New Jersey Department of Health & Senior Services Medicinal Marijuana Program Application to Establish and Operate a Medicinal Marijuana

Alternative Treatment Center SOUTHERN REGION
New Jersey Submitted February 14, 2011 by

Compassionate Sciences ATC, Inc.

Our mission at Compassionate Sciences ATC is to establish in the Southern Region of New Jersey a medical model of care that sets a national standard consistent with the compassionate principle, legislative intent and public policy vision that animate the New Jersey Medicinal Marijuana Program. We intend to accomplish our mission by: • • • Serving the population of medical Cannabis patients exclusively Producing and dispensing Cannabis like a medicine, to pharma-quality standards Optimizing supply chain control and transparency, from seed to patient

Our research has shown that many if not most existing models across the country are, to varying degrees, failing to meet the needs of bona fide patients and their physicians while creating unintended public policy problems. Compassionate Sciences was founded in the belief that there is a manifest need for clinically-appropriate, physician-driven and wellregulated palliative care as envisioned by the State of New Jersey. We are committed to creating the nation’s first pharma-standard model of palliative care in New Jersey, the capitol of the U.S. pharmaceutical industry. To that end, we have brought together a uniquely-qualified team from business, health care, science and agriculture -- including a CEO who introduced a break-through oncology treatment and a pharmacologist who heads the George Washington University Cancer Center. If awarded a permit, Compassionate Sciences will work diligently within the Medicinal Marijuana Program to meet the needs of all stakeholders including patients, physicians, primary care givers, government officials, regulators, law enforcement and the communities of the Southern Region of the State. We commend New Jersey officials and the Department of Health and Senior Services for your leadership in setting the standard for a genuine medicinal model of palliative care and we greatly appreciate the opportunity to contribute to your success. Sincerely,

Richard Taney, Chief Executive Officer Compassionate Sciences ATC, Inc.

New Jersey Medicinal Marijuana Program ATC Application Cover Sheet & Attestation Statement
Applicant Compassionate Sciences ATC, Inc.

Contact Person Richard Taney, CEO Address Telephone e-mail 252 Sea Cliff Avenue Sea Cliff, NY 11579 516-304-5130 Richard.taney@gmail.com

Attestation Statement: I hereby attest and certify to the accuracy and veracity of all statements, figures, amounts and other information incorporated within the application and materials hereby submitted. Compassionate Sciences ATC, Inc. By:

Richard Taney
Chief Executive Officer

February 14, 2011

NEW JERSEY MEDICINAL MARIJUANA PROGRAM Application to Establish and Operate a Medicinal Marijuana Alternative Treatment Center CRITERION 1: SUBMISSION OF REQUIRED INFORMATION REGARDING APPLICANT & FACILITY Measure 1: The applicant shall provide the proposed legal name and the following documents applicable to the applicant’s legal status. Compassionate Sciences ATC, Inc. Please see Appendix A for: • • • Certificate of Incorporation Certificate of Good Standing Corporation by-laws

Measure 2: The applicant shall provide the proposed physical address(es) of the ATC, if a precise address has been determined. If a precise address has not been determined, the applicant shall identify the general location(s) where the facilities would be sited, and when. Management of Compassionate Sciences (“CS-ATC”) commissioned a real estate survey to identify general locations in the Southern Region service area. The survey was conducted by CB Richard Ellis, a global leader in real estate services with an experienced team in New Jersey. The CBRE survey identified general locations in which to site a secure, high tech facility converted to accommodate cultivation, packaging and dispensing of medicinal Cannabis in keeping with the rules of the New Jersey Medicinal Marijuana Program and the New Jersey Compassionate Use Marijuana Act. While designed to identify general locations, the survey also produced a preliminary list of potential sites within each location as a first step toward establishing a precise address for CS-ATC pending the Department’s award decisions. Please see Appendix B for a map of general locations.

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Compassionate Sciences is prepared to identify and secure a precise location immediately upon receiving a favorable award decision from the Department. As indicated, we have targeted potential sites based on criteria that meet the requirements of the NJMMP and the needs of the organization. Management has engaged CBRE to standby in preparation to select the optimal facility and promptly secure occupancy for CS-ATC. Measure 3: The applicant shall provide evidence of compliance with the local zoning laws for each address or proposed location for an ATC. If the current zoning is not appropriate for a given address or location, identify any required zoning variance(s) and the applicant’s actions taken to date to obtain such approval(s) and/or variance(s). The survey conducted on behalf of Compassionate Sciences included a site analysis based on the following zoning and area criteria: • • • • Outside school and other drug free zones Not situated in residential neighborhoods Technology or industrial areas Light industrial or flexible-use zones

Based on the survey, and in consultation with CBRE, management believes that local zoning rules in our targeted locations will not preclude occupancy or filing of appropriate variances to operate an ATC. Please see Appendix C for a list of potential sites in the Southern Region. Measure 4: The applicant shall provide evidence that all of the physical addresses and proposed locations provided in response to Measure 2 are not located within a drug-free school zone. The applicant shall provide the distance to the closest school from the ATC. Throughout our survey of potential locations, Compassionate Sciences made community safety and finding appropriate, discreet, non-residential locations our top priority. A site analysis screen was used to identify only those locations that fell outside of school and other drug-free zones. As a result, potential sites for CS-ATC are at least 1,000 feet from the nearest school, day care center or place of worship. Please refer to our site analysis maps in Appendix D.

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Measure 5: The applicant shall provide a legible map or maps of the ATC service areas by Zip Code. The CS-ATC service area in Southern Region is represented by the map in Appendix E. Measure 6: The applicant shall provide the role, qualifications, name, address and date of birth of each staff member and the role, name, percentage interest, address and date of birth of each principal, officer, board member or partner of the ATC. Our mission at Compassionate Sciences is to establish a facility and product that meets a pharma-standard of palliative care. We believe that that the key to our success is in the quality of our team. We have brought together a uniquely-qualified group of executives and trustees with extensive experience in business, health care, science, agriculture and the non-profit sector. CS-ATC management intends to recruit a staff of similarly accomplished and motivated individuals at every level of the organization. Compassionate Sciences ATC Senior Management Team Richard Taney, Chief Executive Officer. Mr. Taney is a chief executive with extensive experience in health care, medical technology and financial services. Mr. Taney assumed leadership of Compassionate Sciences after serving as CEO of Delcath Systems, Inc., (NASDAQ: DCTH), a medical technology company that developed a patented system for the targeted delivery of ultra-high dose chemotherapy to the liver for treatment of a variety of cancers. Under his leadership, Delcath Systems achieved widespread adoption by doctors and hospitals. Mr. Taney is also a Trustee of the Compassionate Sciences ATC. Jack Burkholder, Chief Financial Officer. Mr. Burkholder is a consultant with more than 30 years of experience in international investment banking, corporate finance and real estate development. He has an expertise in managing complex projects involving close cooperation with governments at all levels and has served extensively in the public trust as a court-appointed receiver. Mr. Burkholder is active in his community as a member of the Real Estate Roundtable and the audit committee of his local school district. He graduated with a BS in Agriculture from Cornell University. Mr. Burkholder is also a Trustee of the Compassionate Sciences ATC. Michael Nelson, Chief Operating Officer. Mr. Nelson is the founder of a highly successful international outfitting business who is also the owner and operator of one of the largest and most respected ATC’s in Montana. As a grower-operator over the last six years, he has developed experience in the building of ATCs, systems design, ATC employee orientation and training and management. Mr. Nelson’s cultivation center and multiple-location dispensaries have set a standard of excellence in serving qualified patients throughout the Central and Western regions of the State. Mr. Nelson brings to his work a background in sales, management, distribution and marketing of school products to universities and high schools across the American Northwest. He is active in the Bozeman area business community and as a volunteer 3

in a sports program for the disabled. Mr. Nelson earned a BS in Business from the University of Colorado. Nicole Wagner, Master Grower. Ms.Wagner is an accomplished government and academic analyst and researcher in the fields of sustainable agriculture, ecology, agronomy, statistics, engineering and economics. With an expertise in global and domestic agricultural policy, she has served as an international economist and crop assessment analyst at the U.S. Department of Agriculture as well as a researcher at Montana State University. Ms. Wagner has published numerous research studies and has a deep understanding of diversified agricultural systems including organic vegetable and dairy production, conventional corn, soybean, and small grains production. She is also a director of the non-profit Community Food Alliance and works with Field Day Farms, a Community Supported Agriculture (CSA) farm that supports 30 families. Ms. Wagner earned her PhD. in Land Resources and Environmental Sciences from Montana State University and attended the University of Minnesota where she earned her Masters and BA in Biosystems and Agricultural Engineering. She developed her expertise as head grower at the Mr. Nelson’s medical Cannabis facility in Montana. Andrei Bogolubov, EVP of External Affairs. Mr. Bogolubov is a communications professional who has served government, major multinationals, regional and emerging growth companies in a wide range of industries around the world. His expertise is in public affairs, business development and community outreach. Mr. Bogolubov’s healthcare, medical and pharmaceutical clients have included American Home Products, Bristol Myers Squibb, Columbia Presbyterian Hospital, Medical Excellence, The Michael J. Fox Foundation, Pfizer, Pharmacia & Upjohn and ValueOptions. He also has served in government as Assistant to the Secretary for Public Affairs at the US Department of the Interior where he was also the Department’s public affairs liaison to the White House. Mr. Bogolubov developed his expertise in community relations as Director of Policy & Communications at a major national grassroots citizens lobby. Mr. Bogolubov began his public sector career on the committee staff of the Connecticut State Legislature and later served as an aide to a US Congressman. Noel Palmer, Chemist (consultant). Dr Noel Palmer is a respected chemist with an expertise in plant and soil chemistry. He is skilled in chromatographic and spectroscopy methods, specializing in the detection of heavy metals, pesticides, and herbicides in both soil and plant matter. He received his doctorate in analytical and soil chemistry from the University of Idaho. The focus of Dr. Palmer’s work was applying various analytical methods to look at soil systems and humic materials and their interactions with various inorganic compounds. Earlier, he managed a soil research lab at the University of Idaho. Dr. Palmer brought his skill in performing chromatographic separations to the analysis and study of Cannabis chemistry. He is a member of the board of the Alliance for Cannabis Science, an international community of Cannabis scientists. Dr Palmer is also the lab manager for Montana Botanical Analysis, a research lab in Montana focused on the study of Cannabis 4

chemistry. His research has been published in more than 10 peer-reviewed scientific papers. Compassionate Sciences Trustees Webster B. Todd, Jr. Mr. Todd brings to Compassionate Sciences experience, judgment and insight he developed over the course of a distinguished career in government, politics and commercial aviation. As a public servant, he was a member of the White House staff and the New Jersey General Assembly as well as a State Department official and the Chairman of the National Transportation Safety Board. Among his private sector achievements, Mr. Todd was the founder of Princeton Aviation Corp, Senior Director of Air Safety at the Airline Pilots Association and President of Frontier Airlines. Throughout his career, Mr. Todd has been active in the community including service as a Director of the New Jersey Commerce and Economic Growth Commission, a member of the Tewksbury Township Agricultural Advisory Board and as a New Jersey firefighter. Dr. Steven Patierno. Dr. Patierno is a leader in the science and medicine of cancer who is Executive Director of the George Washington University Cancer Institute. He also serves as Vivian Gill Distinguished Professor of Oncology, GW School of Medicine; Professor of Pharmacology & Physiology, Genetics & Urology, The GW School of Public Health & Health Services; Health Sciences Professor of Environmental & Occupational Health; and Founding Director of the Molecular & Cellular Oncology Program. Dr. Patierno has over two decades of experience managing over $30 million of grants including large, complex biomedical research grants (both laboratory and population sciences), as well as community-based grants in cancer disparities, prevention and control, education and outreach, and survivorship. Dr. Patierno is also an accomplished teacher who was been the recipient of the GW Medical Student’s Golden Apple Award. He is the principal mentor to 20 Ph.D. graduate students and Program Director to over 50 graduate students as well as 20 postdoctoral fellows, medical residents and undergraduate trainees. Dr. Patierno earned his PhD in pharmacology at the Graduate School of Biomedical Science at University of Texas Health Science Center in Houston and the MD Anderson Cancer Institute where he was awarded the prestigious Rosalie B. Hite Graduate Fellowship in Cancer Research for his work on the genetics of cancer causation. Please refer to Appendix F for: • • A list of Compassionate Sciences officers, staff members and Trustees with required information. Management and trustee biographies

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Measure 7: Disqualifying Drug Offenses
Existence of Disqualifying Offenses by Applicant, Principals, Officers, Trustees or Partners Convictions under any Federal, state or local laws, relating to drug samples, wholesale or retail distribution, or distribution of a controlled substance Felony convictions under any Federal, state or local laws Experience in manufacturing or distribution of drugs or controlled substances Furnished false or fraudulent material in any application concerning drug manufacturing or distribution Whether applicant is in compliance with any previously granted professional health license or registration

Yes No

   

n/a

Measure 8: The applicant shall provide the identities of all its creditors, if any. Compassionate Sciences has a single creditor, Measure 9: The applicant shall provide a list of all persons or business entities having direct or indirect authority over the management or policies of the ATC. Persons & Entities with Authority Over ATC Management & Policies Richard Taney Chief Executive Officer & Trustee Jack Burkholder Chief Financial Officer & Trustee Mike Nelson Chief Operating Officer-Horticultural and Dispensary Andrei Bogolubov Executive Vice President – External Affairs Nicole Wagner Master Grower TBD Vice President– Security Systems Webster B. Todd, Jr. Trustee Dr. Steve Patierno Trustee

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Measure 10: The applicant shall provide a list of all persons or business entities having an indirect interest in the ATC. An indirect interest includes an interest in the land or building where the ATC will be sited. Not applicable. Measure 11: Application cover sheet and attestation statement Please refer to the executed application cover sheet and signed attestation statement exhibited at the front of this document. CRITERION 2: SUBMISSION OF REQUIRED ATC OPERATIONAL INFORMATION Measure 1: The applicant shall provide a draft operations manual and training plan which demonstrates compliance with Subchapter 9 of N.J.A.C. 8:64, the Rules Related to the Medicinal Marijuana Program and which addresses ATC General Administration Requirements for Organization and Recordkeeping. Supporting documents should be included as Appendix G. Please see the draft CS-ATC operations manual in Appendix G. Measure 2: The applicant shall provide a description of how the ATC will operate on a long-term basis as a not-for-profit entity and a business plan that includes, at a minimum, the following: The proposed New Jersey medical Cannabis growing facility and dispensary will be owned and operated by Compassionate Services ATC, Inc. (“CS-ATC”), a registered New Jersey nonprofit organization. CS-ATC was formed by business people with many years of successful experience in creating and managing new companies – including developing economically viable business and marketing plans, securing favorable debt and equity financing from private and commercial institutions, and operating the companies in a financially profitable manner. Together, the founders of Compassionate Sciences have raised more than $100 million in equity and over $2 billion dollars in debt for companies in a variety of industries including medical technology and devices, agriculture, manufacturing, and real estate. In addition to the broad experience brought to Compassionate Sciences by the founders, CS-ATC’s financial and business operation, as set out in its business plan, will be overseen by a Board of Trustees comprising five individuals. Each trustee brings to the board expertise and knowledge unique to the understanding and successful management of not-for-profit businesses, as well as industry specific expertise in medical science, biology, oncology, agricultural finance and economics, and forensic and management accounting. Our Medical Advisory Board, comprised of five prominent individuals from the medical community, will compliment the strength of the trustees and enhance our

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ability to grow, manufacture and deliver superior, high-quality palliative products for our patients. I. Question: The applicant shall provide a detailed description about the amount and source of the equity and debt commitment for the proposed ATC. Financing for the Compassionate Sciences will be provided by

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CRITERION 3: COMMUNITY INPUT - DESCRIBE THE ATC PLANNING PROCESS AND INVOLVEMENT OF COMMUNITY STAKEHOLDERS IN DETAIL. DESCRIBE REMAINING STEPS IF ANY TO RECEIVE NECESSARY APPROVAL FOR SITE LOCATION OR OPERATIONS. Measure 1: Input from the city(s) or town(s) where the applicant’s ATC would be located. (see below) Measure 2: Input from the general public regarding the suitability of the applicant and the general standards for location(s) such as, distance from a school, daycare center or other child-oriented location; distance from a commercial shopping district, pharmacy, etc. (The following response applies to Measure 1 and 2 above) The Compassionate Sciences will conduct an active community outreach program that will begin simultaneously with the local zoning process and continue through build-out, occupancy, the start of ATC operations and beyond. Our community relations effort will be grounded in the principles of openness, inclusive stakeholder engagement and social responsibility. Compassionate Sciences is committed to being a good neighbor and to making a positive contribution to the communities across our service area. Upon identifying an ATC location, we will promptly meet with local zoning and other public officials to get their input. We will also seek their guidance on the best opportunities to obtain feedback from the general public and local communities regarding the ATC site and other areas of public interest. Compassionate Sciences management is prepared to attend, and present at, appropriate public forums or to facilitate a townhallstyle meeting to answer questions and get local input into our planning process, if requested. At the outset of our relationship with the community, an important objective will be to introduce ourselves, the organization and our operating plans and principles. However, the primary purpose from day one and ongoing will be to listen and respond to any issues and concerns of local leaders, law enforcement authorities, community groups, the general public and particularly our neighbors. Our commitment to community engagement begins at the top with the involvement of CEO Richard Taney and the program will be managed by Senior Vice President for External Affairs Andrei Bogolubov, a veteran communications professional with experience in designing and executing public affairs outreach programs for businesses and non-profits including healthcare, medical and pharmaceutical industry organizations.

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Our approach to community relations is expansive and the Compassionate Sciences public affairs program will engage all stakeholders including: • • • • ATC neighbors and community groups Businesses and commercial associations State and local law enforcement Government officials at the town, city, county and State levels

In keeping with our mission to set the standard for a medical model of palliative care, the CS-ATC Medical Advisory Board will oversee the organization’s outreach to the medical and healthcare community in our service area. Led by Medical Advisory Board Chairman Dr. Steven Patierno, we will engage stakeholders including: • • • Doctors, medical and healthcare organizations Academic and research organizations Local representatives of community, State and national organizations such as: - The New Jersey Hospice & Palliative Care Organization - New Jersey Pain Initiative - Medical Society of New Jersey - New Jersey Hospital Association - UMDNJ - The Cancer Institute of New Jersey, etc.

Compassionate Sciences management believes that New Jersey can set the national standard for clinically-appropriate, physician-driven and well-regulated palliative care. We are committed to contributing to the success of the New Jersey Medicinal Marijuana Program. To that end, we will be in regular contact with the Department of Health and Senior Services, the NJMMP and our ATC counterparts to collaborate on issues of management, clinical practice, research, science, public policy and community interests in our industry. The organization will commit ATC resources to support our public outreach program. Mr. Bogolubov will be provided a budget to carry out a comprehensive community relations program. Our database will record and analyze community comments and feedback. In addition to providing neighbors with an ATC point of contact as required by the NJMMP, we will provide contact information and channels for non-emergency input. CS-ATC staff performance reviews will include a community relations component. The trustees and the Medical Advisory Board (MAB) will regularly review the program and make recommendations. The MAB will lead our program of reporting the latest clinical and scientific advances to qualified patients who register for such updates, and we will share this information with our industry colleagues. Finally, Compassionate Sciences is committed to establishing a philanthropic component as soon as possible with a focus on supporting the advancement of pain management, palliative research and addressing indigent healthcare needs. 15

CRITERION 4: DISPENSARY SPECIFIC CONSIDERATIONS Measure 1: The applicant shall provide a plan for inventory, record keeping and security which shows an understanding of the types of records that shall be considered confidential health care information under New Jersey law and are intended to be deemed protected health care information for purposes of the Federal Health Insurance Portability and Accountability Act of 1996, as amended [HIPAA]. A medical standard of data management is at the heart of the Compassionate Sciences model. We will put in place the personnel and tools required to create a secure body of data that will enable the CS ATC to advance the clinical practice and science of palliative care while providing rigorous internal controls and excellent patient service. CS Trustee John Prufeta will bring expertise to this process as the former CEO of a pioneering medical data company. We will also benefit from the extensive experience of Trustee and CEO Richard Taney, who was the chief executive of an FDA-regulated medical device company. In addition, Trustee and Medical Advisory Board Chairman Dr. Steven Patierno, a pharmacologist and Executive Director of the GW Cancer Center will provide oversight and guidance in developing and implementing our data management protocols. Compassionate Science will employ state-of-the-art technology to deploy a secure, HIPAA-compliant data management system that meets our exacting standards and those of the NJMMP. At the core of the system is a proprietary software platform which was designed, tested and refined in a successful and well-established growing/dispensing facility in Montana. The system, which tracks and records every aspect of ATC operations from patient information to sales to the entire production cycle from seed to patient, includes a robust patient outcome, utilization and trend analysis capability. The software will be adapted to the specific requirements of the CS-ATC, the NJMMP, local law enforcement and all governing regulations under the supervision of John Prufeta, Compassionate Sciences executives and the ATC’s head of security. All dispensary employees will be trained in CS-ATC data, privacy and security protocols. Compliance will be a condition of employment and reflected in performance reviews. All patient information will be input into the secure, encrypted database which will be backed-up in keeping with accepted data security practices. Any paper documents will be stored in a locked cabinet with access restricted to authorized personnel and a record of access maintained by the system. Data security records and practices will be reviewed regularly by the ATC’s head of security and the CEO, with reports generated for the Board of Trustees as a basis for their annual assessment.

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Measure 2: The applicant shall submit a description of its proposed program for providing counseling and educational materials regarding methods of administration and research studies on health effects of medicinal marijuana to registered qualifying patients and their registered primary caregivers. The applicant shall submit a description of its historical relationship with clinical or research activities, if present. At the center of a medical model of care is a relationship with patients that provides the information and counsel they require to follow a beneficial course of treatment as recommended by their physicians. Compassionate Sciences intends to establish the highest standard of excellence in our patient education and counseling program. The program will be designed and supervised by Dr. Steven Patierno, the Chairman of the Medical Advisory Board (MAB). Dr. Patierno will bring to the program his expertise in consulting with patients at the GW University Cancer Center as well as his background as an accomplished educator with extensive publishing credits. Our experienced patient counselors will provide every qualified patient with the knowledge and tools they need, along with informative materials to take home. The process will begin with the basics in an intake interview. The counselor will provide background on Compassionate Sciences, ATC procedures, rules of the New Jersey Medicinal Marijuana Program and State laws governing the program. Patients will learn about their rights and responsibilities as well as registration, payment and financial assistance procedures. The patient’s information will be collected including doctor, physician registration, recommendation and other data required by the NJMMP. Patients will have the opportunity to discuss their condition and complete a pain self assessment. Compassionate Sciences counselors will be trained to provide accurate, timely information and sensitive counsel. All patients will be informed of the efficacy, sideeffects and addictive qualities of Cannabis and will be provided with information about signs of addiction as well as resources for recovery. Information covered in the intake counseling session will be supported by written materials in a patient orientation package that will also include FAQs, basic contact information and resources for further information. The packet will also include forms as well as procedural checklists and reminders. Registered patients will also receive educational counsel and materials. Compassionate Sciences will produce a full spectrum of counselor scripts and brochures to inform patients of issues such as diseases, treatments and conditions, Cannabis as a medicine, methods of administration and the state of palliative science. Patients will also be invited to register for alerts about the latest developments in the research and clinical development of Cannabis-based palliative therapies, as well as related issues. Compassionate Sciences staff will actively monitor the latest news under the supervision of the MAB and update counseling protocols and materials on a regular basis. Excellence in education and counseling will be a focus for the organization in terms of

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training and performance reviews. The trustees and the MAB will periodically assess and make recommendations to improve the program. Please see the Appendix entitled Education for an overview of the program and sample materials. Measure 3: The applicant shall provide an acceptable safety and security plan, including staffing and site, and a detailed description of proposed security and safety measures which demonstrate compliance with the Rules Related to the Medicinal Marijuana Program.

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Measure 5: The applicant shall submit a description of its Medical Advisory Board, including by-laws, setting forth the names and expertise of its members and describing how it will function within the organizational structure of the ATC, consistent with the Rules Related to the Medicinal Marijuana Program. For purposes of this requirement, it is not necessary to provide the name of the Medical Advisory Board member who is a registered qualifying patient. Compassionate Sciences views our Medical Advisory Board (MAB) as central to the organization’s commitment to serving the varied needs of qualified patients enrolled in the New Jersey Medicinal Marijuana Program. An accomplished and engaged MAB is also part and parcel of our mission to set the national standard for a medical model of care consistent with New Jersey Compassionate Use Marijuana Act by:

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• • •

Serving and informing medical Cannabis patients and their physicians Producing and dispensing Cannabis like a medicine, to pharma-quality standards Advancing the clinical practice and science of Cannabis-based palliative care

Organization The Compassionate Sciences MAB will be composed of five members, who will be appointed based on their knowledge and leadership in the specialized fields of knowledge: • • • • • • Medical oncologist Pain management expert Pharmacologist Patient advocate (registered qualifying patient) Psychologist or a physician with expertise in drug addiction Ex-officio NJMMP representative will be invited to attend the MAB meetings

The MAB will be comprised of distinguished experts who will help design, support and improve services offered by CS-ATC to meet the evolving needs of the medical Cannabis patient community. Our Medical Advisory Board will be recruited and chaired by Dr. Steven Patierno, a leading pharmacologist and head of the GW Cancer Center as well as a Trustee of CS-ATC (please see Dr. Patierno’s biography in Appendix F). The Compassionate Sciences MAB will have broad responsibility to: • • • • • Engage with CS-ATC management in an advisory capacity to advance its mission of delivering safe, effective palliative care to qualified patients. Conduct initial review and periodic updates of ATC policies to assure compliance with the New Jersey Compassionate Use Medical Marijuana Act. Review and comment on the ATC’s proposed initiatives and ongoing activities. Assist in formulating recommendations to improve or advance implementation of CS-ATC programs and policies relating to palliative therapies and patient education. Apprise management and patients of new developments in the science and clinical practice of Cannabis-based palliative care and related issues.

A major focus of the Compassionate Sciences Medical Advisory Board will be continuing education programs that inform qualified patients pursuant to the rules of the NJMMP. In this regard, the MAB’s expertise in drug addiction and prevention will be of critical importance. The board will also direct the substance and timing of notifications to qualified patients who register to receive scientific and clinical alerts in keeping with the rules of the NJMMP. As part of our commitment to public service, we will work with our MAB experts as well as local healthcare and community leaders to design a targeted and effective plan to reach the broadest patient population and the community consistent with the rules of the 20

NJMMP. As the patient population grows, there will also be a need to increase awareness of the special needs of our patients and their families among the region’s primary, secondary and critical care facilities. The MAB’s physician members will assist in designing that outreach and will assist us in engaging those institutions. As the NJMMP program grows, the data and knowledge base on consumption patterns, conditions treated and patient preferences will increase research and analysis opportunities to the benefit of all stakeholders. The data collected by CS-ATC will be reviewed annually by our MAB to identify areas of improvement in our services and to address, and make recommendations on, any patterns or deficiencies that might be uncovered during their review. This data and analysis will be shared with NJMMP representatives to assist them in analyzing the effectiveness of the program in meeting its stated objectives and legislative intent. Measure 6: The applicant shall submit a plan to track and analyze data including but not limited to patient outcome, utilization and trends. The advance of medical science was greatly accelerated with the advent of computers, sophisticated analytical technologies and powerful data bases. Compassionate Science has placed an organizational emphasis on developing robust data and IT systems. The organization has put in place the personnel and tools required to create a secure body of data that will enable CS-ATC to provide exceptional patient care, data security and privacy while also delivering rigorous supply chain control throughout the production chain. Compassionate Sciences Trustee John Prufeta brings expertise to this process as the former CEO of a pioneering medical data company. We will also benefit from the extensive experience of Trustee and CEO Richard Taney, who was the chief executive of a FDA-regulated medical device company. In addition, Trustee and Medical Advisory Board Chairman Dr. Steven Patierno, a pharmacologist who heads the GW Cancer Center, will provide oversight and guidance in developing and implementing our data management protocols. Compassionate Sciences will employ state-of-the-art technology to deploy a secure, HIPAA-compliant data management system that meets our standards and those of the NJMMP. At the core of the system is a proprietary software platform which was designed, tested and refined in a successful and well-established growing/dispensing facility in Montana. The system, which tracks and records every aspect of ATC operations from seed to patient, includes a robust patient outcome, utilization and trend analysis capability. The software will be adapted to the specific requirements of the CS ATC, the NJMMP, local law enforcement and all governing regulations under the supervision of Trustee John Prufeta and Compassionate Services executives.

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CRITERION 5. CULTIVATION SPECIFIC CONSIDERATIONS Measure 1: The applicant shall provide an acceptable safety and security plan, including staffing and a detailed description of proposed security and safety measures which demonstrate compliance with Rules Related to the Medicinal Marijuana Program.

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Measure 2: The applicant shall provide a description of the enclosed, locked facility that would be used in the cultivation of medicinal marijuana, including steps to ensure that the medicinal marijuana production shall not be visible from the street or other public areas. If the enclosed site is a greenhouse, identify materials used in construction of panels. Glass, fiberglass, metal, or polycarbonate panels shall be used in construction of the facility; polyethylene film is not permissible. Describe window and vent covers.

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Measure 3: The applicant shall demonstrate an ability to provide a steady supply of medicinal marijuana to registered qualifying patients. Based on our experience, the keys to producing consistent, high quality medicinal Cannabis in keeping with State specifications are the following: 1. Experienced cultivators. The single most important asset will be the ATC’s growers. As a plant that must be grown indoors to strict environmental tolerances without the use of pesticides, Cannabis is vulnerable to infestation, mold, disease and other blights that can destroy a harvest and interrupt supplies to patients in need. The record is clear -- even experienced agronomists with access to readily-available literature on cultivating Cannabis have failed to produce a usable first harvest. In this respect, the NJMMP and any other new medicinal marijuana program across the country faces challenge inherent in the lack of local experience in cultivation. Moreover, the experience in California and Colorado demonstrates that there is a relatively limited pool of first-rate growers across the country. CS-ATC management has conducted an exhaustive national search to identify and secure the services of cultivators with the necessary credentials. We are confident that CS-ATC’s COO, Michael Nelson, and Master Grower Nicole Wagner have the credentials and track record that are second to none. 2. State-of-the-Science Environmental Controls. Holding experience constant, the next priority in successful cultivation is the ability to control the vital environmental factors of light, temperature, water and air quality. CS-ATC will install and maintain the best lighting, HVAC, irrigation, sensor, backup generation and other critical systems to ensure that we are able to consistently nurture generations of healthy plants throughout their growing cycle. In addition, CS-ATC will build a cultivation area consisting of ten smaller grow rooms instead of one large growing floor. A multi-room design helps insure against a catastrophic supply disruption stemming from an infestation or disease because minor outbreaks are easily isolated and treated in the room of origin, greatly mitigating the risk of epidemics. Also, a series of smaller affords the ability to sanitize completely after harvests, a safeguard that is not available in an open floor design. This approach also ensures a regular harvest every 7-10 days as the rooms produce crops in a staggered cycle.

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Please see the Site and Room Provisions in Appendix H for a detailed engineering overview. 3. Rigorous Quality Management and Controls. CS-ATC will place primary emphasis on management to achieve the quality standards of the NJMMP. We know of many instances in which the best-available quality control systems have not guaranteed results due to the lack of diligent management by an experienced and dedicated cultivator. At the same time, quality controls are essential tools in any growing operation and CS-ATC’s system consists of four components which are described in Measure 3 (III) below. I. Question: The applicant shall provide a start-up timetable which provides an estimated time from issuance of an authorization for operation to limited operations to full operation, as well as the basis for these estimates. Compassionate Sciences enjoys a significant initial-stage operating advantage that comes from having a COO with the experience of successfully building and launching multiple ATC facilities including growing and dispensary operations in Montana. We have designed our operational launch timetable based on Mr. Nelson’s experience supplemented by consultation from our New Jersey-based commercial real estate advisors at CB Richard Ellis. CS-ATC Start-Up Timetable Issuance of Authority to Building Permit Building Permit to Limited Occupancy Building Permit to Full Occupancy Occupancy to Limited Operations Occupancy to Full Operations/Cultivation Issuance of Authority to Full Operations/Cultivation 1 month 3 months 5 months 2 months 3 months 9 months

The above timetable assumes that the building department issues our permit within four weeks of application. Construction is estimated at five months, and an additional nine week period is required from limited occupancy when cultivation begins to first harvest. II. Question: The applicant shall describe its knowledge of (and experience with) organic growing practices or agricultural growing practices to be used in their cultivation of medicinal marijuana. Compassionate Sciences cultivators have deep experience in agricultural growing methods including organic practices: Michael Nelson, Chief Operating Officer. Mr. Nelson is the owner and operator of the largest and most respected ATC’s in Montana. His cultivation center and multiple-location dispensary has set the standard of excellence in serving qualified 26

patients throughout the Central and Western regions of the State. Mr. Nelson brings to his work a background in sales, management, distribution and marketing of school products to universities and high schools across the American Northwest. He is active in the Bozeman area business community and as a volunteer at a sports program for the disabled. Mr. Nelson earned a BS in Business from the University of Colorado. Nicole Wagner, Master Grower. Ms.Wagner is an accomplished government and academic analyst and researcher in the fields of sustainable agriculture, ecology, agronomy, statistics, engineering and economics. Ms. Wagner has published numerous research studies and has a deep understanding of diversified agricultural systems including organic vegetable and dairy production, conventional corn, soybean, and small grains production. Ms. Wagner earned her PhD. in Land Resources and Environmental Sciences from Montana State University and attended the University of Minnesota where she earned her Masters and BA in Biosystems and Agricultural Engineering. She developed her expertise as head grower at Mr. Nelson’s ATC in Montana. III. Question: The applicant shall describe its quality control program and steps that will be taken to ensure the quality of the medicinal marijuana, including purity, potency and consistency of dose. The Compassionate Science ATC will employ a powerful, integrated quality control system that consists of the following elements: 1. Hardware and IT-based quality systems. CS-ATC will deploy a full spectrum of quality management technologies including: automated environmental controls for lighting, HVAC, water and air; sensors and alerts; back-up power; as well as our proprietary IT technology that records and analyzes production from seed to patient. Please see Appendix entitled Data Systems. 2. Quality protocols and facility features. Compassionate Sciences staff will operate in accordance with strict protocols for daily tasks, reporting requirements and basic responsibilities such as sanitization checklists, labeling and data collection requirements and pest/disease control procedures. The ATC will be built to accommodate these best practices, with features including a clean room where employees will change into fresh uniforms upon reporting to work and workplace aids such as weight charts, photographs and safety reminders. Please see Appendix H for draft operating protocols. 3. Laboratory and Analytical Facility. In keeping with our focus on delivering pharma-standard care and advancing the science of palliative therapies, we will build a state-of-the-science laboratory for testing, analysis and research at the CS27

ATC facility. For this purpose, we have engaged Dr. Noel Palmer, a consultant who has a PhD. in the analysis of soils, plants and particularly Cannabis. Dr. Palmer has worked directly with Cannabis researchers who established the standard Dutch methods currently used by the government of Holland and runs Montana Botanical Analysis, an analytical facility in Montana that is dedicated to working with Cannabis. Dr. Palmer will work directly with our analytical facility, set up instrumentation, and train technicians to ensure that analytical protocols are performed with excellence. The CS-ATC laboratory will enable real time testing and the highest levels of quality control. In terms of production, we will be able to test and label the various strains and measure THC levels as required by the NJMMP. In addition, the lab will provide the organization with a technical platform to engage in botanical research. Please see Appendix entitled Laboratory for an overview of the CS-ATC facility and for Dr. Palmer’s credentials. IV. Question: The applicant shall describe:  Methods to ensure that seed production and/or hybridization is prevented during cultivation of medicinal marijuana; After initial sexing of plants, CS-ATC will be working only with female plants. Please refer to page 13, plant sexing, of the Cultivation Manual in the Appendix.  Methods of testing for the presence of mold, bacteria or other contaminants; Our Master Grower and cultivation staff will employ recognized methods of identifying and testing for the presence of contaminants. In addition, CS-ATC’s onsite laboratory (see Appendix) will enable a full spectrum of product testing for disease conditions, potency and other crucial parameters. Please refer to page 43, Pests and Diseases, of the Cultivation Manual in the Appendix.  Procedures for routine scouting of insect and plant disease conditions; CS-ATC practices for routine insect and disease inspections are presented in the Cultivation and Operating manuals in the Appendix.  Methods to control insect pests that do not include the application of pesticides during cultivation of medicinal marijuana, in accordance with the Rules Related to the Medicinal Marijuana Program;

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The CS-ATC model does not use pesticides in cultivation and will rely on common organic methods as described in the Operations Manual protocol in the Appendix. ATC practices for routine insect and disease inspections are presented in the Cultivation and Operating manuals in the Appendix.  Procedures for proper sanitation practices to minimize plant disease, and to promptly dispose of diseased plant material in a secured disposal area; The CS-ATC Master Grower will establish a separate area, cannisters and protocols dedicated to the disposal of diseased plants and plant medium. Grow room staff will handle diseased plants and plant medium with disposable gloves and foot coverings. The contaminated grow room will be isolated and sanitized by spraying walls, light fixtures and floors with approved cleaning agents. CS ATC’s multiple grow room model will allow complete and thorough sanitation of affected areas with no risk of cross contamination.  Methods for utilization of fans and cooling systems to maintain airflow patterns sufficient to prevent or minimize plant disease and insect infestation; Please refer to Site and Room Provisions in Appendix H.  Methods to keep environment free from flowering male plants to ensure that female plants are not pollinated and seed production and/or hybridization is prevented; After initial sexing of plants, CS-ATC will be working only with female plants. Please refer to page 13, plant sexing, of the Cultivation Manual in the Appendix.  Recordkeeping of any cultural measures used for plant pest or disease control, including disposal of culled plants; Cultural measures are recorded by barcode reader for automatic data entry into the CS-ATC database (see Appendix entitled Data System).  The various strains of marijuana to be dispensed, and the form(s) in which it will be dispensed; Three strains of Cannabis will be dispensed in low, medium and high potencies with a maximum THC content of 10%. The product will be dispensed as the dried and cured flower of the female plant free of seeds, stems, contaminants and foreign matter. In keeping with our mission to create a pharma-standard model, CS-ATC’s R&D will focus on developing ways of delivering Cannabis like a medicine: • In therapeutic, single-dose form to allow treatment to the dose-response curve 29

• •

In sterile doses with non-smoking options for immunocompromised patients In systems that optimize supply chain, regulatory and law enforcement controls

 Record keeping for each package by lot, label and bar code; CS-ATC’s proprietary software tracks all Cannabis throughout the growing and production cycle by plant, batch and lot using a bar-coded labeling system. Please refer to Data System in the Appendix. Patient-ready product will be packaged in no more than ¼ ounce-counts with a label specifying: • • • • • • • ATC name/address, packaging date and quantity Sequential serial and lot number with bar code Cannabinoid profile and THC level not to exceed 10% High, medium or low potency Statement of restriction to medical use by qualified patient, not for resale or redistribution List of other ingredients Dispense date, patient name and registration ID number

 Area security; All external and internal ATC spaces will be housed in a high-tech security envelope in keeping with NJMMP requirements and security industry best practices. Please see Safety and Security Plan in Appendix H.  Packaging and labeling requirements; and CS-ATC’s proprietary software tracks all Cannabis throughout the growing and production cycle by plant, batch and lot using a bar-coded labeling system. Please refer to Data System in the Appendix. Patient-ready product will be packaged in no more than ¼ ounce-counts with a label specifying: • • • • • • • ATC name/address, packaging date and quantity Sequential serial and lot number with bar code Cannabinoid profile and THC level not to exceed 10% High, medium or low potency Statement of restriction to medical use by qualified patient, not for resal List of other ingredients Dispense date, patient name and registration ID number

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 Methods of processing in a safe and sanitary manner. CS-ATC will process Cannabis in a secure processing room away from cultivation and dispensary operations and adjacent to the reinforced central vault room where all inventory will be stored (please see engineering floor plans in Appendix H). Swipe-card access will be restricted to authorized personnel and the room will be fully secured (please see Safety and Security Plan in Appendix H). The space will be maintained to laboratory/pharmacy sanitary and work environment standards. Employees will wash their hands before entering, wear clean lab coats and latex gloves when handling product. All processing will be done on stainless steel work benches using in-line “low touch” production processes to minimize human contact. All work surfaces will be sanitized and the room cleaned by processors daily and staff will observe safety and sanitation procedures established by the NJMMP and CS-ATC management. Compliance will be a condition of employment and will be reflected in performance reviews.

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APPENDIX A

Certificate of Incorporation Certificate of Good Standing Corporation by-laws Medical Advisory Board by-laws

             

       

 

 

             

       

 

APPENDIX C

Site Analysis Maps of Locations and Zones 

             

       

 

APPENDIX D

Public Safety Analysis Maps of Drug-Free Zones 

             

       

 

APPENDIX E

Map of ATC Service Area by Zip Code 

             

       

 

APPENDIX F

Management and Trustee Biographies 

             

       

 

APPENDIX G

ATC Draft Operations Manual Employee Handbook ATC Build-out Timetable  

1

             

CS-ATC Data & IT System 

       

 

 

       

Cultivation Manual

DRAFT
 

 

 

 

 

   

 

 

24 

support 

 

 

 

 

 

 

 

48 

     

 

 

 

53 

             

       

 

CS-ATC Laboratory & Analytical Facility CS-ATC Chemist

 

 

 

 

             

       

 

Education

 

1

2

4

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