A Philadelphia-area investment firm is doubling down on its bet into medical marijuana.

MainLine Investment Partners, which controls about $1 billion in assets, first entered the cannabis world with the birth of Solterra Health LLC, a company created from scratch to grow, process and sell medicinal cannabis in the state of Pennsylvania.

In March, Solterra announced it was partnering with Jefferson Health in Philadelphia to conduct research into uses of marijuana to treat a panoply of serious ailments.

Now comes news that MainLine is placing a significant gamble on marijuana in other states. The company in late April sank $10 million into Alternative Medical Enterprises (AltMed), a Florida-based cannabis grower and retailer. On Monday, MainLine co-founders William Landman and David Clapper were appointed to AltMed's board of directors.

MainLine's stake was part of a $35.4 million investment into AltMed made with a consortium of other backers announced April 26.

William Landman (R) of MainLine Investment Partners, and Michael Smullen, CEO of AltMed Enterprises.
William Landman (R) of MainLine Investment Partners, and Michael Smullen, CEO of AltMed Enterprises.

AltMed, with a valuation of more than $100 million, already has a strong presence in Arizona. It operates a 30,000-square-foot growing and manufacturing warehouse, where it produces the medical marijuana brand MüV. AltMed products include transdermal patches, metered inhalers, topical creams, capsules and tinctures.

This year, AltMed began building out a cannabis empire in Florida. It is constructing a 150,000-square-foot, state-of-the-art growing facility near Tampa Bay and plans to set up 30 retail dispensary outlets across the state. It is one of only nine marijuana companies licensed to cultivate marijuana in the state.

To MainLine's Landman, AltMed is a near-perfect partner.

"We see our investment in AltMed as a rare opportunity to gain a strong foothold in a once-in-a-generation new growth industry," said MainLine's Landman in a statement. "AltMed has demonstrated that they are and will be industry leaders in Florida, Arizona, nationally and globally."

Landman serves on the board of the Thomas Jefferson University System and previously was   the board's chairman. He is often credited for being the architect of Pennsylvania's state-sanctioned medical marijuana research program. Called Chapter 20, after the section of the state's marijuana law, the program allows up to eight health systems to pair with cannabis producers.

Michael Smullen, co-founder and CEO of AltMed Enterprises, said many suitors wanted to invest in his company. But only MainLine brought all the right qualities to the table.

"We were looking for people who not only had strong financial support, but could be great strategic partners," said Smullen, a 30-year pharmaceutical industry veteran. "I loved the idea that [MainLine] was interested in true research into medical marijuana, talked about a partnership with Jefferson and getting licenses in multiple states. And it's very much in line with our own vision."

AltMed plans to take its line of MüV medicines to Pennsylvania.

"We will teach them how to manufacture and oversee quality control," Smullen said from his Sarasota headquarters. "They have their own grower and have a great team assembled. They'll be growing the product and we'll be processing and turning it into the MÜV product line."

Smullen said the company has not yet decided where it will put its Pennsylvania plant. But operations in the Keystone State are only the beginning of its relationship with MainLine.

"We're looking at multiple states right now," Smullen said, "and we expect that MainLine will be involved with deals in at least three or four more states."