Marijuana Business Magazine - May-June 2018

allowed the company to start con- struction shortly after it received permits. The grow project is planned to be completed in phases. The initial round included about 20,000 square feet and kicked off in June 2017, Bach- tell said. Pennsylvania awarded Cresco Yeltrah the state’s first grower/ processor permit in October 2017. Officials signed off on the company’s secure growing environment being fully operational, so the cultivation process could begin immediately. At the time, Cresco noted in a news release that “a full grow cycle takes approximately 120 days,” position- ing the company to have product on retail shelves statewide in February 2018 – a target the company hit. “We were able to get plants grow- ing faster (than our competitors) because we completed our construc- tion faster than them,” Bachtell noted. The first harvest took place before the end of January. Testing, pro- cessing, manufacturing, packaging, labeling and delivering took about two weeks. Relying on Industry Vets While construction was underway, Cresco formed a “mobilization team” comprised of executives, manag- ers and team members from the company’s Illinois headquarters. The team was assembled to hire and train new staffers for key director roles in Pennsylvania. After getting a tour of the Illinois facilities and briefings on the opera- tions, the entire group went back to Pennsylvania to get cultivation and retail facilities up and running, with the goal of phasing out the Illinois staff. In October, Cresco held a job fair in DuBois, Pennsylvania, to find employ- ees including sales representatives, cultivation agents, packing agents, an extraction agent and a lab manager. Previous work in the cannabis indus- try was not required. Bachtell said he wanted workers to come from within the state. He ended up with about 35 full-time employees in Pennsylvania and about 110 across the company’s operations in five states and Puerto Rico. The front-end planning and hiring work – in addi- tion to the initial approval – allowed Cresco to get a leg up on competi- tors. The company saved even more time getting to market through its previous experience in Illinois. “We have standard operating proce- dures,” Bachtell said. “We know how to grow it; we know how to process it; we know how to package it – we have the packaging already. We didn’t have to develop any of that stuff again. That’s what we’ve done over the last three years is really develop a brand. We’re very familiar with seed-to-sale compliance software, tracking and all those things that maybe some guys that are newer to the industry have to learn.” ◆ SHAPING THE RULES M edical cannabis company Cresco Labs wanted to shape the rules it would play by in Pennsylvania. Operating as Cresco Yeltrah, the Illinois-based company participated in the public rulemaking process, providing comments and feedback to state regulators over proposed rules. Cresco officials, for example, suggested that physicians should not be required to give their medical opinions as to whether the benefits of medical cannabis outweigh the risks. That’s because similar rules in Illinois led to doctors not participating in the program initially. “Engaging and embracing the opportunity to help shape the rules is important,” said Charles Bachtell, CEO and co-founder of Cresco Labs. “During the process, we get a very, very good understanding of what the program looks like, how it’s going to develop and what the state is looking for.” Participating in the rulemaking process also alerted Cresco execu- tives that the company needed to change its business model in Pennsylvania to incorporate the state’s initial ban on flower sales. The company put more emphasis on creating downstreammanufactured products including capsules, topical lotions, Rick Simpson Oil (RSO), vaporizing pens and concentrates. Bachtell said the ideal medical marijuana program should benefit patients, regulators and operators. “On the patient side, it’s making sure access to the program is not too restrained, and there’s a nice broad list of qualifying medical conditions,” he said. “We want to make sure that the condition list is broad enough to help the patients it should help, that the application process for a patient isn’t too onerous, and the physician-certification process isn’t too onerous on the medical community. “From the regulation side, we want to make sure it’s a secure and safe program, so they don’t get egg on their face with lax regulations,” he added. “From an operator standpoint, you want to make sure you have the opportunity to run a successful business.” – Adrian D. Garcia 114 • Marijuana Business Magazine • May-June 2018