Tag Archives: public

Colorado Issues Recall, Pesticides Found In Cannabis

By Aaron G. Biros
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Last week, the Colorado Department of Revenue (DOR), the Colorado Department of Agriculture (CDA) and the Colorado Department of Public Health and Environment (CDPHE) announced a health and safety advisory for a large number of cannabis products grown and produced by Tree of Wellness Inc., doing business as Tree of Wellness. The health and safety advisory, synonymous with a product recall, was issued due to the detection of off-label pesticides in cannabis grown by Tree of Wellness.

Tests found Myclobutanil present in batches going all the way back to May, 2017, with some contaminated batches as recent as late October.

According to the press release, the CDA confirmed the presence of Myclobutanil, a near-ubiquitous fungicide used in a wide range of agricultural practices. The chemical has been a thorn in the side of the cannabis industry for being used off-label, or inappropriately, on cultivating cannabis.

Here are the batch numbers included in the recall

Myclobutanil is the active ingredient in Eagle 20, a pesticide used frequently in other agricultural fields like grapes, apples and spinach. According to UC Davis professor and Steep Hill scientist Dr. Don Land, Myclobutanil becomes significantly more dangerous when heated, or smoked. That chemical reaction produces hydrogen cyanide, an extraordinarily toxic chemical. Because of this, and the lack of research on what happens when these chemicals are burned or heated, there is a growing public concern that cannabis laced with a chemical like Myclobutanil can cause adverse health reactions.

The public health and safety advisory says they detected Myclobutanil in cannabis flower, trim, concentrates, and infused-products from Tree of Wellness. The CDPHE and DOR recommend consumers that have the affected products return them to where they were purchased for proper disposal.

Consumers in Colorado should check their labels to see if their products fall under the recall. Look for the Medical Optional Premises Cultivation License 403-00664 and/or Medical Marijuana Center License 402-00443. The recall includes batches of 23 different strains grown by Tree of Wellness.

What Is Going On With Germany’s Cannabis Bid?

By Marguerite Arnold
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Germany is proceeding down the path to officially grow its own medical cannabis crops. Medical use became legal this year, along with a federal mandate for cheap access. That means that public health insurance companies, which cover 90% of Germans, are now firmly on the hook if not front line of the cannabis efficacy issue. As such, Germany’s medical market is potentially one of the most lucrative cannabis markets in the world, with a total dollar amount to at least challenge, if not rival, even California’s recreational market. Some say Canada’s too.

However, before “home grow” enthusiasts get too excited, this legislative move was an attempt to stymie everything but commercial, albeit medical production. Not to mention shut off the recreational discussion for at least another four years.

How successful that foray into legalization will be – especially given the chronic shortages now facing patients – are an open question. Not to mention other infrastructural issues – like doctor unfamiliarity with or resistance to prescribing cannabinoids. Or the public insurers’ so-far reluctance to cover it even though now federally mandated to do so.

Regardless, Germany decided to legalize medical use in 2017 and further to begin a sanctioned domestic cultivation for this market. The decision in the Bundestag to legalize the drug was unanimous. And the idea to follow UN regulations to establish this vertical is cautiously conservative but defendable. Very predictably German in other words.

Since then, however, the path has been far from smooth. Much less efficient.

Trouble in Germany’s Medical Cannabis Paradise

In April the government released its tender bid. And no matter how exciting it was to be in the middle of an industry who finally saw a crack of light, there were also clouds to this silver lining that promised early and frequent thunderstorms on the horizon.

By the time the tender bid application was due in June, it was already clear who the top firms were likely to beIn fact, by the end of the ICBC conference, which held its first annual gathering in Berlin at the same time the bid tender was announced, the controversy was already bubbling. The requirements of the bid, for a laughably small amount of cannabis (2,000 kg), mandated experience producing high qualities of medical marijuana in a federally legitimate market. By definition that excluded all German hopefuls, and set up Canada and Holland as the only countries who could provide such experience, capital and backlog of crop as the growing gets started.

The grumbling from Germans started then.

However, so did an amazingly public race to gain access to the German market directly – by acquisition or capital expenditures that are not refundable easily (like real estate or even buyouts). The common theme? They were large amounts of money being spent, and made by major Canadian Licensed Producers who had the right qualifications to meet the standards of the bid. In fact, by the time the tender bid application was due in June, it was already clear who the top firms were likely to be. They were the only ones who qualified under the judging qualifications.

And while nobody would commit publicly, news of the final decision was expected by August. Several Canadian LPs even issued press releases stating that they were finalists in the bid. But still no news was forthcoming about the official list.

Delay, Delay and More Delay

A month later, as of September, and there was still no official pronouncement. Nor was anybody talking. BfArM, the regulatory agency that is supervising this rollout as well as the regulation of all narcotic drugs (sort of like a German version of the FDA) has been issuing non-statement statements since the late summer. Aurora, however, one of the top contenders for cultivation here, was quietly issued an ex-im license by both Canadian and German authorities. Publicly, this has been described as an effort to help stem the now chronic cannabis shortage facing patients who attempt to go through legitimate, prescribed channels. On the German side, intriguingly, this appears to be a provisional license. Privately, some wondered if this was the beginning of a backdoor approval process for the top scoring bid applicants for cultivation. Although why that might be remains unclear.

Whispered rumours by industry sources that wish to remain anonymous, have suggested that the entire bid is still hanging in jeopardy. Late in the month, rumours began to fly that there were now lawsuits against the bid process. Nobody had much detail. Not to mention specifics. But CannabisIndustryJournal can now confirm in fact that there have been two lawsuits (so far).

The summary of the complaints? It appears that two parties, filing with the “Bundeskartellamt” (or regulatory office focusing on monopolies and unfair business practices) did not think the bid process or scoring system was fair. And both parties also lost.

But as of mid-October, there is still no public decision on the bids. What gives?

Whispered rumours by industry sources that wish to remain anonymous, have suggested that the entire bid is still hanging in jeopardy. Even though the plaintiffs failed, some have suggested that the German government might force a complete redo. Others hint that it will likely be slightly revised to be more inclusive but the regulatory standards must remain. If a redo is in the cards, will the German government decide to increase the total amount of yearly cannabis to be delivered? At this point, it is only calling for 2,000 kg per year by 2019. And that, as everyone knows, is far too little for a market that is exploding no matter the many other obstacles, like insurance companies refusing to compensate patients.

What Is Behind The Continued Delays?

There are several theories circulating the higher levels of the cannabis industry internationally right now even if no one is willing to be quoted. The first is that the total number of successful applicants, including the recent litigants, will be slightly expanded, but stay more or less the same. There is a high standard here for the import of medical cannabis that the Germans intend on duplicating domestically.

The Comprehensive Economic Trade Agreement (CETA – the often controversial free trade alliance between Europe and Canada) is still in the final stages of approval.The second is that the German government will take its time on announcing the final winners and just open the doors to more imported product. This will not be popular with German insurers, who are on the hook to pay the difference. However with Tilray now on track to open a processing facility in Portugal and Canopy now aligned with Alcaliber in Spain, cross-continent import might be one option the government is also weighing as a stop-gap provision. Tilray, who publicly denied in the German press that they were participating in the cultivation license during the summer, just issued a press release in October announcing a national distribution deal to pharmacies with a German partner – for cannabis oil.

But then there is another possibility behind the delay. The government might also be waiting for another issue to resolve – one that has nothing to do with cannabis specifically, but in fact is now right in the middle of the discussion.

The Comprehensive Economic Trade Agreement (CETA – the often controversial free trade alliance between Europe and Canada) is still in the final stages of approval. In fact, on September 19, a prominent German politician, Sigmar Gabriel of the Social Democrats (SPD) made a major statement about his party’s willingness to support Germany’s backing of the deal. It might be in fact, that the German government, which is supportive of CETA, got spooked about the cannabis lawsuits as test trials against not cannabis legalization, but a threat to the treaty itself.

Quality control, namely pesticides when it comes to plant matter, and the right of companies to sue governments are two of the most controversial aspects of this trade deal. And both appear to have risen, like old bong smoke, right at the final leg of closing the cannabis cultivation bid.

Will cannabis be seen as a flagship test for the seaworthiness of CETA? On a very interesting level, that answer may be yes. And will CETA in turn create a different discussion about regulatory compliance in an industry that has been, from the beginning of this year, decidedly Canadian-Deutsch? That is also on the table. And of great concern to those who follow the regulatory issues inherent in all. Not to mention, of course, the industry itself.

Conclusions?

Right now, there are none to be had.

However at present, the German bid process is several months behind schedule as Canadian producers themselves face a new wrinkle at home – the regulation of the recreational crop in the provinces.

It is also clear that there are a lot of questions and not a whole lot of answers. Not to mention a timeline when the smoke will clear.

The Future of California’s Regulations: Q&A with Josh Drayton

By Aaron G. Biros
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Josh Drayton, deputy director of the California Cannabis Industry Association, has an extensive career in local and state-level politics, with his origins in Humboldt County as a political organizer. As a coffee shop owner about ten years ago in Humboldt, he let city council candidates use his space for community engagement, which eventually steered him towards a career in politics. As a heavily involved resident of Northern California and an advocate in local and state matters, he came to understand cannabis as a strong economic driver for the region and beyond.

Drayton saw firsthand how local economies benefit from cannabis as a source of income, economic activity, and providing occupational opportunities for many families in Humboldt County. After running a handful of local campaigns in the Humboldt region, Drayton served as deputy director for a state senate campaign in Riverside.

Josh Drayton, deputy director of the CCIA

Towards the end of his tenure with the Democratic Party in California, the state legislature began working on medical cannabis regulations. “As we saw those regulations moving through, cities and counties began to ban cannabis throughout the state, which was a very unintended consequence,” says Drayton. “The goal was to put regulations forward that would create a framework for the industry to survive and function under, but they were not very fond of cannabis at the time. It was clear that we had a lot of work to do.” Politicians shying away from cannabis issues and a lack of real representation in the legislature for those stakeholders drove him to leave the state’s senate for the California Cannabis Industry Association (CCIA).

In January of 2016, he jumped on board with the CCIA as their deputy director. Ahead of the California Cannabis Business Conference, September 21-22 in Anaheim, we sit down with Drayton to hear his take on the future of California’s cannabis regulations.

CannabisIndustryJournal: Give us a quick update on the regulatory framework in California and the changes we should expect.

Josh Drayton: One of the biggest challenges that California has faced has been the reconciliation of medical regulations with adult use regulations. Although California had medical cannabis legalized in 1996, we did not get those regulations put forward until 2015. That was called the Medical Cannabis Regulation and Safety Act. That was approved by the state legislature and signed by the governor into law. It was created in the legislature. When Prop 64 passed, the Adult Use of Marijuana Act, in November of 2016, it was passed through by a voter initiative. Any time that a piece of legislation goes to the voters, it trumps any legislation or regulations written by the state legislature. The real work has been to reconcile these two pieces of legislation into one regulatory structure. With that being said, we saw the initial trailer bill, attempting to reconcile these regulatory structures. That trailer bill is meant to address the new framework. Currently, we are waiting for the second viewing of the updated trailer bill SB 94 with all current amendments. Then we are anticipating those in the next couple weeks and we will see the regulations that will affect all these changes by November.

CIJ: How strong will local and municipal control be in the future?

Josh: It is incredibly strong and it is meant to be. I will say that California is like its own country. In Northern California, what they are willing to accept is very different in comparison to Southern California. Every city and county still has the ability to fully ban adult use and they can create and draft their own ordinances and regulations as long as it doesn’t go above state requirements. They can craft an ordinance to fit the needs of their city or county. Lets say you are in a rural area, delivery services might be important for patient access. Some areas might not allow brick and mortar dispensaries, and all that control lies in the cities and counties.

CIJ: Will there be a dosing limit for patients buying infused products? What about for adult use?

Josh: For adult use, there is going to be a limitation. Every edible has a maximum potency of 10mg of THC. For example, a chocolate bar can have a maximum of 100mg [of THC] but must be perforated in to 10mg pieces.

We have been advocating for, and what has been a priority for CCIA, is a lift of any sort of limits on medical infused products. Many patients have a higher threshold or tolerance and they may need 100mg and we don’t want them eating an entire chocolate bar to get that. We are anxiously awaiting the new trailer bill to see if we have been able to lift that concentration limit.

CIJ: Some have said the first draft of lab testing rules is extreme and overreaching. Can you speculate how those have been modified?

Josh: The lab testing is a huge educational issue for the industry and regulators. No state right now has been able to fully analyze the effects of different pesticide levels for a product that is smoked. We are basing all of our standards currently on food consumption. A lot of testing labs are concerned they are unable to test at the state’s threshold for some of these contaminants and pesticides; the detection limits seem very low. The testing portion will take years to work out, I am sure we will remove and add different pesticides and contaminants to the list. But again, the data and research isn’t fully there. There is a big push across the board that we will be able to do more research and testing so that the future of regulations can reflect reality, and ensure that consumer safety is priority.

CIJ: What do you think of the lack of residency requirement? When Oregon lifted it, outside investors flocked to the market. How might that impact local, California ownership and smaller businesses?

Josh: Well I do think that is a concern across the board. That is something that cities and counties have been adding to their requirements for the matrix of items needed to get a license. I think there is a very gray area when looking at investors opposed to operators. At what threshold does an investor become an owner? And if that person is from outside the state, how will that reflect on the evolution of the industry? It is a concern. Keeping limitations on the size of outdoor cultivation might help limit folks from outside the state coming into that arena. After living in Humboldt County for years, and living next to Mom and Pop growers for a long time, I don’t want to see them displaced by businesses coming from another area. We have been doing this a long time and I believe we have the best operators in the world.

CIJ: How is the CCIA helping businesses gear up for changing regulations?

Josh: Well one of our biggest areas of focus is education. Educating our own industry is one of the biggest parts in making sure the industry will be successful in this regulated market. Our legislative committee will take a position of support or opposition, which goes to our board, and those recommendations go to the state. The manufacturing committee has worked very closely with Lori Ajax [director of the Bureau of Cannabis Regulation] and her office, to educate on a variety of areas, guiding the way for state departments on how to properly regulate the industry. We have a Diversity and Inclusion Committee, Retail/Delivery, Testing, Distribution and Agricultural committees; across the board our committees create white papers that we submit to the regulatory departments of the state. We take regulatory officials on tours of facilities to get a hands-on view of what they are regulating. They have been speaking with scientists and growers, who often have a better understanding of current industry standards. We see these tours as very helpful. We have brought groups of regulators from LA County, Long Beach, Napa, Alameda and many others on tours of Bay Area commercial manufacturing facilities, dispensaries and nurseries. They have a lot of questions and we want to make sure we are a resource for them. Putting folks in touch with the right people and, in moving forward with this process, in an educated manner. Cannabis is a foreign language to many people and I get that.

CIJ: If you have one recommendation for regulators, what would that be?

Josh: My recommendation to regulators: do not over-tax this industry. Do not make taxation the priority for regulation. Over-taxation will strengthen the illicit market and that is not the goal. We need to make sure the taxes are reasonable to encourage businesses to operate in this market, not in the illegal one. If cities decide to ban, they need to know they can be hubs for illicit activity. Cities with bans might draw the illicit market because illegal operators won’t have to pay taxes or license fees. It is a long play, but responsible taxation is the best path to draw people out of this illicit market. We want to help protect public safety and health, safe medicine, safe products and keep cannabis out of the hands of children.

Canadian Company Recalls Contaminated Cannabis

By Aaron G. Biros
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Broken Coast Cannabis Ltd., a cannabis business located on Vancouver Island, issued a voluntary recall of three cannabis lots due to the detection of pesticides. According to the safety alert published on Health Canada’s website, the voluntary Type III recall follows an inspection of the facility back in March of this year.

A Type III recall means those products are not likely to cause negative health effects. Sampling of those three cannabis lots found a cannabis oil product in July to contain low levels of Myclobutanil and Spinosad.

Upon further testing, a cannabis leaf sample was found to contain 0.017 parts-per-million of Myclobutanil. A third party laboratory confirmed the presence of that fungicide, leading them to recall three lots of dried cannabis sold between July and December of 2016, according to that safety alert.

Spinosad, an insecticide, and Myclobutanil, a fungicide, are not authorized for use with cannabis plants per the Pest Control Products Act, however they are approved for use in food production. The health risks of ingesting either of those two chemicals are well documented. “Health Canada has not received adverse reaction reports related to Broken Coast Cannabis Ltd.’s products sold affected by the recall,” reads the safety alert. “Health Canada recommends that any individual affected by the recall immediately stop using the recalled product and to contact Broken Coast Cannabis Ltd., at the following number 1-888-486-7579.”