How to Open a Dispensary in Pennsylvania

The Keystone State currently ranked third in WalletHub’s Best States To Live report from 2022. Moreover, it cracks the top 15 in the report’s list of the best places to live in America.

A recent cannabis-related development in Pennsylvania could take those already impressive rankings and bump them up a few spots.

Specifically, talks of adult-use legislation in 2023 have ramped up significantly. This momentum could mean that the Keystone State might be the latest domino to fall in the fight for nationwide adult-use marijuana legalization.

Anybody with an entrepreneurial spirit in Pennsylvania can already imagine the business opportunities stemming from legalization. They’d then do some quick research to back up their theory. And they’d’ find out that the legal cannabis market in the US is expected to reach $25 billion by 2025.

Do the possibilities sound endless? In some ways, yes. In other ways, there’s a need for pragmatism and a more cautious type of optimism.

Be mindful that there’s much red tape to navigate when selling cannabis above board–even once it’s legalized in your state. Also, while legal usage exists in 21 states, marijuana is a Schedule I substance at the federal level–in the same vein as heroin and other substances.

Read on as we detail how to open a dispensary in Pennsylvania if statewide legalization comes to fruition.

As of this writing, only patients with valid medical marijuana cards can purchase cannabis from a medical dispensary in Pennsylvania. Not only is adult-use cannabis illegal in the Keystone State, but possession is also a criminal offense in some parts of the state.

We don’t refer to these facts to crush your dreams of running a dispensary in Pennsylvania one day. It’s to let you know the state’s current status and to help inform the potential path you must take to open your legal cannabis business.

Despite the state’s archaic laws against adult-use cannabis, there’s plenty of reason for hope. Forbes names Pennsylvania as one of the states that could legalize adult-use cannabis in 2023.

The efforts to legislate and legalize recreational cannabis for adult use in Pennsylvania have been in overdrive for the past two years. While such initiatives can often be halted by opposing people in power, the recent elections saw the Keystone State elect a pro-cannabis governor. Moreover, the Democrats held onto the Senate, vastly increasing the chances of 2023 legalization in many states.

Yet, receiving a Pennsylvania dispensary license for adult use remains a goal for the (potentially near) future. That’s not necessarily a negative, as it offers you time to prepare and develop a thorough, insightful business plan.

So, what can you do to get ahead of your potential competition and hit the ground running once adult-use cannabis is legalized? We’ll answer that question below.

Adult-use cannabis might not be legal in Pennsylvania, but medical marijuana has been alive and well since April 2016, when Governor Tom Wolf signed Senate Bill 3.

There are bound to be differences between stipulations for the growth, possession, and distribution of medical marijuana and the eventual laws for adult-use cannabis. Still, we can look at medical dispensaries' processes, procedures, and regulations to provide insights into what to expect when adult-use dispensaries are up and running.

Plus, there's always the possibility you could open a medical dispensary first, then veer into adult-use sales. However, we'll note that most states with legal medical dispensaries don't make it easy to get involved in the space, but that's not to say it's impossible. 

Let’s now examine Pennsylvania’s medical marijuana landscape.

Pennsylvania’s Department of Heath has a branch called the Medical Marijuana Advisory Board (MMAB) overseeing the state’s medical marijuana program.

Medical marijuana can only be sold in licensed dispensaries in Pennsylvania. Obtaining such a license requires going through the necessary channels before opening your business.

Due to the lack of available licenses in the Keystone State, receiving medical licensing is akin to a tightrope walk without an end.

Medical distribution licenses are highly exclusive and very rarely available. Regardless, if you wish to enter the medical cannabis space in Pennsylvania, projected to reach up to $2 billion in market worth by the end of last year, you must follow the appropriate steps.

Even if you cannot obtain a medical license, completing the application means you’ll have the foundation of a business plan. You can apply that plan to the adult-use dispensary you’ll eventually open. It’s safe to assume you’ll need to follow similar guidelines and satisfy similar scrutiny to receive your adult-use license.

Fifty dispensary licenses and 25 marijuana grower/processor licenses were created when Senate Bill 3 passed. Obtaining this licensing meant recipients could serve registered patients with qualifying medical issues.

Upon receiving a Pennsylvania dispensary license, applicants can open up to three locations, allowing for 150 statewide dispensaries.

Below are a few things you'd need to receive your medical marijuana license in Pennsylvania. Note that the MMAB requires this information to be written in your application, and they’ll likely want other details:

• You’ll need to describe your business activities and organization.
• The MMAB wants proof that you can provide and maintain successful security. They also need evidence that you can prevent illegal conduct such as substance abuse and diversion.
• Applicants must show they’re complying with municipality zoning requirements.
• Applicants must provide a diversity plan.

This is a simplified rundown of some of the required documentation to be submitted. Applications can be hundreds of pages in length once all of the plans and documents are compiled.

MMAB’s licensing fees for medical dispensary permits application are as follows:

• $5,000 for an initial fee (this is non-refundable)
• A $30,000 permit free (which is refundable if your permit isn’t granted)
• $150,000 in capital (you only need to provide proof that you can access this amount)

Note that you’ll need to pay $30,000 for every dispensary you open and that the non-refundable $5,000 must be paid annually.

Once you’ve received your Pennsylvania dispensary license, the journey has only just begun. You’ll be under a microscope, given the rules and regulations involved in the sector.

For one, your customers must have a legal right to purchase and use medical marijuana. Thus, they need to show you their medical marijuana ID card. Receiving that card means that these patients suffer from qualifying conditions (of which there are 23), such as:

• Autism
• Cancer
• PTSD
• Multiple sclerosis
• Epilepsy
• Glaucoma
• HIV/AIDS

The factors discussed below apply to medical dispensary owners. Still, they are bound to overlap with eventual adult-use licensing and applications.

Pennsylvania doesn’t allow the following individuals to own, directly invest in, or work for a medical marijuana dispensary, processor, or grower:

• People with previous drug addictions or charges
• Some public executives
• Any violators of the state’s Medical Marijuana Act
• Physicians

You’ll even find that the application dictates your need to be of “good moral character” to run a medical dispensary.

The regulatory compliance required from medical marijuana dispensaries, from state and federal agencies alike, can be intimidating. Moreover, the laws are constantly in flux and are tough to track. You could think you’re following all the rules but be subject to a hefty fine come your next inspection. 

Not only will law enforcement agencies and medical regulators follow your operations closely, but you’ll also be subject to oversight from the Department of Agriculture. The EPA and Department of Labor want proof that your operation is above board; we’re only scratching the surface. 

Familiarize yourself, on an ongoing basis, with all the agencies and regulations you need to satisfy to run a medical marijuana dispensary in Pennsylvania. Also, note that many (but not all) of these agencies will play a role in any potential adult-use dispensary you open.

We’ve already discussed the $2 billion market worth of Pennsylvania's cannabis space. That’s without the benefit of legalized adult-use.

Now, legal adult-use is knocking on Pennsylvania’s door, meaning opportunity is knocking at your door. Instead of licenses being limited to a select few medical providers, the proverbial floodgates will open. Of course, that doesn’t mean anybody will be able to receive a Pennsylvania dispensary license, but it’ll be within reach of those who are well-prepared.

The information provided in this guide will give you an edge in receiving state licensing when the time comes. Use it to your advantage and hit the ground running when entering the adult-use cannabis space.

The savviest entrepreneurial minds understand they can’t launch a business entirely alone. The help and insights of experts can guide you through the minefield of trying to start a new enterprise, particularly in a sector as unique as the cannabis industry.

Adult-use cannabis is more of a minefield than most business opportunities, given its murky legal status in Pennsylvania (and the rest of the US). Thus, receiving high-level support from a professional cannabis consulting firm like MOST will give you a competitive edge in launching your dispensary. Contact MOST today to learn more.