Tag Archives: Effective

July 22, 2021

Quality Systems 101: CAPA Programs Drive Improvement & Prevent Costly Mistakes

By David Vaillencourt

No business is perfect, especially when humans are part of the equation. But, how do you tackle fixing quality issues as they arise? The goal of this article is to shed some light on the value of a CAPA program and why many states are making them mandatory for cannabis businesses.

Let’s consider the following situations:

Analytical lab results for a production batch test above the limit for a banned pesticide or microbial contamination
You open a case of tincture bottles and some are broken
A customer returns a vape pen because it is leaking or ‘just doesn’t work’

Do you…

Document the issue?
Perform some sort of an investigation, asking questions of the people involved?
Ask for a retest? Then, if the test comes back positive, move on?

Let’s go through each one of these and understand why the suboptimal answer could be costing your business money:

You don’t document the issue

I hear excuses for skipping on documentation all the time.

“It’s not a big deal”
“It was a one off”
“The glasses probably broke in transit”
“They are cheap and easily replaceable”
“It’s not worth the time”

Tracking and documenting supplier shipments can help you identify supply chain issues.

In the situation of a couple of broken bottles in a shipment, what if it was the seventh time in the last two months? If you haven’t been documenting and tracking the issue, you have no way of knowing if it was a single occurrence. Remember when you were surprised that your filling team did not have enough bottles? Those broken bottles add up. Without documenting the incident, you will never know if it was truly a one-time mistake or the sign of a deeper issue. The reality is, it could be sloppy handling on the production line, issues with the shipper or even a sign of poor quality coming from the supplier.

Have you ever compared the number of fills vs the number of bottles ordered? How much money have you already lost due to those broken bottles adding up? Do you have the ability to answer this question?

You perform an investigation

Let’s say a customer returns a leaky vape pen. You perform an investigation by asking the production workers what they think went wrong. They say that it’s very difficult to get the seal for the cartridge into place. Their supervisor tells them to try harder, refunds the customer and moves on. But, why is it difficult to get the seal into place? Is it a design flaw? Should a special tool be used to assemble the cartridge properly? Without getting to the root cause of why the seals are leading to leaking cartridges, you are doomed to have repeat issues. Numerous studies have found that less than one in twenty dissatisfied customers will complain, and that approximately one in ten will simply leave for another brand or provider. How much is this unresolved issue truly costing your business?

Asking for a retest and if it passes, releasing the product and moving on.

labsphoto — In Colorado, 15% of the final tested cannabis flower products continue to fail.

Suppose a major producer of cereal received test results for its most popular cereal that were positive for levels of heavy metals that research has shown to be linked to cancer or developmental issues in children. Now, suppose the company stated that it was an isolated incident and a retest showed that the product met acceptable limits. Further investigation showed no paperwork, save for a couple of emails and a phone call between the lab and the producer. Would that give you peace of mind? This is known as “testing into compliance” and was the subject of a landmark lawsuit in 1993 that Barr Laboratories lost.

For many the answer would be a hard NO. But this happens every day. In Colorado, 12.5% of cannabis batches failed final product testing in 2018 and 2019. That’s one in eight batches! What happened to those products? Good question.

Enter: CAPA (Corrective Action and Preventive Action) programs! For people with a background in quality and GMPs (Good Manufacturing Practices), CAPA is a household name. And, it’s quickly becoming a requirement that cannabis regulatory bodies are looking at. Colorado was the first state to explicitly require CAPA programs for all license holders effective January of this year and has provided a free resource for them. But, for the large majority of people, including those in the cannabis industry, it’s just another acronym.

What does a CAPA program do?

The benefits are numerous but two major ones are:

An effective tool for investigating the true root cause

First of all, a CAPA program provides the framework for a tool for investigation – as Murphy’s Law posits – things go wrong all of the time. Whether you have a manual, labor-intensive process or a highly automated operation, the equipment is programmed, maintained and monitored by humans. The logical sequence of problem solving within a CAPA program allows you to thoroughly investigate and determine the root cause of the issue. With a complete understanding of root cause, you are then able to eliminate it and prevent future occurrences – not just in the one area investigated, but in all similar situations throughout the company.

System for continuous improvement

Gathering info from a customer complaint like batch or product IDs can be crucial in a CAPA system

Anyone who is in the market for a new car lately can appreciate the technological advances. In the 1980s, it was air bags and ABS brakes (those of you that drive in snowy climates and remember having to pump your brakes can appreciate technological advancements). Bluetooth technology for hands-free communication and radio control is another example of continuous improvement in cars.

This is one of the biggest predictors and differentiators between profitable and successful companies with satisfied clients and one that is barely scraping by. The cost of poor quality adds up!

Key inputs in a CAPA system

If the output is an improved system and lower cost of quality, we need to make sure we’re considering the potential inputs.

Information that feeds into your CAPA system:

Customer complaints

Every complaint must be recorded. Gather as much information as possible, but at a minimum: the product type/SKU, the customer name and date of purchase. If possible, the batch or product ID.

This is not necessarily to identify products for a recall, but to prevent…

Laboratory test results

This should not be restricted to final product testing, but include any in-process inspections. Say you have a product repeatedly failing final testing, what if it’s actually been consistently failing or very close to failing at the very first in-process inspection? It’s also important to work with your laboratory to understand their method validation process, including the accuracy, precision, robustness, etc.

Infrastructure & environmental controls/monitoring

Most people consider “environmental controls” to be things like temperature and humidity control. While that is true, it can also include pest and contamination control. Poorly designed infrastructure layouts are major contributors to product cross contamination as well.

Supplier information

Undetected supply chain issues (remember the broken bottles?) can add up fast! CAPAs for suppliers cannot just include supplier monitoring, but improvement in how you communicate your needs to your suppliers. It’s easy to overlook non-cannabis raw materials as sources of microbiological and chemical contamination. Conduct a risk assessment based on the type of contact with your product and the types of contamination possible and adjust your supplier qualification program accordingly.

Are you ready to recognize the benefits of a CAPA program?

One more major benefit of CAPA programs to mention before we go is … Preventive via predictive analytics.

In Colorado, 15% of the final tested cannabis flower products continue to fail, mostly due to mold and mildew. A quality system, with effective data capture that is funneled into a CAPA program can easily reduce this by 75%. For even a small business doing $2M per year in revenue, that equates to a revenue increase of nearly $200,000 with no additional expenses.

Whether you are operating in the State of Colorado or elsewhere, a CAPA and Recall program will provide immense value. In the best case, it will uncover systemic issues; worst case, it forces you to fix mild errors. What are you waiting for?

January 5, 2021

The Hidden Costs of Non-Compliance for Consumers

By Mark Slaugh

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Anyone owning and operating a cannabis business should know the value of proactive compliance management to operate successfully. For consumers, the view into the world “behind the budtending counter” is limited to the cool looking packaging, test results and the overall “vibe” of products they may want to try.

In our experience, as the oldest cannabis compliance firm, we’ve audited and visited hundreds of facilities and have seen the proverbial “Wizard behind the curtain”. We know “how the sausage is made.” And, as one can expect, it’s not always as glamorous in the back of the house as it appears on the shelf.

As markets expand and people buy into existing or new cannabis businesses, amid a world of thousands of competing companies and products, consumers need to ask themselves: “What do I know about the companies and products I consume?”

More and more, the question of consistent quality keeps coming up in the cannabis industry. Recalls are still ongoing in the news as products continually fail testing for potency and contamination.

Colorado, for example, is considered the shining jewel of the US industry in terms of experience, quality and integrity. However, consumers may be shocked to learn that a majority of dispensaries in the state do not operate by stringent SOPs, nor do they verify packaging and labeling for compliance, or review test results of products coming in and going out of their shops.

Starting January 1, 2021, these retailers finally have to develop and implement recall procedures in the event of contaminated products or cannabis that is causing adverse side effects. Later this year, vape pens will finally have their vapor tested instead of just the concentrate therein.

These liabilities or lack of compliance infrastructure may very well be a ticking time bomb no consumer in their right mind would want to deal with.

Bad Product/Brand Experience

Non-compliance and inconsistency on the part of operators translates directly into negative experiences for consumers. Whether its consuming a product that tastes like chlorophyll or enjoying a product the first time only to find a completely different experience the next time around, consumers experience the cost of non-compliance the most.

Beyond products, most consumers recognize their brand experience when shopping for products. Since the invention of Weedmaps, customers have always expressed their like or dislike for particular dispensaries and delivery services. Operators know these reviews from a customer’s experience can make or break their business and brand.

We always tell cannabis operators that a brand is a double-edged sword. As easily as it can strike through competitors, it can just as easily damage one’s own business.

Examples include SweetLeaf and Kushy Punch whose brands, once well-known and popular, are now synonymous with the worst of the worst given their histories of non-compliance and shut downs.

For consumers, finding consistent, quality products at a fair price is often the most important consideration to avoid the cost of a bad experience with cannabis. For visitors or first-time consumers, this could mean the difference between trying cannabis again or deciding it’s simply not for them.

Contamination & Illness

control the room environment — Preventing contamination can save a business from extremely costly recalls.

The worst-case scenario for consumers, especially patients, is the cost of consuming contaminated products or otherwise having adverse effects from the use of cannabis. While cannabis itself is one of the least harmful substances known to man, contaminated cannabis can be dangerous or deadly.

In the early days of the industry and in many emerging markets with poor to no oversight, these lessons are learned most severely. From the use of non-commercial washing machines being used for water-based extracts that tested positive for E. coli to recalled products ladened with Eagle 20 (which contains the harmful pesticide known as Myclobutanil), the industry has been reactive to safety measures and complying with best practices.

Still, some states persist with limited to no testing and simply label products with a warning to consumers that they are using cannabis at their own risk without testing for safety or efficacy.

Most consumers may be shocked to know that most cannabis companies do not adhere to good agricultural practices or good manufacturing practices (GAP/GMP) to ensure consistent quality and safety standards in similar industries such as nutraceuticals and food manufacturing.

Patients already weakened by disease states – including auto-immune disorders – are most at risk and understand all too well the costs of hospitalization, medical bills and loss of quality of life. For the average adult user, these risks are the same and there is often little to no recourse with the dispensary or product manufacturers if the product slips through contamination testing because of the non-compliance of product validation on flower or infused products.

For companies, outdated and inaccurate SOPs as well as production batches are the only line of defense to protect the company from product liability lawsuits filed by consumers in the event of contamination and illness. Most cannabis companies do not manage this aspect of their business effectively and simply assume they are sufficiently compliant without proactively measuring such compliance and adjusting operations as necessary.

Long-Term Consequences

Consumers would do well to remember that the modern industry is infantile in its development compared to other heavily regulated industries. Cannabis companies are babies learning to crawl while major food and beverage, pharmaceutical and nutraceutical, and alcohol and tobacco industries are far ahead of the game. The US industry, is arguably, already behind the compliance curve comparative to other nations already placing stricter regulations and standards on licensees.

For customers, this can be a confusing experience given that no two batches of flowers will taste the same let alone give a consumer exactly the same effect.

Already, customers are learning Sativa and Indica are imaginary cultural terms to describe generalized characteristics of major and minor cannabinoids and terpenes in each strain which produces a variety of effects – despite state limitations on labeling these active ingredients.

Vape pens are under increasing scrutiny as regulators discover long-term effects of vape use from the tobacco industry causing EVALI in consumers and being deemed as dangerous. As with anything new, the data and science simply aren’t there to truly tell customers what the effects may be over the long run. It has taken decades for tobacco, as an example, to go from doctor-recommended to carcinogenic.

Consistency in quality standards requires meticulous SOPs

Similarly, Big Cannabis of the future may be facing similar concerns that aren’t being warned about currently on their products and consumers could face unknown long-term consequences. In no way is this a condemnation of cannabis and early research shows cannabis is much safer than either alcohol or tobacco.

The point is to emphasize that over the long run, compliance is key to tracking the consistency and safety of products to avoid long-term liability and costs on consumers. Consumers would be wise to gravitate towards compliant brands and companies that focus on consistent quality and safety to minimize potential long-term negative impacts and costs.

Accountability & Transparency

Customers must first understand where the buck stops and who is responsible for what as it applies to cannabis and the cannabis products they consume. This can vary between states from vertically integrated models to horizontal models which allow for independent businesses to buy and sell cannabis between each other.

In the case of cannabis, the restrictions on METRC and other state “seed to sale” tracking systems make it nearly impossible for customers to return products and unclear on how to file complaints.

METRC and other seed to sale systems dictate that dispensaries must be able to track originating sources of cannabis back to another licensed facility. As such, once the consumer buys a faulty vape pen, for example, it’s gone from the dispensary inventory. Bringing it back in physically creates non-compliance issues for the dispensary as they cannot virtually account for the physical addition back into inventory.

No one ever said making sausage was a pretty or easy process. That’s why most consumers don’t want to think about how it’s done.

This example is a simple one to showcase the importance of compliance in the cannabis business and the complexities businesses must go through to operate. What is more applicable and important for consumers to understand is how non-compliance and inconsistency can affect them negatively – beyond messy fingers from leaky vape carts.

These types of unexpected issues represent significant costs for cannabis operators in recalls, fines, lawsuits and fees which is what most people think the “costs of non-compliance” mean.

However, and in addition to the literal cost mandated by regulation, there are the costs owners don’t think about: in the time and fees charged by the professionals to solve these issues, the time and stress spent on production, the increase or decrease in supply, mitigating product liability, and brand recognition and damage due to poor quality or recalls.

All of these factors simply drive up the costs of products for consumers and decrease the reliability of finding consistent, quality products and brands that customers can count on.

As we always say at iComply:

“It is always more cost-effective to be proactive, rather than reactive, when it comes to operational cannabis compliance management.”

Consumers would be wise to recognize which companies are proactive in managing their compliance. And companies would be wise to get ahead of these customer costs by being the proactively compliant companies that consumers want and need.

June 26, 2019

Branding for Cannabis Companies 101: Part 2

By Jennifer Whetzel

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Editor’s Note: In Part 1, Jennifer Whetzel introduced the concepts of branding, marketing and advertising for cannabis companies. Part 2 takes a closer look at the benefits of branding. Stay tuned for Part 3 coming next month.

The Value of Branding

Think back: do you remember the very first Nike ad you saw? Probably not.

But when you see the swoosh, you immediately think of Nike. When you see the swoosh, you probably even think “Just do it.” A whole sensibility, one that signifies perseverance and athletic excellence, gets conjured up by that swoosh. A lot of people think that’s the power of advertising, but they’re only partially correct.

The fact that you don’t just know the swoosh but have thoughts and feelings that bubble up when you see it is due to branding. Companies like Nike don’t spend millions on branding reflexively. They do it because brand recognition and the feelings that come with it turn potential consumers into buyers. Branding success is necessary, measurable and valuable – especially for brands looking to establish themselves.Strong branding is what will increase the chances that your marketing and advertising will be effective, and it’s why branding must be one of your top priorities.

Branding: The Precursor to Advertising

You might not know specifically what ads work on you. But the ones that do work are driven by a strong brand.

For example, check out this ad campaign run by McDonald’s: Essentially, the fast food giant used fractions of its logo to make a wayfinding system on highway billboards. It’s clever and memorable, but it only works thanks to McDonald’s strong branding. McDonald’s has spent years building that shorthand because they understand that immediate recognition pays off in the literal and figurative sense.

Similarly, you know an Apple or an Under Armour ad when you see one. And you know this because there’s a consistent look and sensibility that these companies have worked to codify – that’s the branding piece. If you immediately recognize who these messages are coming from even before you engage with the ad, you’re more focused on the message rather than trying to suss out which company it’s coming from or what they’re selling.

This is why branding has to be a precursor to advertising. If you create ads before you build your brand, you may get a message out about what you’re offering. But if you do this, you’re talking at your customer rather than building a relationship with them. Strong branding is what will increase the chances that your marketing and advertising will be effective, and it’s why branding must be one of your top priorities.

The Benefits of Branding

Branding is about building a lasting, positive relationship with your customer. When you present a consistent brand personality and identity to your audience, you build trust. Consider how you form any long-term relationship; it’s through repeated positive, consistent encounters that allow you to see the other party for who they are. You trust them because you feel that you understand them and that they understand you.

Strange as it seems, it’s also true of brands. Building that bond with your customers will give you an advantage against brands that aren’t very distinct. With proper branding, a company can build and solidify consumer trust, trust that pays off in the form of increased sales, loyalty and good reviews. These brands aren’t constantly introducing themselves to consumers because over time, the branding itself does the selling and makes it easier to introduce new products down the line. Companies that don’t build that trust will have to fight for recognition, and things only get worse with more competition.

The Dollar Value of Branding

And of course, there are numbers to back this up. Every year, Forbes puts out a list of the world’s most valuable brands, and they use complex math to determine the actual value of this intangible thing called a Brand. Based on their thinking, a branded product should earn an 8% premium over a generic product. You can see some of their findings in the table below for a few categories that are traditionally very well-branded.

Industry	Brand	Brand Value (Billions)^[1]
Technology	Apple	$205.5
Technology	Microsoft	$125.3
Consumer Packaged Goods	Coca-Cola	$59.2
Restaurants	McDonald’s	$43.8
Apparel	NIKE	$36.8
Restaurants	Starbucks	$17.0
Apparel	Adidas	$11.2
Consumer Packaged Goods	Kellogg’s	$8.0

These numbers, however, make it difficult to compare how well a company’s branding works for them because the brand’s total value is influenced by the size of the company. After doing a few simple calculations, we compared the Brand Value to the total Enterprise Value of each company to determine what we will call their Brand Contribution, which demonstrates how their branding efforts paid off.

When you compare the percentage of total company value that solely comes from the value of the brand, we can see that Nike significantly outperforms competitor Adidas, McDonald’s has a stronger brand than Starbuck’s, and Apple comes close to doubling the brand performance of Microsoft — none of which is surprising.

What might surprise you is the brand at the top of the list when it comes to contribution versus overall company value. Kellogg’s is one of the smallest companies to make the list in terms of Brand Value, and it has the lowest enterprise value in our list. Yet, Kellogg’s has the highest brand contribution. This makes sense in the high-stakes world of consumer-packaged goods; the competition is fierce, well-funded and global, which means that branding that resonates with customers is extremely important.

Industry	Brand	Brand Value	Enterprise Value^[2]	Brand Contribution^[3]
Consumer Packaged Goods	Kellogg’s	$8.0	$28.4	28.2%
Apparel	NIKE	$36.8	$133.4	27.6%
Restaurants	McDonald’s	$43.8	$187.2	23.4%
Consumer Packaged Goods	Coca-Cola	$59.2	$254.8	23.2%
Technology	Apple	$205.5	$950.3	21.6%
Apparel	Adidas	$11.2	$59.0	19.0%
Restaurants	Starbucks	$17.0	$109.7	15.5%
Technology	Microsoft	$125.3	$990.9	12.6%

These companies are all massive and wealthy because they prioritize trust and consistency as part of their long-term plan to sell products. Branding promotes loyalty, but its ability to promote trust can be even more powerful by paying off in the long-term. And in this new legal cannabis market, trust is going to be just as critical as it is for traditional companies. After all, the power of branding isn’t just getting people to know who you are — it’s getting them to believe in you.

https://www.forbes.com/powerful-brands/list/#tab:rank
Enterprise value gathered from ycharts.com on 6/20/2019. Ycharts defines enterprise value as: Enterprise Value (EV) is a valuation metric alternative to traditional market capitalization that reflects the market value of an entire business. Like market cap, EV is a measure of what the market believes a company is worth. Enterprise value captures the cost of an entire business, including debt and equity. It is a sum of claims of all preferred shareholders, debt holders, security holders, common equity holders, and minority shareholders – unlike market cap, which only captures the total value of common equity securities.
Ladyjane’s valuation of the strength of a brand. What percentage of the company’s overall valuation can be attributed to the brand? Brand Contribution = Brand Value / Enterprise Value

April 29, 2019

Why International Trade Agreements Are Shaping The Cannabis Industry

By Marguerite Arnold

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If you have wondered over the past several years, why the big Canadian companies (in particular) are following the global strategy they are, there is actually a fairly simple answer: Newly implementing trade agreements, particularly between Europe and North America.

More specifically, they are highly technical trade agreements that are also called Mutual Recognition Agreements, (or MRAs).

In fact, look at the schedule of the MRA agreements signed between the U.S. and individual EU countries over the last several years, and it also looks like a map of the countries that have not only legalized at least medical cannabis, but where the big Canadian companies (in particular) have begun to establish operations outside of their home country.

But what is going on is actually more than just CETA-related and also will affect cannabis firms south of the Canadian-U.S. border.

All of these swirling currents are also why the most recent MRA to come into full force in July this year, between the U.S. and Europe, is so interesting from the cannabis perspective. Even before federal reform in the U.S. If this sounds like a confusing disconnect, read on.

What Are MRAs?

MRAs are actually a form of highly specialized trade agreement that allow trading countries to be certain that the pharmaceuticals they purchase from abroad are equivalent to what is produced at home. This includes not only ingredients but processing procedures, production plant hygiene, testing, labeling and more.

When it comes to the EU-US MRA agreement, this means that individual states of the EU can now recognize the American Food and Drug Administration (or FDA) as an effective federal regulator of American pharmaceutical production that is equal to the procedures in Europe. US GMP standards, in other words, will be recognized as equal to those of EU states.

This will now also, by definition, include GMP-certified medical cannabis formulations.

What is so intriguing, however, is how this development will actually place certain American (and Canadian) manufacturers in a first place position to import cannabis into Europe ahead of the rest of the American cannabis industry.

What Are Mutual Recognition Agreements All About?

One of the most important quality and consumer safety aspects of establishing a clean supply chain is tied up in the concept of GMPs (Good Manufacturing Practices). These are procedures, established by compliant producers of pharmaceuticals, to ensure seed (or source) to sale reliability of the medication they make. In the cannabis industry, particularly in the advent of Canadian-European transatlantic trade in cannabis, this has been the first high hurdle to accept and integrate on the Canadian side.

If European countries recognize a country’s GMP certifications are equivalent to its own, in other words, and cannabis is legal for export, a country can enter the international cannabis market without facing bans, in-country inspections and the like. In the interim, imported products still have to be batch tested until the agreements are fully accepted and operational.

Israel, for example, already had an MRA with the EU, and medical cannabis is legal in the country. However, Israel was prevented from selling cannabis abroad until a legislative change domestically, passed on Christmas Day.

That is why the MRA agreement between the US and EU with Canadian companies in the middle also put both Israeli and U.S. firms at an extreme disadvantage in comparison. Both in entering the market in the first place, and of course associated discussions, like the German tender bid. That is now changing- and as of this year.

A Specialized Map Of Global Medical Cannabis Exporters

Ironically, what the new US-EU MRA could also well do is create a channel for pharmaceutical cannabis from the United States to Europe (certainly on the hemp and CBD front) just as Israel is expected to enter the international cannabis export industry (later this summer or fall). It could well be also, particularly given the Trump Administration’s tendency to want to not only “put America first” if not pull off “a better deal” in general and about everything, that this is why President Trump offered the delay to Israel’s president Benjamin Netanyahu in the first place.

Regardless of the international individual developments and subtleties however, what is very clear that from the time the first bid stalled in Germany in the summer of 2017 until now, the U.S.-EU MRA has been in the room even if not named specifically as a driver.

For example, the FDA confirmed the capability of Poland and Slovenia to carry out GMP inspections in February of 2019. It was only last fall that Aurora pulled off its licensing news in the former (on the same day licensing reform was announced by the government). Denmark was recognized in November of last year during the first year of its “medical cannabis pilot progam.” Greece was recognized in March 2018. Italy, Malta, Spain and the UK came online in November of 2017.

Overlay this timetable with a map of cannabis reform (and beyond that, cannabis production) and the logic starts to look very clear.

The upshot, in other words, is that while cannabis still may be “stigmatized” if not still “illegal” in many parts of the world, more generalized, newly negotiated and implementing, specialized global trade agreements between the US, Europe and Canada in particular have been driving the development of certain segments of the cannabis industry globally and since about 2013.

The Biggest News?

As of this year, as a result, expect at least from the GMP-certified front at least, that such international trade will also include medical cannabis from the U.S.

Want an example of the same? First on that list if not early in the game will now undoubtedly be Canadian-based Canopy Growth, with Acreage on board, headquartered in New York.

February 7, 2019

WHO Makes Noise About Cannabis “Rescheduling”

By Marguerite Arnold

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At this point in the end of prohibition, not even the United Nations (UN) or the World Health Organization (WHO) are immune to the great green wave sweeping the planet. Yet, lest anyone get too optimistic about developments at the nose bleed level of international drug reform, the newest round of headlines regarding “WHO cannabis reform” is hardly cause for celebration.

The Story At The International Level So Far

In documents obtained by Cannabis Industry Journal last fall, it appeared that cannabis reform of the serious kind had caught the eye of senior leaders at the WHO. Further, it also appeared that some kind of decisive action or declaration would be forthcoming by the end of the year.

Yet as reported at the end of January, such decisions appear to be headed for a tortoise speed approvals track. Yes, it appears that CBD will probably be descheduled, and from both the hemp and cannabis perspective. That should be good news to many who are caught in a raft of international standards that are confusing and all over the place on a country-by-country level. However, this will not be much of a boon to the industry in Europe, in particular, where the discussion is less over CBD but the source of it, and how distillates are used. From this perspective, the draft WHO documents will make no difference, except perhaps to speed the acceptance of CBD, and create clearer regulations around it.

On the THC front, the WHO appears to do nothing more than move cannabis squarely into international Schedule I territory. More interesting of course, is the intent of international regulators to keep cannabis very much in uncertain status while moving “pharmacized” versions of the same into Schedule III designation.

What Does The Opinion of The WHO Really Mean?

What this means is also still unclear except that those who want to sell to regulated medical and nonmedical markets have to get their products (whatever those are) registered as medicine or a legitimate consumer product in every jurisdiction and eventually at a regional level (see Europe). That is clearly underway right now by both the big Canadian and emerging Israeli entities in the market as well as savvy European players in both verticals. That said, it is also a game that is about to create a very interesting market for those who are able to produce cheap, but high-grade oils in particular.

What Does This Mean For The Future Of Flower?

On the medical front, Germany became the third country in the world to consider reimbursing flower via national healthcare. Of the three who have tried it to date so far (and it is unclear what Poland will do at this point longer term), Israel is inching away and Holland nixed the entire cannabis covered by insurance conversation at the same time Germany took it on. Where that plays out across Europe will be interesting, especially as the cost of production and end retail cost continues to drop. And doctor education includes information about “whole plant” vs. pre-prescribed “dosing” where the patient has no control. The reality in the room in Europe right now is that this drug is being used to treat people with drug resistant conditions. Dosing dramas in other words, will be in the room here for some time to come as they have in no other jurisdiction.

Beyond dosing and control issues that have as much to do with doctors as overall reform, flower is still controversial for other reasons. One, it is currently still being imported into Europe from highly remote and expensive import destinations. That will probably change this year because of both the cultivation bid and Israel’s aggressive move into the middle of the fray as well as widely expected ex-im changes that will allow imports from countries throughout Europe. However, in the meantime, this is one of the reasons that flower is so unpopular right now at the policy and insurance level. The other is that pharmacists in Germany are allowed to treat the flower as a drug that must be processed. In this case, that means that they are adding a significant surcharge, per gram, to flower because they grind it before they give it to patients.

How long this loophole will exist is unclear. However, what is also very clear is that oils in particular, will play a larger and larger role in most medical markets. Read, in other words, “pharmaceutical products.”

For this reason, the WHO recommendations, for one, are actually responding to unfolding realities on the ground, not leading or setting them.

Setting A Longer-Term Date For Widespread Recreational Reform

This conservative stance from the WHO also means, however, that in the longer run, individual country “recreational reform” particularly in places like Europe, will be on a slower than so far expected track. There are no countries in the EU who are willing to step too far ahead of the UN in general. That includes Luxembourg, which so far has made the boldest predictions about its intentions on the recreational front of any EU member. However, what this also may signal is that the UN will follow the lead set by Luxembourg. Even so, this legitimately puts a marker in the ground that at least Europe’s recreational picture is at least five years off.

In the meantime, the WHO recommendations begin to set international precedent and potentially the beginnings of guidelines around a global trade that has already challenged the UN to change its own regulations. In turn, expect these regulations to guide and help set national policy outside a few outliers (see Canada, Uruguay and potentially New Zealand) globally.

Bottom line, in other words? The latest news from the UN is not “bad” but clearly seems to say that cannabis reform is a battle that is still years in the making. That said, from the glass is half full perspective, it appears, finally, there might be the beginning of a light at the end of the international tunnel of prohibition.

February 15, 2018

The Grass Isn’t Always Greener: Removal of Purple Pigmentation from Cannabis

By Danielle Mackowsky

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Cannabis strains used (clockwise from top left): Agent Orange, Tahoe OG, Blue Skunk, Grand Daddy and Grape Drink

Cannabis-testing laboratories have the challenge of removing a variety of unwanted matrix components from plant material prior to running extracts on their LC-MS/MS or GC-MS. The complexity of the cannabis plant presents additional analytical challenges that do not need to be accounted for in other agricultural products. Up to a third of the overall mass of cannabis seed, half of usable flower and nearly all extracts can be contributed to essential oils such as terpenes, flavonoids and actual cannabinoid content¹. The biodiversity of this plant is exhibited in the over 2,000 unique strains that have been identified, each with their own pigmentation, cannabinoid profile and overall suggested medicinal use². While novel methods have been developed for the removal of chlorophyll, few, if any, sample preparation methods have been devoted to removal of other colored pigments from cannabis.

Cannabis samples following QuEChERS extraction

Sample Preparation

Cannabis samples from four strains of plant (Purple Drink, Tahoe OG, Grand Daddy and Agent Orange) were hydrated using deionized water. Following the addition of 10 mL acetonitrile, samples were homogenized using a SPEX Geno/Grinder and stainless steel grinding balls. QuEChERS (Quick, Easy, Cheap, Effective, Rugged and Safe) non-buffered extraction salts were then added and samples were shaken. Following centrifugation, an aliquot of the supernatant was transferred to various blends of dispersive SPE (dSPE) salts packed into centrifugation tubes. All dSPE tubes were vortexed prior to being centrifuged. Resulting supernatant was transferred to clear auto sampler vials for visual analysis. Recoveries of 48 pesticides and four mycotoxins were determined for the two dSPE blends that provided the most pigmentation removal.

Seven dSPE blends were evaluated for their ability to remove both chlorophyll and purple pigmentation from cannabis plant material:

150 mg MgSO₄, 50 mg PSA, 50 mg C18, 50 mg Chlorofiltr®
150 mg MgSO₄, 50 mg C18, 50 mg Chlorofiltr®
150 mg MgSO₄, 50 mg PSA
150 mg MgSO₄, 25 mg C18
150 mg MgSO₄, 50 mg PSA, 50 mg C18
150 mg MgSO₄, 25 mg PSA, 7.5 mg GCB
150 mg MgSO₄, 50 mg PSA, 50 mg C18, 50 mg GCB

Based on the coloration of the resulting extracts, blends A, F and G were determined to be the most effective in removing both chlorophyll (all cannabis strains) and purple pigments (Purple Drink and Grand Daddy). Previous research regarding the ability of large quantities of GCB to retain planar pesticides allowed for the exclusion of blend G from further analyte quantitation³. The recoveries of the 48 selected pesticides and four mycotoxins for blends A and F were determined.

Grand Daddy following various dSPE cleanups

Summary

A blend of MgSO₄, C18, PSA and Chlorofiltr® allowed for the most sample clean up, without loss of pesticides and mycotoxins, for all cannabis samples tested. Average recovery of the 47 pesticides and five mycotoxins using the selected dSPE blend was 75.6% were as the average recovery when including GCB instead of Chlorofiltr® was 67.6%. Regardless of the sample’s original pigmentation, this blend successfully removed both chlorophyll and purple hues from all strains tested. The other six dSPE blends evaluated were unable to provide the sample clean up needed or had previously demonstrated to be detrimental to the recovery of pesticides routinely analyzed in cannabis.

References

(1) Recommended methods for the identification and analysis of cannabis and cannabis products, United Nations Office of Drugs and Crime (2009)

(2) W. Ross, Newsweek, (2016)

(3) Koesukwiwat, Urairat, et al. “High Throughput Analysis of 150 Pesticides in Fruits and Vegetables Using QuEChERS and Low-Pressure Gas Chromatography Time-of-Flight Mass Spectrometry.” Journal of Chromatography A, vol. 1217, no. 43, 2010, pp. 6692–6703., doi:10.1016/j.chroma.2010.05.012.

January 30, 2018

10 Treatment Methods to Reduce Mold in Cannabis

By Ketch DeGabrielle

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As the operations manager at Los Sueños Farms, the largest outdoor cannabis farm in the country, I was tasked with the challenge of finding a yeast and mold remediation treatment method that would ensure safe and healthy cannabis for all of our customers while complying with stringent regulations.

While outdoor cannabis is not inherently moldy, outdoor farms are vulnerable to changing weather conditions. Wind transports spores, which can cause mold. Each spore is a colony forming unit if plated at a lab, even if not germinated in the final product. In other words, perfectly good cannabis can easily fail microbial testing with the presence of benign spores.

Fun Fact: one square centimeter of mold can produce over 2,065,000,000 spores .

If all of those landed on cannabis it would be enough to cause over 450 pounds of cannabis to fail testing, even if those spores remained ungerminated.

Photo credit: Steep Hill- a petri dish of mold growth from tested cannabis

It should also be known that almost every food item purchased in a store goes through some type of remediation method to be considered safe for sale. Cannabis is finally becoming a legitimized industry and we will see regulations that make cannabis production look more like food production each year.

Regulations in Colorado (as well as Nevada and Canada) require cannabis to have a total yeast and mold count (TYMC) of ≤ 10,000 colony forming units per gram. We needed a TYMC treatment method that was safe, reliable, efficient and suitable for a large-scale operation. Our main problem was the presence of fungal spores, not living, growing mold.

Below is a short list of the pros and cons of each treatment method I compiled after two years of research:

Autoclave: This is the same technology used to sterilize tattoo needles and medical equipment. Autoclave uses heat and pressure to kill living things. While extremely effective, readily available and fiscally reasonable, this method is time-consuming and cannot treat large batches. It also utilizes moisture, which increases mold risk. The final product may experience decarboxylation and a change in color, taste and smell.

Dry Heat: Placing cannabis in dry heat is a very inexpensive method that is effective at reducing mold and yeast. However, it totally ruins product unless you plan to extract it.

Gamma Ray Radiation: By applying gamma ray radiation, microbial growth is reduced in plants without affecting potency. This is a very effective, fast and scalable method that doesn’t cause terpene loss or decarboxylation. However, it uses ionizing radiation that can create new chemical compounds not present before, some of which can be cancer-causing. The Department of Homeland Security will never allow U.S. cannabis farmers to use this method, as it relies on a radioactive isotope to create the gamma rays.

Gas Treatment: (Ozone, Propylene Oxide, Ethylene Oxide, Sulfur Dioxide) Treatment with gas is inexpensive, readily available and treats the entire product. Gas treatment is time consuming and must be handled carefully, as all of these gases are toxic to humans. Ozone is challenging to scale while PPO, EO and SO2 are very scalable. Gases require special facilities to apply and it’s important to note that gases such as PPO and EO are carcinogenic. These methods introduce chemicals to cannabis and can affect the end product by reducing terpenes, aroma and flavor.

Hydrogen Peroxide: Spraying cannabis plants with a hydrogen peroxide mixture can reduce yeast and mold. However, moisture is increased, which can cause otherwise benign spores to germinate. This method only treats the surface level of the plant and is not an effective remediation treatment. It also causes extreme oxidation, burning the cannabis and removing terpenes.

Microwave: This method is readily available for small-scale use and is non-chemical based and non-ionizing. However, it causes uneven heating, burning product, which is damaging to terpenes and greatly reduces quality. This method can also result in a loss of moisture. Microwave treatment is difficult to scale and is not optimal for large cultivators.

Radio Frequency: This method is organic, non-toxic, non-ionizing and non-chemical based. It is also scalable and effective; treatment time is very fast and it treats the entire product at once. There is no decarboxylation or potency loss with radio frequency treatment. Minimal moisture loss and terpene loss may result. This method has been proven by a decade of use in the food industry and will probably become the standard in large-scale treatment facilities.

Steam Treatment: Water vapor treatment is effective in other industries, scalable, organic and readily available. This method wets cannabis, introducing further mold risk, and only treats the product surface. It also uses heat, which can cause decarboxylation, and takes a long time to implement. This is not an effective method to reduce TYMC in cannabis, even though it works very well for other agricultural products

Extraction: Using supercritical gas such as butane, heptane, carbon dioxide or hexane in the cannabis extraction process is the only method of remediation approved by the Colorado Marijuana Enforcement Division and is guaranteed to kill almost everything. It’s also readily available and easy to access. However, this time-consuming method will change your final product into a concentrate instead of flower and usually constitutes a high profit loss.

UV Light: This is an inexpensive and readily available method that is limited in efficacy. UV light is only effective on certain organisms and does not work well for killing mold spores. It also only kills what the light is touching, unless ozone is captured from photolysis of oxygen near the UV lamp. It is time consuming and very difficult to scale.

After exhaustively testing and researching all treatment methods, we settled on radio frequency treatment as the best option. APEX, a radio frequency treatment machine created by Ziel, allowed us to treat 100 pounds of cannabis in an hour – a critical factor when harvesting 36,000 plants during the October harvest.

February 21, 2017

From The Lab

QuEChERS 101

By Danielle Mackowsky

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Sample preparation experts and analytical chemists are quick to suggest QuEChERS (Quick, Easy, Cheap, Effective, Rugged and Safe) to cannabis laboratories that are analyzing both flower and edible material for pesticides, mycotoxins and cannabinoid content. Besides having a quirky name, just what makes QuEChERS a good extraction technique for the complicated matrices of cannabis products? By understanding the chemistry behind the extraction and the methodology’s history, cannabis laboratories can better implement the technology and educate their workforce.

QuEChERS salt blends can be packed into mylar pouches for use with any type of centrifuge tubes

In 2003, a time when only eight states had legalized the use of medical cannabis, a group of four researchers published an article in the Journal of AOAC International that made quite the impact in the residue monitoring industry. Titled Fast and Easy Multiresidue Method Employing Acetonitrile Extraction/Partitioning and “Dispersive Solid-Phase Extraction” for the Determination of Pesticide Residues in Produce, Drs. Michael Anastassiades, Steven Lehotay, Darinka Štajnbaher and Frank Schenck demonstrate how hundreds of pesticides could be extracted from a variety of produce samples through the use of two sequential steps: an initial phase partitioning followed by an additional matrix clean up. In the paper’s conclusion, the term QuEChERS was officially coined. In the fourteen years that have followed, this article has been cited over 2800 times. Subsequent research publications have demonstrated its use in matrices beyond food products such as biological fluids, soil and dietary supplements for a plethora of analytes including phthalates, pharmaceutical compounds and most recently cannabis.

QuEChERS salts can come prepacked into centrifuge tubes

The original QuEChERS extraction method utilized a salt blend of 4 g of magnesium sulfate and 1 g of sodium chloride. A starting sample volume of 10 g and 10 mL of acetonitrile (ACN) were combined with the above-mentioned salt blend in a centrifuge tube. The second step, dispersive solid phase extraction (dSPE) cleanup, included 150 mg of magnesium sulfate and 25 mg of primary secondary amine (PSA). Subsequent extraction techniques, now known as AOAC and European QuEChERS, suggested the use of buffered salts in order to protect any base sensitive analytes that may be critical to one’s analysis. Though the pH of the extraction solvent may differ, all three methods agree that ACN should be used as the starting organic phase. ACN is capable of extracting the broadest range of analytes and is compatible with both LC-MS/MS and GC-MS systems. While ethyl acetate has also been suggested as a starting solvent, it is incompatible with LC-MS/MS and extracts a larger amount of undesirable matrix components in the final aliquot.

All laboratories, including cannabis and food safety settings, are constantly looking for ways to decrease their overhead costs, batch out the most samples possible per day, and keep their employees trained and safe. It is not a stretch to say that QuEChERS revolutionized the analytical industry and made the above goals tangible achievements. In the original publication, Anastassiades et al. established that recoveries of over 85% for pesticides residues were possible at a cost as low as $1 per ten grams of sample. Within forty minutes, up to twelve samples were fully extracted and ready to be analyzed by GC-MS, without the purchase of any specialized equipment. Most importantly, no halogenated solvents were necessary, making this an environmentally conscious concept. Due to the nature of the cannabis industry, laboratories in this field are able to decrease overall solvent usage by a greater amount than what was demonstrated in 2003. The recommended starting sample for cannabis laboratories is only one gram of flower, or a tenth of the starting volume that is commonly utilized in the food safety industry. This reduction in sample volume then leads to a reduction in acetonitrile usage and thus QuEChERS is a very green extraction methodology.

The complexity of the cannabis matrix can cause great extraction difficulties if proper techniques are not used

As with any analytical method, QuEChERS is not perfect or ideal for every laboratory setting. Challenges remain in the cannabis industry where the polarity of individual pesticides monitored in some states precludes them from being amenable to the QuEChERS approach. For cannabis laboratories looking to improve their pesticide recoveries, decrease their solvent usage and not invest their resources into additional bench top equipment, QuEChERS is an excellent technique to adopt. The commercialization of salt blends specific for cannabis flowers and edibles takes the guesswork out of which products to use. The growth of cannabis technical groups within established analytical organizations has allowed for better communication among scientists when it comes to best practices for this complicated matrix. Overall, it is definitely worth implementing the QuEChERS technique in one’s cannabis laboratory in order to streamline productivity without sacrificing your results.

May 16, 2016

How Potent is Your Product: Getting Educated on Edibles Analysis

By Danielle Mackowsky

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As a result of the rapidly developing cannabis industry, many forensic toxicology labs are looking for fast, reliable and cost-effective methods to determine cannabis potency and pesticide residue in edibles. Although the pros and cons of legalization are still heavily debated throughout the country, all scientists agree that uniform testing policies and procedures need to be established as soon as possible.

Within environmental and food testing laboratories, the use of QuEChERS (Quick, Easy, Cheap, Effective, Rugged, and Safe) has been practiced widely for the past 15 years. In 2003, Dr.’s Michelangelo Anastassiades and Steven Lehotay published the first QuEChERS application, which detailed the determination of pesticide residues in produce. Since then, QuEChERS has become the gold standard for the testing and analysis of a wide variety of edible matrices. United Chemical Technologies (UCT) was the first company to commercialize the product and it became apparent that the application of this technology to cannabis edibles was a natural solution to pesticide residue testing. All of the data from the QuEChERS cannabis edibles pesticide and potency analyses can be found here.

Sample preparation

mixeddropsUCTarticle — Hard candy before freezer mill grinding

Preparation of a sample for QuEChERS analysis varies depending on the type of edible product being tested. Baked goods, chocolate bars and hard candies should be ground into a fine powder prior to analysis. Although this can be achieved using a product such as a SPEX 6770 freezer mill, a blender can suffice when analyzing typical plant-based samples. Liquid samples, such as sodas or teas, should be degassed prior to analysis, whereas any gummy-based candies should be cut into fine pieces. With the exception of the liquid samples, all other matrices should then be hydrated for one hour within a QuEChERS extraction tube.

UCTarticle — Hard candy after freezer mill grinding

Following sample preparation, acetonitrile is added to all samples along with a proprietary blend of QuEChERS extraction salts. These salts remove water from the organic phase, help to facilitate solvent partitioning and protect base-sensitive analytes from degradation. After shaking and centrifuging the sample, three distinct layers are formed. The top layer, which is the organic phase, can then be aliquoted off for further sample clean-up or dilution.

querchersUCTsample — A mint milk chocolate sample after QuEChERS extraction

For pesticide analysis, an aliquot of the organic layer was subjected to dispersive solid phase extraction (dSPE). This process utilizes an additional blend of proprietary sorbents that remove chlorophyll, sugars, organic acids and fatty compounds from the sample. The resulting extract is free of pigmentation and is ready for analysis on the LC-MS/MS. All samples that were analyzed for cannabinoids did not undergo dSPE; rather, a serial dilution was carried out due to the high concentration of cannabinoids in the original organic layer. The original QuEChERS extract required a dilution of 100-200x in order to have a sample that was ultimately suitable for analysis on LC-MS/MS. A UCT Selectra Aqueous C18 HPLC Column and Guard Column were used in a Thermo Scientific Dionex UltiMate 3000 LC System. An aqueous C18 column was selected due to the extreme polarity of the pesticides being analyzed.

Summary

This application utilizes the advantages of UCT’s proprietary QuEChERS combination to extract 35 pesticides and 3 cannabinoids, including tetrahydrocannabinol (THC), cannabidiol (CBD) and cannabinol (CBN) in edibles, followed by either serial dilutions for cannabis potency analysis, or a dSPE cleanup for pesticide residue analysis. This hybrid method allows QuEChERs, which are extensively used in the food testing industry, to be utilized in a forensic setting.