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Judge A Book By Its Cover: Why Understanding Information Economics is Critical to Gain Consumer Trust and Build a Sustainable Brand

By Nathan Libbey
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Information economics has existed for decades and drives much of how products, including cannabis, are marketed and purchased. One of the essential frameworks that guides information economics are the search, experience, and credence properties of a product (Patterson, 2017). Understanding these different product attributes is key to setting up a sustaining cannabis product, corporation, and industry.

Search

The search attribute of a product is largely what we see prior to the purchase of a product. Images, claims, and packaging may all contribute to the search attribute of a product. You’ve got a good-looking, flower, pre-roll or edible, and it shows well on your insta page. Information is seemingly symmetrical between agency and consumer, what you see is what you get. In the developing cannabis industry, firms are investing a tremendous amount of resources into search attributes.

Experience

What is the effect of the product? There are two aspects of the experience attribute in information economics. Testimonials may be also considered experience attributes, as they give a user knowledge of how a product tastes, how long it takes to kick in, how long it lasts and descriptions of how others perceived the product’s deliverables. Despite testimonial power, experience is largely personal and occurs only after the product is consumed. Information is seemingly symmetrical; you get the experience that the agency planned and you anticipated. Advances in genetics, homogeneous production methods and potency testing demonstrate that the cannabis industry is investing in experience attributes.

A level playing field where transparency is at the forefront of all transactions will help solidify trust and drive sustainable growth. So, your product looks good, tastes good, and has very positive reviews. Customers can’t get enough; they are voting with their wallets for your product. But there is a third part of information economics you may be missing.

Credence

Credence attributes rely on information asymmetry. Think of used cars as a textbook example: sellers of used cars rely on asymmetry to motivate purchases. Highway miles, adult driven, oil changes every 3,000 miles, etc. are claims that can only be verified by the seller, the buyer has no way of knowing if these are true or not. Credence attributes can’t be verified by the seller due to lack of knowledge or expertise (Ford et al, 1988). The same goes for a consumable good like cannabis, only the grower or manufacturer knows what occurred in the “back of the house.” Product safety, therefore, is a credence attribute of cannabis products.

Investing in credence attributes in a young market may seem cost prohibitive. Many in the cannabis industry simply want to follow whatever the state they operate in dictates as the minimum allowable. In hemp we see states that require QR codes on each product that link to a COA, but many do not. Does the cost to produce the COA and QR code make a product more eye-catching or enhance the experiences? No, but those producing it may pay a hefty price if and when the product makes someone sick.

If a firm relies on fragmented, disparate regulatory bodies to dictate their investments in product safety, they will eventually face credence issues. Is smokable flower grown in Texas safer than that grown in Maine? We don’t have data to support either regulation’s effectiveness, so a firm or industry must dictate what the standard is and stick to it.

We need only look at the leafy green industry to see an example of a product that did not break any regulatory guidelines yet continued to sell a good with very negative credence attributes. How long were folks getting sick from leafy greens prior to them identifying the source? No one knows and that is what makes credence attributes so hard to pin down and develop an ROI formula for. Inputs that yield not-sick people aren’t known until someone gets sick. For leafy greens, they had an advantage – years of studies showing that they were good for you. Cannabis, unfortunately, doesn’t have that leg to stand on and faces an uphill battle gaining public trust.

As soccer moms (and dads) across the nation start to work cannabis into their play date wine sessions, the industry must ensure that they are investing in all avenues of information economics. A level playing field where transparency is at the forefront of all transactions will help solidify trust and drive sustainable growth.


References

Patterson, M. (2017). The economics of information. In Antitrust Law in the New Economy (pp. 39-60). Cambridge, Massachusetts; London, England: Harvard University Press. Retrieved February 7, 2020, from www.jstor.org/stable/j.ctvc2rkm6.6

Ford, G., Smith, D.,  and Swasy, J. (1988), An Empirical Test of the Search, Experience and Credence Attributes Framework, in NA – Advances in Consumer Research Volume 15, eds. Micheal J. Houston, Provo, UT : Association for Consumer Research, Pages: 239-244.

Cannabis Industry Journal

Cannabis Labs Conference Announced for Spring 2020

By Cannabis Industry Journal Staff
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Cannabis Industry Journal

EDGARTOWN, MA, Jan. 23, 2020 – Innovative Publishing Co., the publisher of Cannabis Industry Journal and organizer of the Cannabis Quality Conference & Expo is announcing the launch of the Cannabis Labs Conference. The event will address science, technology, regulatory compliance and quality management as they relate to the cannabis testing market. It will take place on June 2–3 at U.S. Pharmacopeia in Rockville, MD.

A few of the noteworthy topics that will be discussed at the conference include hemp testing under new federal guidelines, ISO 17025:2017 accreditation, potency and cannabinoid quantification, regulatory compliance and state regulations, microbiology and sample preparation best practices, among other topic areas.

The event is co-located with the Food Labs Conference, which will focus on regulatory, compliance and risk management issues that companies face in the area of testing and food laboratory management. More information about this event is available on Food Safety Tech. Some of the critical topics include a discussion of FDA’s proposed FSMA rule, Laboratory Accreditation Program for Food Testing; considerations in laboratory design; pathogen testing and detection; food fraud; advances in testing and lab technology; allergen testing, control and management; validation and proficiency testing; and much more.

“By presenting two industry conferences under one roof, we can provide attendees with technology, regulatory compliance and best practices that cannabis and food might share but also focused topics that are unique to cannabis or food laboratory industry needs,” said Rick Biros, president of Innovative Publishing Co., Inc. and director of the Food Labs Conference.

The call for abstracts is open until February 28.

The agenda and speakers will be announced in early March. Click here to learn more.

Preventing Mold & Fungus in Cannabis with Data Analytics

By Leighton Wolffe
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Cannabis legalization has taken the United States by storm, with 33 states approved for medicinal cannabis use — 11 of which are also approved for recreational use for adults aged 21 and over. With new patients and consumers entering the market every day, it’s more important than ever for cannabis cultivators to establish more effective methods for mold and fungal prevention in their crops and to ensure consumer confidence in their brands.

Today, many cultivators address the risk of mold and fungus growth by testing crops for contaminants at the end stage of production. While this helps to catch some infected product before it reaches the market, this method is largely ineffective for mold and fungal prevention during the cultivation process. In fact, recent studies have shown an 80% failure rate in mold and fungal testing in Denver cannabis dispensaries. By relying on late-stage, pass/fail testing, cannabis entrepreneurs also expose themselves to increased risk of lost crops and profits.

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

However, emerging sensor technologies exist that can test plants during the grow process, significantly reducing the risks associated with cannabis cultivation while increasing the bottom line for commercial grow operations. By leveraging data from these monitoring sensors along with environmental automation systems that are integrated with data analytics platforms, cannabis professionals can take a proactive approach to achieve the ideal environmental conditions for their crops and prevent against mold and fungal infestation.

Common Causes for Bud Rot in Indoor Growing Systems 

Botrytis cinerea — commonly known as “bud rot” — is a pathogenic fungi species that creates a gray mold infection in cannabis plants. An air-borne contaminant, it is among the most prevalent diseases affecting marijuana crops today and can lead to significant damages, particularly when left untreated during post-harvest storage. Bud rot is one of the most difficult challenges cannabis entrepreneurs face: Once plants have been affected, only 2% can be expected to recover. This is because Botrytis cinerea can use multiple methods for attacking host plants, including using the plant’s natural defenses against it to continue infestation.

While difficult to contain, bud rot is very easy to spot. Plants affected with the fungus will begin yellowing, experience impaired growth, and develop gray fungus around its buds. Overall crop yield will be significantly reduced, leading to decreased profit for cannabis cultivators. The biggest contributing factors to a Botrytis cinerea infestation are as follows:

  • Humidity: Indoor grow facilities that maintain humidity levels in excess of 45% are breeding grounds for mold and fungus. These environments can become perfect conditions for mold and fungal growth.
  • Temperature: Bud rot typically thrives in environments where temperatures fall between 65- and 75-degrees Fahrenheit, which is why greenhouses and grow rooms are often the victim of such infestations.
  • Ventilation: Poor airflow is another contributing factor to Botrytis cinerea Without proper ventilation, excess moisture buildup will eventually result in mold and mildew growth.
  • Strain: Some marijuana strains are better equipped to fend off bud rot infection. In particular, sativa plants have a higher resistance to mold development than their C. indica and C. ruderalis cousins.

Controlling mold and fungal growth in commercial grow facilities is a top priority for cannabis cultivators. Not only detrimental to their profitability and crop yield, infected plants can pose serious health risks to consumers, especially for immunocompromised patients. Consuming cannabis products that have been compromised by bud rot or other mold and fungal infections can cause a wide range of medical concerns, including pneumonitis, bronchitis, and other pulmonary diseases. As a result, growers are required to dispose of all infected plants without the possibility to sell.

Bud rot isn’t the only culprit responsible for cannabis plant destruction. Powdery mildew, Fusarium, sooty molds, and Pythium all contribute to the challenges faced by cannabis professionals. In fact, a recent study conducted by Steep Hill Labs and University of California, Davis – Medical Center found that in 20 randomly-selected samples submitted for testing, all samples showed detectable levels of microbial contamination7. Many of these samples also contained significant pathogenic microorganism contamination. Without proper detection and prevention methods in place, these pesky plant-killers will only continue to terrorize the cannabis cultivation industry.

The Current Cannabis Cultivation Landscape 

The data is clear: Current practices for cannabis cultivation are insufficient for preventing against mold and fungal growth. Sterilization and pass/fail testing do not identify the root cause of harmful infestations in plants, therefore leaving cannabis professionals in the dark about how to better optimize their grow conditions for improved crop reliability and safety. In order to prevent against damages incurred from mold and fungal infestation, marijuana growers must be more diligent in their grow condition monitoring practices.

Many cannabis professionals rely on manual monitoring to identify environmental changes within their indoor grow facilities. While it’s important to collect data on your operation’s essential systems, doing so without the right tools can be time-consuming and ineffective. Manual monitoring often relies on past data and does not illustrate the relationship between different systems and their impact on environmental changes. The goal is to assemble data from all the grow systems and create correlations on actual bio-environmental conditions during the grow process to compare to yield results. This is only available when an information management platform is synthesizing data from all the systems within the grow facility and presenting meaningful information to the growers, facility operators and owners.

Especially as the cannabis industry is expected to grow exponentially in coming years, growers need more robust tools for tracking and manipulating environmental changes within their indoor growing systems.

Leveraging Building Automation Systems & Data Analytics in Cannabis Cultivation 

A powerful approach to prevent environmental conditions that are known to lead to mold and fungus growth exists in leveraging the data produced from your grow facility’s various automation systems. Most commercial cultivation facilities have multiple stand-alone and proprietary systems to control their indoor environment, making it difficult to not only collect all of this valuable data, but also to achieve the level of grow condition monitoring necessary for mold and fungal prevention.

With some data analytics platforms, such as GrowFit Analytics, data is collected across disparate systems that don’t normally communicate with one another, providing access to the key insights necessary for achieving environmental perfection with your cannabis crops. A viable solution collects vital grow facility system data and relevant bio-environmental monitoring data, and delivers this information in one, centralized software interface. The software then will apply analytic algorithms to develop key performance indicators (KPIs) while working to detect system anomalies, faults, and environmental fluctuations. The right analytics solution should also be customizable, allowing you to track the KPIs that are most important to your unique facility, and to achieve the vision of your chief grower. Ultimately, the software should serve up actionable insights that empower facility management and growers.

Sample data visualization dashboard from GrowFit Analytics showing real-time Temperature and Relative Humidity readings and indicating potential Mold Risk as defined by the Grower.

Collecting reliable data from different grow facility systems and environmental sensors can be a complex process and the information collected illustrates more than just what’s working right and what isn’t. By implementing an advanced data analytics solution, cannabis cultivation professionals can now be empowered to track minute details about their indoor grow facility, providing a safer, healthier environment for their crops and avoiding those environmental conditions that lead to mold and fungus altogether.

An ideal data analytics platform won’t simply collect data to be analyzed at a later date, and simple trending of sensor data is not enough. Information — especially in a commercial grow facility — is time-sensitive, which is why growers should select a system that offers real-time analytics capabilities. Some platforms offering real-time analytics utilize cloud computing, allowing for easy access from anywhere while also providing enhanced security to protect sensitive facility data. The most robust data analytics platforms provide detailed historical data for your entire crop’s lifecycle that provide a “digital recipe” to replicate successful crops, and fine-tune the process for continuous improvement.

Data analytics tools can also impact the bottom line by lowering operational costs. GrowFit Analytics, for example, was born out of a software solution designed to lower energy costs for large complex buildings like commercial grow facilities.

The data and insights provided can help identify opportunities for greater energy efficiency, which can lead to significant utility savings. Grow facilities operate 24 hours/day, with energy expenses representing one of the largest operational costs. With data analytics tools at their disposal, facility managers are armed with the information they need to improve system efficiency, increase energy savings, and improve profitability.

Eliminating Mold & Fungus from the Future of Cannabis Cultivation 

By focusing on grow condition monitoring using data analytics tools, cannabis professionals can effectively eliminate the risk of mold and fungus growth in their crops. Leading data analytics tools make tracking environmental changes simple and easy to manage, allowing cannabis professionals to take a proactive approach to mold and fungus prevention. As we look to the future of the cannabis cultivation industry, it’s paramount for professionals to explore the technological advancements available that can help them address their business’ most pressing challenges.

control the room environment

Food Safety: What it Means and How ERP Helps Edibles Manufacturers

By Daniel Erickson
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control the room environment

The diverse cannabis industry has experienced tremendous growth, especially in the popular edibles market whether consumed recreationally or medicinally. Since these cannabis-infused food and beverage products come in a variety of forms, including candies, baked goods, energy drinks, chips, chocolates and teas, food safety questions and concerns for companies manufacturing these products can seem daunting. ERP software solutions designed for the cannabis industry play an imperative and necessary role in addressing key food safety issues for edibles producers, helping to fill in the gaps where new and established businesses struggle. By mitigating the potential for damaging effects of a food safety event, companies can prevent, or greatly lessen the impact, to both their reputation and public perception, as well as limit the financial liability and legal penalties.

What is safety?

On a fundamental level, safety is the state of being protected from undergoing or causing hurt, injury or loss. As a manufacturer of cannabis edibles, it is critical that products are consistent, labeled appropriately and safe for consumers. Forward-thinking companies are employing ERP solutions to help ensure their products are not harmful to their current and future customers.

FDAlogoA lack of safety in the cannabis edibles market stems from the unregulated nature of the industry on a federal level, despite consumers’ expectations otherwise. Similar to products in the food and beverage industry, safety issues with inaccurate labeling, food-borne pathogens and disease outbreaks are all concerns within the manufacturing environment. Particularly to cannabis businesses, extraction methods, bacteria and mold growth, pest and pesticide contamination, chemical exposure, improper employee handling and the unintentional consumption or overconsumption of edibles are all potential safety concerns. In states where edible products are legal, local municipalities and state governments each have their own unique regulations – requiring manufacturers to comply to different guidelines. With the absence of federal regulations, many cannabis companies have adopted a more conservative approach to food safety. Following U.S. Food and Drug Administration (FDA) guidelines and Food Safety Modernization Act (FSMA) best practices allows manufacturers to address key current food safety issues and prepare for future regulation.

Utilize Best Practices and ERPGMP

Introducing current Good Manufacturing Practices (cGMP’s) traditionally implemented in the food and beverage industry help to form a foundation for cannabis edibles safety in 9 key areas:

  1. Personnel – As an often-overlooked aspect of cannabis edibles manufacturing, adequate training on procedures to ensure disease control and proper cleanliness is required to maintain a company culture of safety. Advocating for quality standards with proper safety procedures should be a priority for every employee.
  2. Manufacturing Environment – Effective management of the manufacturing environment ensures that facilities are controlled to prevent the contamination of finished goods – restricting extraneous materials such as glass, metal, rubber, etc. from the production floor. Warehouse and office lighting should be adequately maintained so that employees are able to inspect equipment, by-products and finished goods and conduct their jobs effectively.
  3. Sanitary Operations – Physical facilities and all equipment must be maintained in clean and sanitary conditions and kept in good repair to prevent food and beverages from becoming contaminated. Cleaning processes should protect ingredients, work in progress, finished goods and workspaces from potential contamination.
  4. Sanitary Facilities and Controls – Effective control of water, plumbing, sewage disposal and drainage are essential. Staff must have access to adequate handwashing and restroom facilities and employee changing rooms. Restrooms and break rooms should be clean and stocked at all times, while garbage is handled properly and disposed of in a timely manner.
  5. Equipment and Utensils – Properly cleaning and maintaining vats, conveyor belts, shrink wrap machines, blenders, etc. to avoid contamination and allergen cross-contact ensures safe procedures are being followed. A robust sanitation program with defined cleaning schedules should be followed for the sanitizing of utensils and equipment.
  6. Processes and Controls – The manufacturing of edible products should be done in accordance with best practices established in the food and beverage industry, taking account of sanitation, quality control and protection from allergens and contamination. Ongoing testing is conducted to identify sanitation failures and contamination occurrences and ensure items are discarded properly.

    control the room environment
    Personal Protective Equipment (PPE) can reduce the risks of contamination
  7. Warehousing and Distribution – Establishing proper storage and transportation processes protects the products from contamination, allergen cross-contact and container deterioration – ensuring proper handling procedures throughout the growing, manufacturing and distribution steps.
  8. Defect Action Levels – Quality control is used to minimize defects by requiring an action response when a problem is discovered. An established response plan demonstrates the proper procedures to follow when defects occur during production.
  9. Holding and Distribution of By-products for use as Animal Food (if applicable) – This applies to food and beverage facilities that either donate or sell a by-product for use as animal food. By-products used for animal consumption that are managed properly remain free from contamination. Accurate labeling should identify by-product by the common or usual name and denote not for human consumption when distributed.

Cannabis-specific ERP solutions efficiently provide the structure, integration and processes to follow cGMP’s to address food safety concerns in all phases of growing, manufacturing and distribution. By automating the documentation of audit trails, edibles companies are equipped with the same tools that food and beverage manufacturers have utilized for decades. Validated procedures and best practices incorporate safety initiatives from cannabis cultivation to the sale of edible products and beyond, offering greater efficiency than manual methods. Since cGMP’s provide a foundation for Hazard Analysis Critical Control Points (HACCP) planning, edibles manufacturers are able to take advantage of incorporating control points into the ERP solution to prevent and control hazards before they affect food safety. Having a HACCP Plan, along with proper implementation and adherence to cGMP’s, helps to minimize food safety hazards for edibles manufacturers in the cannabis industry.

Quality and safety in the cannabis edibles market is an area that cannot be ignored, as the consequences for failing to handle hazards are potentially devastating. Savvy cannabis companies are employing best practices of food and beverage manufacturers, including the 9 addressed above, in tandem with an ERP software solution, to effectively navigating this highly competitive market. Paving the way with their commitment to quality and in delivering safe and consistent products to the market demonstrates to customers and investors alike their preparedness for growth.

PharmLabs Accredited to ISO 17025

By Cannabis Industry Journal Staff
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According to a press release emailed today, Perry Johnson Laboratory Accreditation Inc. (PJLA) announced the accreditation of PharmLabs LLC to ISO/IEC 17025. Based in San Diego, California, PharmLabs has four locations, with three in the Southern California region and one in Maui.

PharmLabs offers a very wide variety of services including: California Compliance testing, a specialized Hemp Testing Program, Hemp Biomass Verification testing, and THC-free testing for the state of California. In addition, they offer the testing of cannabinoids, pesticides, residual solvents, microbiological contaminants, mycotoxins, heavy metals, terpenes, water activity, moisture content, and filth/foreign material testing.

“Our experience with [Perry Johnson Laboratory Accreditation] has been incredible over the years. Since we have multiple locations, we have had many visits with PJLA and their knowledge and quick response time has helped us get where we need to be,” says Greg Magdoff, founder of PharmLabs.

According to the press release, PharmLabs has plans to expand throughout the state of California and the rest of the United States in both hemp and cannabis testing in legal states.

PJRFSI Introduces Cannabis Safety Standard for Manufacturing

By Amy Wayne
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With the rapid expansion of the cannabis industry in North America, there are more questions than ever about the safety and integrity of the new products constantly flooding the market. It seems as if there’s something new hitting store shelves every day, and as legalization spreads across the United States, the market is widening to an increasing range of consumers. But just how safe are all these new products? With regulations and requirements varying state to state, how can new medical and recreational users be certain of a product’s potency, safety, or other qualities?

Certification of products is a likely answer. Much like how requirement of food safety standards has helped ensure produce and manufactured foods are safe to eat, a cannabis safety standard can help guarantee a safe, thriving industry. Perry Johnson Registrars Food Safety, Inc. (PJRFSI) now offers specialty certifications to cover all facets of the cannabis industry, based on successful food, agricultural and pharmaceutical safety certifications. From growing and harvesting to production or extraction, there are streamlined and effective resources available for everyone.

Since requirements vary so widely from coast to coast based on state mandates, PJRFSI cannabis certifications are custom-tailored state by state, and based on Good Manufacturing Practice (GMP) guidelines. In addition to this fully-customizable approach, PJRFSI is part of a family of companies that have worked with cannabis testing lab accreditation for years; numerous producers have already partnered with PJRFSI to develop their own custom cannabis quality audits. Not only have our specialists worked with producers and industry players, but with state regulators and lawmakers as well in providing input for cannabis program implementation. Download the PJRFSI standard for free today!

To learn more about designing your own customized cannabis quality and safety certification audit, or to hear more about just why PJRFSI certification may be the best option for your operation, give us a call at (248) 519-2523, or visit www.PJRFSI.com.

The Power of Prevention: Pathogen Monitoring in Cannabis Cultivation and Processing Facilities

By Nathan Libbey
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As the cannabis market matures and the value chain becomes modernized, it’s important to address product safety in a comprehensive way. In other areas of manufacturing, Hazard Analysis & Critical Control Points (HACCP) has been the standard for reducing hazards both for employees and for the products themselves. A Critical Control Point (CCP) is any spot from conception to consumption where a loss of control can potentially result in risk (Unnevehr, 1996). In the food realm, HACCP has been used to drive quality enhancements since the 1980s (Cichy, 1982).

In a nutshell, HACCP seeks to help identify where a problem may enter a product or environment and how that problem may be addressed before it escalates. In cannabis, these hazards include many of the same problems that food products have: specifically molds, yeasts, and pathogenic bacteria (Listeria, E. coli, etc.). While the current industry standard is to test products at the end stage for these contaminants, this late-stage pass/fail regimen leads to huge lots of destroyed product and a risk for consumer distrust (Yamashiro, 2019). HACCP, therefore, should be applied at every stage of the production process.

Pathogen Environmental Monitoring (PEM) is a tool that can be used to identify CCPs in a cannabis cultivation or processing facility. The main goal of a PEM program is to find a contaminant before it reaches a surface that touches the product or the product itself. PEM is conducted using a pre-moistened swab or a sponge to collect a sample from the cannabis environment. The swab can then be sent to a lab for microbial testing. Keys to an effective PEM are:

1. Start with a broad stroke – When the FDA comes to a facility suspected of producing pathogen-laced food products, they conduct what is known as a Swab-a-thon. A Swab-a-thon is a top to bottom collection of samples, usually totaling 100 or more. Similarly, preemptively swabbing should be the first step in any PEM—swab everything to see what exists as a baseline.

2. Map your scene – identify on a map of your facility the following:

  • Cannabis contact surfaces (CCS) (belts, clippers, tables, etc)
  • Non-cannabis contact surfaces (Non-CCS) (floors, lighting, drains, etc)
  • Flow of air and people (where do air and people enter and where do they go?

Identifying the above zones will help deepen your understanding of where contaminants may come into contact with cannabis and how they may migrate from a Non-CCS to a CCS. 

3. Plan and execute:

  • Based on the results of mapping, and Swab-a-thon, identify where and when you will be collecting samples on a consistent and repeatable basis. Emphasis should be placed on areas that are deemed a risk based on 1) and 2). Samples should be collected at random in all zones to ensure comprehensive screening.

4. Remediate and modify:

  • If you get a positive result during PEM, don’t panic—pathogens are ubiquitous.
  • Remediate any trouble spots with deep cleaning, remediation devices or other protocols.
  • Re-test areas that were positive for pathogens to ensure remediation is successful.
  • Revisit and modify the plan at least once a year and each time a new piece of equipment is added or production flow is otherwise changed.

The steps above are a good starting point for a grower or processor to begin a PEM. Remember that this is not a one-size-fits-all approach to safety; each facility has its own unique set of hazards and control points.

Comprehensive guides for PEM can be found at the links below, many of the concepts can be applied to cannabis production.


https://affifoodsafety.org/lcp/advanced-search/

http://www.centerforproducesafety.org/amass/documents/document/263/Listeria%20Guidance%20UFPA%202013.pdf

Cichy, R. (1982). HACCP as a quality assurance tool in a commissary food-service system. International Journal of Hospitality Management, 1(2), 103-106.

Unnevehr, L., & Jensen, H. (1996). HACCP as a Regulatory Innovation to Improve Food Safety in the Meat Industry. American Journal of Agricultural Economics, 78(3), 764-769.

Yamashiro, C, & Baca, Y. (2019).  Prevent high-value cannabis crop loss with innovative environmental monitoring tool.

Radojka Barycki picture

Preparing Your Recall Strategies

By Radojka Barycki
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Radojka Barycki picture

A product recall is the removal of a defective product from the market because it can cause harm to the consumer or place the manufacturer at risk of legal action.

Although a recall is not something that companies want to be related to, preparing for it is very critical and it is an important part of crisis management.Product recalls can cost companies million dollars in profit loss and civil damages. The company senior management and employees can also face criminal action, if the investigation shows negligent acts. The company will also face loss of reputation and the trust of its customers.

Although a recall is not something that companies want to be related to, preparing for it is very critical and it is an important part of crisis management.

There are several phases when preparing a recall strategy:

Planning Phase

During the planning phase, a recall plan is developed. A recall plan is the procedure that will be followed by an appointed company’s team during an actual recall. A good recall plan will have the following components:

  • Definitions of the type of products recalls. According to federal regulations, there are three types of recalls. The company should know what type of recall they are performing to understand the risk the consumer is facing.
  • A Recall Team. The recall team is the key stakeholders that are responsible for different processes within the company. A good recall team will be multidisciplinary. A multidisciplinary team is a group of people that have different responsibilities within the manufacturing site (i.e. Receiving Manager, QA Manager, etc.) and/or outside (i.e. Legal Counsel, Public Relations, etc.) 
  • A description of the recall team member’s responsibilities must be outlined. A recall coordinator and a backup should be assigned to ensure that there is one person organizing all activities during the recall. 
  • A Communication Plan. It is important that only the appointed person that has the responsibility of external communications (i.e. media, regulators, customers, key stakeholders, etc.). In addition, there should be only one person appointed to handle all the communication within the team (internal communications.)
  • Documents to be used during the recall are:
    • Communication documents: Letters to customers, regulators and media must be drafted and kept on hand for use during the crisis.
    • Forms that will be used to keep track of product inventory on hand (still in the site), product being returned and product being destroyed.
  • A Traceability Procedure should be in place to ensure that materials used in the manufacturing of the finished good can be traced from the time of the delivery to the facility and throughout the product manufacturing process. In addition, traceability must also be provided for finished goods from the manufacturing site to its first point of distribution. This is known as traceability one step back (materials used) and one step forward (first point of distribution.)

    PlantTag
    A plant tagged with a barcode and date for tracking
  • A description of (or reference to) product quarantine (product hold) procedures that must be followed to ensure that the product that is still at the site do not leave the facility. 
  • Product Destruction The company must outline (or reference) how product will be destroyed during a recall process.

Implementation Phase

There are three processes that need to be followed when implementing the recall plan:

  • Training: The recall team must be trained on their roles and responsibilities. Employees working at the site will be receiving directives from the appointed recall team members. It is also important that they are aware about the recall plan and understand the importance of urgency during the situation.
  • Exercise: It is important that the company doesn’t wait until the incident occurs to ensure that everyone in the team understands their roles and responsibilities during the recall. Therefore, annual testing of the procedure is imperative. This implies creating a “mock recall” situation and providing the information to the team to evaluate if they fully understand their role and responsibilities. This also allows the testing of the traceability protocols and systems that have been put in place by the site. Ensure that the team understands that this is an exercise and not an actual recall. You don’t want the team members going through the emotions that an actual recall gives. However, stress the importance of their participation during this exercise. You do not communicate to customers, media or regulators during a recall exercise. 
  • Execution: This is the actual recall and full implementation of the plan. During the actual recall, you communicate to the regulators, customers and media. The company must also conduct daily recall effectiveness checks by using the forms developed for tracking product inventory, recovery and destruction. 
  • Identify root cause and implement corrective actions. Root cause(s) will be identified during the recall process by analyzing the information resulting from the investigation of the incident. Regulatory agencies will actively participate in the discussion for identifying in the implementation of corrective actions. 

Improvement Phase

The recall team should always meet after the recall exercise or the actual recall incident. The team must evaluate what positive or negative outcomes resulted from the process. If there are gaps identified, these need to be closed, so the process is improved.

Strengthen Supply Chain Management with an Integrated ERP & CMS

By Daniel Erickson
1 Comment

Success in the cannabis industry is driven by a company’s ability to adapt to an ever-changing market and meet the demands of the evolving consumer. Selecting the right business management solution to handle the complexities of the growing cycle as well as daily operations and compliance requirements necessitates diligent research. Ensuring that the selected technology solution has a centralized database in a secure platform designed to reinforce quality throughout company operations is essential in today’s competitive industry. An ERP solution with integrated CMS capabilities helps businesses strengthen supply chain management by seamlessly incorporating cannabis cultivation with day-to-day company operations to efficiently deliver seed to sale capabilities and meet marketplace demands.

What are ERP & CMS?

Enterprise resource planning (ERP) is a business system in which all data is centralized – including finances, human resources, quality, manufacturing, inventory, sales and reporting. A cultivation management system (CMS) is an extension of an ERP solution to manage cannabis greenhouse operations, including growing, inventory and labor needs. A CMS maintains a detailed level of tracking to account for continuous cannabis growth periods that require extensive monitoring and incur a multitude of expenses. In an integrated solution, both the ERP and CMS data are managed under the same secure database to provide a forward and backward audit trail of all business processes. This visibility encompasses the entire supply chain from the management of supplier relationships to distribution – including growing, cultivating, extracting, manufacturing and shipping.

How do ERP & CMS strengthen supply chain processes?

Tracks individual plants and growth stages – By tracking plant inventories at the individual plant level in real-time with a unique plant identifier, greenhouse operations are optimized – monitoring the entire lifecycle of the plant throughout the germination, seedling, vegetative and flowering stages. Audit trails maintain regulatory compliance, including information such as terpene profiles and THC and CBD potency. Monitoring genealogy, mother and cloning, crossbreeding, plant genetics and clone propagation are key to success in this industry. Strain tracking is equally important, including identifying which strains are performing best, producing the most yield and how they are received by the marketplace. Tracking of the entire supply chain includes the recording of plant health, harvesting techniques, production, growth, costs, lab testing and batch yields – without any gaps in information.

PlantTag
A plant tagged with a barcode and date for tracking

Optimizes growing conditions to increase yields – By automatically documenting and analyzing data, insights into plant and greenhouse activities create streamlined processes for an optimal cannabis cultivation environment. This includes the monitoring of all growing activities such as space, climate, light cycles, moisture content, nutrient applications, fertilizer and other resources, which all have an effect on plant growth and yields. Most importantly, labor costs are monitored, as it is the highest expense incurred by growers. In an industry for which many companies have limited budgets, enabling efficient greenhouse planning, automation and workflows reduces overhead costs.

Integrates with regulatory compliance systems – Compliance is a mandatory part of the cannabis business, and many companies haven’t expended the effort to ensure their processes are meeting regulations. This has placed their licensing and business at risk. An integration that automates the transfer of required reporting information from the ERP to state government approved software such as METRC, Biotrack THC and Leaf Data Systems to ensure regulatory compliance is imperative. This streamlined process assures that reporting is accurate, timely and meets changing requirements in this complex industry.

Facilitates safety and quality control – With an ERP solution tracking all aspects of growing, manufacturing, packaging, distribution and sales, safety and quality are effectively secured throughout the supply chain. Despite the lack of federal legality and regulatory guidelines, proactive cannabis producers can utilize an ERP’s automated processes and best practices to ensure safe and consistent products. By standardizing and documenting food safety procedures, manufacturers mitigate the risk of cannabis-specific concerns (such as aflatoxins, plant pesticide residue, pest contamination and inconsistent levels of THC/CBD potency) as well as dangers common to traditional food manufacturers (such as improper employee procedures and training) for those in the edibles marketplace. Food safety initiatives and quality control measures documented within the ERP strengthen the entire supply chain.

Maintains recipes and formulations – In manufacturing, to achieve product consistency in regards to taste, texture, appearance, potency and expected results, complex recipe and formula management is a necessity – including monitoring of THC and CBD percentages. The calculation of specific nutritional values to provide accurate labeling and product packaging provides necessary information for consumers. Cannabis businesses have to evolve with the consumer buying habits and marketplace saturation by getting creative with their product offerings. With integrated R&D functionality, the expansion of new and innovative edibles, beverages and forms of delivery, as well as new extractions, tinctures, concentrates and other derivatives, helps to meet consumer demands.

Handles inventory efficiently – Established inventory control measures such as tracking stock levels, expiration dates and product loss are effectively managed in an ERP solution across multiple warehouses and locations. Cannabis manufacturers are able to maintain raw material and product levels, reduce waste, facilitate rotation methods and avoid overproduction to control costs. With the use of plant tag IDs and serial and lot numbers with forward and backward traceability, barcode scanning automatically links product information to batch tickets, shipping documents and labels – providing the ability to locate goods quickly in the supply chain if necessary in the event of contamination or recall. The real-time and integrated information available helps mitigate the risk of unsafe products entering the marketplace.

Food processing and sanitation
By standardizing and documenting food safety procedures, manufacturers mitigate the risk of cannabis-specific concerns

Utilizes user-based software permissions – Access to data and ability to execute transactions throughout the growing stages, production and distribution are restricted to designated employees with proper authorization – ensuring security and accountability throughout the inventory chain.

Manages supplier approvals – Assurance of safety is enhanced with the maintenance of detailed supplier information lists with test results to meet in-house quality and product standards. Quality control testing ensures that critical control points are monitored and only approved materials and finished products are released – keeping undeclared substances, harmful chemicals and impure ingredients from infiltrating the supply chain. When standards are not met, the system alerts stakeholders and alternate vendors can be sought.

Delivers recall preparedness – As part of an edible company’s food safety plan, recall plans that include the practice of performing mock recalls ensures that cannabis businesses are implementing food safety procedures within their facilities. With seed to sale traceability in an ERP solution, mitigating the risk of inconsistent, unsafe or contaminated products is readily maintained. Integrated data from the CMS solution provides greater insight into contamination issues in the growth stages.

An ERP solution developed for the cannabis industry with supporting CMS functionality embodies the inventory and quality-driven system that growers, processors, manufacturers and distributors seek to strengthen supply chain management. Offering a centralized, secure database, seed to sale traceability, integration to compliance systems, in-application quality and inventory control, formula and recipe management functionality and the ability to conduct mock recalls, these robust business management solutions meet the needs of a demanding industry. With a variety of additional features designed to enhance processes in all aspects of your cannabis operation the solution provides a framework to deliver truly supportive supply chain management capabilities.

PerkinElmer & Emerald Scientific Collaborate

By Cannabis Industry Journal Staff
1 Comment

Last week, just before MJBizCon, PerkinElmer announced a collaboration with Emerald Scientific, allowing Emerald Scientific customers access to PerkinElmer’s portfolio of cannabis and hemp testing products and services. PerkinElmer is a leading instrument manufacturer and analytical method developer. Emerald Scientific is a distributor for scientific lab testing equipment and instrumentation.

Emerald Scientific now offers their customers PerkinElmer products, like their QSight® 420 Triple Quad system LC/MS, the Titan MPS™ Microwave Sample Preparation System, the Clarus® SQ 8 Gas Chromatograph/Mass Spectrometer (GC/MS) and the Flexar™ High-Performance Liquid Chromatography (HPLC) system. This partnership also allows Emerald Scientific customers to utilize the PerkinElmer analytical methods and standard operating procedures (SOPs) for cannabis and hemp testing. That includes SOPs for things like sample preparation, acquisition methods and consumable use. They’ll also be able to shop for lab products like PerkinElmer’s chromatography columns, vials and sample prep products.

According to Greg Sears, vice president and general manager, Food and Organic Mass Spectrometry at PerkinElmer, the cannabis testing market is exploding and this will help labs get their equipment and necessities all in the same place. “With the cannabis and hemp markets continuing to grow rapidly and regulations strengthening, labs increasingly need streamlined access to best-in-class, user-friendly testing solutions geared toward the unique requirements of the industry,” says Sears. ““This collaboration with Emerald Scientific brings together leading cannabis analysis offerings in one place to help labs start up and expand more efficiently.  In addition, we can build on the work we have done with Emerald around testing standardization which is important for the science of the industry.”

Kirsten Blake, Vice President of Emerald Scientific, says they are really excited about the partnership. “As regulations become more challenging, laboratory competition intensifies, and the science of the industry receives increasing focus, it is essential to align with organizations dedicated to improving both the quality and throughput of analytics,” says Blake. “After working with PerkinElmer to inform, educate, and advance the cannabis science industry around best practices, we see them as the industry leader for providing analytical instrumentation, methods and SOP’s. By adding their complementary solutions to our existing portfolio, we can now deliver complete packaged analytical solutions to the cannabis and hemp industries.”