Tag Archives: state

Jeff Sessions and Eric Holder

Jeff Sessions Rescinds Cole Memo

By Aaron G. Biros
4 Comments
Jeff Sessions and Eric Holder

According to The Associated Press, U.S. Attorney General Jeff Sessions rescinded the Cole Memo today, an Obama-era policy barring Department of Justice officials from going after state-legal cannabis businesses. This move comes just after California, the nation’s most populous state, legalized adult use sales of cannabis. Previously, the Cole Memo has served as a kind of stopgap for states to conduct legal cannabis markets, giving them peace of mind that the federal government wouldn’t interfere.

Sen. Jeff Sessions (R-AL)
Photo: Gage Skidmore, Flickr

Ushering in 2018 with a bang, California’s cannabis businesses finally celebrated their new market launch on New Year’s Day. Even CNN rang in the New Year with copious amounts of cannabis, sending journalist Randi Kaye to Denver where she was passed joints and even donned a gas mask bong.

One fifth of the entire United States population now live in states where adult use cannabis sales are legal. A majority of states in the country have some form of cannabis legalization law on the books.

According to The Associated Press, AG Sessions’ new policy will leave it up to federal prosecutors to determine how they wish to enforce federal law and the controlled substances act. Sessions has been historically conflicted with federal policy surrounding legal cannabis and has repeatedly expressed his disdain for the drug.

But his back and forth on policy directives has been largely symbolic until now. In January last year, Sessions said he would uphold federal law but expressed openness to ending the conflict between state and federal laws. In February of last year, he tied legal cannabis to violence in a press conference where he alluded to greater enforcement. But flip-flopping again in March of last year, he said the Cole Memo is valid and appropriate after a speech.

Sen. Cory Gardner (R-CO)
Image: Gage Skidmore, Flickr

The Trump Administration’s confusing and often-unclear stance on cannabis has only fueled more speculation, worries and fear that cannabis businesses are no longer safe from federal prosecution.

The cannabis industry and politicians around the country were quick to respond to the AG’s new policy shift. Sen. Cory Gardner (R-CO) said he would be holding up DoJ nominees, “until the Attorney General lives up to the commitment he made to me prior to his confirmation.” The Cannabis Control Commission of Massachusetts, the regulatory body tasked with overseeing the state’s legal cannabis industry, says “nothing has changed” and that it will continue their work to legalize and regulate the cannabis industry.

Steve Schain, Esq. practicing at the Hoban law Group

Steve Schain, Esq., an attorney with Hoban Law Group, a prominent cannabis law firm, says this only fuels the confusion. “With Jeff Sessions threatening to singlehandedly crush $7.2 billion legalized marijuana industry spanning 30 states, generating millions in taxes and providing tens of thousands of jobs, much confusion abounds,” says Schain. “While unclear if merely a ‘knee jerk reaction’ to California program’s launch breadth of coverage, unless and until the United States Department of Justice provides an official statement, publication, or other specific information, neither legalized marijuana’s current status – nor the Federal Government lack of Congressional mandate or funds to derail state programs – has changed.”

Omar Figueroa, a well-known California cannabis attorney, urges clients and friends to start getting informed. “Which district is your ‘commercial cannabis activity’ operation(s) located? Who is the US Attorney for that district? What is that US Attorney’s cannabis policy? The answers to these questions just became extremely important. Please contact us for legal advice and representation.”

Advocates and activists were also very quick to condemn Sessions’ move, including Matthew Schweich, interim executive director for the Marijuana Policy Project (MPP). “This extremely misguided action will enable a federal crackdown on states’ rights with regard to marijuana policy,” says Schweich. “Attorney General Sessions has decided to use the power of the federal government to attack the ability of states to decide their own laws. A majority of Americans support legalization, and Sessions has simply decided to ignore their views. In the states where marijuana is legal, voters approved those legalization policies at the ballot box. This is a direct attack on the will of the people.”

National Cannabis Industry Association (NCIA) Executive Director Aaron Smith gave the following statement in a press release:

“This news from the Department of Justice is disturbing, especially in light of the fact that 73% of voters oppose federal interference with state cannabis laws. But, the rescinding of this memo does not necessarily mean that any major change in enforcement policy is on the horizon. This has been, and still will be, a matter of prosecutorial discretion. We therefore hope that Department of Justice officials, including U.S. Attorneys, will continue to uphold President Trump’s campaign promise to not interfere with state cannabis programs, which have been overwhelmingly successful in undercutting the criminal market.

In addition to safely regulating the production and sale of cannabis, state-based cannabis programs have created tens of thousands of jobs and generated more than a billion dollars in state and local tax revenue to date. Any significant change in federal enforcement policy will result in higher unemployment and will take funds away from education and other beneficial programs. Those revenues will instead go back to drug cartels and other criminal actors.”

Could this move be a genuine policy shift that will cause a crackdown on the legal cannabis industry? One action that could prevent the DoJ’s ability to target cannabis businesses relies on a Senate vote passing the Leahy Amendment as part of the Omnibus Appropriations Bill. That amendment would prevent the DoJ from using resources to go after state-legal medical cannabis laws, but does not exactly protect companies operating under adult use and recreational laws.

Is it possible that this is just the Trump Administration moving public eyes away from the bombshell revelations in Michael Wolff’s book and Trump’s feud with Steve Bannon? The current administration has a history of creating headlines amidst unrelated controversy, deflecting a public relations crisis from the public eye.

Total Yeast & Mold Count: What Cultivators & Business Owners Need to Know

By Parastoo Yaghmaee, PhD
3 Comments

Editor’s note: This article should serve as a foundation of knowledge for yeast and mold in cannabis. Beginning in January 2018, we will publish a series of articles focused entirely on yeast and mold, discussing topics such as TYMC testing, preventing yeast and mold in cultivation and treatment methods to reduce yeast and mold.

Cannabis stakeholders, including cultivators, extractors, brokers, distributors and consumers, have been active in the shadows for decades. With the legalization of recreational adult use in several states, and more on the way, safety of the distributed product is one of the main concerns for regulators and the public. Currently, Colorado1, Nevada and Canada2 require total yeast and mold count (TYMC) compliance testing to evaluate whether or not cannabis is safe for human consumption. As the cannabis industry matures, it is likely that TYMC or other stringent testing for yeast and mold will be adopted in the increasingly regulated medical and recreational markets.

The goal of this article is to provide general information on yeast and mold, and to explain why TYMC is an important indicator in determining cannabis safety.

Yeast & Mold

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

Yeast and mold are members of the fungi family. Fungus, widespread in nature, can be found in the air, water, soil, vegetation and in decaying matter. The types of fungus found in different geographic regions vary based upon humidity, soil and other environmental conditions. In general, fungi can grow in a wide range of pH environments and temperatures, and can survive in harsh conditions that bacteria cannot. They are not able to produce their own food like plants, and survive by breaking down material from their surroundings into nutrients. Mold cannot thrive in an environment with limited oxygen, while yeast is able to grow with or without oxygen. Most molds, if grown for a long enough period, can be detected visually, while yeast growth is usually detected by off-flavor and fermentation.

Due to their versatility, it is rare to find a place or surface that is naturally free of fungi or their spores. Damp conditions, poor air quality and darker areas are inviting environments for yeast and mold growth.

Cannabis plants are grown in both indoor and outdoor conditions. Plants grown outdoors are exposed to wider ranges and larger populations of fungal species compared to indoor plants. However, factors such as improper watering, the type of soil and fertilizer and poor air circulation can all increase the chance of mold growth in indoor environments. Moreover, secondary contamination is a prevalent risk from human handling during harvest and trimming for both indoor and outdoor-grown cannabis. If humidity and temperature levels of drying and curing rooms are not carefully controlled, the final product could also easily develop fungi or their growth by-product.

 What is TYMC?

TYMC, or total yeast and mold count, is the number of colony forming units present per gram of product (CFU/g). A colony forming unit is the scientific means of counting and reporting the population of live bacteria or yeast and mold in a product. To determine the count, the cannabis sample is plated on a petri dish which is then incubated at a specific temperature for three to five days. During this time, the yeast and mold present will grow and reproduce. Each colony, which represents an individual or a group of yeast and mold, produces one spot on the petri dish. Each spot is considered one colony forming unit.

Why is TYMC Measured?

TYMC is an indicator of the overall cleanliness of the product’s life cycle: growing environment, processing conditions, material handling and storage facilities. Mold by itself is not considered “bad,” but having a high mold count, as measured by TYMC, is alarming and could be detrimental to both consumers and cultivators. 

Aspergillus species niger
Photo: Carlos de Paz, Flickr

The vast majority of mold and yeast present in the environment are indeed harmless, and even useful to humans. Some fungi are used commercially in production of fermented food, industrial alcohol, biodegradation of waste material and the production of antibiotics and enzymes, such as penicillin and proteases. However, certain fungi cause food spoilage and the production of mycotoxin, a fungal growth by-product that is toxic to humans and animals. Humans absorb mycotoxins through inhalation, skin contact and ingestion. Unfortunately, mycotoxins are very stable and withstand both freezing and cooking temperatures. One way to reduce mycotoxin levels in a product is to have a low TYMC.

Aspergillus flavus on culture.
Photo: Iqbal Osman, Flickr

Yeast and mold have been found to be prevalent in cannabis in both current and previous case studies. In a 2017 UC Davis study, 20 marijuana samples obtained from Northern California dispensaries were found to contain several yeast and mold species, including Cryptococcus, Mucor, Aspergillus fumigatus, Aspergillus niger, and Aspergillus flavus.3 The same results were reported in 1983, when marijuana samples collected from 14 cannabis smokers were analyzed. All of the above mold species in the 2017 study were present in 13 out of 14 marijuana samples.4

Aspergillus species niger, flavus, and fumigatus are known for aflatoxin production, a type of dangerous mycotoxin that can be lethal.5 Once a patient smokes and/or ingests cannabis with mold, the toxins and/or spores can thrive inside the lungs and body.6, 7 There are documented fatalities and complications in immunocompromised patients smoking cannabis with mold, including patients with HIV and other autoimmune diseases, as well as the elderly.8, 9, 10, 11

For this reason, regulations exist to limit the allowable TYMC counts for purposes of protecting consumer safety. At the time of writing this article, the acceptable limit for TYMC in cannabis plant material in Colorado, Nevada and Canada is ≤10,000 CFU/g. Washington state requires a mycotoxin test.12 California is looking into testing for specific Aspergillus species as a part of their requirement. As the cannabis industry continues to grow and advance, it is likely that additional states will adopt some form of TYMC testing into their regulatory testing requirements.

References:

  1. https://www.colorado.gov/pacific/sites/default/files/Complete%20Retail%20Marijuana%20Rules%20as%20of%20April%2014%202017.pdf
  2. http://laws-lois.justice.gc.ca/eng/acts/f-27/
  3. https://www.ucdmc.ucdavis.edu/publish/news/newsroom/11791
  4. Kagen SL, Kurup VP, Sohnle PG, Fink JN. 1983. Marijuana smoking and fungal sensitization. Journal of Allergy & Clinical Immunology. 71(4): 389-393.
  5. Centre for Disease control and prevention. 2004 Outbreak of Aflatoxin Poisoning – Eastern and central provinces, Kenya, Jan – July 2004. Morbidity and mortality weekly report.. Sep 3, 2004: 53(34): 790-793
  6. Cescon DW, Page AV, Richardson S, Moore MJ, Boerner S, Gold WL. 2008. Invasive pulmonary Aspergillosis associated with marijuana use in a man with colorectal cancer. Diagnosis in Oncology. 26(13): 2214-2215.
  7. Szyper-Kravits M, Lang R, Manor Y, Lahav M. 2001 Early invasive pulmonary aspergillosis in a leukemia patient linked to aspergillus contaminated marijuana smoking. Leukemia Lymphoma 42(6): 1433 – 1437.
  8. Verweii PE, Kerremans JJ, Voss A, F.G. Meis M. 2000. Fungal contamination of Tobacco and Marijuana. JAMA 2000 284(22): 2875.
  9. Ruchlemer R, Amit-Kohn M, Raveh D, Hanus L. 2015. Inhaled medicinal cannabis and the immunocompromised patient. Support Care Cancer. 23(3):819-822.
  10. McPartland JM, Pruitt PL. 1997. Medical Marijuana and its use by the immunocompromised. Alternative Therapies in Health and Medicine. 3 (3): 39-45.
  11. Hamadeh R, Ardehali A, Locksley RM, York MK. 1983. Fatal aspergillosis associated with smoking contaminated marijuana, in a marrow transplant recipient. Chest. 94(2): 432-433.
  12. http://apps.leg.wa.gov/wac/default.aspx?cite=314-55-102

European Cannabis News Roundup 2017 And Predictions For 2018

By Marguerite Arnold
No Comments

Europe saw big developments on the cannabis front all year. This includes country-by-country developments that include legalization of medical use and even plans to begin domestic production, no matter how delayed such plans have turned out to be.

By far the most interesting market developments were in Germany all year. The Teutonic state has entered some interesting territory – even if its potential is still in the development rather than rollout status.

Elsewhere, however, medical acceptance is clearly starting to bloom across the continent in a way that is more reminiscent of American state development than what is about to happen in Canada.

One of the most interesting aspects of European reform however, that is in marked difference to what has happened in the U.S., is that grow facilities are being slowly established with federal authorization, even before further reform comes (see Turkey, Slovenia, Germany and even Denmark).

How reform will continue to roll out and shape the discussion however, is still a matter very much left up to individual European states. Cannabis legalization may become the first uniting issue of the new Deutsch ruling parliamentary coalition, whatever that is. In Spain, the cannabis question might yet be a play in simmering separatist tensions. Across the continent, legislatures are, for the first time in two generations, reconsidering what cannabis is, how it should be used, and what the penalties should be for those who use the drug either medicinally or recreationally.

Change is still all over the map. And it is still very, very slow.

Germany

The country’s federal legislators voted unanimously to mandate medical coverage of cannabis under public health insurance (which covers 90% of the population) on January 19th. Since then, however, forward movement has been stymied by a combination of forces and politics. While the legislation became law in March and the government established a cannabis agency, other developments have not been so clear cut. Yes, import licenses are being issued. And yes, there is a pending tender bid. However announcements of the finalists have been delayed since August due to lawsuits over qualifications of the growers, among other things. The new German government (whatever it will be) plus apparent CETA (EU-Canada Comprehensive Economic and Trade Agreement)-related complications have all added to the drama. That said, when the cannabis opera moves into its next act, as of probably early next year, expect to see domestic medical grow go forward. Importing medical supplies, even from across the continent (which is what is happening now) is ludicrously expensive. Rumours are already flying out of Berlin that further cannabis reform is one of the few things that all parties can agree to as a new government forms.

Holland

Sadly, the biggest cannabis-related “development” this year was the decision by all major health insurers to stop covering the drug, just as the German government changed its mind about the issue. Greater regulation of coffee shop grows coupled with this lack of insurance coverage means that patients are being forced into a coffee shop culture which is also commoditizing and commercializing into a high-volume affair, particularly in Amsterdam. While this might just be the new face of an old business, the laid back “coffee shop” culture of yore is an endangered species.

Barcelona, capital of Catalonia
Photo: Bert Kaufmann

Spain

Catalonian independence made headlines globally this year. So did the associated bid for other freedoms of a cannabis sort – particularly in Barcelona. Club grows were set to become more regulated as of this summer. However the massive Catalonian bid for independence has further muddied the waters. Given the fact that cannabis reform appears to be at the forefront of finding political compromise elsewhere in Germany, perhaps givebacks about taxes for this industry might be one way to temper down the still-raging separatist forces afoot.

Poland

The Polish government surprised everyone this fall, and legalized the drug for medical purposes (at least in theory) in November. What this actually means for patients is another story. There are no plans to cultivate on the radar. Patients under the new law are allowed to travel to other countries to seek their medical cannabis. How they might afford it is another question. Not to mention how they will escape prosecution from personal importation if checked at a border.

Warsaw, Poland
Image: Nikos Roussos, Flickr

Polish pharmacists will however be trained on how to make medicaments from imported cannabis. They will have to be registered with the Office for the Registration of Medical Products. This means that pharmacists must be pre-registered with the government – in a move much like the early days of the Israeli medical program. The medicine is expected to cost about $460 a month. How well this will work in serving the country’s more than 300,000 already eligible patients is another story.

Greece

Cannabis economists have long said that what the Greeks really need to heal their economy is a vibrant cannabis injection. And as of mid-November early investors in the nascent market had already staked close to $2 billion in cultivation opportunities. Senior ministers in the government have also publicly backed plans to move Greece into a strategic position to claim a piece of a global cannabis market estimated to reach 200 billion dollars a year by the end of the next decade. It means jobs. It means capital infusions. Exactly, in other words, what the Greek economy desperately needs. Expect to see further formalization of the grow program here in 2018 for sure.

Lithuania

It appears that quite a few countries in Europe are pushing for real cannabis reform by the end of the year, and this little EU country is joining the list. With a unanimous agreement in Parliament already to change the country’s drug policy, Lithuania’s legislators could vote to legalize the drug on December 12th of this year. All signs look promising.

Slovenia

MCG, an Australian-based company, made news in the fall by announcing a new cannabinoid extraction facility in the country, on track for completion this year. The company also ramped up domestic production operations in August. Real reform here still has a long way to go. However with domestic production underway, greater medical use looks promising.

Denmark

The country signed a production agreement to open a new facility in Odense, the country’s third largest city with Spektrum Cannabis, the medical brand of one of the largest Canadian producers (Canopy Cannabis) now seeking a foothold in Europe late this fall. What this means for ongoing reform in Denmark is also positive. The company will import cannabis via Spektrum Denmark until all the necessary approvals are ironed out for cultivation.

Portugal

While “reform” here is less of an issue than it is elsewhere (since all drugs are decriminalized), Portugal might yet play an interesting role in cross-European legalization. Tilray, another large Canadian-American firm with interests in Europe, announced the construction of a large medical cannabis facility in the country earlier this year. That plant could easily ship medical supplies across Europe as new countries legalize but do not implement grow facilities.

amandarigdon

Proficiency Testing in the Cannabis Industry: An Inside Look

By Cannabis Industry Journal Staff
No Comments
amandarigdon

Cannabis Labs Virtual Conference: Part 4

Proficiency Testing in the Cannabis Industry: An Inside Look
By Amanda Rigdon, Chief Technical Officer, Emerald Scientific

This presentation covers specifics of different proficiency testing schemes available to the cannabis industry. Additionally, specific challenges facing both laboratories and PT providers in the cannabis industry will be addressed. Data relating to residual solvent and potency proficiency testing will be presented.

Designing Your Continuing Cannabis Education Program

By RJ Starr
No Comments

As many states’ medical cannabis programs are already in full swing and several are launching or nearing their one-year or biennial maturation periods, medical cannabis dispensaries and cannabis cultivation and processing facilities should be fine-tuning their Continuing Cannabis Education Program, or CCEP, and be ready for inspection by state agencies.

While states with medical cannabis programs administer them through various agencies such as Department of Medicine/Health, Department of Pharmacy, Department of Commerce, Alcoholic Beverage Control, each has their own minimum requirements for continuing education in the medical cannabis space, and each structures their program in the direction within which that particular regulatory agency leans. Each state’s personality also brings an influential component as well; for example, a state with a highly visible opioid crisis may place greater emphasis on substance abuse training.

Suffice it to say that while there is certainly insight to be gained from knowing your particular state, there are certain elements of an ongoing professional development program that should be considered in each CCEP. This article will explore a few of the elements integral to any successful human capital and professional development plan from a vantage of compliance, and will offer some insight into the exceptional training methodology designed by Midwest Compassion Center and Bloom Medicinals.

There are a number of key considerations in developing a Continuing Cannabis Education Program, and a thoughtful CCEP should be developed specifically to meet the needs of both the organization and its employees. This can be done by a needs assessment consisting of three levels: organizational, occupational, and individual assessments.

  1. Needs assessment and learning objectives. This part of the framework development asks you to consider what kind of training is needed in your organization. Once you have determined the training needed, you can set learning objectives to measure at the end of the training.
    1. Organizational assessment. In this type of needs assessment, we can determine the skills, knowledge and abilities our cannabis dispensaries need in order to meet their strategic objectives. This type of assessment considers things such as changing laws, demographics and technology trends. Overall, this type of assessment looks at how the organization as a whole can handle its weaknesses while promoting strengths.
    2. Occupational (task) assessment. This type of assessment looks at the specific tasks, skills, knowledge and abilities required of our employees to do the jobs necessary within our dispensaries.
    3. Individual assessment. An individual assessment looks at the performance of an individual employee and determines what training should be accomplished for that individual.
  2. Consideration of learning styles. Making sure to teach to a variety of learning styles is important to development of training programs.
  3. Delivery mode. What is the best way to get your message across? Is classroom or web-based training more appropriate, or should one-on-one mentoring be used? Successful training programs should incorporate a variety of delivery methods.
  4. How much money do you have to spend on this training? This does not only include the cost of materials, but the cost of time. Consideration should also be given to the costs associated with not investing in training: CFO asks CEO, “What happens if we invest in developing our people and then they leave us?” CEO: “What happens if we don’t, and they stay?”
  5. Delivery style. Will the training be self-paced or instructor led? What kinds of discussions and interactions can be developed in conjunction with this training? The delivery style must take into account people’s individual learning styles. A balance of lectures, discussions, role-playing, and activities that solidify concepts are considered part of delivery style.
  6. Audience. Who will be part of this training? Do you have a mix of roles, such as accounting people and marketing people? What are the job responsibilities of these individuals, and how can you make the training relevant to their individual jobs? The audience for the training is an important aspect when developing your CCEP. This can allow the training to be better developed to meet the needs and the skills of a particular group of people.
  7. Content. What needs to be taught? How will you sequence the information? The content obviously is an important consideration. Learning objectives and goals for the training should be established and articulated before content is developed.
  8. Timelines. How long will it take to develop the training? Is there a deadline for training to be completed, and if so, what risk analysis can be used to determine the consequences of not meeting that deadline? After content is developed, understanding time constraints is an important aspect. Will the training take one hour or a day to deliver? What is the timeline consideration in terms of when people should take the training?
  9. Communication. How will employees know the training is available to them? Letting people know when and where the training will take place is part of communication.
  10. Measuring effectiveness. How will you know if your training worked? What ways will you use to measure this? The final aspect of developing a training framework is to consider how it will be measured. At the end, how will you know if the trainees learned what they needed to learn?

A thorough review of your state’s rules and regulations should take place quarterly, with one or more specific employees designated to stay abreast of changes. If your regulatory authority has implemented requirements that trainings must be approved in advance, know that as well, and keep your Continuous Cannabis Education Program up-to-date and ready for inspection.

New Jersey Governor Phil Murphy

Is New Jersey The Next State To Legalize Adult Use Cannabis?

By Aaron G. Biros
1 Comment
New Jersey Governor Phil Murphy

Back in November, New Jersey elected Democrat Phil Murphy for governor, who ran on a campaign of legalizing adult use cannabis and using tax revenue from that for important government programs like education and pensions. According to CNN Money, NJ State Senate President Stephen Sweeney says he wants to vote on draft legislation and have it approved within 100 days of Gov. Murphy’s inauguration.

New Jersey’s Governor-elect Phil Murphy Photo: Phil Murphy, Flickr

That bill, sponsored by Sen. Nicholas Scutari back in May (the same Senator that sponsored the state’s now-implemented medical cannabis law), would legalize cannabis use, growing and sales, for those over the age of 21, while tacking on a hefty tax. The legislation, if it passes the vote and signed into law this spring, would also create a licensing framework and a “Division of Marijuana Enforcement,” the government body that would be tasked with regulating the industry.

Election victories throughout the state for Democrats means they now control the executive and legislative branches of the state’s government, opening the door for possibly legalizing cannabis within a year. This is a massive about-face for the state, previously controlled by Republican and Trump-supporter Chris Christie, a less-than-cannabis-friendly Governor who once called tax revenue from cannabis “blood money.”

Senator Nicholas P. Scutari (D)

But the newly revived fervor over legalizing cannabis in New Jersey comes with its own hang-ups. For one, Governor Phil Murphy claimed this could bring up to $300 million in tax revenue, which is a bit of a pipedream in the short term. The state would need total cannabis sales to hit $1.2 billion to reach that amount of tax revenue, something New Frontier Data doesn’t expect would happen until maybe 2025.

Amol Sinha, executive director of the ACLU of New Jersey, wrote an op-ed addressing Murphy’s campaign promises. Sinha says that Gov.-elect Murphy ran on legalizing cannabis “as a social and racial justice priority.” He argues that in order for New Jersey to legalize cannabis equitably, the legislation needs to have automatic expungement of previous cannabis-related criminal convictions, a provision for growing at home, fair regulations and community reinvestment of the tax revenue. On the surface, Sen. Nicholas Scutari’s bill introduced back in May of 2017 seems to have provisions in place to meet all of these requirements.

California Manufacturing Regulations: What You Need To Know

By Aaron G. Biros
No Comments

In late November, California released their proposed emergency regulations for the cannabis industry, ahead of the full 2018 medical and adult use legalization for the state. We highlighted some of the key takeaways from the California Bureau of Cannabis Control’s regulations for the entire industry earlier. Now, we are going to take a look at the California Department of Public Health (CDPH) cannabis manufacturing regulations.

According to the summary published by the CDPH, business can have an A-type license (for products sold on the adult use market) and an M-type license (products sold on the medical market). The four license types in extraction are as follows:

  • Type 7: Extraction using volatile solvents (butane, hexane, pentane)
  • Type 6: Extraction using a non-volatile solvent or mechanical method
    (food-grade butter, oil, water, ethanol, or carbon dioxide)
  • Type N: Infusions (using pre-extracted oils to create edibles, beverages,
  • capsules, vape cartridges, tinctures or topicals)
  • Type P: Packaging and labeling only

As we discussed in out initial breakdown of the overall rules, California’s dual licensing system means applicants must get local approval before getting a state license to operate.

The rules dictate a close-loop system certified by a California-licensed engineer when using carbon dioxide or a volatile solvent in extraction. They require 99% purity for hydrocarbon solvents. Local fire code officials must certify all extraction facilities.

In the realm of edibles, much like the rule that Colorado recently implemented, infused products cannot be shaped like a human, animal, insect, or fruit. No more than 10mg of THC per serving and 100mg of THC per package is allowed in infused products, with the exception of tinctures, capsules or topicals that are limited to 1,000 mg of THC for the adult use market and 2,000 mg in the medical market. This is a rule very similar to what we have seen Washington, Oregon and Colorado implement.

On a somewhat interesting note, no cannabis infused products can contain nicotine, caffeine or alcohol. California already has brewers and winemakers using cannabis in beer and wine, so it will be interesting to see how this rule might change, if at all.

CA Universal Symbol (JPG)

The rules for packaging and labeling are indicative of a major push for product safety, disclosure and differentiating cannabis products from other foods. Packaging must be opaque, cannot resemble other foods packaged, not attractive to children, tamper-evident, re-sealable if it has multiple servings and child-resistant. The label has to include nutrition facts, a full ingredient list and the universal symbol, demonstrating that it contains cannabis in it. “Statute requires that labels not be attractive to individuals under age 21 and include mandated warning statements and the amount of THC content,” reads the summary. Also, manufacturers cannot call their product a candy.

Foods that require refrigeration and any potentially hazardous food, like meat and seafood, cannot be used in cannabis product manufacturing. They do allow juice and dried meat and perishable ingredients like milk and eggs as long as the final product is up to standards. This will seemingly allow for baked goods to be sold, as long as they are packaged prior to distribution.

Perhaps the most interesting of the proposed rules are requiring written standard operating procedures (SOPs) and following good manufacturing practices (GMPs). Per the new rules, the state will require manufacturers to have written SOPs for waste disposal, inventory and quality control, transportation and security.

Donavan Bennett, co-founder and CEO of the Cannabis Quality Group

According to Donavan Bennett, co-founder and chief executive officer of the Cannabis Quality Group, California is taking a page from the manufacturing and life science industry by requiring SOPs. “The purpose of an SOP is straightforward: to ensure that essential job tasks are performed correctly, consistently, and in conformance with internally approved procedures,” says Bennett. “Without having robust SOPs, how can department managers ensure their employees are trained effectively? Or, how will these department managers know their harvest is consistently being grown? No matter the employee or location.” California requiring written SOPs can potentially help a large number of cannabis businesses improve their operations. “SOPs set the tempo and standard for your organization,” says Bennett. “Without effective training and continuous improvement of SOPs, operators are losing efficiency and their likelihood of having a recall is greater.”

Bennett also says GMPs, now required by the state, can help companies keep track of their sanitation and cleanliness overall. “GMPs address a wide range of production activities, including raw material, sanitation and cleanliness of the premises, and facility design,” says Bennett. “Auditing internal and supplier GMPs should be conducted to ensure any deficiencies are identified and addressed. The company is responsible for the whole process and products, even for the used and unused products which are produced by others.” Bennett recommends auditing your suppliers at least twice annually, checking their GMPs and quality of raw materials, such as cannabis flower or trim prior to extraction.

“These regulations are only the beginning,” says Bennett. “As the consumer becomes more educated on quality cannabis and as more states come online who derives a significant amount of their revenue from the manufacturing and/or life science industries (e.g. New Jersey), regulations like these will become the norm.” Bennett’s Cannabis Quality Group is a provider of cloud quality management software for the cannabis industry.

“Think about it this way: Anything you eat today or any medicine you should take today, is following set and stringent SOPs and GMPs to ensure you are safe and consuming the highest quality product. Why should the cannabis industry be any different?”

BioTrackTHC To The Rescue: Contingency Plan for Washington

By Aaron G. Biros
1 Comment

According to a press release published this morning, BioTrackTHC successfully implemented their Universal Cannabis System (UCS) in Washington State, a temporary solution for the state’s seed-to-sale cannabis tracking system, while the new system is yet to be deployed.

BioTrackTHC had a contract with Washington State for four years, which expired just weeks ago at the beginning of November. Back in June, after a few minor hiccups, the state announced that MJ Freeway would be the successive software platform used for the state’s seed-to-sale traceability system.

The deadline for the new software to be ready for deployment was set for November 1st, when the BioTrackTHC contract would expire and the MJ Freeway contract would begin. Between when the contract was awarded and the deadline for implementation, MJ Freeway made headlines for a series of security hacks and systems failures. Subsequently, MJ Freeway said they could not deliver the software platform until January of 2018, leaving a two-month gap where businesses have no state-mandated software to use for the tracking system.

The contingency plan that the state laid out consisted of business owners manually inputting data in excel spreadsheets. When first pressed for a Band-Aid solution, representatives of BioTrackTHC cited security concerns related to MJ Freeway’s hacks as reason for being hesitant to extend their contract through the interim period.

In an open letter to the Washington cannabis industry back in October before the end of their contract, Patrick Vo, president and chief executive officer of BioTrackTHC, laid out an explanation for what went wrong and provided an alternative solution, essentially a private sector version of their government-mandated traceability software system.

The open letter to the Washington cannabis industry, written by Patrick Vo

Announced this morning, the new system, UCS, is being used by over 1,600 of the 1,700 cannabis licensees in Washington. The UCS has so far submitted 39,000 individual excel spreadsheets to the Washington State Liquor and Cannabis Board (WSLCB). “After the WSLCB announced that their replacement system would not be ready in time and that the only other option was for all 1,700 licensees to submit their seed-to-sale data via manual spreadsheets, BioTrackTHC created the UCS—a privatized clone of the government system—within a few days and deployed it minutes after the termination of the old system to minimize the impact on all licensees,” reads the press release.

The UCS allows business owners to streamline data recording, instead of manually entering information into spreadsheets. It is also integrating with 3rd party software competitors such as WeedTraQR, GrowFlow, Mr. Kraken, TraceWeed, GreenBits, S2Solutions and DopePlow. “After the WSLCB’s announcement, we knew that we had only a few days to provide a universal system to which the whole industry could submit compliance data and enable communication across the supply chain between licensees and their seed-to-sale system,” says Vo. “Our priority was to ensure that licensees could continue to operate in the absence of a government seed-to-sale system. Not having that system in place could have left Washington licensees vulnerable to noncompliance in a variety of ways, not to mention the potentially crippling volume of extra work needed to manually track a business’ entire inventory.”

Washington State’s new traceability software system by MJ Freeway is expected to deploy in January of 2018.

Hoban Law Group Expands Internationally

By Aaron G. Biros
No Comments

Last week, Hoban Law Group announced a major international expansion, with new offices in Latin America and the European Union. The Denver-based law firm said they will have four new offices across the EU by late fall and two new offices in Latin America by spring of 2018.

BobHobanAttorney
Bob Hoban, managing partner

Bob Hoban, managing partner and co-founder of Hoban Law Group, says they have already been working internationally for years. “HLG steps in to global markets quickly as our direct work with government officials on policy and regulation has kept us in this important global curve,” says Hoban. “We have accepted the challenge of being global cannabis industry leaders & experts and will work with strategic industry-leading partners, such as New Frontier Data, to move the industry forward across six countries.”

The press release says the law firm has been advising governments around the world on cannabis policy for several years, as well as working on a handful of international business transactions in the past. These new offices will work mainly with structured finance, mergers and acquisitions, worldwide trade, regulatory law and equity placement in the cannabis (including industrial hemp) industry. “Combining the firm’s corporate practice, with our intellectual property and tax practice groups will position our firm’s client’s to succeed at the highest levels in this international marketplace,” says Hoban.

The press release also announced they have added Andrew Telsey, an experienced securities attorney, to their firm. He has helped take more cannabis businesses public in the U.S. than any other attorney.

Hoban Law Group, founded in 2009, is the nation’s largest cannabis business law firm. They have attorneys in every state that has legalized cannabis in the United States.

MJ Freeway Hardships Linger

By Aaron G. Biros
1 Comment

MJ Freeway, a seed-to-sale traceability software company with a number of government contracts, has been making headlines this year for all the wrong reasons. A series of security breaches, website crashes and implementation delays have beleaguered the software company throughout 2017.

Just this morning, the Philadelphia Inquirer reported the company’s services crashed Saturday night and Monday afternoon. That article also mentions an anonymous hacker tried to sell sensitive information from the Washington and Nevada hacks in September. Back in April, when Pennsylvania awarded the state’s contract to MJ Freeway for its tracking system, Amy Poinsett, co-founder and chief executive officer of MJ Freeway told reporters “I think I can confidently say we are the most secure cannabis company in this particular industry.” It is safe to say this is now being called into question.

Earlier this week, New Cannabis Venture’s Alan Brochstein reported that MJ Freeway is unable to meet Washington’s October 31st deadline to integrate their software with the state, forcing customers to manually report data.

Roughly a month ago, Nevada suddenly cancelled their contract with MJ Freeway, just two years into their five-year deal. Back in June, the company’s source code was stolen and published online. And back in January of this year, the company’s sales and inventory system was the target of a cyber attack.

According to an email we obtained, all of MJFreeway’s clients in Spain experienced an online outage, but that services were restored within 24 hours. In an email sent to clients in Spain, the company told customers that the problems were the result of a system failure. “Our initial analysis indicates that this was a system failure and unfortunately none of the data was able to be successfully retrieved from the backup archive due to an error but we can assure you that none of your data was extracted or viewed at any moment,” reads the email. “We are extremely distressed regarding the event that occurred with the system and the service interruption that occurred yesterday. We recognize that this is a situation that is very serious and negatively impacts your club.” The email says that MJ Freeway is addressing those problems in a few ways, one of which being ongoing audits of their data backups. “The event has led us to reconstruct our “hosting environment” in Europe to use the latest technology from Amazon Web Services with the best redundancy, flexibility and security, using the highest stability measures in the AWS environment,” reads the email. While the site will be restored fully, according the email, historical data is lost. The company is working with their clients to help them get data back into the system.