According to a press release published earlier in October, Metrc has won the seed-to-sale traceability software contract for West Virginia. The West Virginia Department of Health and Human Resources, Bureau for Public Health, Office of Medical Cannabis (OMC) made the announcement on October 21.
According to that press release, the main focus for the state’s traceability program is “helping OMC regulators ensure no illicit cannabis products are sold in the medical cannabis market, and also that no legal medical cannabis products are sold unlawfully.”
Regulators in West Virginia are still on schedule to open the medical cannabis market as soon as next year, according to Jason Frame, OMC director. “This is an important step to make certain medical cannabis is available only to West Virginians with serious medical conditions and to prevent diversion of products in West Virginia,” says Frame. “While the COVID-19 pandemic has put many industries across the country on hold, we’re proud to say that it has not stopped West Virginia from meeting its deadlines and laying the groundwork for a safe, regulated medical cannabis market.”
Regulators at the OMC are still working on scoring processing and retail license applications. The OMC says they will begin the process of issuing patient cards in the spring of 2021.
By Steve Levine, Megan Herr, Meghan Brennan No Comments
On Thursday April 23, 2020, Representatives Earl Blumenauer (D-OR) and Ed Perlmutter (D-CO) introduced the “Emergency Cannabis Small Business Health and Safety Act” in the House. Blumenauer and Perlmutter have been influential in protecting state-legal cannabis businesses from federal interference, most recently under the 2020 federal appropriations rider.
If passed, the Act would allow state-legal medical and recreational cannabis businesses to take advantage of the multi-trillion dollar stimulus packages designed to help small businesses harmed by COVID-19.
As we previously discussed, cannabis businesses harmed by COVID-19 remain ineligible to receive federal financial assistance due to their engagement in “federally illegal” activities. Consequently, cannabis businesses cannot receive assistance from the Small Business Administration (SBA) thereby making them ineligible to receive Paycheck Protection Program (PPP) loans and other SBA financial assistance, including Economic Injury Disaster Loans (EIDLs), traditional 7(a) loans, 504 loans, and microloans.
To provide the industry with much needed economic relief, the legislation states that cannabis businesses would no longer be prohibited from (i) participating in the PPP, (ii) receiving EIDL loans, or (iii) receiving emergency EIDL grants purely on the basis that the business is a “cannabis-related legitimate business”1 or “service provider.”2
Additionally, the Act clarifies that the SBA and its officers, directors and employees would “not be held liable pursuant to any Federal law or regulation solely for providing a loan or a loan guarantee to a cannabis-related legitimate business or a service provider.”
Even though states have varied in their approach to continue medical and retail cannabis operations amid the coronavirus outbreak, a majority of states that allow some form of sale and consumption of cannabis have designated the cannabis industry as “essential” and open for operation.3 Some states have gone as far as allowing home delivery, curbside pick-up, and telemedicine consultations.
Nonetheless, despite the cannabis industry’s designation as “essential,” cannabis businesses (including those who service the cannabis industry) will continue to be precluded from receiving federal financial assistance until the Emergency Cannabis Small Business Health and Safety Act, or similar legislation, is passed. It is important to note that, even if passed, the Emergency Cannabis Small Business Health and Safety Act would likely provide little relief, as the majority of the funds to be administered by the SBA have already been accounted for.
What does this mean to you?
Although the COVID-19 pandemic has highlighted the need for the heavily-taxed and financially burdened cannabis industry to receive assistance under the stimulus packages, the Act, even if passed by Congress, faces an uphill battle in the Republican-held Senate.
The term “cannabis-related legitimate business” means a manufacturer, producer, or any person that – (A) engages in any activity described in subparagraph (B) pursuant to a law established by a State or a political subdivision of a State, as determined by such State or political subdivision; and (B) participates in any business or organized activity that involves handling cannabis or cannabis products, including cultivating, producing, manufacturing, selling, transporting, displaying, dispensing, distributing, or purchasing cannabis or cannabis products.”
The term “service provider” (A) means a business, organization, or other person that – (i) sells goods or services to a cannabis-related legitimate business; or (ii) provides any business services, including the sale or lease of real or any other property, legal or other licensed services, or any other ancillary service, relating to cannabis; and (B) does not include a business, organization, or other person that participates in any business or organized activity that involves handling cannabis or cannabis products, including cultivating, producing, manufacturing, selling, transporting, displaying, dispensing, distributing, or purchasing cannabis or cannabis products.”
Folks from around the country and the world tuned into the U.S. Food & Drug Administration (FDA) website as they held a public hearing on Friday, May 31. Manufacturers and suppliers asked the FDA to regulate CBD like food or dietary supplements, while the FDA seemed to want more evidence on the safety of CBD products before giving the greenlight.
Background On The Hearing
For the uninitiated, after President Trump signed the Farm Bill into law back in December 2018, Scott Gottlieb, now former director of the FDA, issued a statement the same day the Farm Bill passed, clarifying the FDA’s regulatory authority. In the statement, Gottlieb explained that Congress preserved the FDA’s authority to regulate products containing cannabis and its constituents under the Federal Food, Drug, and Cosmetic Act (FD&C Act).
In April 2019, around the same time he resigned from the FDA, Gottlieb issued another statement, acknowledging the quickly growing industry throughout the country and total lack of federal regulatory guidance. This time around, Gottlieb laid out a handful of steps that the FDA plans on taking to address regulations around hemp and cannabidiol (CBD). Those included scheduling the public hearing for May 31, where written and oral public comments were submitted by stakeholders, sharing “their experiences and challenges with these products [hemp and CBD products], including information and views related to product safety.”
That statement also announced the formation of an internal agency working group to “explore potential pathways for dietary supplements and/or conventional foods containing CBD to be lawfully marketed; including a consideration of what statutory or regulatory changes might be needed and what the impact of such marketing would be on the public health.”
Fast-forward to May 31, the day of the public hearing, and all eyes in the industry focused on what all these stakeholders had to say to the FDA about CBD. The day started off with about two hours of oral comments, each speaker had roughly two minutes to deliver their thoughts.
Industry stakeholders representing cannabis businesses sang much of the same tune, clamoring for wise regulations on safety, testing, banking and interstate commerce, among other standards. NCIA Policy Director Andrew Kline’s comments included running through five major positions of the industry trade organization representing CBD companies. Those included recommending the FDA act quickly in setting up regulations, stressing the massive economic impact of the industry, saying that CBD products are generally safe, clamoring for voluntary, consensus-based standards and informing consumers of any potential risks. “The bottom line is this – an overwhelming preponderance of evidence indicates that cannabis and cannabis-derived compounds present minimal health and safety concerns,” Kline told the folks at the FDA. “Time is of the essence. Hemp-derived CBD products are in very high consumer demand and the industry is eagerly awaiting FDA’s regulatory framework for these products. We strongly recommend that FDA act quickly to clarify the regulatory environment because there is significant confusion in the market.”
Anna Williams, representing the American Association for Laboratory Accreditation (A2LA), stressed the importance of testing for contaminants and adulterants as well as advocating for national standards on lab testing, instead of the state-by-state network of different standards.
Patients & Public Safety
After industry stakeholders had their chance to speak, the FDA allowed a group of advocacy organizations representing patients time to speak. That included representatives for the Alzheimer’s Association and the American Epilepsy Society, both of which were hesitant to throw their full support behind CBD as medicine. Kevin Chapman with the American Epilepsy Society said he wants to see clear warning labels, testing standards, more clinical trials and more studies before the group is ready to form a position on using CBD as medicine. Keith Fargo with the Alzheimer’s Association supports clinical trials to study it more, but thinks CBD is risky for patients without serious evidence of efficacy. A representative from the Tuberous Sclerosis Alliance also echoed similar concerns. They want to see labeling of drug interactions on labels of CBD products.
After those comments, some organizations had the chance to speak followed by comments from retailers and distributors. Patrick Bird, owner of PMB BioTek Consulting, spoke on behalf of AOAC International, where he primarily discussed public safety. He said they want cannabis products to be regulated with food safety in mind, asking for FSMA to apply to hemp products. They want to adequately ensure product safety with things like mandating HACCP plans, recall readiness, saying hemp products should be treated just like food products.
Retailers & Distributors
Peter Matz, representing the Food Marketing Institute, the trade association for the supermarket industry, said that regulatory ambiguity is a serious issue that needs addressing. “There is mass confusion in the marketplace for the public, suppliers, retailers and state regulators,” says Matz. “Demand for CBD products in human and animal use is growing rapidly. ¼ of American have already tried it. We are fielding questions from companies seeking clarity regarding the current federal regulatory framework.” He added, what many others also mentioned, that the FDA needs to move swiftly to provide a pathway to regulation.
Next on the docket came presentations from state government entities, including state departments of agriculture, followed by healthcare professionals. The state regulators that spoke mentioned a lot about food safety, standards, testing regulations, GMPs and things like that to protect consumer safety. “Currently states are struggling with the lack of sound scientific research available in CBD and long-term health impacts,” said Pam Miles, representing the Virginia Department of Agriculture.
One interesting aspect on their talks however was telling the FDA just how large their markets have gotten already and how they need guidance on how to regulate markets in their own states. Joseph Reardon, with the North Carolina Department of Agriculture, said they already have about 600 farmers growing hemp and thousands of processors working with the product in their state. “We urge the FDA to resolve the statutory issues improperly establish a legal pathway for CBD products to enter the market place,” Reardon commented. He also asked that the FDA extend the written comment period from July to August. “We are simply looking for a regulatory framework on the extraction, production and reconstitution of CBD or cannabinoid related products.”
Healthcare & Research
Healthcare providers, and physician testimony also echoed a lot of the same concerns, including the lack of research done, concerns about effects on at-risk populations and concerns about use as ingredients in dietary supplements and food. Some of the presentations also highlighted the room for nefarious activity in an unregulated marketplace. Some went as far as to mention cases where they found CBD vape juices with DXM in it (the active ingredient in cough syrup), CBD products found to contain THC, as well as synthetic cannabinoids responsible for drug overdose deaths. Some advocates in the hemp and CBD community have equated these arguments similar to reefer madness.
The major takeaway from this hearing is that everyone wants to see more data. Researchers and healthcare providers want to study the efficacy of CBD used in medicine, regulators want public safety information, patient advocates want to see data about effects on at-risk populations, trade organizations want data to back up label claims and the FDA wants to see just how safe CBD really is.
According to a press release, Helix TCS and its subsidiary, BiotrackTHC, are expanding internationally at a rapid pace. The seed-to-sale traceability software solution now has customers in the United Kingdom, Canada, Colombia, Jamaica, Australia and New Zealand, in addition to the United States.
According to Zachary Venegas, executive chairman and CEO of Helix TCS, Inc., Vicente Fox will help serve as a strategic advisor for their continued expansion abroad. “”We are honored to welcome former President Fox to our Board of Directors and to benefit from his strategic vision and global network,” says Venegas. “His addition is a significant multiplier in our further expansion into key production markets that we expect to become dominant cannabis export hubs that will require our full suite of services.”
According to Venegas, they are prepared to meet the needs of a globalizing cannabis economy. “As international markets develop and more countries create a legal cannabis industry, our technology and service solutions will continue to reach new markets quickly to meet the needs of businesses and regulators in any regulatory environment,” says Venegas. “We are very excited to see the progress of legal cannabis on the global stage and we look forward to continuing to play a vital role in enabling a transparent and secure supply chain.”
Mistake #5: Planning Just-In-Time Inventory Too Close to Production; Effecting On-time Deliveries
Using JIT (Just-In-Time) management is common throughout North America. JIT involves manufacturers and suppliers trying to minimize, or even eliminate, their inventory. This approach relies on suppliers to deliver materials just before production is started. When this method is done properly, it is a very efficient way to minimize production costs, but when companies do not prepare for a “crisis” situation, they will have nothing in stock to fall back on.
Minimizing inventory costs is always a challenge. It’s a never-ending contradiction trying to maintain low inventory costs while factoring the percentage of potential new growth. Calculations can fluctuate from month to month, especially when industries rely on commodity ingredients or are impacted by sudden regulatory changes like we see with the cannabis, food packaging, and health supplement markets. Front runners in these markets practice minimizing their product label inventories, but their needs might quickly change from one day to the next. They do not want to place a one-time annual label order for each SKU. If an ingredient runs out of supply or a regulatory change affects their production profile, they would be sitting on unusable labels that will go to waste.
Best Method Approach: Think in terms of what the bottom line effect will be when factoring how you should manage your inventory. Try not to reduce your inventory too low. This could cause your company to experience shipping delays when complications arise with suppliers or quality control. You should have at least one-to-two production cycles worth of inventory available for those “crisis” moments.
This backup inventory can also help reduce paying for excessive rush fees. Sometimes businesses can experience unexpected demand for a product, especially when companies consolidate production plants, acquire other companies, or have a new product launch. Supplier material shortages can greatly impact internal quality control and delay delivery times. Building a strong business relationship with your label provider is key to working around business demands and potential problems; which in turn, will help your label provider ship on-time deliveries so your production deadlines are met.
Mistake #6: Selecting the Lowest Price, But Approving the Wrong Materials for Your Product Needs
Sometimes clients buy the lowest priced labels without their procurement department knowing what the label specification requirements should be. It’s always a good business practice to shop for the best price, but it is equally as important to make sure you understand what you’re buying for that price.
Label providers vary on the quality of work they do, value-added services they offer, their production expertise, and the quality of material they use. Additionally, the hidden potential costs to lowest price shopping is that once the construction of those labels fail, it could cost you much more than a simple reorder.
Best Method Approach:Establish clear and concise procedures so your production team can forward the necessary criteria for your procurement department to have during the buying process.
brands want strong, eye-catching labels that stand out online, on the shelf, and/or on the retail floor. On a separate note, some businesses and manufacturers don’t care how long their brand and contact information remains on their product after the purchase. This gives them the flexibility to buy extremely low-quality material, but the outcome is a much lower brand awareness reminder at the end of the product’s use. But if your business model is such that you sell a “one-time use” product and all that you need is the label to survive through the POS, then the cheapest materials and lowest price might be your best solution.
In most cases, brands want strong, eye-catching labels that stand out online, on the shelf, and/or on the retail floor. Manufacturers want their labels to remain on their product, so their customers have a reminder of what they need to buy again or the ability to reread product use instructions and label warnings. Even if you don’t require the most expensive materials, using good quality, durable substrates and inks is always a solid approach.
Mistake #7: Not Preparing for Oil Based Products
One of the most popular products expected in retail for 2019 will be essential oils and/or CBD infused oil ingredients in foods, drinks, and wellness supplements. One of the most common mistakes relating to oil-based products is that entrepreneurs often forget that oils can soak into paper substrates and/or disperse certain inks, even when laminated.
Whether your product is on display in retail, or being sampled at a trade show, the last thing you want to be concerned about is your product name and contact information smearing or washing out. Even the smallest drop of oil can seep into a paper label and spread the ink to the point that you’ll have your own little tie-dye action on the label. That might look cool to some, but you lose your branding and the perception with most retail customers will be that your company is either cheap or is not professional.
Best Method Approach: There are affordable films such as polypropylene materials that will allow you to print the look you want while still protecting your branding and product. From cooking oils to industrial grade oils, the approach is the same but may require different types of films and ink solubility, so each bottle and container has oil resistant labels that maintain a professional look.Whenever one of our clients launch a new product or changes the intended surface conditions for label application, testing the label is always extremely important
If you’re feeling overwhelmed, remember that you don’t need to select all the label materials on your own. Your label provider should help you settle on the best solution.
Mistake #8: Not Properly Testing New Labels and New Product Surfaces
This is one of the most common and overlooked issues. Whenever one of our clients launch a new product or changes the intended surface conditions for label application, testing the label is always extremely important. This is especially critical when dealing with high quantity orders.
Best Method Approach: Testing parameters should be outlined by you and your label provider so both parties understand how long the label and the ink consistency should remain on the surface after purchase and use of product. There are wide variations of testing, so it will depend on the type of product and the intended industry.
For example, testing hand-applied, durable labels on powder coated metals for the boat and trailer industry require a completely different testing method compared to tests for typical food and beverage products that are machine applied. Usually, with uniform container products like food clamshell packaging, beverage cans, and supplement jars, all you will need to do is make sure to test labels on your production line, so your team is confident with the results.
In summary, preventing just one of these mistakes can yield huge cost savings no matter if your company is a start-up or a large corporation. Even if these eight common mistakes do not directly apply to your own issues, hopefully the “Best Methods” approach will give your company ideas about how you can prepare for future product releases, reduce product label issues, and improve your own quality control metrics.
If you have topics relating to product labeling that you would like me to discuss, please write to email@example.com. Be sure to save this article and forward it to your peers for future reference.
Whether you’re a small business owner or a production manager of a large manufacturer, if you’ve ever experienced problems with your product labels you know it can quickly turn into a serious issue until that problem is resolved. From the time it’s applied to your product all the way to the POS (Point of Sale), labels always seem to be the least significant part of the production process- until something goes wrong. And when it does go wrong, it can create major branding issues and cost your company tens of thousands of dollars due to hefty supply chain late penalties and/or even government fines.
This article aims to provide insight as to how a company like Label Solutions Inc. helps businesses and manufacturers create new labels for their products as well as what to look for should you experience label failure at your retail locations. Topics discussed in this article do not cover all possible issues, but these common mistakes will hopefully help you better understand how creating a product label works, and how to possibly prevent your own problems in the future.
Mistake #1: Not Understanding the Importance Between the “Construction” Versus the “Artwork & Compliance” of the Label
This may seem like common sense, but it is often overlooked. Especially when dealing with fast-track projects.
Construction of the Label is the material selected and production process to produce the label. When creating a new label from the ground up, it is important to factor in how your product will be produced, necessary shipping and supply chain needs, how it is stored in inventory and how it will be presented at the POS. Understanding what environments your product will be exposed to throughout its life cycle will give you an advantage when approving substrate material, inks, and the strength of adhesive that might be necessary for your application.
The Artwork & Compliance of the Label refers to the overall design of the label, artwork, customer messaging, bar codes and regulatory requirements you need to follow in order to avoid serious government fines that might relate to your industry (Referring to agencies such as OSHA, DOT, and the FDA).In most cases the construction of the label does not apply to the compliance of the label.
Most label providers do not have the in-house expertise to offer compliance assistance. Although it is still the manufacturer who is liable for all final artwork approvals on their product, label providers that do offer advisory services can help update label content when regulatory changes are enacted. This “safety net” can save your company from extra production costs and, potentially, excessive legal time and material costs. In short, you should always review final label artwork approvals with your compliance team and/or legal expert, but it never hurts to have a “safety net” to help eliminate unnecessary orders or production delays.
In most cases the construction of the label does not apply to the compliance of the label. An exception to this statement would be industries such as the electronics industry that use UL (Underwriter Laboratories) labels that must meet UL specifications and be produced under recognized UL files. In other words, the compliance of a UL label is the construction of the label.
Best Method Approach: An excellent example of companies that understand the difference between the Construction vs. Artwork & Compliance of the label would be the compressed gas industry. Gas suppliers and distributors require long term regulatory compliant labels on their cylinders and micro-bulk tanks. These gas tanks are used in a wide variety of industries such as for manufacturing, welding, medical procedures, and specialty gas mixes for the micro-electronics industry.
The compressed gas industry requires that their labels follow strict, up-to-date OHSA and DOT compliance requirements. As for the construction of the label, it is common practice that the label remains legible on the cylinder for an average of five years. The 5-year duration is due to the millions of tanks that are in circulation throughout the US and Canada. What’s more, each label is produced to adhere to the cylinder’s metal surface during extreme outdoor weather conditions such as fluctuating temperatures, freezing rain, high winds, and direct sunlight year-round.
Mistake #2: Applying Labels Incorrectly to Your Products
Whether the label is applied to the product surface by hand or automatically with a label applicator, the label itself may not be applied level or evenly. Besides this being a major branding issue, this could also affect how the bar codes are scanned and could eventually impact your delivery times while trying to correct a batch.
Best Method Approach: There are construction alternatives that you can choose from to potentially reduce the impact of incorrect label application. For example, products with certain label adhesives allow your production team to reposition the label within a few minutes before the tack completely sets to the surface. The type of surface (cardboard, metal, plastic, glass, etc.) and the type of adhesive will determine how much time your production team will have before the tack sets.
The best practice is to apply labels prior to filling the bottles and cans as opposed to filling first and then applying the label in your production line.A good example of this best practice can be seen in the beverage market. Whether the client produces a uniquely crafted beer, or a rare ingredient infused into a new health drink, labels that are auto-applied to bottles and cans will sometimes experience equipment tension issues that need to be recalibrated. Once labels are applied off-alignment, a delayed tack setting can allow the label to be quickly repositioned by hand when needed. The best practice is to apply labels prior to filling the bottles and cans as opposed to filling first and then applying the label in your production line. The reason, excess spillage from filling can interfere with most adhesives.
This same repositionable adhesive is excellent to keep in mind for large equipment production assembly lines that apply prime (branding) labels and warning labels by hand. Even with large wide-format labels, the adhesive tack can be formulated so your employees have a few minutes to adjust, straighten, and smooth away trapped air bubbles once it has been placed on the surface. Knowing you have this option can help reduce label inventory waste, additional production material wastes and avoid delaying production time. More importantly, this option keeps your brand and your warning/instructional labels looking fresh.
Mistake #3: Not Sharing Your Production Run Schedules with Your Label ProviderSupply chain management (SCM) models are excellent examples of the best approach.
Some of Label Solutions’ largest accounts have the most efficient real-time tracking supply chain models in North America, but even they cannot avoid sudden increased orders for their products stemming from high customer demand or similar issues. It is a good problem to have, but it is a problem, nonetheless. Manufacturers utilize supply chain management tools to notify their suppliers of their monthly order forecasts, which in turn helps suppliers manage their materials and deliveries more efficiently.
On the other side of the spectrum, when small businesses share their production schedules with a supplier it means that both parties (the manufacturer and label provider) understand when to expect higher or lower order quantities each month. Label providers should back date their label production schedules, so they have the materials available to handle your busier months while ensuring on-time deliveries.
Best Method Approach: Supply chain management (SCM) models are excellent examples of the best approach. Although SCM’s are designed for scalability and real-time tracking, the benefit to you also helps your label supplier. For example, our large retail and industrial manufacturing clients notify the Label Solutions team to produce their labels according to their Supply Chain portal demand schedules. This, in turn, allows label suppliers to allocate production time and materials more efficiently for your last-minute rush orders.
Smaller companies can take a much more simplified approach (without the SCM tracking) to help their suppliers manage their orders – even if they do not use supply chain management. A simple Excel report of production runs over a 12-month time frame is ideal. If your label provider does not already practice this or similar methodology, it might be time to start looking for a more proactive label provider. If you’re unsure you want to share your information, then you might consider requiring your label provider to sign an NDA (Non-disclosure Agreement).
Mistake #4: Not Accepting Alternative Sizes of the Label to Allow for Better Pricing
If your product needs a label with, for example, a dimension of 5.25 X 6.75 inches, there might be a much better price point offered to you if you’re open to switching to a slightly different dimension label of, say, 5 X 7 inches. Obviously, you need to make sure the new dimension would fit your product(s) and work with your production line. But, if alternate dimensions are within the scope of the project, a modified SKU could potentially cut down on cost and production time.
Best Method Approach: You might not have the time or ability to change your label if you already market that product in retail stores. But, if you are changing your branding, creating a new style of label, or releasing a completely new product, this is the ideal time to consider implementing better continuity between your products. This could include elements such as matching colors and label/packaging design.
In addition to updating your SKU’s, this might also be an opportunity for your company to consolidate multiple products onto a universal label size. By applying the same sized labels to multiple SKU’s, you can increase efficiency regarding repeated label orders, especially for label printers that use digital printers. Combine this approach with your expected annual quantity estimates and you’ll be positioned for very efficient ordering options as your company grows.
Editor’s Note: We’ll cover the next four most common labeling mistakes in Part Two coming next week. Stay tuned for more!
Phenova, Inc., a proficiency testing products and reference materials provider based in Golden, Colorado, works with labs and regulatory bodies to develop proficiency testing (PT) programs. According to a press release sent out by the American Association for Laboratory Accreditation (A2LA), Phenova is A2LA’s first ISO/IEC 17043 accredited PT provider for the cannabis marketplace.
According to Ty Garber, director of new business development for the cannabis and food and beverage markets at Phenova, they have been working with A2LA for over a decade in other industries, but the cannabis testing industry is a huge new market for them. “Our Cannabis Proficiency Testing products and services are experiencing high demand across North America and we are fortunate to offer our expertise in proficiency testing to client laboratories and regulatory agencies in their joint efforts to ensure cannabis product quality and safety,” says Garber. “By working with the laboratories and stakeholder agencies, we have been able to develop and operate Proficiency Testing Programs based on real marijuana matrices, especially where the matrix creates specific analytical challenges. This approach has proven to be very beneficial for everyone involved, and we are working diligently to expand these efforts.”
Trace McInturff, senior director of accreditation services at A2LA, says this could help fill a serious need for conformity assessments in accredited cannabis labs. “A2LA is excited to announce the expansion of Phenova’s existing ISO/IEC 17043 Proficiency Testing Provider scope of accreditation to become the first A2LA accredited Proficiency Testing Provider for cannabis,” says McInturff. “This milestone adds to the positive historical relationship between Phenova and A2LA that dates back to 2005 when A2LA implemented a new TNI SSAS program for Proficiency Testing Providers and A2LA performed one of the first assessments of its kind at Phenova.” McInturff also says that A2LA has been instrumental in establishing the initial ILAC Proficiency Testing Provider accreditation requirements which ultimately became the basis for ISO/IEC 17043.
In addition to the “real marijuana matrix PT programs” that Phenova offers in certain states and countries where legal, they also offer alternative PT standards for labs that have obtained or are working on obtaining ISO/IEC 17025 accreditation.
Last week, Curaleaf, a medical cannabis producer and processor in Miami, Florida, announced they have earned the Safe Quality Food (SQF) Level II certification. In the press release, they claim they are the first and only medical cannabis company in the state to achieve that certification.
Curaleaf’s products include a line of low-THC and full strength medical cannabis products. They have dispensaries in Miami, Lake Worth, Fort Myers and St. Petersburg, as well as delivery of products from Jacksonville south to Key West.
According to Lindsay Jones, president of Curaleaf Florida, patients ask frequently about the level of safety of cannabis products. “Every day patients express interest and assurance of wanting to know that the foods and medicines they consume are safe and of the best quality available,” says Jones. “This SQF Level II certification that Curaleaf has earned is particularly important for patients and demonstrates that our medical marijuana processing expertise delivers superior quality products for patients in need across Florida.”
Florida’s regulations on medical cannabis producers and processors actually require a form of certification demonstrating proper food safety protocols. “Within 12 months after licensure, a medical marijuana treatment center must demonstrate to the department that all of its processing facilities have passed a Food Safety Good Manufacturing Practices, such as Global Food Safety Initiative or equivalent, inspection by a nationally accredited certifying body,” reads Rule 9 in the 2017 Florida Statute. Edibles producers in Florida “must hold a permit to operate as a food establishment pursuant to chapter 500, the Florida Food Safety Act, and must comply with all the requirements for food establishments pursuant to chapter 500 and any rules adopted thereunder.” The rules also lay out requirements for packaging, dosage and sanitation rules for storage, display and dispensing of edible products.
Looking at SQF Level II certification and GFSI could be a step in the right direction for many cannabis infused product manufacturers, as they are some of the more recognized programs in the food industry.
Munich, Germany- In a darkened movie studio on the east end of town, the Digital Insurance Agenda or DIA, the largest insurtech conference in the world, kicked off its annual event in mid-November. The sold-out event attracted about 1,000 top insurance executives from 40 countries and all six continents.
CannabisIndustryJournal attended from the perspective of investigating the overall status of digitalization in the industry. However, there were a couple of things we were on the hunt for. The first was to see how and where blockchain has begun to penetrate the industry. This revolutionary processing and identification layer of digital communications is coming – and fast – to the insurance industry everywhere.
We were also there of course to see if cannabis was anywhere on the agenda. Digitized or not.
By way of disclosure, I am also a high tech entrepreneur with my own insurtech, blockchain-based start-up that we are in the process of launching. MedPayRx is intended to be the first insurance product that will help patients access their meds facing nothing but their co-pay and help insurers automate the approvals process for all prescription drugs and medical devices.
By definition, in Germany, this includes medical cannabis.
Ultimately, our mission is to take the paper and the pain of all reimbursement out of the prescription process. At present, as anyone with a chronic condition knows, many medications and medical devices must be paid for out of pocket first and then reimbursed via a claims process that is paper-based, laborious and expensive. This is not a model that works for anyone. Certainly not poor and chronically ill patients who face this process at least monthly. And certainly not insurers who are now facing higher drug costs if not more claims reimbursements for the same from an aging population.
In a country like Germany where 90% of the population is covered by public health insurance, the situation also poses quandaries of a kind that are rocking the fundamental concept of inclusive public healthcare.
The Impact of Digitalization On The Insurance Industry
As one insurance executive and speaker mentioned from the stage during DIA, there are few industries that are more universally despised than insurance in general. And few verticals where the existing mantra is “you cannot do it worse.” The insurance industry is well aware of that. Further, for all insurances that are not “mandatory” the competition is fierce for consumers’ bucks. Particularly in places like Europe where insurance is also seen as a kind of savings scheme.
If you are a private insurer, of any kind, or offering services to both end consumers and B2B services, you are out of the game if you are not now thinking how to streamline and upgrade all aspects of your business in the digital era. There are many start-ups now tackling what is euphemistically called “cloud2cloud” integrations.
What does that mean?
According to DIA co-founders Reggy de Feniks and Roger Peverelli, the influence of tech in general is here to stay and is now driving widespread innovation across the industry. “The DIA line-up and the massive response among the audience show that insurtech is now mainstream,” says de Feniks. “This edition clearly showed the…ever growing attention for artificial intelligence, machine learning and other shapes of advanced analytics.”
“Platform thinking, thinking beyond insurance and creating new insurtech enabled services will be the next challenge for insurers,” added Peverelli.
Subtext? Insurers want your data. They want to use tech to analyse and understand it. The technology is here. But is the regulation? Specifically, in an industry that wants to know everything about you, how is privacy understood and implemented with revolutionary tech?
A Cloud-Based Future
Paper is rapidly becoming an old-fashioned concept in insurance, much like it has in banking. And like banking, insurance has a strong “financial” side to it. Germans, for example, tend to use insurance policies as retirement accounts, (the idea of a 401K is almost unheard of here). And by far, the most dynamic and digitalized part of the industry tends to be in areas unrelated to healthcare.
Some of the most interesting start-ups at DIA were actually weather-based.
The challenges of these types of insurtechs of convincing both regulators and the industry that such services are not only feasible but needed, pale in comparison however, to the challenge now facing all public health insurers.
And while they were certainly present at DIA, this industry segment was underrepresented at the November gathering. There is a reason for this. The real threat to consumer medical privacy is only growing, not receding in an era where data can be seamlessly transferred globally and digitally.
For that reason, blockchain has many uses and applications in this part of the vertical.
MedPayRx – even as a pre-seed start-up, was not, even this year, the only blockchain-based service we found in attendance at DIA. Next year look for even more.
Blockchain might be the next new “buzzy” tech, but in the insurance industry, there is a real reason for it.
What Was The Response To A Cannabis-Themed “Insurtech?”
As readers in the United States know, health insurance and cannabis is a loaded subject. And while insurance services are beginning to be available as high-risk commercial services for the industry, inclusive health insurance is still off the table because of the lack of federal reform.
Other places, however, the issue is taking a fascinating turn. And in Germany, right now, the situation so far has shaped up to be cannabis vs. public health insurance. It is a mainstreaming trial drug in other words. For that reason, beyond any lingering but rapidly fading stigma, it is a fertile time to be in the middle of it, with a tech solution.
It is also perfect timing from the digitalization and privacy perspective. Unlike the U.S., Germany in particular has tended to keep its insurance services, certainly on the health front, undigitalized because of privacy concerns. That is no longer feasible from a cost perspective. It is also increasingly one that has to be dealt with from a tech and regulatory one.
Why Is CannabisIndustryJournal At DIA?
My nametag identifying me as both “media” and of a certain green source, was the source of endless discussion with everyone I talked to. Many attendees were extremely curious about why a cannabis industry publication was at an insurance conference. And most people, certainly the non-Germans in attendance, were unaware that per federal law, cannabis is now, at least in theory, covered by public health insurance here.
Medical insurance that treats cannabis just like “any other drug” is a discussion at the forefront of the medical community in Europe. Even if not at health insurance industry events like DIA. Yet. In the last year, in fact, Dutch insurers have started refusing to cover the drug as the German government moved forward on mandating coverage.
In other places, like Australia, Israel and Canada, the conversation is also proceeding, albeit slowly within the context of public health coverage.
However compliance and tracking of the drug itself, not to mention the need for research on how cannabis interacts with other drugs mandates a consideration of how digital health records, privacy and tracking can exist in the same conversation. And further, can be accessed by the insurance industry, the government and policy makers as reform moves into its 2.0 iteration – namely federal recognition of the drug as a legitimate medicine.
We at MedPayRx think we have one answer. And next year, we hope to present from the stage as we continue to move forward with engaging the insurance industry here on all such fronts. Not to mention helping move the conversation forward in other places. And of course, launching services.
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