When I heard the Thames Valley Alternative Relief (TVAR) story, a company led by Laurie Zrenda and her niece Meredith Elmer, all I could think about was how the Connecticut Department of Consumer Protection’s (CDCP) cannabis regulatory authority got it right.
In the medical marijuana program that the state launched in 2013-14, they had a limited number of grower/processor (4) and medical dispensary (6 and now 9) license awardees that were geographically dispersed to serve patients statewide.
Since formally beginning the program in late 2014, the state has registered over 22,000 patients; TVAR currently serves in excess of 3,500 of them. TVAR’s projected 2017 year-end revenues are on track to be triple their first full year of operating revenues.
Back in 2013, Zrenda, a Rite Aid pharmacist for the previous 16 years, heard from a peer at Walgreens about Connecticut’s new medical marijuana program. That conversation led her to think about entering the competition for the original six dispensary licenses that the state would issue. Connecticut’s program was unique at the time in the sense that only licensed pharmacists would be able to apply for and obtain a dispensary license from the CDCP.
Like many others before her who had entered the cannabis industry, Zrenda, a single mom and a non-cannabis consumer, was intrigued by the opportunity to be her own boss and control her destiny. But she was hesitant to go it alone. So she reached out to Elmer, who was also a pharmacist.
The two women were not confident in their ability to submit a winning application, so they decided to do some due diligence. They attended a National Cannabis Industry Association event in Chicago in July, 2013, and heard two industry insiders speak: Kayvan S.T. Khalatbari of Denver Relief and Denver Relief Consulting (DRC), and Mark Passerini, the owner/operator of Om of Medicine in Ann Arbor, Michigan. They approached both guys to see if they could help get their application together. Khalatbari provided a menu of services, and Passerini agreed to let the two of them tour his dispensary, which they did shortly after the meeting.
Armed with the DRC’s expertise and an idea of how a dispensary operation worked, they began the process of becoming one of the state’s 27 applicants. They submitted an application for one of the six that would be awarded. Their first step was to find a convenient location that would be willing to host a new medical dispensary.
They began working with the progressive local authorities in Uncasville, Connecticut, where they found an acceptable 1,100 square feet of space that would meet TVAR’s needs. They did very little market research to determine potential patient count, but never-the-less decided to move forward. Zrenda told me their mantra was, “If you build it, they will come.”
After submitting their application, the two were pleasantly surprised to be awarded a license to dispense medical cannabis.
Located in southeastern Connecticut, the TVAR location was a reasonable driving distance from their homes and was geographically ideal, since there were no other selected locations within an hour drive for potential patients.
As TVAR approached launch in the second half of 2014, their next biggest challenges involved product sourcing and generating patient count. Patients would be allowed to purchase 2.5 ounces a month from a dispensary where they would hang their medical marijuana card (patients can amend their dispensary of choice but it is a 24-hour process) that met any of the covered qualifying medical conditions which the new law included. Additional conditions have been added since the launch, including:
New debilitating medical conditions (effective as of October 1, 2016):
For patients 18 years of age or older:
For patients less than 18 years of age:
The four licenses granted to producer/processors in Connecticut were required to supply pre-weighed, lab-tested and packaged product to the original six dispensaries. The original and current licensed producer/processors in state include:
Theraplant was their original supplier at launch with a limited amount of flower representing three strains that they sold to the other dispensaries as well. Edibles and infused products would come later as production ramped up at the four designated suppliers.
Generating patient count was by far the bigger challenge as doctors in the state were slow to join the ranks to qualify patients for the initial conditions. TVAR did some radio and newspaper ads in their first three months of operation, plus a separate targeted effort to demystify the program and TVAR for physicians to participate.
One promotion included an offer for physicians to visit TVAR to learn more about the state’s MMJ program. For that promotion, they scheduled three different nights of receptions for the 60 or so targeted physicians in the area, only to have one show up. TVAR also visited local cancer clinics and neurologist practices, and did a tour of senior homes with a doctor from Hartford to educate potential patients.
After a slow start, TVAR now has a core group of 8-12 participating doctors in their draw area that people can go to if their primary care or specialists won’t help. But they have over 100 doctors that have patients registered at TVAR.
The few original patients tended to have a couple of things in common. Many were past consumers who bought their marijuana from the black market. PTSD was one of the most cited qualifying conditions for which TVAR served medical marijuana in year one.
The current dispensary was designed to provide patient consultations (state law only allows a pharmacist to provide any product or dosage recommendations), and they set up one area to handle this. They also have a counter to serve patients medical marijuana.
Since the state also doesn’t allow for any product to be displayed, product is always bought sight unseen and is delivered via pharmacy technicians once the pharmacists have provided the consultation.
As producers have gotten up to speed, inventory items have expanded to include wax, concentrates, vaperwear and edibles. The backend of the shop has been used to store any cannabis-related items in safes to serve the ever-expanding patient base that has grown steadily in TVAR’s three-plus years of operation (they launched in September of 2014).
What is amazing about TVAR’s sales growth is that they don’t currently do any advertising. Word of mouth and a captive, 1 hour drive time expanding patient base has fueled their growth. Zrenda humbly said they didn’t have to do anything to attract and gain sales.
She has paid close attention to the customer service aspect of the operation, and it is reflected in TVAR’s staff of 15 of which seven are family members. The others are pharmacy people Zrenda and Elmer have worked with over the years.
Zrenda has been very cautious in her hiring practices, looking for folks that she trusts who are patient and have great people skills. They have four full-time pharmacists on staff – three full-time and 1 part-time technician.
TVAR gets about 10 new patients a day. The on-boarding consultations and strong product mix play a key role in their success. Noteworthy in the patient count growth is its weighting.
Zrenda told CBE that most new patients are seniors 70 years old and older who have no experience with cannabis. Pain related issues tied to specific state approved qualifying conditions seem to be one of the more prevalent reasons that their new patients come to TVAR, and many of them specifically want to cut back on opiate treatment for pain.
As a result of their growth, TVAR is renovating a new 2,200 square foot dispensary in Uncasville in a building that they bought a year ago and plan to have up and running in a couple of months. The new facility will include two private consultation areas and more space to handle an expanding inventory mix and patient flow. They have no debt outside of the owner financing on the new property, and the operation’s cash flow has allowed them to turn a profit, even with 280E tax requirements.
When the interview was winding down, I asked Zrenda what keeps her up at night. At 53 years of age, she says that she believes she can work for another 15 years. But she is concerned about the effects of the state legalizing adult-use marijuana, and the ultimate end of federal prohibition, and what that will mean for medical marijuana in general.
She and Elmer enjoy their business and the relief it gives their patients. But they are uncertain about what a recreational program will mean to these two pharmacists who took a chance four years ago and are now seeing the fruits of their labor come true.
Company Name: Thames Valley Apothecary
Year Founded: 2013
Ownership structure/operating entities: DBA Thames Valley Alternative Relief (TVAR)/ 50% owned by Laurie Zrenda, 40% Meredith Elmer and 10% Bruce and Ellen Chandler
Management Team: Laurie Zrenda, Meredith Elmer
Headquarters: Uncasville, CT
Number of Locations: 1
Number of Licenses by State: 1
Industry Segment/Category: Medical marijuana dispensary
Current Markets/States Served: Eastern Connecticut within an hour drive time of Uncasville.
Current Number of employees: 15
2015 Revenues: N/A
2016 Revenues: N/A
2017 Projected Revenues: N/A
Company/Revenue Mix: We sell some vapes and glass items as well, but our primary sales are medical marijuana flower, waxes, concentrates, edibles and oil cartridges.
Expansion Plans: TVAR is moving to a larger location (doubling the square footage/new dispensary is 2,200 square feet) in about 2 months.
Financing strategy: Self-financed. TVAR doesn’t have any financing except for the mortgage on their new building which is owner financed.
Rob Meagher, CBE’s Founder, President and Editor-in-Chief is a 30 year veteran of the media world. His career has spanned from stints representing the Washington Post, USA Weekend, Reader’s Digest, Financial World & Corporate Finance to the technology world where he worked at International Data Group and Ziff Davis where he was part of the launch team for The Web Magazine, Yahoo Internet Life, Smart Business and Expedia Travels before starting his own marketing and Publisher’s Representative Firm. He also ran all print and online media sales and marketing for the Society for Human Resource Management before partnering with Forbes and then Fortune to create Special Sections covering a variety of topics. Rob, who started CBE Press in 2014, can be contacted at [email protected]
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