Last Friday, the Bureau of Marijuana Control, the regulatory body overseeing California’s cannabis industry, released a set of proposed regulations for the lab testing market. The regulations are somewhat comprehensive, covering sampling, licensing, pesticide testing, microbiological contaminants, residual solvents, water activity and much more.
Formerly named the Bureau of Medical Cannabis Regulation under the state’s Department of Consumer Affairs, the Bureau of Marijuana Control is tasked with overseeing the development, implementation and enforcement of the regulations for the state’s cannabis industry. In their statement of reasons for the lab testing regulations, the bureau says they are designed with public health and safety at top of mind. At first glance, much of these laboratory rules seem loosely modeled off of Colorado and Oregon’s already implemented testing regulations.
The regulations lay out requirements for testing cannabis products prior to bringing them to market. That includes testing for residual solvents and processing chemicals, microbiological contaminants, mycotoxins, foreign materials, heavy metals, pesticides, homogeneity as well as potency in quantifying cannabinoids.
The microbiological impurities section lays out some testing requirements designed to prevent food-borne illness. Labs are required to test for E. coli, Salmonella and multiple species of the pathogenic Aspergillus. If a lab detects any of those contaminants, that batch of cannabis or cannabis products would then fail the test and could not be sold to consumers. A lab must report all of that information on a certificate of analysis, according to the text of the regulations.
The proposed regulations stipulate requirements for sampling, including requiring labs to develop sampling plans with standard operating procedures (SOPs) and requiring a lab-approved sampler to follow chain-of-custody protocols. The rules also propose requiring SOPs for analytical methodology. That includes some method development parameters like the list of analytes and applicable matrices. It also says all testing methods need to be validated and labs need to incorporate guidelines from the FDA’s Bacterial Analytical Manual, the U.S. Pharmacopeia and AOAC’s Official Methods of Analysis for Contaminant Testing, or other scientifically valid testing methodology.
Labs will be required to be ISO 17025-accredited in order to perform routine cannabis testing. Laboratories also need to participate in proficiency testing (PT) program “provided by an ISO 17043 accredited proficiency-test provider.” If a laboratory fails to participate in the PT program or fails to pass to receive a passing grade, that lab may be subject to disciplinary action against the lab’s license. Labs need to have corrective action plans in place if they fail to get a passing grade for any portion of the PT program.
This three-part series will provide an in-depth look at intellectual property (IP) protection that is available for innovative and new varieties of cannabis. In this first installment, we will examine the reasons why cannabis breeders should adopt a strong IP strategy and look briefly at the types of IP that they should be considering. In the second and third pieces, we will look at the types of IP protection that can be used to protect innovative cannabis varieties and the unique IP issues the cannabis industry faces right now. Taken together, these articles will provide insight into IP strategies that cannabis breeders and growers can employ today to help prepare for the day that cannabis becomes legal nationally.
Why should I use IP to protect my cannabis varieties?
First and foremost, as the cannabis industry continues to move from a small, tight-knit community of breeders and growers into a ‘big-business’ industry, IP is the only way for breeders to protect the investment of time, energy and money that they put into developing new and innovative strains of cannabis. At a recent cannabis growing conference, one sentiment felt among numerous breeders was a feeling of frustration– stemming from the fact that they had spent many years developing new varieties of cannabis and, now that the industry is exploding, they are not getting recognition for all that effort. The way to avoid this issue is to protect novel varieties with IP to ensure that you are given proper credit for all of your hard work.
Moreover, an examination of industries that have strong similarities to the cannabis industry, such as other plant-based industries and ‘vice’ industries, provides compelling evidence that IP will become a main driving force in the cannabis industry as it continues to mature. For example, the fruit and hops industries have been relying upon strong plant patent and trademark protection for many years. The extremely popular Honeycrisp apple is a patented variety and the Amarillo hops variety (officially called ‘VGXP01’) is protected by both a U.S. Plant Patent and a federally registered trademark. Similarly, the alcohol and tobacco industries rely upon strong trademark and branding strategies, with many consumers being extremely brand-particular.
Additionally, there is strong evidence that the cannabis industry is primed for intellectual property protection. Since long before cannabis was legalized, consumers who were buying cannabis on the black market often sought out a particular variety from their dealer, something that becomes more prevalent as the industry continues to mature.
Why is now the time to think about IP?
First, the relevant governmental bodies have now provided some clarity as to the types of IP protection that can, and cannot be obtained for cannabis. For example, it is now clear that the U.S. Patent and Trademark Office (USPTO) will issue patents that cover new cannabis plant varieties and related innovations, such as novel growing methods. In fact, the first U.S. Plant Patent that covers a novel cannabis strain, called ‘Ecuadorian Sativa’, issued in late 2016.
Similarly, though federal trademark registration is not currently available if the product being protected is a cannabis product that is illegal under federal law. Federal trademark registration may be available to protect products related to the cannabis industry that are not themselves federally illegal (e.g., grow lights, fertilizer, etc.). Many states with legalized cannabis will grant state trademark registrations for cannabis products regardless of whether the products are viewed as illegal under current federal law. With this increased clarity, companies can now begin to formulate a comprehensive IP strategy that ties together the various types of IP protection.
Additionally, cannabis breeders and growers should look to adopt an IP strategy now because there are certain time bars that exist that may result in loss of rights if they wait. For example, as we will discuss in Part 2 of the series, patent protection can only be sought if the variety to be patented was not sold, offered for sale, or otherwise made publicly available more than one year before the patent application is filed. So if a breeder chooses to wait to seek patent protection for a new variety, the ability to ever get that protection may be lost.
The bottom line is that, to solidify their place in the market, cannabis breeders and growers should be formulating an IP strategy sooner rather than later. Those forward-thinking growers and breeders that adopt a comprehensive IP strategy up front will gain a distinct competitive advantage over competing growers and breeders down the road – an advantage that will become even more important if and when large corporations begin to move into the cannabis space. Those companies that have strong brands in place will be better equipped to survive and thrive in the face of pressure from legal teams at larger companies.
The next two installments of this series will examine the specifics of the types of IP protection that can be sought and the unique issues that the cannabis industry faces with each of them.
Legal disclaimer: The material provided in this article is for informational purposes only and not for the purpose of providing legal advice. The opinions expressed herein are the opinions of the individual author and may not reflect the opinions of the firm or any individual attorney. The provision of this information and your receipt and/or use of it (1) is not provided in the course of and does not create or constitute an attorney-client relationship, (2) is not intended as a solicitation, (3) is not intended to convey or constitute legal advice, and (4) is not a substitute for obtaining legal advice from a qualified attorney. You should not act upon any such information without first seeking qualified professional counsel on your specific matter.
Last week, the American Society for Testing and Materials (ASTM International) approved the formation of a committee to develop standards for the cannabis industry. ASTM International is a standards development organization that develops voluntary consensus-based standards for industries. United States regulatory bodies and the World Trade Organization have recognized the organization’s standards in other industries.
On March 1st, the non-profit announced the formation of a committee for ““creating technical standards and guidance materials for cannabis and its products and processes.” So now that the vote has passed, what is the next step? They will begin the process of member training, appointment of leadership and writing the bylaws. ASTM will have two online briefings before their official meeting for the cannabis committee (D37) in June. Those meetings will discuss how the committee was formed and how it’ll be structured. The first official meeting of the cannabis committee will take place June 11th and 12th in Toronto.
Lezli Engelking, founder of FOCUS
Voluntary consensus-based standards means there is a balance of interests, an appeals process and an overall consensus has been reached. The areas of focus for the cannabis standards include indoor and outdoor horticulture and agriculture, quality management systems, laboratories, processing and handling, security and transportation, and personnel training, assessment and credentialing. Many standards will be developed under each of these broad categories. A large component of consensus-based standard development is openness…so anyone who wants to participate in the development of the standards is welcome and encouraged to do so. They are still looking for participants from the cannabis industry and those interested can register here.
Lezli Engelking, founder of the Foundation of Cannabis Unified Standards (FOCUS), says this is terrific news for the cannabis industry. “To have a global organization like ASTM, that federal governments actually work with and respect, is a huge stride forward for the cannabis industry,” says Engelking. “FOCUS is thrilled to be working with ASTM.” FOCUS and ASTM International have a derivative work license agreement that provides ASTM the FOCUS standards to use as a baseline for developing their standards. “FOCUS will continue to certify cannabis businesses to the FOCUS standards, but we will be able to add in the ASTM standards to our certification platform,” says Engelking. “It helps us expand our depth and reach in tools for our clients.”
FOCUS standards and ASTM standards are both voluntary consensus-based, meaning it is the businesses and stakeholders participating that ultimately write the standards. The organizations’ staff does not actually contribute to and develop the standards; they are more like a vehicle for the industry and stakeholders to come to a consensus, according to Engelking. “ASTM does the same thing that we do for the cannabis industry, just on a much larger scale,” says Engelking. “Its role is to fulfill the development, not actually develop it.” Because of that, ASTM and FOCUS standards can work in harmony.
In the first part of this series, we introduced Dr. Hope Jones, who took her experience in tissue culture from NASA and brought it to the cannabis industry and C4 Laboratories. We discussed some of the essential concepts behind tissue culture and defined a few basic terms like micropropagation, totipotency, explants and cloning. Now let’s get into some of the issues with cloning from mother plants and the advantages that come with using tissue culture for propagating and cultivating cannabis.
Time & Resources
Dr. Hope Jones, chief scientific officer at C4 Labs
Taking cuttings from mother plants is arguably the most popular method of propagating cannabis plants. It is a process that requires significant real estate, resources and labor. “Moms can take up a great deal of space that is not contributing directly to production,” says Dr. Jones. “I know from experience that scaling up production and/or adding new strains to the production line requires significant time and resources to raise and maintain new healthy and productive mother plants.” Each mother plant produces a limited number of clones per harvest period and over the course of her life cycle.
By using tissue culture, a cultivator can generate an almost infinite number of clones from one plant cutting. With so many growers calculating their costs-per-square-foot, micropropagation is an effective tool to save space, labor and time, thus increasing profit margins. “Just to put it in perspective: Holly Scoggins’ book Plants From Test Tubes, cites a Day Lily cultivator who uses micropropagation to produce 1,000 plants in 30 square feet of shelf space each week,” says Dr. Jones. “Using conventional methods, one would need a half-acre to produce the same amount of plants.” Cultivators can produce a much greater number of plants-per-square-foot by using micropropagation effectively.
Damage from whiteflies, thrips and powdery mildew is all visible on this sick plant.
Early Health & Vigor
Most tissue culture methods use sterilized vessels that contain sugar-rich media to support growth of plantlets before they can photosynthesize on their own. “The media is prepped, poured into vessels, and placed in an autoclave (or pressure cooker) where it is subjected to high temps and pressure to achieve proper sterility.”
The sterile environment and rich growth media supplies plantlets with an abundance of everything they need. “When plantlets emerge from culture, they are pathogen-free, with a stockpile of food and nutrient reserves that support rapid growth and vigor, superior to conventional cuttings,” says Dr. Jones.
Stress & Disease
As any grower knows, mother plants can sometimes experience stress and disease. This might come in the form under or over-watering, heat stress, spider mites, whiteflies, mold and viruses. “Any stress or infection that a mother plant is subjected too can impact progeny health and productivity in a couple of ways,” says Dr. Jones.
Powdery mildew starts with white/grey spots seen on the upper leaves surfaceTobacco Mosaic Virus symptoms can include tip curling, blotching of leaf mosaic patterning, and stunting.
For example, diseases like powdery mildew and tobacco mosaic virus are often systemic, meaning that pathogens have spread to almost every tissue in the plant. Once infected, it is impossible to completely eliminate pathogens from tissues. Therefore any cuttings made from a diseased mother plant, even if they look perfectly healthy, will also be infected and can eventually present disease symptoms like reduced productivity and/or plant death, according to Dr. Jones.
How does tissue culture get around this problem? Remember that explants (small tissue samples used as starting material) can be extracted from any part of the plant. Meristematic cells in shoot tips and leaves are the source of new plant growth. Dr. Jones explains that these cells, and the first set of primordial leaves are not connected directly to the vascular tissue, the plant’s transport system by which pathogens spread. Therefore, meristematic cells tend to be disease-free, whatever the condition of the mother. It takes a sharp blade, a dissecting microscope, and a lot of experience to learn, but as Dr. Jones explains, “harvesting explants from meristems is a routine micropropagation technique used by ‘Big Horticulture.’ One example is the strawberry. Viruses and pathogens are so prevalent that the strawberry industry must use meristematic culture to ensure pathogen free progeny.”
Epigenetics
Now let’s talk about epigenetics. We know that plants don’t have the option of physically moving away from stress or predation. Instead, they have evolved sophisticated ways of changing their own biology to adapt to and/or protect themselves. “Consider what happens to a mom exposed to a pathogen. The infected plant will start expressing (turning on) genes and making proteins that contribute to pathogen resistance,” says Dr. Jones. “These changes to gene expression are partly regulated by epigenetic modifications, chemical changes to DNA that increase or decrease the likelihood a cell will express a particular gene, but that do not actually modify the gene itself. Like annotations to a piece of music, epigenetic modifications don’t change the notes but rather how loud or soft, quickly or slowly the notes are played.”
There are more than 1,000 different viruses and mixed infections are very common
This is where it gets interesting. “Epigenetic modifications can be systemic and long lived. Plants infected by a pathogen or stressed by drought will present widespread epigenetic modifications to their DNA,” says Dr. Jones. “For an annual plant like cannabis, those modifications are relatively permanent. Thus a cutting from a mom having drought or pathogen adapted epigenetic programming will inherit that modified DNA and behave as if it were experiencing that stress, whether present or not.”
In the wild, this adaptability is critical for plant survival and reproduction, but to a grower, this is a less-than-ideal scenario. “The epigenetic modifications allowed the mother to tolerate the stress, which is great from the perspective of survival and fitness, but it comes at a cost. Some of the finite energy and resources that usually support plant growth and reproduction are instead channeled to stress response,” says Dr. Jones. This trade off results in reduction in overall plant yield and quality. “Those epigenetic changes result in a new phenotype for that mother,” says Dr. Jones. “All cuttings from her will reflect the new phenotype. This is one major mechanism underlying what many in the cannabis industry (incorrectly) call ‘genetic drift,’ or the loss of vigor over successive clonal generations.”
This is again where tissue culture can be such a game changer. The process of dedifferentiation, as explained in part 1 of this series, can rejuvenate a “tired” mother plant by inducing a kind of reboot– clearing accumulated epigenetic modifications that negatively impact progeny vigor and productivity. In the third part of this series, we will discuss the five stages of micropropagation, detailing the process of how you can grow plantlets in tissue culture. Stay tuned for more!
According to a press release, the State of Delaware has chosen BioTrackTHC as their partner in seed-to-sale tracking software. Delaware’s Department of Health and Social Services (DHSS) signed a contract with BioTrackTHC for the tracking and patient registry software.
In 2016, Delaware issued a request for proposals for “the Delaware Enterprise Consolidated Cannabis Control System,” which encompasses the statewide patient registry and seed-to-sale traceability systems. “Our sincerest thanks to DHSS for choosing Team BioTrack,” says Patrick Vo, CEO of BioTrackTHC. “DHSS has been wonderful to work with throughout the contracting process, and we look forward to partnering with them to provide the tools and data they need to continue overseeing the industry and protecting their patients.” BioTrack’s software was selected as the winner of a number of government contracts in other states previously for the same role.
Their software is currently used in government traceability systems in Washington, New Mexico, Illinois, Hawaii, New York and the city of Arcata, California. The press release states regulators will have the ability to view the retail data “including plant counts and usable inventory, lab results, transportation, and point-of-sale data—to perform periodic audits and ensure compliance.” The patient registry will also provide better patient accessibility through the new software with a faster turn around time and automated application processing.
BioTrackTHC provides technology solutions for businesses and governments to tracking products throughout the supply chain to the point of sale. The software systems help businesses remain compliant with regulations and monitor data for things like inventory management.
On May 1st, Congress reached a bipartisan deal to keep the government open and funded through September 30th, 2017. Congress approved the appropriations bill that sets the government’s spending with an important section in it relating to cannabis. Section 537 on page 230 states that the Department of Justice cannot use funds to interfere with states’ legal medical cannabis programs.
The bill uses similar language to The Rohrabacher–Farr amendment, a bill that was originally introduced in 2013 to prevent the Department of Justice from spending money on enforcing the Controlled Substances Act in states with legal medical cannabis programs. This new appropriations bill, with the language in section 537, effectively achieves the same thing. “None of the funds made available in this Act to the Department of Justice may be used, with respect to any of the States of… to prevent any of them from implementing their own laws that authorize the use, distribution, possession, or cultivation of medical marijuana,” reads the bill. The language includes a mention of the 40 or so states and territories with some form of medical cannabis program, legislation or bill.
The language of section 537 (second half)
This means that Attorney General Jeff Sessions is relatively powerless to go on a sort of ‘crackdown’ on medical cannabis programs. Given Sessions’ previous comments and general views on cannabis, this should put cannabis industry stakeholders at ease for the time being. Of course, this budget is only for the 2017 fiscal year, so come September, the same or similar language needs to be included in the next appropriations bill. With Jeff Sessions’ task force still investigating federal cannabis policy, it is still very possible we could get a clear policy decision in the near future.
“We are encouraged that the Federal Government and NIDA are recognizing the true and powerful medical benefits that cannabis provides, especially in the war against devastating opiate-based drug addiction, abuse and death,” says Sally Vander Veer, President of Medicine Man Denver. “We have seen anecdotal evidence of this as reported by our patients/customers (and the beneficial effects of cannabis in numerous other conditions) since we opened our doors in 2010. Our hope is that this acknowledgment will open the door to additional research, eventually leading to legal and safe access to cannabis medicine for all Americans.”
The following section also includes a protection of industrial hemp research, as defined in the Agricultural Act of 2014, which basically means universities and institutions can research it. SEC. 538. “None of the funds made available by this Act may be used in contravention of section 7606 (‘‘Legitimacy of Industrial Hemp Research’’) of the Agricultural Act of 2014 (Public Law 113–79) by the Department of Justice or the Drug Enforcement Administration.” With all of the uncertainty and inconsistent comments coming out of the Trump administration, at least we have a sense of security in the medical cannabis community through the summer.
The Colorado Department of Revenue (DOR), in conjunction with the Colorado Department of Agriculture (CDA) and the Colorado Department of Public Health and Environment (CDPHE) issued two public health and safety advisories this morning after they identified pesticide residues on dried cannabis flower, trim, concentrates and infused products, according to the advisory. The contaminated products come from cannabis grown by Rocky Mountain Ways, LLC and Herbal Options, LLC, both doing business as Good Meds.
The Advisory was issued at 10am MT this morning
The advisory cautions consumers to check their labels for the license numbers of the businesses and the harvest batch numbers. They list the license number as, “Medical Optional Premises Cultivation License 403-001116 and/or Medical Marijuana Center License 402-00736.” The harvest batch numbers in question are B11H15.041317-Headband, B11H15.041317-Night Terror OG, and B11H15.041217-Citrix.
The CDA found the presence of off-label pesticides, including Pyrimethanil, Tebuconazole, and Spinosyn, in the products. Pyrimethanil is a fungicide commonly used on seeds, but it is generally regarded as not acutely toxic to humans. Tebuconazole is another fungicide, while the FDA says it is safe for humans, other sources say it could have a moderate acute toxicity in humans. Spinosyn is a class of insecticides with a slight acute toxicity to humans and has been the culprit in a previous cannabis recall in Oregon. In the public health and safety advisory, the CDPHE and DOR say the pesticides were used off-label and none of them are on the approved list of pesticides for cannabis.
The license numbers and batch harvest numbers in question
Tikun Olam is a Jewish concept that addresses social policy, promoting acts of kindness to better society. In Hebrew, it literally means, “repair of the world.” The company by the same name, Tikun Olam Ltd, and now in the United States as T.O. Global LLC, was the first medical cannabis provider in Israel back in 2007. Working with patients, doctors and nurses in clinical trials, they developed 16 strains over the last decade that target alleviating symptoms of specific ailments.
Tel Aviv, Israel, where Tikun Olam has a dispensary
In November 2016, they launched their United States brand, Tikun, in the Delaware medical cannabis program with their partner, First State Compassion Center, a vertically integrated business of cultivation, extraction and retail in Wilmington. After the success of their pilot program, Tikun announced their expansion into the Nevada market with their licensed partner, CW Nevada LLC. Tikun is leveraging its experience with clinical trials and medical research to launch a line of cannabis products focused on health and wellness in the United States. According to Stephan Gardner, chief marketing officer at Tikun Olam, they have the largest collection of medical cannabis data in the world. “Tikun Olam started out as a non-profit, working to bring medication to patients in Israel,” says Gardner. “Opening nursing clinics gave us a tremendous amount of knowledge and data to work on the efficacy of strains developed specifically for targeting symptoms associated with certain conditions.” For example, their strain, Avidekel, was developed years ago as the first high-CBD strain ever created.
The strain Avidekel being grown in Israel.
In a single-strain extraction, Avidekel has been used to successfully mitigate the symptoms associated with neurological conditions, like epilepsy in children, and they have the data to demonstrate that efficacy. “The American market needs some sort of guidance on how these cannabinoid and terpene profiles in certain strains can truly assist patients,” says Gardner. “We have been tracking and monitoring our patients with clinical and observational data in one, six month and annual follow ups, which are data we can use to guide the needs in the US.”
Their expansion strategy focuses heavily on the health benefits of their strains, not necessarily targeting the recreational market. “As a wellness brand in Nevada, we are positioned to work first and foremost in the medical market,” says Gardner. “Our wellness brand can cater to people looking for homeopathic remedies for things like inflammation issues, sleep disorders or pain relief for example,” says Gardner. “You will not see us going out there catering to the truly recreational market; the benefits of what our strains can do is marketed from a wellness perspective.” A cannabis product with high-THC percentages is not unique, says Gardner, but their approach using the entourage effect and proven delivery mechanisms is. “While higher THC might appeal to the rec market, that is not exactly how we will promote and position ourselves,” says Gardner. “We want to be a dominant force in the wellness market.”
Best practices include quality control protocols
That effort requires working within the US regulatory framework, which can be quite complicated compared to their experience in Israel. “We have to understand the Israeli market and American market are completely different due to the regulatory regimes each country has in place,” says Gardner. “We understand the efficacy of these products and want to educate customers on how they might benefit. We don’t want to make claims looking to cure anything, but we found in our data that a lot of symptoms in different ailments, like cancer, PTSD, Crohn’s disease, colitis and IBS, can be alleviated by strains we developed.” In addition to the medical research, they are bringing their intellectual property, cultivation methodologies, evidence-based scientific collaboration and best practices to their partners in the US.
So for Tikun’s expansion in the US, they want to get a medical dialogue going. “We will launch a fully accredited AMA [American Medical Association] program, educating medical practitioners, giving the doctors the understanding of the capabilities of cannabis and what our strains can do,” says Gardner. “We will also share our observational data with doctors so they can work to better guide their patients.” Right now, they are working on the education platform in their pilot program in Delaware. “We plan on using that as a platform to expand into other markets like Nevada,” says Gardner. “And we will be launching the Tikun brand in the Washington market this summer.” Based on the high demand they saw in the Delaware market, Gardner says they plan to launch six unique strains in the American market, with delivery mechanisms like vape products, tinctures, lozenges and topicals in addition to dried flower.
Rows of cannabis plants drying and curing before processing.
While Tikun expands throughout the United States, their sights are set on global expansion, living up to the true meaning of the concept Tikun Olam. They entered a strategic partnership with a licensed producer based in Toronto, bringing their strains, including Avidekel, to the Canadian market. The company they are partnering with, MedReleaf, recently filed for an initial public offering (IPO) on the Toronto stock exchange. Tikun Olam is actively seeking to expand in other parts of the world as well.
In November 2016, residents in Denver, Colorado voted to pass Initiative 300, allowing businesses to seek social marijuana use permits if neighborhood or business groups also agreed and signed off. In the very near future, the process for how cannabis consumers purchase and consume cannabis will no longer be restricted to only going inside a dispensary to make your purchase and returning to a private residence to consume. Instead, it may be as simple as visiting a drive-thru and then going to a cannabis bar or social club to enjoy.
Cities such as San Francisco have had on-site consumption laws in place for some time, with notable locations including sparc, a well-known dispensary with two locations in the city, and the recently announced Power Plant Fitness, a gym slated to open in late 2017 that will allow members to consume cannabis while working out.
Social consumption of cannabis is not a new topic of discussion—just look at Amsterdam’s cannabis coffee clubs—but it is undoubtedly a legalization trend that will continue to be at the forefront as more states pass legalization or convert to adult-use markets. There remains one reoccurring theme, however: a lack of clarity on how these laws will be structured and how social consumption regulation will be put in place.
In Colorado’s state legislature, there was bipartisan agreement that the state needed to allow for venues to let patrons consume cannabis in order to deter residents and tourists alike from consuming in public places such as sidewalks and parks. A Republican-sponsored measure proposed in the state legislature would have allowed for the regulation of cannabis clubs in a similar format to how cigar bars are managed, but that legislation was put on hold for rewrite.
Within the state, there also exists a heated debate over whether or not the creation of social cannabis clubs would instigate federal intervention by the new administration, especially in light of Attorney General Jeff Sessions’ comments in opposition of the adult-use cannabis industry.
One thing is clear: since Denver’s passing of the social use ballot measure in November, there have been numerous halting attempts to put a law in place and the current law is vague. There remains much work to be done before Initiative 300 may be enacted.
For those interested in learning more or joining the discussion, the National Cannabis Industry Association (NCIA) will be hosting a panel titled “For Here or To Go? Evolving Regulations on Social Consumption of Cannabis” at its 4th annual Cannabis Business Summit & Expo in Oakland, June 12-14. The panel will be led by Sam Tracy of 4Front Ventures, who supports the company’s business development and communication efforts.
You can learn more about the Summit and see the full conference agenda on the Cannabis Business Summit & Expo website. In celebration of 4/20, NCIA has extended the early bird pricing deadline for conference registration from April 21 to April 24 to allow for busy cannabis business owners and operators to take advantage of the savings.
Cannabis Industry Journal readers may use discount code CIJ15 to save 15% on registration.
You’ve heard it in a lot of campaigns to legalize cannabis on a state level and even as the name of a bill in Congress for legalization on the federal level. The Marijuana Policy Project through their campaigns in several states, along with activists, politicians and lobbyists, have used the phrase “Regulate Marijuana Like Alcohol” as a rallying cry to pass legislation reforming cannabis laws. This isn’t an attack on them; those campaign names serve the cause well, moreover it was the name of successful campaigns in Massachusetts, Maine, California, Alaska and Colorado among others. It is a relatable and fair comparison, helping to normalize the concept of adults using cannabis in a legal environment.
But that feeling of validation is short-lived after lawmakers write the actual regulations. In reality, I don’t think a single state can confidently say they actually regulate cannabis like alcohol. Most states do not allow public or social consumption of cannabis; many people that would like to enjoy cannabis in a social setting are restricted to the confines of their home.
420 Rally at Civic Center Park, Denver, CO. Photo: Cannabis Destiny
Voters in Colorado passed Amendment 64 in 2012 with this language in the very beginning of the bill: “In the interest of the health and public safety of our citizenry, the people of the State of Colorado further find and declare that marijuana should be regulated in a manner similar to alcohol.” If you look closely, you can see how important phrasing is when it comes to the specific regulations. The key words here are “a manner similar to alcohol,” not exactly like alcohol. That language is critical to understanding how regulators address the double standard.
The most obvious way lawmakers regulate cannabis like alcohol is through a tiered system of license holders: manufacturers, distributors or wholesalers and retailers. Many states might set a limit on potency, just like they do with alcohol, according to Pamela S. Erickson, former executive director of the Oregon Liquor Control Commission. Both of the drugs are taxed and there are usually regulations for both governing the advertising of products, such as preventing targeting youth or encouraging high consumption. Regulators might limit the store hours or locations for both cannabis and alcohol. Beyond those similarities, there are a number of areas where cannabis is over-regulated and alcohol is seemingly under-regulated. It is very possible that much of this has to do with the power of the alcohol lobby. In 2016, the alcohol industry spent over $26 million on lobbying efforts, according to the Center for Responsive Politics, a non-profit, nonpartisan group that tracks lobbying efforts. During election season, the alcohol industry spent more than $11 million on campaign contributions. There are several examples of the alcohol industry actively fighting legalization efforts, including paying for anti-cannabis ads in a Politico newsletter and even funding opposition campaigns. While this doesn’t exactly pertain to the regulation of cannabis versus alcohol, it gives you a glimpse of how deep their coffers go and the amount of influence they have on politics.
Last year, the city of Denver passed a ballot measure, Initiative 300, which will legalize the social consumption of cannabis in permitted venues. The Denver Social Consumption Advisory Committee met for the final time last week. That committee designed two styles of permits: one for events and one for established businesses, which would receive a designated consumption area permit (DCA). Those permitted venues must be 1,000 feet from schools, child-care centers or drug rehabilitation centers. They need a waste plan, compliance with the Indoor Air Quality Act and they cannot sell cannabis products. Rachel Gillette, attorney in the cannabis law group and shareholder at Greenspoon Marder, says the legal implications of the initiative are still up in the air. “This was a step in the right direction,” says Gillette. “You can’t pass a law to regulate marijuana like alcohol and then say people can only use it in their home. You are going to run into problems like people smoking on the street. This is why this initiative was introduced.”
Rachel K. Gillette, Esq., practicing at the cannabis law group in Greenspoon Marder
The general idea here is B.Y.O.P.- bring your own pot. They cannot have a liquor license, the location cannot be accessible to the general public, they have to submit a detailed security plan and patrons have to sign a waiver to get in, according to Westword. Signing a waiver to get into a bar should seem asinine to anyone, but I have been to some dive bars where a waiver could’ve definitely been useful. The point is that cannabis doesn’t lead to violence or destructive behavior, alcohol is the drug that does that. There is plenty of evidence to support that, including a comparative risk assessment of the drugs, which found alcohol’s danger to be strongly underestimated previously.
Senate Bill 63 in the Colorado State legislature would have been very similar, issuing licenses for “marijuana consumption clubs.” However that bill was voted down last Thursday, largely due to the uncertainty of federal policy, according to ABC News.
Amendment 64 also has specific language saying you cannot consume cannabis in a public space, but that is not exactly the case with liquor, even when you consider open container and public intoxication laws. “In my previous interactions with the state and particularly the liquor licensing authority, they consider liquor-licensed premises to be de facto public spaces but you can’t consume cannabis there, which is why hotels, bars and restaurants explicitly prohibit cannabis consumption, they have a liquor license,” says Gillette. “There is a bit of conflict in the law here.”
Yet other rules, such as mandatory childproof containers for cannabis retailers, seem a bit draconian compared with buying a bottle of twist-off wine from the grocery store. “Childproof packaging isn’t required in liquor stores anywhere,” says Gillette. “Why cant responsible adults be trusted to keep it out of a child’s reach? Unfortunately there is a lot of trepidation to allow responsible adults to be responsible when it comes to cannabis.” In some ways, we are seeing states begin to regulate cannabis very closely to how they would alcohol, yet there is a long way to go. “There is still this nanny state mentality where we run the risk of regulating it to the point of absurdity,” says Gillette. For now at least, we need to be cognizant of the age-old stigma and work to normalize social cannabis use in a legal sense. Until that time comes, we will have to tolerate lawmakers regulating cannabis in a manner similar to alcohol, not exactly like alcohol.
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