ForwardGro was the first licensed medical cannabis operator in the state of Maryland. After an intense application, review, and licensing process, it ranked 11th out of 15 licenses in the initial process, but was the first to build a facility, pass inspection, and get plants on the ground. Founded on a dual passion to place medicine into the hands of patients who need it, and for agricultural businesses to bring production expertise into the medical cannabis market to provide quality plants, ForwardGro’s partners include Gail Rand, Dr. Deb Kimless, Mike McCarthy, and Gary Mangum.
With personal experience in the need for alternative medicine as the parent of a son with epilepsy, Rand became involved in advocating for medical cannabis in Maryland in 2013 after learning that a friend’s son in Colorado was seizure-free on medical cannabis.
“I thought Marylanders had a right to access this safe, but often effective medicine in their home state,” Rand says.
Around the same time, McCarthy and Mangum were investigating the opportunity to become involved in medical cannabis production in Maryland, and after checking with equity partners in the nursery business, who had no interest, established an unrelated LLC that would eventually evolve into ForwardGro.
The ForwardGro partners’ paths crossed in 2015 when Mangum observed Rand at work with the state legislature as Maryland’s new laws were being developed. She was a full-fledged advocate by then, and though Rand didn’t originally set out to be part of the industry, she realized she wanted to see the process of medicine production come to fruition. Rand now serves as a Patient Advocate at ForwardGro and as the company’s Chief Financial Officer.
“I was inspired by ForwardGro’s sustainable approach to growing this medicine,” Rand says. “I believe we have a responsibility to grow this medicine using the powerful energy from the sun. I also like the focus we have on efficient heating and using water responsibly. Bringing the best practices and technology used in agricultural greenhouses into the cannabis industry not only makes good business sense, but it’s the right thing to do.”
Medical Director Dr. Deb Kimless, a medical professional with interest and experience working with medical cannabis, joined ForwardGro because she was drawn to the company’s agricultural background and the small size of the group, and the investment commitment made by McCarthy and Mangum.
After touring the facilities in September, we caught up with Rand and McCarthy to get some insight on the operation’s core mission and experience on the journey into producing medical cannabis.
Greenhouse Grower (GG): How have you been involved in the legalization and medical cannabis law development in Maryland? How have you continued to be involved in the state and nationally?
Gail Rand: I co-founded an organization called StopTheSeizures.org that was solely focused on passing the medical cannabis bill in Maryland. I worked with amazing parent advocates in Maryland and throughout the country to educate the Maryland General Assembly, including state leadership, about the importance of safe access to this medicine. I continue to advocate for various regulations in Maryland and am proud that the program strikes a nice balance between the patients, the industry, and the other constituents like recommending medical providers.
My advocacy continues to be an important part of my work, both on a personal and professional level. I want to see Maryland add more explicit conditions like autism and opioid-use disorder. I participate on a national level by lobbying on Capitol Hill with organizations like the Americans for Safe Access. I’ve spoken at several national events at both cannabis-specific and also traditional conferences, for example, on policy and sustainability. I also am helping to define national standards for cannabis through the National Association of Cannabis Businesses. I think having national standards will take this nascent industry to the next level.
GG: What has the process been like, in getting certification, setting up the business, developing the property, etc.?
McCarthy: Taxing. The energy necessary and the obstacles along the way have been unlike anything we’ve experienced. Maryland has to be one of the most unique regulatory environments in the country, and the initial rollout year was significantly impacted by litigation from groups that did not fare well competitively, or felt they were otherwise harmed by the process or commission at the time.
GG: What are some of the most valuable lessons you have learned about building a cannabis business from the ground up? What was a surprise to you? What wasn’t?
McCarthy: Patience is crucial. We also believe it’s crucial to operate fully within the confines of the regulatory environment. Because we were first to complete our facility and be fully inspected and licensed, we were in the unique position to receive multiple unannounced visits from the inspection/enforcement teams during the months that we were the only entity in production. It was a lonely island for several months, but today we can look back and smile as we are a better company as a result of the aggressive scrutiny. We’ve also learned that this medicine is truly life altering for some people. Stories that we have heard from very satisfied patients make any personal frustrations or challenges seem trivial.
Rand: The most valuable lesson I have learned is that you have to focus only on what you can control. There can be so many distractions and complexities in this industry due to the politics and federal status that could affect our business. Keeping focused on our mission to bring best-in-class medicine to the patients of Maryland is key to our success. What surprised me most was how many resources it takes to be compliant. We take compliance very seriously and have chosen to spend a lot of time and money to ensure that we comply with the state’s laws and regulations. What wasn’t a surprise was the incredible patient stories. We are only four months in from patients having access and we are hearing how life changing this medicine can be for people who suffer from pain, who have multiple sclerosis, who have seizures, and much more.
GG: How many acres do you have? How many acres do you hope to one day have for producing cannabis? How much money did you invest in the initial set up?
McCarthy: Our facility is located on a 150-acre parcel. We started with an acre of greenhouse production and expect to begin construction of a second acre and complete our new processing facility this fall. This property will accommodate approximately 24 acres of greenhouses, a central processing facility, testing lab, and security and secure transportation services. All fueled by sustainable energy while executing one of the state’s most impactful Integrated Pest Management programs.
Our investment to date is in the $15 million range; $10 million in and around the initial greenhouse and operations facility, which includes most of the infrastructure for our next acre.
GG: How have you applied your knowledge of growing ornamental greenhouse crops to producing cannabis?
McCarthy: Plant physiology is plant physiology. Cannabis production is unique, but we are able to bring our experience to the greenhouse production every day, and we’re working with a grower who was born to be doing what he’s doing. We feel it’s our job to give him the best tools possible to produce the quality ingredients to provide the medicine. Our grower works very closely with our medical director.
GG: How is growing cannabis different from growing ornamental greenhouse crops? How is it similar?
McCarthy: It’s really quite similar — it’s an expensive annual. We’ve had to respect the thoughts of our head grower, as he has adapted to growing under glass. He understands the unique cannabis crop extremely well, and we bring our greenhouse and multi-crop management experience. Our grower, working closely with our integrated pest management (IPM) advisor, has allowed for a focus on clean green production.
GG: What are some of the biggest issues with cannabis crop production? How have you overcome that?
McCarthy: Disease and pest management. Maryland law to date has not allowed for any crop protection agents — including the most benign food-safe products known. The trade association has worked nearly two years to get this addressed in a way that is consistent with most other states with substantial medical cannabis experience. The General Assembly has just passed legislation that provides for crop protection agents as part of IPM.
A distinct advantage for us is our long history of experience in the industry with IPM. Even with access to a modest range of crop protection agents, we expect to remain pesticide-free, as we have been since day one. Our facility environment, the environment, and growing and intensive IPM scouting techniques have helped us ensure that good bugs killing bad bugs works very effectively.
GG: What are some challenges that cannabis producers face that could be resolved with more knowledge of horticultural production?
McCarthy: Clearly energy costs and issues around environmental sustainability are two areas where opportunity exists for cannabis. In Maryland, we currently have two greenhouse operators and 12 operating in warehouses. Pest control is another area that concerns the broader industry, as experienced growers are important to a viable IPM program. Maryland has a rigorous independent testing program that growers appreciate, as it helps ensure consumer safety.
GG: What are some measures you have put in place to ensure quality plants for the best medicinal output?
McCarthy: We continue to make process improvements regularly. From facility design and layout to cloning procedures to fertility choices, we consistently challenge our own thinking in order to make measurable improvements.
GG: What are some technologies you have had to implement in your operation to ensure proper traceability and security?
McCarthy: Maryland has engaged the METRC seed to sale system. Discussion around METRC would be very involved and warrants more pages than are allowed here. Maryland is not a recreational/adult use market, and diversion is a serious concern for the regulators. METRC helps provide full transparency through the seed to sale process.
GG: How long did it take for patients to receive their medicine, from the time you had plants on the ground, to first harvest?
Rand: Since cannabis has a long post-harvest stage, it took many months from the time we had plants on the ground to having medicine ready to sell. We made a conscious decision to sell first to processors to allow for a variety of routes of administration to meet various patient needs. As other growers came online, dispensaries were able to offer both processed and flower products as they opened.
GG: What should other growers know about what it really takes to build a cannabis operation? If you had to do it over again, would you?
McCarthy: We would. It’s imperative to have the resources set aside for both construction and operations, as traditional lending is not part of the average business reality. Banking for daily receipts, payroll, and all other aspects of the business is very limited. Once Maryland law is settled, Gary plans to start to work with our Congressional Delegation to help focus more energy on a true federal solution to the banking issues and tax opportunities related to this young industry. He and I actually feel as inspired and enthusiastic as we were 30 years ago in the very young interiorscape industry of the 1970s and then again years later in the developing wholesale growing business.
GG: What federal regulations are the biggest roadblocks to getting a supply of medicine to the people who need it? How would the lifting of these regulations help?
Rand: That’s easy — banking and taxes. We are very happy to say that we currently do have a bank; however, we are aware that could change. Cannabis businesses are taxed at exorbitant rates due to some old legislation that wasn’t intended for a state legal medical cannabis market. If Congress were to address these policies, it would ultimately decrease the cost of the medicine and improve public safety by allowing patients to buy medicine with methods other than cash.
GG: What misconceptions about medical and legal cannabis do you think need to be cleared up, in order for the agricultural community to consider this a legitimate agricultural crop, without bias?
Rand: One evolution I’ve witnessed in the past several years has been the ongoing increase in professionalism in this industry. People from traditional industries are joining the medical cannabis at increasing rates. This is a complex, but incredibly rewarding industry to be in.
GG: What are your goals for the future of ForwardGro?
Rand: Our primary goal is to provide best-in-class medicine to patients in Maryland. To do that, we strive to have an even more advanced integrated pest management system, a state-of-the-art facility, and consistent, efficient procedures. We are working toward having plants with a variety of cannabinoids to meet patients varied medicinal needs.
McCarthy: In this business we are already helping patients, young and old, and are helping to blaze a trail in Maryland with this new/old medicine. We’re committed. We’re a long way from profitability at the moment, but we expect a favorable return on investment as we gain experience and market share. Predictable medical-grade quality, patient advocacy, and understanding and being responsive to medical needs is key to our long-term success.