AUGUSTA — An attorney for Maine’s largest medical marijuana nonprofit group says it has secured $1.6 million in financing in a deal that will be formally delivered to the state today.

If approved, the deal will enable Northeast Patients Group to open its first dispensary within a month, according to Daniel Walker, a Portland lawyer who represents the struggling dispensary group.

Walker filed documents Aug. 4 with the Maine Department of Health and Human Services naming The Farmacy Institute for Wellness and retired NBA basketball player Cuttino Mobley as partners in The Wellness and Pain Management Connection LLC.

The Wellness and Pain Management Connection LLC — which formed Aug. 3 in Delaware — is the entity that will lend Northeast $1.6 million during eight years at 8.5 percent annual interest.

Walker said The Wellness and Pain Management Connection LLC was not formed at the last minute, but had been in the works for “months and months.”

“It wasn’t this mashed-together, last-minute thing,” he said.


The Farmacy Institute for Wellness is an offshoot of The Farmacy, which operates three dispensaries in California, Walker said.

Joanna LaForce, director of clinical operations for those dispensaries, will “oversee and support delivery of certain consulting and related services” for Northeast, according to the term sheet detailing the loan.

Walker said Northeast’s first dispensary, in Thomaston, will be open in the first half of September, thanks in part to the new capital. State officials have said they inspected a Northeast cultivation operation there, where two people now work, in June.

Northeast’s deal with The Wellness and Pain Management Connection LLC has been questioned by several interests, including Berkeley Patients Group, Northeast’s former backer, which sued Northeast in Cumberland County Superior Court in July for repayment of more than $632,000 in loans.

Berkeley also alleges Northeast Patients Group CEO Becky DeKeuster used proprietary information to negotiate the deal with Mobley while still employed as Berkeley’s New England expansion director.

She quit that job days after signing the deal with The Farmacy Institute for Wellness.


Berkeley is also asking the court to remove DeKeuster from her job with Northeast.

An attorney for The Farmacy also questioned whether a deal had been reached. William Kroger, a Beverly Hills, Calif., attorney who said he represented The Farmacy, said Aug. 5 there was no deal between Northeast and The Farmacy.

“Your facts are incorrect,” Kroger wrote in an email. “I am the attorney for The Farmacy and there has not been any such agreement or business arrangement.”

“I think it was a misstatement,” Walker said of Kroger’s statement. “(He thought LaForce) had given the money, or that it was a collective. No one’s denying there was an agreement.”

Walker — who had not returned several calls over the past several weeks seeking clarifications on Northeast’s operating status, said Friday that published reports have erroneously overstated his role with Northeast.

He has never been chairman of the Northeast Patients Group board of directors, Walker said Friday.


“I’m just counsel, not chairman of the board,” he said.

DeKeuster did not return calls seeking comment last week.

DHHS spokesman John Martins said Friday the department’s licensing staff will receive signed copies of the agreement this week; Walker said those documents will be delivered to the state today.

Martins wrote that department representatives have “seen signed documentation regarding the agreement.”

“We have full confidence that the agreement is in place,” Martins wrote.

Northeast Patients Group owns the exclusive right to run half the state’s licensed marijuana dispensaries, including the state’s largest potential markets: Portland, Bangor and Augusta.


But the organization has struggled to open a single dispensary, and it has dialed back the financial expectations it envisioned in its initial applications.

In its 2010 application, Northeast projected a net gain of more than $426,000 while serving 691 patients in its first full year.

On July 20, Northeast projected a net loss of more than $1.75 million while serving 540 patients in its first full year.

Meanwhile, growth in the state’s medical marijuana program has skyrocketed.

In March, the state said there were 773 patients. By mid-June, 1,800 patients were approved, according to John Thiele, medical marijuana program manager for the DHHS Division of Licensing and Regulatory Services.

Michael Shepherd — 621-5662

[email protected]

Only subscribers are eligible to post comments. Please subscribe or login first for digital access. Here’s why.

Use the form below to reset your password. When you've submitted your account email, we will send an email with a reset code.