commonwealth. It’s just a tremendous opportunity in terms of patients’ demand and stability. We also need to consume a fair amount of space.
We felt in the early stages it was important to have the ability to partner with South Heidelberg Township. It has proven beneficial and it’s all we anticipated and then some. It’s been a great partnership from the outset. They have welcomed us. We looked at the opportunity to be a very strong corporate citizen. [Prime Wellness pledged to donate $50,000 a year to the township over several years].
LVB: You worked in the consumer packaged goods, or CPG, industry before you took this job. Can you apply what you learned there to being CEO of a medical marijuana grower/processing plant?
ALI: All my experience in branding, business development and strategic planning has come into play when starting a new company and leading in an industry. When I think about CPG and my work at Johnson & Johnson, this is the next frontier in health care.
There’s the whole notion of how do you take a product from conception and bring it to life in the marketplace? The positioning, the branding, the ability to engage with your customers. That experience from seed to sale really encapsulates everything we’re doing. I really feel this is an incredible opportunity and I’m happy to be leading the company in this industry.
LVB: Pennsylvania introduced a cannabis research program, the first in the country, where hospital-affiliated cannabis growers and universities would collaborate on research, but it’s been held up in the courts. Did Prime Wellness oppose this and if so, why?
ALI: No. We weren’t part of that challenge. It’s been signed off by Wolf. The schools that initially applied for certification have been recertified as of last month.
Prime Wellness’s partnership with Drexel University College of Medicine is still under discussion. We are laser-focused on our grower/processing and our wholesaling.
It’s a question mark. I can’t say where things are going to land at this junction.
LVB: Is the cannabis industry a good field for women? Women executives in the industry are said to have higher salaries than the national average.
ALI: I think it’s an excellent field in and of itself, especially if you are someone such as myself who has a very, very strong interest in health care. I think it’s an industry that offers you a number of opportunities to basically focus on helping people with medical marijuana’s role, especially in the context of the 21 qualifying medical conditions. There’s tremendous growth projected of $90 million in retail sales in 2018.
LVB: Do you think medical marijuana still has a stigma attached to it?
ALI: Nationally, over 60 percent of the public feels that medical marijuana should be legal. I think there will be a fairly substantial increase in that number over time because people are starting to appreciate the incredible lifesaving benefits of the product. This industry is fraught with misperception. There’s an incredible opportunity to educate people. People are hearing and seeing it does make a difference. It’s a life-altering business. It’s one of those things where there’s been a consistent sentiment toward this making a marked difference in people’s lives.