Tag Archives: system

Steven Burton

3 Ways The Cannabis Industry Can Benefit By Adopting IoT Tech

By Steven Burton
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Steven Burton

The cannabis industry of the United States is unlike other horticulture markets in the country. It’s younger, less traditional and with roots in a black market, it’s no surprise that its forerunners aren’t afraid to experiment with new approaches and technology.

The rapid adoption of IoT (Internet of Things) technology is one way in particular that this new generation of producers is stepping up, and they’re beginning to reap the rewards. But to better demonstrate how significant the implementation of IoT tech can be, we’ll peek over the fence at other craft-oriented food industries—namely wine and chocolate—to discover how effective they can be long-term for serious players in the cannabis industry.

The results, as you can probably guess, are astounding.

Farm Productivity and Precision is on the Rise

IoT tech isn’t just a cool new thing for experimental growers – it’s as necessary as air in the 21st century. New and veteran farms alike are discovering ways to streamline production and enhance the quality of their crops. One of the most common implementations of IoT tech in agriculture is the installation of smart measurement tools. Remote sensors can monitor soil acidity, humidity, salt concentrations, temperature and a variety of other metrics, automating the collection of data and providing a clear picture of plant health. For many farms, like E. & J. Gallo Winery, this is a game-changer.By installing hundreds of sensors per block and upgrading to a more precise irrigation system, Gallo was able to connect moisture measurements to a central system

Before placing sensors in over 250 acres of their vineyard, Gallo could only make irrigation adjustments at the large block level. Even with careful monitoring of moisture levels, the grape yield was inconsistent in size and flavor. By installing hundreds of sensors per block and upgrading to a more precise irrigation system, Gallo was able to connect moisture measurements to a central system. The system collects the data, considers the weather forecast, and automatically irrigates small areas of the vineyard as needed to ensure all plants are optimally watered. This resulted in a more uniform crop, less water waste and more desirable grapes.

Cannabis farms are starting to pick up on this simple approach as well. Organigram, one of Canada’s leading Cannabis producers, is well aware of the benefits of this kind of automation and data collection. “All our grow rooms are helping us learn all the time,” says Matt Rogers, head of production at Organigram. “With 20 grow rooms going, we can gather as much information about these plants as you would get in a century of summers.”

Automation and precision have enabled by Gallo and Organigram to improve yield and increase precision, which has helped them achieve their well-respected status in the wine and cannabis industries.

The Supply Chain is Becoming More Transparent

As much as we would like the industry to be free of scams and crooks, there’s more than a few producers stretching the truth when it comes to labeling product. MyDx, a cannabis chemical analyzer, recently revealed that the label on the package often does not totally coincide with the product within.Protecting your brand’s reputation is a necessity and IoT tech is helping some pioneering industries do that.

For example, the most frequently tested cannabis strain, “Blue Dream”, averages a 64% difference in chemical makeup from sample to sample. Similarly, “Gorilla Glue” and “Green Crack” show as much as 83% variation from sample to sample—largely because there’s no regulation of these names.

While variation is inevitable from grower to grower, plant to plant, and even between different parts of the same plant, misleading labels and the addition of ‘fillers’ is a growing issue for edible cannabis producers, and the threat it poses to your brand isn’t minor. Protecting your brand’s reputation is a necessity and IoT tech is helping some pioneering industries do that.

Wine in China is a powerful example of how improved traceability can reduce large-scale mislabeling. Brand-name winemakers in the country face a massive problem: 70% of imported wines are counterfeits. To combat this, winemakers are attaching near-field communication (NFC) labels to imported and domestic bottles. It’s a dramatic solution, but one that’s protecting the brand of winemakers dedicated to quality and transparency.

As the legalization of cannabis spreads and coveted strains emerge, so will the availability of counterfeits—or, at the very least, less-than-truthful labeling. This has proven to be true in almost every specialty market, and adopting improved traceability tech will defend your brand and reputation from the consequences of selling a product that’s discovered to be more ‘filler’ than cannabis.

Compliance is Easily Achieved

The conversation of cannabis regulation generally revolves around age restrictions and driving while impaired, but government compliance is far more complicated – especially for facilities that create cannabis-infused food products. And here’s the frustrating part for those who must (and should) maintain a food safety plan: every time a regulation is adjusted (or every time a new variation is added in another state), facilities must be able to document changes in procedures, recipes and hazard controls. It gets complicated quickly, especially if all the documentation is kept manually.

There’s a lot to be gained by connecting your systems and products to the Internet of ThingsA central, connected system is the best way for food manufacturers to streamline and automate a variety of documentation and food safety tasks, which can mean thousands of dollars saved over months or years. Using software like Icicle, facilities can create a comprehensive data environment that’s dynamic and accessible from anywhere. Incoming measurements from connected equipment and employee records are collected and an admin dashboard allows you to see what food safety systems are thriving and which need revisiting. The records – transformed into a compliant food safety plan – can then be pulled up during audits and inspections on the spot, saving the months that companies usually spend preparing documentation.

According to Mitchell Pugh of Chewter’s Chocolates, their system “gives me a great peace of mind in the sense to know we have all our information prepared and anything that an inspector is going to ask for – whether they’re looking for one product, a general system, a certain hazard, or a bill of ingredients or materials or an allergen – is easy for us to search for it, pull it up, and find exactly what they’re looking for.”

Considering that most food manufacturers still record measurements and create food safety plans manually, this is an area where progressive companies can quickly outpace their non-automated rivals.

Whether you’re a grower, dispensary, food producer, or some other kind of cannabis professional, there’s a lot to be gained by connecting your systems and products to the Internet of Things. Which direction will you take?

Iowa’s Medical CBD Program Gets Tracking System

By Aaron G. Biros
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BioMauris, LLC became the 5th company in the United States to win a state contract for a seed-to-sale platform today. BioMauris is a technology company that manages product tracking, fulfillment and distribution with a focus on the healthcare market. According to a press release, the company announced today that the state of Iowa selected BioMauris to manage their tracking system for the medical cannabidiol (CBD) program.

That program’s contract includes inventory tracking, medical cannabidiol sales and patient and caregiver registration. In 2014, Iowa’s Medical Cannabidiol Act was signed into law. Three years later, in May of 2017, Governor Terry Branstad expanded the state’s program, including manufacture and dispensing in the previous legislation. On December 1st, 2018, Iowa expects sales to begin and fully implement the program.

This is BioMauris’ first state contract in the cannabis industry. According to the press release, BioMauris bases their platform on Salesforce for point of sale, tracking, customer loyalty and distribution services in the healthcare sector. The company says they use Salesforce because it is extremely customizable and secure.

Erik Emerson
Erik Emerson, founder and president of Biomauris

According to Erik Emerson, founder and president of BioMauris, they’re poised to deliver on this front, given their experience in other industries. “Our team has extensive history in the pharmaceutical business, and therefore has a unique appreciation for data integrity and security,” says Emerson. “Additionally, we fundamentally believe the opportunity to track patient progress and associate the benefits received with the products used, is an incredible opportunity for the cannabis industry.” BioMauris has worked with clients on similar projects in the healthcare space for some time.

The company touts their platform as fully PCI-DSS and HIPAA compliant, allowing them to process payments and protect sensitive patient information. “Our patented technology, makes this not only possible, but simple for all users,” says Emerson. “We are excited to bring our product to the great state of Iowa and look forward to a long partnership with them. We believe strongly in what Iowa is attempting to do with their program and believe it is a perfect fit with our strategy for the cannabis industry.”

currencies around the world

The Global Price of Cannabis

By Marguerite Arnold
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currencies around the world

Cannabis pricing, globally, is a topic that is going to remain heated if not highly fluid for some time to come. Why? Government regulation (or lack thereof), compliance and even transport along with different models for commerce and consumption are creating an odd and absolutely uneven map of commodity pricing. We live in a world where accurate information is hard to come by. Even from ostensibly “official” sources that track operational markets. Black or legit.

It may sound complex today but it used to be a lot harder. As of just 2014, the UN’s Office of Drug Control listed the price of a gram of (black market) cannabis in Lichtenstein at $1,020 (as reported by a bemused Business Insider). While this could have been a simple matter of misunderstanding that Europeans frequently use commas rather than periods as decimal points in numbers, the fact that this was later corrected to $10.13 suggests human error in transcription rather than reporting. And the world has certainly changed since then.

Yet with no international legal marketplace or even platform yet in existence to track the global price of legal cannabis in different jurisdictions, this is the kind of issue that faces not only those in the industry but those trying to analyze it.

That said, there are beginning to be data points for those who are interested and those who must have this information for professional reasons. Here is a break-down of regional (legal) prices, per gram from a selection of sources generally considered fairly accurate. This is also made a bit more difficult by the difference in measurement systems and currency fluctuations. For ease of reference, these figures are in grams and U.S. dollars. An ounce is about 28 grams.currencies around the world

Medical grade cannabis also means different things in different markets. Outside the U.S., in Canada and the EU in particular, medical grade cannabis must meet a certification process that adds to the cost of production considerably. Certainly in comparison with outdoor grows. It is still, for the most part, imported, from either Canada or Holland, although look for that to start changing this year as domestic cultivation in multiple countries finally gets seriously underway.

The U.S.

Pricing really depends on where you are. It is also dropping fairly dramatically in established markets. The most recent example of this is Oregon – which has seen its higher-than-normal state retail market begin to normalize with California, Washington and Colorado. This is the price of establishing regulatory schemes on a non-federal level. That said, the competition is so extreme at the moment that Oregon, in particular, is a buyer’s market, with recently reported prices as low as $1 and change for a gram.

Retail pricing, in particular, will remain all over the place on a national level, especially given the amount of local competition between dispensaries underway. On average, however, medical grade-ish cannabis runs between $6-30 a gram, retail.

According to the website Cannabis Benchmarks, which tracks U.S. wholesale prices, the domestic spot index of wholesale cannabis was at $1,292 per pound at the end of January. Or about $5 per gram.The theory that the legit market has to price the black market out of existence is unpopular with those who want to collect more taxes from rec sales.

Nationally, at the moment, uncertainty over how the new post-Cole Memo world will play out, plus oversupply in certain markets, is creating strange pricing. Note to consumers, particularly in recreational markets: There are deals to be had.

Canada

This market is interesting for several reasons. The first is that several of the regional governments are considering establishing a Canadian $10 per gram price for the recreational market. Medical grade runs about $8 at the moment in local currency. That means, with a 20% differential in current f/x rates, a recreational gram will be set at USD $8 and a medical gram at about $6. That said, the theory that the legit market has to price the black market out of existence is unpopular with those who want to collect more taxes from rec sales.

Theories abound about the future of recreational pricing, but for the moment, a great deal of supply and new producers will keep prices low at least through 2019. After that? It is impossible to even guess. At that point, Canadian producers will still be supplying at least German medical patients with some of their imported bud. Regardless, the country will continue to play an important role in global pricing – even if it is to set a recreational and medical standard that plays out in markets already from the EU to Australia.

Israel

Like Canada’s market, although for different reasons, the Israeli official price on legal cannabis is absolutely constant. It is set by government policy. Those who have the drug legally, in other words with a doctor’s prescription, pay about $100 for a month’s supply. That amount on average is about 28 grams. That means that a medical gram in Israel will set you back about $3.50 per. U.S. not Canadian.

Europe

Price deltas here are the most impacted by changing national laws, standards and medical legalization. There are only two semi-legitimate recreational markets at the moment that include THC. Those are Holland and Spain. In Holland, via the coffee shops, the low-end of passable bud starts at between $12-15 per gram and goes up to about $30 for the really exotic breeds. This being Holland, they exist and are obtainable. In Spain, add the cost of joining a social club (about $50), but in general, the cost of a gram is about $10.Price deltas here are the most impacted by changing national laws, standards and medical legalization.

Medical markets in places like Germany are still skewed by integration of the drug into the country’s healthcare system and the fact that it is still all imported. The horror stories are real here. Patients must pay out-of-pocket right now for cannabis flower that is also being pre-ground by local apothekes for an additional price per gram that is eye-wincingly high. However, once the price and supply normalize, look for a medical standard here of about $10 for a month’s supply. That will be about 28 grams too.

Germany, in other words, will eventually be one of the cheapest markets for patients after reimbursement by insurance. That shapes up to be about $0.50 per gram at point of sale. It could be far less for those who are able to obtain authorization for higher amounts up to five ounces per month. The flat fee stays the same. Do the math. That works out to some pretty cheap (high grade) medical relief.

Black market cannabis and hash, which is also far more common in Europe than the U.S. at least, is fairly widely available for between $12 and $20 a gram.

The rise of cannabis production in Eastern Europe and the Baltics (which is also still largely pending and based on ongoing government talks and emerging distribution and cultivation agreements) will also dramatically drive down the cost of legal cannabis in the EU within the next several years. Production in this part of the world, along with Greece, may well also source rec markets all over the continent once that happens.

Africa & Central and South America

While the African cannabis trade has yet to break out – even in the media much of yet, there is definitely something green growing in several African countries including South Africa and Ethiopia. That trade unlike most of what is going on in South America with the possible exception of Uruguay is already looking for export opportunities globally. With African cannabis going for less than a buck a gram in most places (as in about a fifth of even that), look for certified African medical cannabis in select Western markets where price is going to be a major issue. Think medical standards. On the South American front, prices are equally low. However, remember that these are not regulated markets yet. And domestic government standards, starting with GMP and both indoor and outdoor grow requirements are basically non-existent. Growers who want to export to higher regulated markets are planning accordingly.

Assorted Outliers

It goes without saying that in places where cannabis is both illegal and carries the death penalty or other harsh penal retaliation, that the price is not only much higher, but the source is black market. In the UAE for example, a gram will set you back well over $100.

Supplier Quality Audits: A Critical Factor in Ensuring GMP Compliance

By Amy Scanlin
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Editor’s Note: This is an article submission from the EAS Consulting Group, LLC team.


To Audit, or not to audit? Not even a question! Audits play a crucial role in verifying and validating business practices, ensuring suppliers are meeting their requirements for Good Manufacturing Practices (GMPs), and most importantly, protecting your interests by ensuring that you consistently receive a compliant and quality product. Audits can help ensure sound business procedures and quality systems, including well-established SOPs, verification and documentation of batch records, appropriate sanitation practices and safe storage and use of ingredients. Audits can also identify deficiencies, putting into motion a corrective action plan to mitigate any further challenges. While a detailed audit scheme is commonplace for established industries such as food, pharmaceuticals and dietary supplements, it is equally important for the cannabis industry to ensure the same quality and safety measures are applied to this budding industry.

If the question then is not whether to audit, perhaps the question is how and when to audit, particularly in the case of a company’s suppliers.This is an opportunity to strengthen the working relationship with each side demonstrating a commitment to the end product.

Supplier audits ensure first and foremost that the company with which you have chosen to work is operating in a manner that meets or exceeds your quality expectations – and you should have expectations because ultimately your product is your responsibility. Any issues that arise, even if they are technically the fault of a supplier, become your issue, meaning any enforcement action taken by your state regulators will directly impact your business. Yes, your supplier may provide you with a batch Certificate of Analysis but you should certify their results as well.

Audits are a snapshot of a moment in time and therefore should be conducted on a regular basis, perhaps biennially or even annually, if they are a critical supplier. In some cases, companies choose to bring in third-party auditors to provide an objective assessment of suppliers. This is especially helpful when the manufacturer or customer does not have the manufacturing, compliance and analytical background to accurately interpret data gathered as part of the audit. With the responsibility for ensuring ingredient identity and product integrity falling on the manufacturer, gaining an unbiased and accurate assessment is imperative to reducing the risk to your business.

Conducting a supplier audit should be well planned in advance to ensure both sides are ready. The audit team must be prepared and able to perform their duties via a combination of education, training and experience. A lead auditor will oversee the team and ultimately will also oversee the results, verifying all nonconformities have been properly identified. They will also work with the supplier to conduct a root cause analysis for those nonconformities and develop a corrective action plan to eliminate them from occurring in the future. The audit lead will also verify follow-up results.

Auditors should discuss with the supplier in advance what areas will be observed, what documentation will need to be ready for review and they should conduct their assessments with professionalism. After all, this is an opportunity to strengthen the working relationship with each side demonstrating a commitment to the end product.This is your chance to ensure your suppliers are performing and will meet your business, quality and product expectations.

Auditors must document that ingredient identity and finished product specifications are verified by test methods appropriate for the intended purpose (such as a whole compound versus a powder). State regulations vary so be certain to understand the number and types of required tests. Once the audit is complete and results are analyzed, you, the manufacturer, have an opportunity to determine if the results are acceptable. Remember, it is your product, so ultimately it is your responsibility to review the available data and release the product to market, you cannot put that responsibility on your supplier.

Quality Agreements as Part of a Business Agreement

There are opportunities to strengthen a partnership at every turn, and one way to set a relationship on the right path is to include a quality agreement as part of a business agreement. A quality agreement lays out your expectations for your suppliers, what you are responsible for and is a living document that, once signed, demonstrates their commitment to upholding the standards you expect. Just as with a business agreement, have any quality agreements reviewed by an outside expert to ensure the wording is sound and that your interests are protected. This is just another step in the development of a well-executed business plan and one that solidifies expectations and provides consequences when those expectations are not met.

Supplier audits must be taken seriously as they are opportunities to protect your brand, your business and your consumers. Enter into an audit as you would with any business endeavor – prepared. This is your chance to ensure your suppliers are performing and will meet your business, quality and product expectations.

israel flag

Israel’s Cannabis Export Plans Evaporate in Fire and Fury

By Marguerite Arnold
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israel flag

Trump Administration-Israeli relations had the distinct whiff of cannabis to them in the first week of February. In a development potentially just as impactful as transplanting Israel’s capital to Jerusalem, it has now emerged that Israel’s president, Benjamin Netanyahu, has effectively scotched, at least temporarily, the country’s budding medical cannabis international export plans on the eve of finally launching them.

Why? To appease the U.S. president.

What this latest act of international “diplomacy” will eventually impact in the long run is anyone’s guess. There will, however, be winners and losers out of this situation, both now and in the long term.

Who Wins

On the surface (and to gentiles) it might be hard to understand why Israel effectively shot itself in the foot from a global perspective. But cannabis falls into complicated geopolitical and religious crevices at home too. Bibi, as Netanyahu is referred to by an international Jewish audience, has just scored political points over the Jerusalem showdown. Why rock the boat over a plant that has so recently gained legitimacy just in Israel? Remember the country only partially decriminalized recreational use in 2017. However, Israel has explored legal medical cannabis for quite some time, and Tikun Olam, the country’s flagship producer, has been growing cannabis since 2007.

Tel Aviv, Israel, where Tikun Olam has a dispensary

The quote from Netanyahu that has been widely circulated in the press says a great deal. “I spoke with Trump and he told me about his general opposition to the legalization of cannabis, and I’m not sure Israel should be the export pioneer.”

The fact that apparent encouragement of this policy came from the Israeli Finance Ministry only underscores the gravity of the impact for the losing side – and what was also probably threatened. Uruguayan pharmacies, who began distributing medical cannabis legally, walked away from customers last year after their banks were first informed by U.S. partners that they would either have to cut off the pharmacies or sever ties and access to the entire U.S. banking system. The cannabis trade was estimated to be worth between $1-4 billion per year to Israeli firms.

That said, this will also be a short-lived hiccup. Netanyahu apparently wants to see more medical evidence before moving forward with the plan. That means Israel will be in the race, but not for the next 12 to 18 months (minimum).

Prime Minister Benjamin Netanyahu (Bibi)
Image: Kjetil Elsebutangen, UD

This will also not affect the cannabinoid-related export of intellectual property, where Israel has also led the cannabinoid discussion and for several generations now. Recipes, breeding instructions and even seeds cross borders more easily than plants. If anything, it will merely sharpen and shape the start up nation’s many budding cannapreneurs in a slightly different focus.

Canadian, Australian and a few other exporters also win. As of 2018, there will also be multiple European countries and EU-based firms importing and exporting (even if it is to each other).

Who Loses

The U.S. legal state cannabis movement has just been served a two fisted punch in the face by the White House. The Trump administration, in fact, has doubled down, in the space of less than five weeks, on its views towards cannabis legalization.

This also means that there will be no U.S. firms in any position to join a now global and exploding legitimate cannabis industry that stretches from the American hemisphere north and south of the U.S. itself. Not only will American producers not be able to get export approvals themselves from the U.S. government, but they may well be facing federal prosecution back home.israel flag

It will also be interesting to see whether this heralds any post-Cole memo prosecutions of the many Israeli entrepreneurs already operating in the U.S. state cannabis space. American and Israeli entrepreneurs with IP to protect are also the losers here, no matter how much this is being fought on the California front right now. That is just a state battle. IP must be protected federally.

Investors in the U.S. who had already been tempted to invest in the Canadian cannabis industry, now have little incentive to invest domestically or in Israel, no matter how big and bad California is. There is clearly budding (and less politically risky) competition elsewhere.

It goes without saying, of course, that this decision also hurts consumers – both recreational consumers and medical patients.

Bottom Line

This is clearly sabre rattling of the kind intended to make news both internationally and abroad. However, in direct terms, it will have little impact to the overall growth of the industry, no matter who is doing the growing, distributing and ex-im. The cannabis industry will also clearly not stop being a political business for the near term.

Look for prosecutions this if not next year in the U.S. – potentially in California or another high profile “impact” state. We might see pressure on Netanyahu at home, and probably from abroad as well, to get Israel into the cannabis game globally.

OLCC-Logo

Audit Finds Oregon Lacking Regulatory Oversight and Proper Security

By Aaron G. Biros
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OLCC-Logo

Last week, Oregon Secretary of State Dennis Richardson published his office’s audit of The Oregon Liquor Control Commission (OLCC). The audit uncovered a number of inadequacies with the regulatory agency, most notably the problems with their tracking system, designed to prevent cannabis form being sold on the black market.

The report highlights the need for Oregon to implement a more robust tracking system, citing reliance on self-reporting, overall poor data quality and allowing untracked inventory for newly licensed businesses. The audit also found an insufficient number of inspectors and unresolved security issues. According to The Oregonian, the OLCC only has 18 inspectors, roughly one for every 83 licensed businesses.

Auditors also found inadequacies in the application system, saying the OLCC doesn’t monitor third-party service providers and doesn’t have a process in place for reconciling data between the licensing and tracking systems. The audit found there is a risk that decisions made for the program could be based on unreliable data. It also found a risk of unauthorized access to the systems, due to a lack of managing user accounts.

Oregon Secretary of State Dennis Richardson
Oregon Secretary of State Dennis Richardson

This audit’s publication is very timely. Most notably because U.S. Attorney Billy Williams, who called Oregon’s black market problem “formidable,” convened a summit this week to examine how Oregon can prevent cannabis being exported to other states. According to the Oregonian, Williams said Oregon has an “identifiable and formidable overproduction and diversion problem.” The audit’s findings highlighting security issues are also very timely, given that in the same week, Oregon’s neighbor to the North, Washington, experienced a security breach in its own tracking system.

The problems with the Oregon tracking system’s security features are numerous, the audit says. They found that the OLCC lacks a good security plan, IT assets aren’t tracked well, there are no processes to determine vulnerabilities, servers and workstations not using supported operating systems and a lack of appropriately managing antivirus solutions. “Long-standing information security issues remain unresolved, including insufficient and outdated policies and procedures necessary to safeguard information assets,” reads the report’s summary.

The audit proposes 17 recommendations for the state to bolster its regulatory oversight. Those recommendations intend to address undetected compliance violations, weaknesses in application management, IT security weaknesses and weaknesses in disaster recovery and media backup testing. You can read the full audit here.

Washington Security Breach Delays Traceability System Rollout

By Aaron G. Biros
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On February 8th, Peter Antolin, the deputy director for the Washington State Liquor and Cannabis Board (WSLCB), sent an email to licensees explaining why the transition to their new traceability system was disrupted. Last Saturday, someone gained access to the sensitive information in Leaf Data Systems, the state’s traceability software that is powered by MJ Freeway.

“A computer vulnerability was exploited on Saturday, allowing unauthorized access to the traceability system,” Antolin told licensees in the email. “There are indications an intruder downloaded a copy of the traceability database and took action that caused issues with inventory transfers for some users. We believe this was the root cause of the transfer/manifest issue experienced between Saturday and Monday.”WSLCB

The email goes on to say that no personally identifiable information was available to the ‘intruder,’ but some sensitive information was clearly accessed. That data includes route information of manifests filed between February 1st and 4th as well as transporter vehicle information including VIN, license plate number and vehicle type, according to the email.

That email leaves much to be desired. For one, they do not exactly have a solution, instead trying to alleviate licensees’ worries with a hollow inanity full of meaningless jargon: “The WSLCB and MJ Freeway continue to implement several strategies to prevent future vulnerabilities to future intrusions,” reads the email. “This includes full logging and monitoring and working with third-party entities. Since this remains an active investigation, details on security are not publicly available.” However, today the WSLCB is hosting a webinar where Peter Antolin, their IT division, the MJ Examiners unit and enforcement will be available to answer questions, according to the email.

WSLCB emailThis is by no means the first security breach that Washington and MJ Freeway have suffered. In May of 2017, Washington originally selected Franwell’s METRC as the contract partner for their traceability software system. Less than a month later in June of 2017, after a mistake in the selection process, Washington selected MJ Freeway instead of Franwell for the traceability contract. Three days later, MJ Freeway’s source code was stolen and published online. Then in September, Nevada cancelled their contract with MJ Freeway after a security breach, their services crashed in Pennsylvania and Spain, and in October it became clear that the company could not meet the October 31 deadline for their new Washington contract.

In November of 2017, BioTrackTHC, the company that held the previous contract for Washington’s traceability software, helped the state through the transition period with a temporary Band-Aid solution to hold the state over until January of 2018. A month after they expected to implement the new MJ Freeway system, the latest security breach occurred this week and disrupting the rollout yet again.

At the end of the email Antolin sent to licensees yesterday, he says there will continue to be attempts to breach the system’s security. “The bottom line is that this incident is unfortunate,” says Antolin. “There will continue to be malicious cyberattacks on the system. This is true of any public or private system and is especially true of the traceability system.” This begs a few questions: why aren’t we hearing about this kind of security breach in other states’ traceability systems? What are other companies doing that prevents this from happening? Why does this keep happening to MJ Freeway?

Open For Business: California Market Launches

By Aaron G. Biros
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California’s full legal cannabis market officially opened its doors for business on January 1st, 2018. Following a relatively short time frame when they announced the first licenses awarded less than a month ago, retail stores were open for business in counties throughout California. Customers came out in full force, with long lines on the opening day, with some hundreds deep stretching around blocks.

For the quick turn around time between implementing regulations and awarding temporary licenses, the grand opening of the cannabis market in the nation’s most populous state proceeded smoothly. Only a handful of minor hiccups associated with the launch were reported throughout the state. In the grand scheme of things, that’s a pretty good job for a new regulatory agency (The Bureau) tasked with regulating such a massive fledgling market.

One major and definitely foreseeable hiccup in the launch of California’s new medical and adult use markets was the failure to implement tracking software. According to Michael Blood with The Associated Press, licensed businesses are being asked by the California Department of Food and Agriculture to manually document sales and transfers of cannabis with paper invoices.

Los Angeles
Image: Kevin Stanchfield, Flickr

While the Department said the traceability system was implemented Tuesday, Blood says, cannabis businesses are not required to use it and will be trained on how to operate it before it becomes required to use later in 2018.

Local control regulations in California means that businesses must first seek approval from local authorities before attaining a temporary license from the state to operate. That coupled with the rolling process of awarding licenses meant that only some cannabis businesses could officially open their doors. Municipalities throughout California handle regulating cannabis differently.

The handful of adult use dispensaries with temporary licenses in the Los Angeles area received a massive influx of customers on opening day. Residents of LA came in droves to the four West Hollywood dispensaries open for adult use business.

California Rolls Out Licensing For Cannabis Businesses

By Aaron G. Biros
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Last week, the Bureau of Cannabis Control issued the first licenses for California’s new market. The first license went to Moxie, a cannabis distribution company out of Lynwood.

The search feature for the list of licenses issued so far

As of the publication of this article, the Bureau, the state authority tasked with leading the regulation of the industry, has issued 43 temporary licenses. So far, four laboratories have received licenses, along with a number of retailers, distributors, microbusinesses in both medical and adult-use markets.

The labs to receive their temporary licenses so far are pH Solutions, Steep Hill Labs, Pure Analytics and ORCA Cannalytics. Judging by the number of temporary medical and adult-use licenses awarded so far, it appears the Bureau is trying to issue a similar amount for each sector, distributing the number of licenses between the two equitably.

You can find the list of licensees here, and search between the dates of 12/15/17 to 1/2/18 to get the most up-to-date list of licenses awarded. “Last week, we officially launched our online licensing system, and today we’re pleased to issue the first group of temporary licenses to cannabis businesses that fall under the Bureau’s jurisdiction,” says Lori Ajax, Bureau of Cannabis Control Chief. “We plan to issue many more before January 1.”

According to the press release, temporary licenses are only issued to applicants with prior local authorization in the form of a license or permit from the jurisdiction where the business is. Those licenses will become effective on January 1, 2018. The temporary licenses will work for 120 days, or May 1, 2018, after which businesses will need to have a permanent license to continue operating.

More than 1,900 users have registered with the Bureau’s online system, and more than 200 applications have been submitted, according to the press release.

The various regulatory bodies in California have worked diligently for months now to roll out proposed emergency regulations, setting strict requirements for manufacturers, growers, retailers and testing labs. Manufacturing regulations, including specific labeling, packaging and processing requirements, give a good snapshot of how regulators plan to move forward. Testing requirements could also be significantly firmer, with rules for documentation, sample sizes, sampling procedures, storage and transportation.

Yet when the adult-use sales become fully legal on January 1, 2018, those regulations will not be fully implemented.

Donald Land, a UC Davis chemistry professor and chief scientific consultant at Steep Hill Labs Inc., told The Associated Press, “Buyer beware.” There will be a six-month range where existing inventory will be allowed on the shelves, products that might not meet the standards of the new rules. So dispensaries will get half a year of sales before all products have to meet the new, stricter testing requirements.

Integrating Your LIMS System With State Tracking Systems

By Cannabis Industry Journal Staff
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Cannabis Labs Virtual Conference: Part 3

Integrating Your LIMS System With State Tracking Systems
By Hannah O’Brien, Operations Manager, Confident Cannabis

Running a lab is hard. Running a cannabis lab is harder. Watch this webinar hosted by Confident Cannabis, the most popular and only free cannabis LIMS in the country, to learn how cannabis compliance and regulatory burdens impact analytical testing laboratories in any state, and how important purpose-built software solutions are to make their business run smoothly.